Caracas Chronicles

A couple of weeks ago, a group of twenty-five opposition academics, economists, and politicians signed a letter to several members of the U.S. government—including President Biden—asking the United States to ease up sanctions on the Maduro regime. The signatories argued that U.S sanctions have been ineffective in removing Maduro from power and that the only thing that sanctions have achieved is causing great economic hardship to the Venezuelan population. While the letter has been criticized by some members of the opposition and many observers from academia and media, it brings to the forefront a debate that is often discussed abroad but it’s still sensitive for Venezuelans: should sanctions be removed?

In the context of the global increase in the price of oil, several international experts and academics—from the left and the right—have somewhat reached a consensus that U.S. sanctions have been counterproductive and that they should be lifted, as it would help curve the energy crisis in the U.S. and—probably—benefit the Venezuelan population altogether. Notwithstanding, this debate is usually complex for Venezuelan society as the emotions created by the suffering that we’ve endured due to years of dictatorial rule usually get in the way of objective debate. However, with Maduro stronger than ever,  and with an expected economic growth that could reach two digits for 2022 (up to 20% according to Credit Suisse), it’s about time for us Venezuelans to have a national debate and ask ourselves if sanctions are still a practical policy to defend under the current circumstances.

Chavista Resilience Makes Sanctions Ineffective

As a dictator, Maduro’s grip on power has survived some of the country’s most critical and severe moments in recent history. Maduro has governed through the lowest price of oil in decades, months after Chávez’s death; through one of the worst economic downfalls in Western history; through massive protests in 2014-2017; through the general rejection of the international community; and through the creation of a parallel government that even attempted a military uprising. Yet, after all these challenges to his authority throughout the years, Maduro has been able to stay in power. 

Now looking at the present, Maduro not only keeps his unquestionable power, but he also faces a dwindling opposition and a possible economic recovery that has been exacerbated by the Ukraine war. In the words of analyst Phil Gunson, it has become evident that the “maximum pressure” strategy launched in coordination with the Trump administration has failed.

Adding to this, in Venezuela, unless you are involved in the scheme of the regime to evade sanctions or have joined what professor Guillermo Aveledo Coll coined as Pax Bodégonica, many Venezuelans suffer the direct consequences of sanctions according to the latest National Survey of Living Conditions (ENCOVI) the sanctions have caused notable impact in certain standards of living. For example, the report mentions that the process of importation of food, especially for the government food program CLAP, has been significantly affected as beneficiaries who are usually comprised of senior adults and poor families from the misiones system have seen their food deliveries affected. Another case would be the one of government water supplier Hidrocapital, as it has been reported its inability to repair certain sewage and water distribution systems as it’s unable to acquire foreign-built parts for repairs. Even if most current problems in Venezuela have their roots in the years of corruption and mismanagement by the chavista regimes that predated the U.S. sanctions, as mentioned in last year’s report by UN rapporteur Alena Douhan. That same report also argued that as sanctions damaged the Venezuelan economy, they exacerbated the already existing problems in electricity, public services, and humanitarian efforts, with the latter being confirmed by a U.S. government study itself. 

Considering the hardship that the Venezuelan people are undergoing compared to how little they’ve got in return, as Maduro is still there, this can lead some people to believe that the sanctions actually benefited Maduro instead of harming him at the expense of the population.

This is the opinion of professor Edgardo Lander, a former Chávez supporter, who said in an expert panel formed by the Interamerican Dialogue that the sanctions were a “gift” to Maduro, since he’s blamed the sanctions for anything that ever happens in the country. He also added that the policy that is currently being pursued by the United States has had more of an effect on the population than on the Maduro regime itself. A concern that is shared with the signatories of the aforementioned letter.

No Free Lunch

As we have seen, several analysts and experts believe that current sanctions have actually caused a contrary effect to what they were established for, and therefore, keeping them long-term serves no practical purpose. Many of them also agree that any resolution of the Venezuelan crisis must stem from political negotiations. However, where the division is most visible is in how to use the sanctions themselves to achieve the return of democracy to Venezuela. While the letter proposes that, in order to move negotiations forward, the U.S. needs to ease sanctions on the oil sector, which in turn would make the Maduro regime more open to negotiating and additionally bring investment and development to Venezuela, Harvard economist Ricardo Hausmann believes that it’s not through easing sanctions but strengthening multilateral sanctions that the Maduro regime would be more willing (or forced) to negotiate, a position that is shared by Voluntad Popular politician Freddy Guevara.

It should also be mentioned that it’s not all analysts that are in favor of sanction removal. During the rapprochement that Washington and Caracas had last month, Ryan Berg, a fellow of the Center for Strategic and International Studies argued that negotiations with Maduro have no guarantees and that a relaxation of sanctions might bring a “dictator swap” between Russia and Venezuela but no real advancement of democracy whatsoever. Additionally, the former mayor of Caracas Antonio Ledezma wrote a response to the aforementioned letter alongside sixty-eight signatories (most of the politicians) asking President Biden to keep the current sanctions in place. The response argued that sanctions are not the ones at fault for impeding the importation of goods but the dictatorship’s arbitrary actions are. He also added that the relaxation of sanctions would only perpetuate the regime alongside those who “pretend to oppose”. The response also held some additional requests to President Biden like keeping the bounties on the “drug kingpins that usurp Venezuelan institutions”, protecting Venezuelan assets abroad such as Citgo, and also requesting the international community to create a “credible threat to the regime so it leaves the institutions that it usurps”.

However, while it’s understandable that some opposition members, especially those in the caretaker government, might not look favorably to easing sanctions so quickly as it’s currently the opposition’s only bargaining chip, the opposition should also consider that as things stand, current sanctions aren’t even making a dent on Maduro’s strength, but exacerbating the population’s problems that were created by Maduro. An example of this has been presented in an interview by then-president of Fedecamaras (and signatory of the letter), Ricardo Cussano, as he has stated that while the economic crisis was caused by ill-fated policies like price controls and the systematic disrespect of businesses and individuals by the government. Sanctions only raise costs to Venezuelans as they make the importation of goods extremely complex for businesses as suppliers are fearful of getting involved in Venezuela, thus raising prices. Furthermore, in a review ordered by the office of the Inspector General of USAID, it was reported that current legal guidelines from the sanctions also increases challenges for humanitarian efforts in the country as it makes it harder for the agency to collaborate with certain organizations due to legal impediments. In other words, while no free lunch should be given to the dictatorship in the negotiations, there are also humanitarian concerns that need to be addressed too. 

Let’s remember that Venezuela no se arregló, please. 

The Importance of Gas Money

While the opposition can say misa on sanction relief, don’t forget that the signatories of the letter addressed it not to the Venezuelan opposition nor the caretaker government, but to the United States government, which is the only one that can actually remove the sanctions.

Donald Trump often used inflammatory rhetoric and implemented a “maximum pressure” policy, as a way to court the Venezuelan and Cuban vote in Florida—and he succeeded. President Trump’s actions greatly politicized the Venezuelan question and made it almost impossible for anyone to re-evaluate U.S. policy on Venezuela without opening a political Pandora’s box. However, the White House finds itself in a very different position to when all options were “on the table.” Apart from a change in the Oval Office with the arrival of President Biden to Pennsylvania Av., the entire geopolitical board changed with Russia’s invasion of Ukraine, as Russia—a major exporter of natural gas and oil—became the most sanctioned country in the world, which made the price of oil skyrocket to over $100 per barrel. With the flick of a switch, suddenly for America, attempting to thaw relations with Venezuela wasn’t such a bad idea after all.

The change in rhetoric was public and notable, with Biden’s Latin American advisor, Juan González, publicly saying on a Miami radio station that “no matter how many sanctions you enforce on Venezuela, the status quo will not change.” Adding to this, the rising price of gas in the country has created a pressing political issue for the Biden administration; especially with the midterm elections around the corner at the end of this year. Interestingly, this concern is shared not only by other politicians but also by academics. In an op-ed for the Miami Herald, Florida International University professors Brian Fonseca and Eduardo Gamarra argued that U.S. sanctions not only harmed the Venezuelan people, but also harmed American national interests. They added that Russia was the main benefactor of the U.S. sanctions on Venezuela, as it sidelined American oil companies by preventing them from extracting Venezuelan oil which the U.S. now urgently needs to keep energy prices down. They concluded by saying that this is the right moment for the United States to reevaluate the sanctions that are currently hurting the interest of both: the United States and Venezuela. A conclusion that divided the Biden administration.

All in all, it’s important to recognize that sanctions have spectacularly failed in helping Venezuela recover its democracy.

Not only Maduro’s grip on power is tighter than ever, but the current opposition is so weak that they depend on foreign sanctions to have any power at the negotiation table. In addition, the country that actually enforces the sanctions has more economic and political incentives to ease them now than ever before. On the other hand, we’re seeing a Venezuela that every day is looking less like a criminally sanctioned country by the “Empire from the North” and more like a big casino where bills with Benjamin Franklin’s face are king, which makes us question the current extent of the sanctions’ repercussions. Nevertheless, while the letter signed by the twenty-five experts created great controversy—and even outrage—I embrace the debate that it’s bringing up, as Venezuelans still struggle to come to terms with the default situation of deciding between what’s practical and what’s right; especially with a topic that affects us all. Even if what we think about sanctions won’t matter in the end: it’s not in our hands, as a society, to remove the sanctions or keep them in place, or even to produce the conditions that would induce the U.S. to remove them, such as the recovery of democracy. 

Do you believe sanctions should be lifted?