Wednesday, March 06, 2013

Hugo Chavez is Dead

So what can you say about this?  Tragic, yes, but his legacy casts a shadow over Venezuela and Latin America.

Chavez was very popular with common people and spent a lot of money on projects to help them. But with little transparency, lack of political checks and balances and no accountability, hundreds of billions of dollars were wasted and stolen. First that means many projects were never completed - casting doubt on official poverty-reduction figures. if a clinic or hospital is never completed you can't count those hospital beds; the same goes for tons of containers of food that rotted in warehouses. Also it created a new class of multi-millionaires and further enriching Venezuela's traditional oligarchs. Chavez' State Capitalism enriched a lot of people at the very top.

Remember in a decade of historically high oil prices Chavez presided over a country with the biggest oil reserves in the world. He came into power with a barrel of oil at $10 dollars it climbed to $150 With this unprecedented bounty poverty SHOULD HAVE been reduced. You could hand out cash to poor people. Indeed, in previous governments during oil booms social spending was about the same percentage of GDP. People forget Venezuela had Social-Democratic governments that subsidized housing, education and health, well before Chavez.  Chavez spent a lot of money and poverty did go down, but with the kind of money available and spent you would expect a stronger overall picture, which still is not true, due to waste, corruption and inefficiency. He has plowed through a trillion dollars in oil revenue and somehow left a country with the regions highest inflation, food scarcities, weak currency, indebted, infrastructure collapsing