From the notebook of Marketplace correspondent Scott Tong, on the ground in Venezuela.
Like many countries, Venezuela is a politically polarized place with competing stories as to why things are going wrong. It didn’t take long for me to realize the pro-Chavez and anti-Chavez camps live on different planets.
What’s clear is the country’s economy is in free fall, and exactly why seems awfully complicated. It has something to do with price controls, something to do with the economy’s over-reliance on oil production, plunging petroleum prices, as well as government intervention, land confiscation, money supply, hyperinflation, a strong currency exchange rate that hurts domestic producers, shortages of food and medicine, sky-high black market prices, lack of imported animal feed and spare parts and dollar controls that force multinational companies out of the market.
It’s a complex story to untangle.
I figured the ruling Socialist Party would find it awfully challenging to explain all this. But they’re smarter than I am, and long ago came upon the winning bumper-sticker phrase: economic war. Then late president, Hugo Chavez, used this, and now his successor Nicolas Maduro is recycling it. Effectively. I heard “economic war” cited by residents of the barrio slums, by government workers in state-run medical facilities, by an elderly woman who maintains a small shrine/chapel dedicated to Chavez, just down the hill from his mausoleum.
Exactly who was firing economic missiles at Venezuela was not immediately apparent to me.
Many people I spoke to simply mentioned “economic war” without citing the combatants. I later learned the list of enemies includes: businesses hoarding goods from the people, U.S. shale oil drillers pushing down the global price of oil, the bourgeoisie, capitalists, the United States.
“They talk against the private sector. Against imperialism. Against the Martians, whatever,” Caracas-based poller and consultant Luis Vicente Leon told me. “Never the government.”
Hear his clip here:
I’m still trying to untangle other views I’ve encountered during this reporting trip to Venezuela. There’s a lot of blame to go around. But one point made repeatedly to me is that this country sitting on the world’s largest reservoir of oil has not “sowed oil.” I’m not sure that’s the best translation. Perhaps it’s “planted oil.”
The point is that this petro-state, like so many others, has not diversified away from producing fossil fuels. It has not created other industries. In fact, the era of oil that began in the early 1900s choked off previously successful agricultural sectors here. Once upon a time, Venezuela produced some of the world’s leading pearls, coffee and cocoa beans. The land here is awfully fertile. Yet today, much of the food consumed here is imported.