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Venezuela has been in the news lately because of its corrupt election. Its national election commission declared that the incumbent of the United Socialist Party of Venezuela, Nicolás Maduro, won 51% to 44% against the challenger, Edmundo Gonzalez. However, the commission has not released tallies from the polling places. Polling places where the opposition obtained the results showed that Gonzalez won overwhelmingly.
Most people in Venezuela and the world view this as fraud and are refusing to recognize Maduro’s reelection. A notable exception is Vladimir Putin, who sent a note of congratulations telling Maduro he was always welcome in Russia. The Maduro government reacted to widespread protests in Venezuela by killing 20 and detaining over 2,000 of its citizens in the first week.
According to the Economist magazine, Venezuela’s 2022 GDP has shrunk 75% since 2013. The more subjective but widely used U.N. Social Progress Index (SPI) shows that Venezuela “has seen the biggest drop of any country in its SPI rank between 1990 and 2020.”
We have previously argued in this column that the issue of whether Venezuela is socialist is primarily rhetorical: “Print up money, confiscate private property, and impose price controls, and you too can make your economy a basket case in the name of any ideology you choose.”
But we now recant a bit on that position. Given a 2022 poll showing that a plurality of U.S. 18- to 29-year-olds favors socialism over capitalism, the issue is not purely a matter of rhetoric. A recent New York Times story (not an editorial!) stated in its coverage of the Venezuelan election: “… in recent years, the socialist model has given way to brutal capitalism, economists say, with a small state-connected minority controlling much of the nation’s wealth.” But the Venezuelan system didn’t change. Anti-democratic authoritarianism and elite control of wealth are inherent in a Venezuelan socialism that is willing to confiscate private property. Interestingly, Maduro routinely praises The Communist Manifesto.
Before Venezuela’s economy collapsed, news reporters showed positive images with glossy pictures of the self-proclaimed socialists feeding hungry children. Once the policies of the self-proclaimed socialists created Venezuela’s great depression, 8 million Venezuelans emigrating and widespread starvation, they became brutal capitalists. As our friend, Columbia University economics doctoral student and Venezuelan dissident Daniel Di Martino, says, “It’s classic New York Times to celebrate the socialist policies that destroy a nation and then call them capitalist when they fail.”•
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Bohanon and Horowitz are professors of economics at Ball State University. Send comments to ibjedit@ibj.com.
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