socialism
Has Hugo Chavez helped the poor?

President Hugo Chavez is a divisive character — on the international stage and within Venezuela. After 10 years in power Venezuelans and the world are reviewing his record and asking themselves, what has Chavez done for Venezuela? What has he done for the poor?
Although Chavez's government and the main opposition party Un Nuevo Tiempo (A New Era), may argue about the numbers and results of Chavez’s social programs, it goes undisputed that Chavez has placed a new emphasis on aiding the poor. The focuses of Chavez’s missions include; widespread free health care, soup kitchens, and literacy and education programs. The government reports lowering extreme poverty from 42 percent in 1998 to 9.5 percent today and a 50-percent decrease in unemployment, reports the BBC.
These numbers are impressive, but highly contested. The opposition has disputed these statistics, saying they are inaccurate because the government’s collection methods do not hold to international standards. Other issues include opposition reports of hospital closings, an increase in human rights abuses, and high inflation and crime rates. In fact, according to The Christian Science Monitor the inflation rate is 31 percent and food prices have risen by 50 percent in 2008. Inflation may be starting to outstrip salaries and could reverse some of the good achieved through Chavez's programs. In addition, Chavez’s critics insist they have been blacklisted, unable to work in the public sector or access passports and national ID cards.
Two BBC video interviews underscore the widely differing experiences under his presidency.
On February 15 the citizens of Venezuela will vote on whether to amend the constitution to abolish term limits on the presidency and other government offices. This vote will be the latest gauge of how people feel about Chavez and the success or failures of his programs and administration.
Coming Down from an Oil High

Last week oil prices dipped under $70 a barrel for the first time in over a year. While the lower price may have Americans at the gas pump celebrating, it’s bad news for the leaders of oil-rich countries that made long term plans based on the high price of oil.
Venezuela, Iran and Russia went on a spending spree when oil hit $100 per barrel and then planned upcoming government budgets on the peak price.
The high price of oil allowed these countries to thumb their nose at the West with little risk of a response. Venezuela advanced its socialist agenda both at home and in the region. Iran ignored U.S. nuclear related sanctions, and Russia reasserted itself by invading Georgia.
But because they assumed the price of oil would stay high, they might soon be on receiving end of such gestures. The Washington Post reports that:
According to independent estimates, [Iran and Venezuela] need an average oil price of up to $95 a barrel to fund the populist subsidies and social programs they have launched in recent years — not to mention billions of dollars in arms purchases from Russia. Venezuela has been furiously importing food to fill empty shop shelves, while Iran heavily subsidizes domestic fuel.
Venezuelan President Hugo Chávez has gone on the record as unworried about the falling oil prices citing Venezuela's $40 billion in foreign currency reserves. However, Ricardo Hausmann, a Venezuelan economist who teaches at Harvard, doesn't share Chavez's confidence. “We’re in the same situation of people who have lost a limb but can still feel it. I don’t know how long it will take for Chávez to realize he’s lost a limb."
In response Iran and Venezuela pressured OPEC to cut production by 2 million barrels a day. OPEC members initially took a wait-and-see approach, wary of intensifying a global economic crisis or further decreasing global oil demand, before agreeing to cut production by 1.5 million barrels a day in an attempt to drive up prices.
But skeptics question whether significant production cuts won't simply decrease demand for oil — or whether it will influence the price at all. If OPEC can't drive prices back up to their historic highs, Venezuela, Iran and Russia may face a tough reality as they come off their own oil high.
Possible Changes Ahead for Cuba
Although Cuba's new leader says he will continue to run the country under a socialist framework, economic changes may soon be underway.
According to The Economist:
In his speech, Raúl also gave broad hints of economic changes. He recalled a commitment by Fidel in 2005 gradually to revalue the peso. Since many prices are set in hard currency, that is essential if wages are to rise above their average of $20 a month. This would take time, he said, but would involve moving away from the state-run rationing system and taking more account of wages and prices. That amounts to a move towards market mechanisms. And he praised decentralisation.
Some predict that Cuba will try to mimic progress made in Vietnam in Cuba by embracing markets while still adhering to the concept of socialism. This would be a substantial change for Cuban economic policy.
After 10 years, could the honeymoon be over?
Food shortages, a weakening economy and outbreaks of dengue fever are fueling growing discontent among Venezuelans and Hugo Chavez and his socialist party are experiencing their greatest period of unpopularity. Beyond domestic problems, recent weeks have brought Chavez a heightened level of threats from his enemies, reports the New York Times.
From the Archives
A Million Paths to Peace
From the Archives
The Axis of Oil - China and Venezuela
Countries: Venezuela, China
Previously filed under: South America, Global Economy


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