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The PetroState

Background info on Venezuela from VenEconomy editor.

The Petrostate that was and the Petrostate that is:
I: The Accion Democratica Model
II: Our botched attempt at reform
III: From institutional clientelism to the Chavista cult of personality

The scene went down in the middle of one of his infamous, never-ending televised speeches in 2004. President Chavez had barely hit his stride when something caught his eye. His tone changed. Concerned, he started looking towards the scaffolding to the left of the stage he was using, the one used to put up the lights for the speech.

"Hey, come down from there," he said in a soft, fatherly tone, "no, don't climb to the front, it's hot there because of the lights...that's right, climb down towards the back. Don't worry, you'll get to talk to me. I want to hear your problem. I saw you crying earlier, just, just come down from the scaffolding and come up here."

Soon, a 15 year old kid has climbed down from the scaffolding and is walking towards the stage. He's crying. Chavez calls him up to the podium. With the camera's running, millions of people watching, Chavez takes him, hugs him hard and holds him for, oh, 45 seconds or a minute, while he the kid tells him, in between sobs, how his father recently died and his mother is sick and he can't afford the medicines to make her better...Chavez listens at length, pets his hair, assures him that he's going to help him.

The crowd is ecstatic, chanting "that, that, that's the way to govern!"

By vladimiro on Feb 4, 2006, 08:06 in Politics & the war.

vladimiro says on Feb 4, 2006, 08:09:

here's the link http://caracaschronicles.blogspot.com/2003/02/petrostate-that-was-and-petrostate.html

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cali373 says on Feb 10, 2006, 10:50:

What does this have to do with Colombia?

Smile if you are a thinker!

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Mr. Hollywood says on Feb 10, 2006, 20:40:

"That's the Way to Govern" Uh, yeah, right, the way to solve a country's problems is to wait until the poor die and a kid has to climb a scaffold to get your eye, then manipulate his tragedy for your own political gain...

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cali373 says on Feb 13, 2006, 08:33:

Chavez must be getting Political advise from Karl Rove.

Smile if you are a thinker!

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vladimiro says on Feb 13, 2006, 17:12:

"...it was clear that the election would go to the one who best voiced the people’s virulent rage at the ongoing failure of the petrostate.

And if that’s the game you’re playing, nobody but nobody beats Hugo Chavez."

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vladimiro says on Feb 13, 2006, 17:14:

More background Back in 1989, all you needed to do to realize how badly Venezuela needed reform was pick up a phone. On a bad day it could take half an hour or more to get a dial-tone. You’d unhook the phone, go make yourself a sandwich, check for a dial town, eat the sandwich, check for a dial tone again, wash your dishes and put away the mayonnaise, come back and check for a dial tone again…it was pretty ridiculous.

People were sick of it, and understandably so. But – and this is a crucial “but�? – they didn’t see the need for root and branch reform. What they wanted was to see the petrostate fixed, not replaced. Venezuelan longed for the bonanza days of the 70s, when windfall oil revenues financed a huge and rapid expansion in consumer spending.

If they were angry at politicians, it was because they thought politicians had failed to deliver on their basic mission to meet everyone’s needs by distributing the oil money fairly and generously. Do that, they figured, and the country could return to the good old days of the 70s.

Here we get back to the mental model that underpins the Venezuelan petrostate, and its founding myth that Venezuela is a fantastically rich country so all the state has to do is distribute the oil rents for everyone to live comfortably.

Let me be clear about this: corruption really was a huge problem back then (still is.) But Venezuelans had wildly unrealistic notions how much their lives could improve if corruption was stamped out. Few grasped that even without corruption, the petrostate model was unworkable. The complicated structural and demographic reasons that made it fundamentally non-viable were not a part of the national debate. They were understood only partially even in academic and technocratic circles. So the perception that corruption was the whole of the problem in fact impeded a deeper examination of the real reasons the state had stopped working.

...

Venezuelans thought they’d elected CAP to fix the petrostate, instead, he immediately moved to dismantle it. It barely made a difference that the petrostate was badly in need of dismantling: anyone needing a phone-line in those days should have been able to see that. Consensus on the need for reform was confined to technocratic circles - the public sphere just was not on board.

....

It was during the third year of this little CAP vs. AD psychodrama that a certain army lieutenant colonel first entered the public scene…the valiant paratrooper willing to put his life on the line to stop CAP’s outrageous drive to dismantle the cherished petrostate.

...

In other words, Chavez's bright idea for moving beyond the outdated system of vertical interpersonal relations is to replace it with a cult of personality.

It's bad news.

In the old system, the state had two fully independent institutions: AD and Copei. It's true, it's terrible that there were only two real institutions around, that the
courts and the elections authorities and the nationalized companies and every other part of the state was subjugated to one party or the other. But at least there were two of them!

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