Venezuela: The Right's Bogeyman

If you've ever argued from a left-of-center position in the US, you've likely come across the "socialist Venezuela" argument. It is made, often in passing, to delegitimize anything other than a mostly free-market approach to industry.

The argument goes like this: Venezuela claims to be a socialist country, in 2013 the Venezuelan economic crisis began, the crisis is because Venezuela is socialist, the left are socialists, therefore: the left will destroy America with socialism.

The argument is often presented as follows: "look what happened in Venezuela. Is that what you want to happen here?"

Here is the truth. Venezuela, while claiming to be socialist, is actually a mixed economy. Further, the economic crisis was created by corruption and democratic failure, not by Venezuela's economic model. The goal here is not to excuse the brutal Maduro regime, nor the socialist authoritarians in South America generally. Rather, I want to dispel the myth that government intervention is always and everywhere malignant---and that Venezuela is not an honest representation of leftist policy proposals in the US.

The economy of Venezuela is still largely private. As of 2011, roughly 70 percent of the economy was made up of private enterprise. This alone dismisses the argument that Venezuela is socialist. By definition, a socialist country has all means of production equally and democratically controlled by the people---not only by capital-owners. 

However, the oil industry---which caused Venezuela's collapse---is indeed publicly owned. This is not a vindication of the right-wing argument. Instead, it indicates the need for accountable democratic institutions.

Venezuela's neighbors, who are also predominantly export/oil oriented economies with state-owned enterprise, have not suffered similar economic shocks. Even though the same resource curse and government control issues obtain, these governments have had democratic accountability. Hence, when politicians did not deliver, they were ejected.

Further, it is not by virtue of state ownership that such companies fail. For instance, Saudi Aramco is the public oil company run by the Saudi Arabian government. It is the largest oil producer in the world and has generated massive growth for the regime. Saudi Arabia has governance problems, no doubt. But, the fact remains that public ownership has not destroyed the oil sector nor the economy as a whole.

Another example is Norway. The Norwegian government owns many of its own companies and heavily regulates the oil industry to generate revenue for its social safety net. Despite this, Norway is a wealthy country. If we applied the same logic to Norway, American conservatives would call it socialism. To be clear, it isn't. But one can see how it does not fit the conservative narrative.

Now, when Bernie Sanders or Alexandria Ocasio-Cortez talk about Universal Healthcare or a federal jobs guarantee, they're not talking about socialism. They are calling for the same programs which have delivered wealth and prosperity to other developed countries around the globe. Despite Sanders' overtures to "democratic socialism", unless he calls for class consciousness and universal and equitable access to the means of production through democratic decision-making, he's not a socialist.

It should be obvious at this point that regardless of Maduro's claim to socialism, Venezuela simply is not. It is a mixed economy where the majority of business is still done privately. It failed because of bad policy without the democratic means to oust corrupt politicians.

Rather than root around for socialist bogeymen, we should focus on the manifold policies that will actually harm the US economy. They aren't government-owned enterprise. They are Tax cuts for billionaires, immigrant deportation, and tariffs. 

And these have not been perpetrated by US "socialists".