Venezuela and Socialism

In the 1950s, Venezuela was the fourth wealthiest country in the world. Today, Venezuela is poorer than it was prior to the 1920s, its infrastructure is deteriorating, and its economy has been shrinking since the turn of the century. Hyperinflation (out of control price increases) has left the currency worthless and made it almost impossible for Venezuelans to afford basic necessities. Millions have fled the country’s inhospitable conditions. 

How did the country go from having a GDP on par with that of the United States, New Zealand, and Switzerland to having almost 90% of the population living in poverty?

Introduction
This brief takes a closer look at Venezuela’s past and present social, political, and economic circumstances, the role socialist policies played, and how this relates to conversations within our own government. Understanding the history of such an evolution is an important way to keep similar tendencies from reaching other shores, including our own.

Case Studies: On the Ground in Venezuela
In what was once Latin America’s richest nation, over 75% of Venezuelans are living in extreme poverty. According to a September 2021 report from the National Survey of Living Conditions, created in 2014 to make up for the absence of official data, the percentage of Venezuelans living in extreme poverty rose from 67.7% to 76.6%. This is a reversal of the improvement in previous years after the government started cash transfers and relaxed price controls. The COVID-19 pandemic has exacerbated the crisis in Venezuela that had already been ongoing for years; before the pandemic, the UN World Food Programme estimated one-third of Venezuelans struggled to get enough food to meet the minimum nutritional requirements.

The U.S. State Department announced in September 2021 that it was sending $247 million in humanitarian assistance and $89 million in economic and development assistance to aid “Venezuelans in their home country and Venezuelan refugees, migrants, and their host communities in the region.” This includes $120 million from the State Department’s Bureau of Population, Refugees and Migration; and $216 million through the U.S. Agency for International Development (USAID), bringing total U.S. humanitarian, economic, development, and health assistance for the Venezuela crisis to more than $1.9 billion since 2017. 

This includes:

Food assistance;
Emergency shelter;
Access to health care, water, sanitation, and hygiene supplies;
COVID-19 support;
Protection for vulnerable groups including women, children, and indigenous people;
Assistance to democratic actors within Venezuela;
Integration support for communities that host Venezuelan refugees and migrants, “including development programs to expand access to education, vocational opportunities, and public services.”

As of early 2022, more than 7 million Venezuelans in Venezuela are in critical need, and almost 6 million have fled to 17 countries across the region.  READ MORE...