Caracas Chronicles

(This week I am starting a new Caracas Chronicles column: the weekly Friday-afternoon-suggestion-for-a-controversial-conversation-topic-over-Sunday-lunch post. 

Many extended Venezuelan families get together around the lunch table on Sundays, and after the meal is done, they engage in the “sobremesa,” a sacred Venezuelan tradition where people have dessert, drink coffee, chat, gossip, and generally bitch about the government.

The sobremesa is a great occasion to catch up with relatives and impress them with your weird theories. It’s also a good time to challenge ridiculous Venezuelan conventional wisdom and, if you’re one of our younger readers, annoy your parents with wacky stuff you’ve read on the Internet.

If you do this and a furiously passionate conversation unfolds, I would consider my job done. Regardless, I would love to hear how the conversation went in the comments section. Have a great weekend, everyone.)

The Venezuelan economy is in shambles. So is our public sphere.

You see, there have been a lot of rumblings lately about how chavistas have supposedly wasted away the nation’s fortunes. They “dilapidated” the oil boom. They “gave it away” to other countries. They “stole it all.”

Comparisons with the sovereign wealth funds of Norway, Saudi Arabia, or even Russia abound. Chavista incompetence and graft are blamed by all.

They make it sound like a trillion dollars of oil wealth simply disappeared inside one of Diosdado Cabello’s pockets.

Bull. Crap.

Sure, theft is a big part of the story of why we’re bankrupt. Venezuela is, in many respects, a kleptocracy. But we simply cannot claim that chavistas “squandered” the oil boom. All of us are to blame.

Misiones were giveaways that ended up in the pockets of millions of Venezuelans. Some of them surely spent their Misiones money on flat-screen TVs and additions to their ranchos which yielded few long-term benefits. The government does not bear the fault for their financial decisions.

Cadivi was a massive handout to the middle class. We all know people who have made a killing off of “raspar cupos” and generally taking advantage of exchange rate distortions – heck, they’re still doing so! Venezuelans of all stripes paid subsidized airplane tickets to travel extensively around the world these past ten years. Some saved the money they made off their allocations. Others decided to spend it all on holidays. Many reaped the bounty.

The government payroll increased by hundreds of thousands of people. These people don’t really do anything in their jobs. They just sit there, idly cashing in on the oil boom. Heck, even middle class housewives began getting a pension from Chávez a few years ago. What they decided to do with their little chunk of the oil boom had little to do with the government.

And let’s not even discuss the subsidies. One can make the case that Venezuelans were paying artificially low prices for everything from construction material to black beans the last few years. How much of the oil boom of the last ten years or so was literally burned away in free gasoline for everyone?

Finally, let’s remember that not all oil revenue was necessarily oil profit. Some of it went to pay for the cost of production – the drills, rigs, and ships needed to take the oil to market. Oil revenues are irrelevant – one has to look at oil profits to get the correct financial picture. Politicians who speak of oil “revenues” are being deliberately misleading, or just plain ignorant.

Chavistas have benefitted handsomely from the oil boom, and they have dilapidated a big chunk of it. But let’s not kid ourselves: some of the benefits trickled down to the rest of us. Any time we loaded our car with gas, went on a Cadivi-sponsored vacation, bought a Cadivi-subsidized Dutch cheese, cashed in a government paycheck or pension, or purchased something at Mercal or PDVAL, we too were “dilapidating” the oil boom. And any time we voted for the people engaged in these types of policies, whether government or opposition, we too were dilapidating the oil boom.

Ojo, I’m not making any judgments here. All I’m saying is that claims that chavistas simply squandered the oil boom – as if they held a party and none of us was invited – are factually incorrect.

Sprinkle that on your bienmesabe.