Essay About Largest Known Oil Reserves And Venezuela’S Political

Explaining Venezuela’s Political and Humanitarian Crises
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Hosting some of the largest known oil reserves in the world, Venezuela was once the richest country in Latin America. However, these same oil reserves and the leaders who controlled them—and continue to do so—are responsible for 20 years of corrupt government in the crisis-ridden country. To understand their current political and humanitarian crises, one must first decipher the following question: “How did Venezuela become economically dependent on oil revenue, and why did this dependence push the country away from democratic practices and closer to authoritarian regime? This question can be answered by breaking Venezuela’s political history into three main parts. I argue argues that the “Puntofijismo,” “Chavismo,” and “Madurismo” periods in Venezuela’s political history created a domino effect of major economic and civil instability, ultimately spurring the country’s collapse and intense political crisis. This essay will explain how Venezuela’s democratic consolidation period in the late 1950s—Puntofijismo—was countered with populist practices in the Chavismo and Madurismo eras, and how the three collectively brought about today’s geopolitical issue.

First, it is crucial to know how Venezuela became heavily dependent on oil revenues. Essentially, Venezuela is a fallen petrostate. According to Labrador, a petrostate is an informal term attributed to a country whose “government income is deeply reliant on the export of oil and natural gas, economic and political power are highly concentrated in an elite minority, political institutions are weak and unaccountable, and corruption is widespread” (2019). Venezuela’s premature beginning as a petrostate dates back to 1908 when the country was known as the world’s largest oil exporter until 1935. In the decade that succeeded, the country shifted back and forth between military rule and civilian government.

It was not until the formation of Punto Fijo pact of 1959 that a solid democracy ensued. The pact was entered into by the “major Venezuelan political parties”—Accion Democratica and Comite de Organizacion Politica (Mejía 2018). This period became known as Puntofijismo and spanned from 1959 to 1998. Over these nearly 30 years, the two major parties shared governance. Prosperity in oil profits during this time mainly benefitted the middle and upper classes. Specifically in 1973, the country experienced a huge oil boom, and Venezuela’s currency‚—the bolivar—“peaked against the U.S. dollar.” However, in the 1980s, Puntofijismo began to weaken. Decreased demands for oil drove Venezuela into recession. As the oil profits favored the upper class and neglected the poor, the recession caused these class divides to intensify. The marginalized were driven even deeper into poverty.

This eventually gave way to the rise of Hugo Chavez and his Bolivarianism ideology. Chavez was initially a beloved leader, especially among the poor, marginalized population of the country. His power to “prioritize social goals at an early stage” and play into social demand gave Chavez “a revolutionary political platform” at the time (Mejía 2018). Before gaining power, Chavez publicly condemned the government, blamed them for corruption, and emphasized the need for social reform. Essentially, Chavez broadcasted a populist message to draw support from the poor, which ultimately put him into power as president in 1998.

Chavez’s “key moment” in his presidency came in 2004 when oil prices surged and lead to an economic boom. In turn, Chaves spent billions in social welfare programs for the poor. Major benefits for the poor included “ an improved educational system, a strong healthcare system, and a more than 50-percent reduced poverty rate” (Ellner 2019). Rigging the economy in this way allowed Chavez to maintain support and enacting referendums to ensure his reelection. However, as Chavez spent billions on social welfare, he neglected to minimize dependence on oil and created a “growing deficit. This unrestrained spending made welfare programs “impossible to sustain if oil prices were to fall” (Ellner 2019). Oil prices did, in fact, eventually plummet following the death of Hugo Chavez in 2013.

Nicolas Maduro was Chavez’s appointed successor currently in