Once an oil rich, tropical destination, Venezuela has slowly descended into an unstable and corrupt nation. This is the result of an economic crisis that first began to take root following the death of former president Hugo Chavez in April 2013. His successor, Nicolas Maduro, was elected by a narrow margin shortly after. His election was not without skepticism. The opposition party at the time contested the result of the election, suggesting fraud. Five months into Maduro’s presidency, a series of events unfolded that have led up to the current crisis we are seeing unfold today. Here’s how it happened.
In September of 2013, a massive power cut left 70% of Venezuela, including a large portion of Caracas, without electricity. This was followed by one of the first official statements featuring divisive rhetoric aimed at condemning the opposition that still contested Maduro’s rise to power. Maduro labeled the opposition “right-wing saboteurs,” opening the platform which Maduro would use to further delegitimize his opponents.
In November of 2013, shortly after the power outage, an inflation crisis at more than 50% a year put the National Assembly of Venezuela in a desperate position. They elected to give President Maduro emergency powers for a year to mitigate the damages of the inevitable crisis to come. This sparked major protests from opposition supporters which took to the streets in the thousands. President Maduro used the powers to limit profit margins and shrink the money supply. These protests would last the rest of the year, resulting in major victories by the socialist party in local elections.
2014 signaled the solidification and growing strength of the opposition in Venezuela. Protests over poor security in the western states of Venezuela spread to Caracas, resulting in anti-government protests fueled by the ever-growing opposition parties in the capital. The Maduro administration labeled the movement a coup attempt and used force to disperse the crowds. At least 28 people died in the violence. This tension would exponentially grow as oil prices hit a 4-year low towards the end of the year. This resulted in a major cut in public spending, crippling the growth of the economy and increasing the discontent among citizens. At the end of 2014, Maduro made a bold move by charging the leader of the opposition, Maria Corina Machado, with conspiracy to assassinate him.
If 2013-2014 weren’t extreme enough for you, the best has yet to come. The following events in 2015 were mainly political moves that created the ‘perfect storm’ for the consolidation of power by Nicolas Maduro.
In early 2015, Antonio Ledezma, the opposition mayor of Caracas, was charged with plotting a coup with US support. While he denied the claims, the accusation brought the issue to international attention. The United States has long had ties to crisis in South America. While these claims were fruitless, they were symbolic to nationalists in Venezuela who may have been on the fence about Maduro’s administration. Later in the year, the opposition Democratic Unity coalition won a two-thirds majority in parliamentary elections. This effectively ended 16 years of socialist party control. It was short-lived, however. Just one month later, in January of 2016, three Democratic Unity deputies resigned from the National Assembly under Supreme Court pressure. This collapsed the two-thirds majority that would have the power to block legislations proposed by President Maduro.
The economic crisis in Venezuela continued to rage on. Protests around the nation continued to grow in size and support. The falling oil prices affected many nations whose main exports were energy. Venezuela was no exception. Drought and increased poverty resulted in an unfolding humanitarian crisis. Many Venezuelans chose to flee to neighboring countries. All the while, Maduro continued to isolate opposition and solidify his regime.
A month after the Democratic Unity collapse in the National Assembly, Maduro announced new measures aimed at fighting the economic crisis. These included currency devaluation and increased oil taxes. This was the first price spike for gasoline in 20 years. An increase in the cost of living, as gasoline has inelastic demand, coupled with increasing poverty rates gave even more fuel to the opposition. Political concepts argued on the national stage are rather abstract to everyday citizens. It isn’t until the impact is truly felt on the ground that society puts it into perspective and forms an opinion not dictated by the talking heads on news channels. This growing tension would be seen later in 2016 when the largest protest since the crisis began took to the streets.
In September of 2016, hundreds of thousands of people took part in a protest in Caracas calling for the removal of Maduro, accusing him of responsibility for the economic crisis. Simply disagreeing with the president’s decisions and calling for his removal from power are completely different things. Historically, individuals in power whose legitimacy is challenged often respond in very instinctual, sporadic ways. This is especially true in third world and developing nations. The events of 2017, saw bold steps made by Maduro in an attempt to protect his regime and isolate the opposition.
In early 2017, several people died in clashed with security forces during the mass protests demanding early elections and delegitimizing Maduro. These protests continued to grow as news circulated of Maduro’s attempt to replace the National Assembly with a constituent assembly. In July, the opposition crafted an unofficial referendum rejecting Maduro’s proposal for the new constituent assembly. It got 7 million signatures! Despite their efforts, however, the National Constituent Assembly vote prevailed, though skepticism of fraud persisted.
What is a National Constituent Assembly, you ask? Essentially, it gives even more power to the president and government supporters. Constituent assemblies have the authority to not only change the constitution, but also to remove existing officials and institutions. It’s essentially a body of government with no checks and balances beyond the president, who supports them. It’s even possible for the constituent assembly to cancel the presidential election next year.
This action didn’t go without notice in the international community. The day after the successful vote to consolidate Maduro’s power, the US Treasury Department imposed new sanctions on Nicolas Maduro and his regime. This sent a clear message that the United States does not support his regime. While unlikely to reach the headlines of the media, allies in Europe and Asia will most likely follow the United States’ lead.
So why does this all matter? Let’s take a look at the potential after-shock of this series of unfortunate events.
It’s likely that Maduro will use the creation of the constituent assembly to radicalize his movement. He’ll use the new power to jail political opponents and remove the parliamentary immunity of current legislators. In fact, it’s already happening. Remember Antonio Ledezma? He was the opposition mayor of Caracas discussed previously. Both he and Leopoldo Lopez were taken into custody from their homes after previously being placed under house arrest. They aren’t likely to be the last. The forceful removal of opposition will further cement his hold on power.
Maduro will also use the US sanctions as propaganda to rally nationalists as he paints Venezuela as a victim. This has been historically successful and was often used by Hugo Chavez and the previous administration. The US boogeyman and “David vs. Goliath” rhetoric will empower his movement and label the opposition as traitors or worse. This will serve as a distraction as Maduro continues to restrict liberties in the attempt to consolidate power indefinitely.
The private sector in Venezuela will also find it increasingly difficult to operate as the regime continues its interventionist tactics in business affairs. The new constituent assembly will be able to adjust current laws, making it easier for the government to seize assets and gain greater control of the economy. This will definitely have an impact on foreign direct investment as speculation markets continue to sow economic instability.
What we’re seeing is the advancing of an authoritarian regime in Venezuela. Maduro is only a few small actions away from completely neutralizing the opposition. Many Venezuelans have sought refuge in neighboring countries. Many can’t afford to leave. The ingredients on the table are the perfect recipe for the creation of a rogue state in South America. With the international community distracted by ongoing speculation on Russia, North Korea, and an unpredictable US Foreign Policy, it’s likely that Maduro will succeed. Let’s hope I’m wrong.