The American Spectator

Venezuela nationalized its oil industry long before Chavez came to power, but the president has made a career out of demonizing oil executives whom he describes as living in “luxury chalets where they perform orgies, drinking whisky.” (This from a twice-divorced would-be dictator who is chummy with Bolivian cocaine leader Evo Morales, and lives in a palace.)

Like all socialist leaders Chavez’s one trump card is to play the rich against the poor. And since the '90s, there have been a lot more of the latter. Venezuela, the world’s fourth largest oil exporter, once had a thriving bourgeoisie (about half Venezuelans were middle class). When oil prices slumped in the '80s and '90s, and the Latin American debt crisis worsened the economy went into freefall. The government of Carlos Andres Perez was forced to borrow heavily and undertake austerity measures. Chavez took advantage of the recession and subsequent public disenchantment. But rather than attempting to defeat the floundering government at the ballot box, Chavez and his supporters decided to stage a bloody coup. Twice. Both times they failed.

After his release from prison, Chavez formed the socialist party, Movement for a Fifth Republic. This time he took the presidency riding a wave of popular disillusionment and bolstered by windy promises to redistribute wealth. As president one of his first actions was to throw out the archaic notion of private property rights. In January, the Chavez government began breaking up the country’s large estates. Plan Zamora, as it is called, taxes unused landholdings, expropriates unused private lands (with compensation), gives inheritable unsellable land grants to small farmers and collectives, and places a legal limit on the size of landholdings.

Venezuela remains the only country in the region that relies on food imports. Chavez says giving land to the peasants will make the country more self-sufficient. But few of the poor seem interested in returning to rural areas. Most have migrated to the shantytowns that surround the larger cities and have no intention of returning to the provinces, unless forced to. Following the Cuban Revolution, Venezuela passed similar reforms in 1960, but the land reform movement was a bust, the farms failed or the peasants lost interest, and the idea was soon given up. The government is now focusing on giving slumdwellers the rights to their slums.

The first coup d’etat of the 21st century occurred in the (newly renamed) Bolivarian Republic of Venezuela in April 2002. The spark that ignited the coup was the passage of legislation giving Chavez almost unlimited powers for one year. Days before the law expired Chavez announced 49 reforms, including the land reform bill. Outraged, trade unions and the national chamber of commerce declared a one-day general strike.

Three months later the Venezuelan president fired the management of the state-run oil monopoly, replacing the board with his supporters. On April 11, 150,000 people marched to the presidential palace in support of the strike and to protest the firings. Chavez vowed to crush the strike, and sent in the National Guard and Bolivarian Circle gunmen. In the ensuing melee, 17 people were killed and 110 injured.