By Kevin D. Williamson
Tuesday, April 26, 2016
Some of you will be familiar with the Twitter feed of the
DPRK News Service, an often hilarious online parody of the output of socialist
North Korea’s official pronouncements on world affairs: “Kim Il-Sung University
professors announce individually packaged celerys, bringing joy to celery
lovers throughout our land.” “International shouting tycoon Donald Trump
criticizes U.S. politicians for their swinish and uncouth table manners.” But
we live in times beyond satire, and even the imaginary Norks behind Juche
Beyoncé (“Noble dissident folksinger Beyoncé hit by disgusting, pornographic,
and racist slanders by English illiterate smut-peddler Piers Morgan”) couldn’t
produce what’s being published under Wired’s
venerable flag right now.
This isn’t parody.
In an article produced in association with CityLab and
Climate Desk, Wired argues with a
straight face that Venezuela, where the use of hairdryers has become a matter
of urgent national policy, is in this pickle because Hugo Chávez’s economic
policies were just so damned successful. Chávezism — which is roughly the
economic philosophy of Bernie Sanders and Donald Trump — brought so many
Venezuelans out of poverty that the resultant increase in demand on the
electrical infrastructure simply could not be met.
This is, as the economists say, horsepucky.
If you consider the most meaningful measure of a country’s
economic output — GDP per capita over time — you’ll see that the fat years
under Chávez did not actually happen. In fact, if you chart that real
(inflation-adjusted) GDP per capita
by year, you’ll see that Venezuela is significantly poorer today than it
was in the 1960s, 1970s, or 1980s. In fact, Venezuela’s per capita GDP reached
its all-time low in 2003, under Chávez. This is no surprise: Making well-off
countries poor and poor countries starving is what socialists do.
Chávez’s predecessors during the last gasps of the old
Republic of Venezuela (Chávezism came with a new constitution and a new name,
the Bolivarian Republic of Venezuela) weren’t winning any prizes for growth or
stability in the years leading up to the catastrophe that was Chávez, but the
idea that there was some kind of general economic renaissance in Venezuela
under Chávezism isn’t supported by the data. What we see is an economy that
threw off a lot of money when oil prices were high (Venezuela is something
close to a single-commodity economy) during which time Chávez seized everything
he could get his hands on in order to enrich himself and his cronys, and to
purchase political support at home and abroad. The obscene spectacle of U.S.
congressmen such as Chaka Fattah of Philadelphia and other Democrats groveling
before the murderous autocrat in exchange for a few measly barrels of
subsidized heating oil sticks in the memory.
Oil prices went back down, and down went Venezuela.
Somehow, at the end of that roller-coaster ride, Chávez’s
daughter acquired a net worth of $4.2 billion. But Bernie Sanders isn’t doing
too poorly, either.
Under Chávez and his successor, Nicolás Maduro, Venezuela
kinda-sorta invested billions and billions of dollars in electrical capacity
and infrastructure. It just never quite materialized. For example, a $40
billion project “created” more than 5,000 MW of new capacity, but only 3,300 MW
became available for consumption. How? The answer to that riddle, and not das Kapital, is the real socialist
master-text: mismanagement, incompetence, and corruption. The cost of those
projects ran on average two-and-a-half times over estimates — while producing
less power than they were supposed to. The socialist government gave billions
of dollars in electricity contracts to firms with no background in the
business. Of course that money walked away, ending up in banks in, among other
places, Lebanon.
If you truly believe that Venezuela is suffering from
electricity shortages because its economy is so successful, you should ask
yourself why it is suffering from a toilet-paper shortage, too. And a shortage
of rice, milk, cooking oil, and other basic foods. And water.
“Forward-looking Venezuelan comrades put entire country
on hardcore paleo diet!” the DPRK News might say. People who aren’t in the
comedy business detect something more serious.
The authors of the dopey Wired article cite the reduction — purported reduction — in
Venezuela’s poverty rate under Chavez as their main evidence. The World Bank
figures (based, inevitably, on questionable Venezuelan data) suggest that the
Venezuelan poverty rate was cut from 50 percent to 30 percent over 15 years.
The same figures have the poverty rate around 80 percent today. If you follow
along with that bouncing ball and still can’t figure out what song is being
sung, maybe a different line of work is in order.
Maybe the fact that the Venezuelan economy is today
contracting at about 7 percent per year while inflation is running at about 720
percent per year has something to do with it, too.
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