The Evolution of Venezuela From the 1950s to the Present Day

9 mins read

By Ike Bennet ’21

Over the course of half a century, what was once the wealthiest country in Latin America has become a hotbed of corruption, violence and humanitarian crises. Venezuela’s journey from being top-dog to being a borderline failed state is one that spans half a century of corruption, oil, narcotics and political upheaval. Now, as President Maduro stands off against the rest of the world with Russia and China by his side, it’s important to understand how Venezuela became what it is today.

Oil has been known to exist in Venezuela since long before European colonists arrived there. However, its most remarked economic impact occurred in the 1970s. On October 6, 1973, the Yom Kippur War, also known as the Six-Day War, began between a coalition of Arab states led by Egypt and Syria against US-backed Israel. These Arab states included Saudi Arabia, Iran, Iraq, United Arab Emirates and Kuwait, which today make up half of the top ten global producers of oil. In response to western powers’ support of their enemy, these states and the group they belonged to, OAPEC (Organization of Arab Petroleum Exporting Countries), placed an embargo on oil, targeting the U.K., the U.S., Canada, Japan and the Netherlands. Over the course of six months, the price of oil increased by 400 percent, before the embargo was lifted in March of 1974. Simultaneously, Venezuela flourished, its revenue increasing at the same rate as oil prices. For the next few years, Venezuela enjoyed a golden age as one of the world’s wealthiest countries. But calamity lurked just below the surface.

Venezuela’s economic success was short-lived. Because of the billions of dollars that the oil crisis provided, Venezuela gradually began shifting focus away from other sectors of their economy, namely industry, which decreased from 50 to 26 percent of Venezuela’s GDP. Simultaneously, the nationalization of oil-birthed corruption in the Venezuelan government, as politicians funneled oil profits to their personal accounts, compounding their focus on the oil industry that lined their pockets. When the oil crisis ended, oil prices collapsed and inflation sank its teeth into the economy. The effect of inflation was magnified by Venezuela’s reliance on oil, causing rates as high as 84 percent in 1989 and 100 percent in 1996. Inflation hit Venezuela’s banks hard, forcing the flailing and corrupt government to bail them out, at a cost the equivalent of 12 billion U.S. dollars.

Venezuela’s abrupt economic collapse provoked political unrest in its dissatisfied citizens. In 1992, a military commander, Hugo Chávez, unofficially supported by the Russian-backed Cuban government, attempted a coup against the largely unpopular government. However, the coup failed, and Chávez surrendered on public television, promoting him to the international spotlight and into the focus of his countrymen, beginning his career as a politician.

Chávez was jailed for his rebellion. However, the president he contested was impeached for corruption, adding legitimacy to Chávez’s efforts. The new president, Rafael Caldera, was somewhat sympathetic to Chávez’s cause, causing him to pardon the revolutionary after two years in prison. Subsequently, Chávez toured Latin America, spending time with the terrorist group FARC in Colombia as well as befriending the communist revolutionary Fidel Castro in Cuba. Chávez returned to Venezuela critical of Caldera’s neoliberal policies. He garnered the support of the lower and middle classes through promises of beneficial policy, to which the desperate and impoverished growing majority of citizens were especially receptive. In fact, 66% of citizens suffered from poverty in 1995, up from 36% in 1984. In 1998, Chávez won the presidential election, receiving 56% of the votes.

Two years after Chávez’s appointment, oil prices surged, providing Venezuela with economic power comparable to that which it held in the 1970s. The results could not have been more different. Since ascending to power, Chávez had set about appointing like-minded individuals and former military buddies to various positions of power and abolishing constitutional checks and balances in the Venezuelan government.

He also increased the power of the sitting president by introducing both six-year and consecutive terms. This came as part of a new constitution he passed that drew criticism for easing abuse of power. When the economy surged, he sought to increase governmental control over the oil industry and began using the funds as a piggy bank for his social programs, causing corruption and overspending that led to increased inflation rates. To ensure the people’s support Chávez began polarizing the population, calling out anyone who questioned him. This included, but was not limited to, various forms of media, the Catholic church (note that Venezuela was, and still is, majority Catholic), business leaders and even the middle class. His tactics were embodied by this quote: “Come out to the street and look at me! The more dirt you throw at me, the more I’ll throw at you. That is who I am.”

Chávez drove a wedge not just between citizens of Venezuela, but also between Venezuela and western powers. The government under Chávez alienated the United States while associating itself closely with Cuba. Schools began issuing Cuban textbooks that amounted to propaganda for the regime, and Venezuela began supplying oil to Cuba at cheaper rates. Chávez also condemned the United States’ response to the September 11 attacks, showing pictures of Afghan children and comparing the US presence in Afghanistan to terrorism. Chávez’s presidency drove a divide between his country and the United States at a time during which the U.S. were frantically reevaluating their relationship with other powers.

In 2005, Chávez openly embraced socialism, inviting “all Venezuelans to march together on the path of socialism of the new century” because “it’s impossible for capitalism to achieve our goals, nor is it possible to search for an intermediate way.” More than a year later, Chávez was elected to a third term with 63 percent of the vote.

In 2007, Chávez sought to amend the constitution he had passed nearly a decade earlier. The amendments included progressive policies geared toward helping the workforce, specifically for sexual and racial minorities. Among these policies, however, Chávez sought to once more increase his power by trying to allow the president to serve seven-year terms, to serve an indefinite number of terms, and to declare unlimited states of emergency. Unfortunately for Chávez, the proposal was narrowly defeated 51 percent to 49 percent.

Desperate to extend his time in power, Chávez attempted once again, in 2009, to abolish term limits, this time for all public offices. He succeeded, earning 54 percent of the vote with a voter turnout 20 percent higher than that for his 2007 amendments. Five years later, Chávez was elected to a fourth presidential term by the narrowest margin yet.

The opposition party accused him of misusing government funds to campaign, but the complaints were largely ignored. By this time, Chávez’s health had declined severely, to the point that he was unable to attend his own inauguration. Less than two months after his inauguration was supposed to take place, Chávez died of cancer. Vice President Nicolás Maduro ascended to power, awaiting a snap election to determine the next president of the spiraling country.

Nicolás Maduro was fifty-one years old when his predecessor died. A high school drop out with little education, Maduro is an example of the effect of rampant corruption in Venezuela. In 1986, Maduro, then a leftist militant, traveled to Cuba for a one-year course in politics taught by a communist group. During this time he was personally mentored by a senior member of the Cuban government, a communist with close ties to Castro.

Upon returning to Venezuela, Maduro was allegedly tasked with associating himself closely with Chávez, who was at this time finding success in the military. Maduro was to sow seeds of communist thought and report back to Cuba. When Chávez was jailed for attempting a coup, Maduro was instrumental in freeing him. As recompense, Maduro was appointed by Chávez as Minister of Foreign Affairs in 2006, despite his complete lack of experience and inability to speak a single foreign language. His relationship with Chávez only grew from then.

In 2011, before Maduro was appointed Vice President, Chávez, having recently learned of his cancer, privately expressed his desire that Maduro succeed him in the case of his death. Chávez officially appointed Maduro Vice President in 2013, shortly after his electoral victory. On April 14, 2013, Maduro narrowly won a snap election and became president. Since then, any authoritarian streak in the Venezuelan government has increased tenfold.

In 2013, a mere six months after his election, Maduro was granted the power to rule by decree, which allows Maduro to pass legislation without any debate or deliberation, similar to a dictator or monarch. He has also doubled down on Chávez’s suppression of free press and political opposition, having ordered the torture of 31 political opponents since 2014 as well as the arrest of 12,800 protesters, some taken from their homes without warrants.

In terms of policy, Maduro has attempted to confront the many problems Venezuela faces. He relies primarily on the Venezuelan armed forces, not just to maintain power but for domestic issues as well. In May of 2013, Maduro deployed thousands of soldiers in various locations across the country to combat high homicide rates. Venezuela claims this plan has reduced homicide by 55 percent, but in truth the rate has only increased since its implementation. In terms of Venezuela’s economy, many have claimed that Maduro focuses on the public’s image of Venezuela’s economy, not the economy itself. Publicly, Maduro has blamed capitalism and an international conspiracy against Venezuela for economic retardation.

Like Chávez before him, Maduro also casts blame on the United States for damaging Venezuela’s economy and international image, going so far as to force an “anti-imperialist day” on Venezuela’s schools, during which teachers were to collect signatures to denounce then-President Barack Obama’s declaration that Venezuela was a threat to national security.

Above all else, Venezuela under Maduro has faced unprecedented and rampant corruption. Not only has Venezuela allegedly received funding from the terrorist group Hezbollah and the Syrian government, but two nephews of Maduro were arrested by the DEA (Drug Enforcement Administration) in 2016 with over 800 kilograms of cocaine after arriving in a Haitian airport. They reportedly flew out of a terminal in Venezuela reserved for government officials, tying the crime back to the government.

Maduro himself was named “2016 Man of the Year in Organized Crime and Corruption” by the Organized Crime and Corruption Reporting Project (OCCRP), an international NGO that said it “chose Maduro for the global award on the strength of his corrupt and oppressive reign, so rife with mismanagement that citizens of his oil-rich nation are literally starving and begging for medicines.” OCCRP further explained their choice, declaring that “as murder and crime in Venezuela has skyrocketed and political oppression has intensified, the president and his inner circle, including wife Cilia Flores, have extracted millions from state coffers to cover the patronage that keeps him in power.”

So why has Venezuela been at the center of the international spotlight as of late? Well, once again, corruption has caught the attention of governments and individuals around the world. The accumulation of Maduro’s efforts to consolidate power won him Venezuela’s 2018 election with a supposed 65 percent of the vote. Recently, the LIMA group, made up of diplomats from Argentina, Brazil, Canada, Chile, Colombia, Costa Rica, Guatemala, Guyana, Honduras, Panama, Paraguay, Peru and St. Lucia, met and declared the election flawed, requesting Maduro give up power until another election can be held. This meeting has dragged the issue of Venezuelan corruption all the way to the UN.

Having been allied closely with Cuba for decades, Venezuela is associated with Russia and China as well. Both countries have loaned billions in aid to Venezuela, and both countries recognize Maduro as president. As such, Venezuela has become a proxy for economic competition by China and Russia against western powers. The United States, the United Kingdom, France, Spain, Austria, Denmark, the Netherlands, Poland, the Czech Republic, Belgium, Estonia, Sweden and the previously mentioned LIMA group have all recognized the Venezuelan politician Juan Guiado as the interim president of Venezuela, until a proper election can take place. On January 26, 2019 U.S. Secretary of State Mike Pompeo declared to the UN, “Now it is time for every other nation to pick a side. No more delays, no more games. Either you stand with the forces of freedom, or you’re in league with Maduro and his mayhem.”

Tensions have been steadily rising. According to a Venezuelan economist and lawmaker, a Russian Boeing 777 landed at the airport of Venezuela’s capital city, Caracas, on January 30, where it was loaded with 20 tons of gold bars before departing to an unknown destination. Both Russia and Venezuela deny the existence of this plane, but many believe Maduro is taking government funds out of the country in case things go south for him. On February 3, President Trump announced that military action in Venezuela was still on the table, less than a week after National Security advisor John Bolton flashed a notebook indicating the possibility of the deployment of five thousand US troops to Venezuela. This appeared to be accidental, but may have been a threat to the Venezuelan president. In response to Trump’s announcement, Maduro warned the White House would be “stained in blood” and predicted a “repeat of Vietnam” if the U.S. intervened. During the same interview, Maduro rejected calls to step down, saying, “We don’t accept ultimatums from anyone. I refuse to call for elections now – there will be elections in 2024. We don’t care what Europe says.”

With talk of violence increasing, support for Guiado growing, Russia and China sticking by Venezuela and Venezuelan citizens continuing to suffer, it remains to be seen what will happen. Defusing the situation without violence would be ideal, but that outcome seems unlikely as of now. Regardless of what happens, Venezuela’s political and humanitarian crises have widened the divide between Russia, China and the United States.

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