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Obama ignoring the trouble in Venezuela

As oil revenue has plummeted, Maduro has refused to address even the most extreme economic distortions

An enduring characteristic of Barack Obama’s US presidency has been his determination to implement the ideological agenda with which he arrived in office without regard for conditions in the real world. He imposed timetables for “ending the wars” in Afghanistan and Iraq unlinked to military progress. He insisted on pursuing Israeli-Palestinian peace talks, even though the leaders of both sides were manifestly unwilling. He began his second term by seeking a new nuclear arms deal with Russian President Vladimir Putin, despite abundant evidence that Putin was preparing for confrontation with the West.

Now, six years into his presidency, Obama has launched, as his first significant initiative in Latin America, detente with Cuba. It’s a torch that many liberals have carried for decades. Once again, however, the president has acted with wilful disregard for current events.

In particular, two salient facts were ignored. The first is that the regime of Raul Castro was desperate for an economic opening to the US — meaning that concessions offered gratis by Obama could have been used to leverage meaningful political concessions by the regime. A simple one could have been an end to the arrests and beatings of peaceful dissidents, such as those that occurred last week.

Second, Obama ignored the slowly mushrooming crisis that triggered Castro’s distress and that ought to be the focus of US energies in Latin America. That is the slow but potentially catastrophic collapse of Venezuela, a major US oil supplier with three times Cuba’s population that, as 2015 begins, is well on its way to becoming a failed state.

Venezuela has been a virtual Cuban colony in recent years, which is one big reason for the fix it is in. After sheltering caudillo (strongman) Hugo Chavez during his slow demise from cancer, Havana helped to install as his successor Nicolas Maduro, a former bus driver of astonishingly small talents. Since Chavez’s death 22 months ago, Maduro has faithfully continued the 100,000-barrel-a-day oil subsidy that keeps Cuba’s moribund economy from crumbling.

Meanwhile, Maduro has overseen the degeneration of his country’s economic, political and social situation from abysmal to truly disastrous. Economic production declined by 5 per cent in the first half of this year, inflation rose past 60 per cent and an estimated one-third of consumer goods were in shortage — and that was before the 50 per cent drop in the price of Venezuela’s oil, which provides 95 per cent of the hard currency for a country that imports most of its food and medicine.

Failed state

By many measures, Venezuela is already a failed state. According to the Venezuelan Violence Observatory, a record 25,000 people were murdered in the country in 2014, the second-worse homicide rate in the world after Honduras. The US government estimates that half of the cocaine produced in South America now moves through Venezuela — 300 tonnes a year — with the help of top leaders of the military and police. There have been deadly clashes between official security forces and the armed civilian “collectives” organised by the regime. And Wall Street has begun anticipating a Venezuelan default.

As oil revenue has plummeted in the past few months, Maduro has refused to address even the most extreme economic distortions — such as a black-market exchange rate for the dollar 350 per cent higher than the highest of three official ones, or gasoline that sells for pennies a gallon. Instead he has delivered endless speeches denouncing the “economic war” he claims is being waged against Venezuela by the US, and he has imprisoned top opposition leaders such as Leopoldo Lopez, a US-educated moderate leftist. “My country,” Lopez wrote in a letter published by the Wall Street Journal on December 25, “is on the verge of social and economic collapse.”

Oddly, the only discernible policy the Obama administration has towards this unfolding implosion is the one it just repudiated for Cuba: Sanctions. The day after announcing the normalisation with Havana, Obama signed legislation mandating visa bans and asset freezes for senior Venezuelan officials linked to violations of human rights, including the killing of dozens of street demonstrators last year.

Venezuela’s opposition supports those sanctions. But its leaders have also been saying that the country desperately needs outside diplomatic intervention. A halfhearted effort by the Unasur regional group petered out months ago. Now the region’s big governments, like the White House, focus on the political rehabilitation of Cuba while ignoring the situation in Caracas. That’s particularly wrongheaded because there is a clear role for foreign mediators to play in brokering a deal between the government and moderate opposition that could allow for a political truce, the release of prisoners and emergency measures to stabilize the economy. “To remain silent,” wrote Lopez, “is to be complicit in a disaster that doesn’t just impact Venezuela but could have implications across the hemisphere.” Too bad his country wasn’t on Obama’s preconceived agenda.

— Washington Post