Venezuela, “A Fling of the Past”

When Van Trevor & the Four Seasons released “A Fling of the Past” back in 1963 Venezuelan-US relations were harmonious and to a certain extend exceptional within the Western Hemisphere. Creole Petroleum Corporation, Standard Oil of New Jersey’s subsidiary in Venezuela, controlled large part of the nation’s oil production and exports, and capitalized on disproportional royalties that left 95 percent profits in the hands of the company and the rest in the hands of the nation. Baseball was the national sport, signs of the Americanization of Venezuelan culture, not to mention tourism and the import of commodities that were monopolized by US business interests. By that point the World Bank had been in Venezuela and had easily convinced pro-US dictator Marcos Pérez Jiménez that the specialization in oil exports was the magic formula for the nation’s long-term economic development. Venezuela had embraced an economic development model that relied on the export of oil and the import of consumer commodities, including food. Venezuela was on the path to modernity, it was a model to follow in the global south.[1]Modernity had come at a high cost to the majority of Venezuelans who did not benefit from the oil dependent economic development model. The benefits went directly to the shareholders of oil corporations operating in Venezuela, the western nations that imported the oil for their own industrialization processes, the political and economic elites that benefited from the partnership with foreign corporations, and the working class and middle management that was fortunate to find a job in the oil industry. The poorly managed oil policy eventually led to internal confrontations among Venezuelans during the late 1940s, forcing the rise of a military government designed to protect the status quo.

The people’s revolution of 1958 overthrew Pérez Jiménez’s ten-year dictatorship, opening the doors for political leaders that had lived in exile.[2] The ex-communist and former president Rómulo Betancourt called for unity under the traditional democratic leftist party, Acción Democrática, with the agenda of bringing socialist democratic change to Latin America; this, before the Castro’s Cuban Revolution (1959) or Salvador Allende’s socialist victory in Chile (1973). But political corruption and the dangers of the dependency on oil once again surfaced soon after Betancourt (1959-1964) took over power through democratic elections. His agrarian reform never took off and neither did his other distributive policies, quickly returning civil society to its traditional conditions of disenfranchisement.

Betancourt had promised the United States, before departing New York where he was living in exile, that “no responsible member of the new government had any intention of nationalizing the oil” operation owned by Standard Oil of New Jersey and that democracies provided better security to foreign interests than dictatorships.[3] Betancourt kept his promise, and under his regime foreign interests once again prioritized.

By the late 1950s U.S. businesses controlled 65 percent of Venezuela’s oil, at a time when Venezuela was the second largest oil producer in the world just behind the United States.[4] Following the advice of the World Bank, Venezuela had become fully dependent on oil for its economic development, and it was Betancourt’s view that what the nation needed was more foreign investment in order to extract even more oil.[5] He did lay down a pro-Latin American agenda on the table, expressing his desire to sell cheaper oil to his Latin American brothers and sisters, an idea that would resurface under the Hugo Cháez administration.[6] Like his agrarian reform law, the Latin American initiative was never honored. Social democratic and regional policies were never implemented because they went against the interests of foreign corporations. Land reform went against the interests of Dutch, British, and American companies that wanted to secure more land for exploration and extraction, and the idea of cheaper sales of oil to Latin American nations never took off because international demand and Venezuela’s dependency on royalties impeded it.

Inspired by the Cuban Revolution, the masses once again took the streets in protest against Betancourt but like in the past, the state used its armed forces against the people in order to quiet them down. The ex-communist/socialist Betancourt had moved to the right on behalf of foreign interests and traditional political and economic elites.[7] Leftist student movements were quickly silenced and so were labor uprisings through force and intimidation. Betancourt publicly voiced its opposition to the Castro regime and voted in favor of Cuba’s expulsion from the Organization of American States (OAS), winning him support from Washington as his administration systematically persecuted leftists in Venezuela, forcing them underground. The result was the emergence of guerrilla movements in Venezuela such as the FALN (Fuerzas Armadas de Liberación Nacional) that were quickly dismantled by a steady flow of “democratically” elected administrations that secured foreign interests, local elite interests, and locked the nation’s economic dependency on oil. Through the ebbs and flows of Latin American history, Raúl Leoni (1964-1969), Rafael Caldera (1969-1974 / 1994-1999), Carlos Andrés Pérez (1974-1979 / 1989-1993), Luis Herrera Campins (1979-1984), Jaime Lusinchi (1984-1989), and Ramón José Velásquez (1993-1994) assured that Venezuela remained America’s best friend and that the nation remained an oil export-oriented economy.

Venezuela became a case study for dependency theorists that predicted before the turn of the twenty-first century that nations that did not diversity their commodities and industrial production systems, and that depended exclusively on one or two export and one or two trading partners were destined to become failed states. All the more so when the international price of oil plummeted in the 1980s, revealed the weaknesses of Venezuela’s economy.

I remember growing up in Colombia, near the border with Venezuela, that my family would cross the border in order to fill the gas tank with cheap Venezuelan oil and load up with American imports that we would find in the supermarkets of San Cristobal. As an American growing up in Colombia during the 1980s it was tough getting sneakers, Levi’s jeans, peanut butter, Velveeta cheese, Cheetos, and all the other goodies of American culture because Colombia was investing in industrially replicating consumer products for Colombian consumption. Made in USA products were being replaced by Made in Colombia products under Import Substitution Industrialization (ISI) policies, while in Venezuela there was no interest in this nationalist path.

There was no need for the introduction of nationalist production systems in Venezuela because the status quo established by foreign oil corporations and backed by the ill advice of the World Bank had impeded it. Betancourt and all the others that followed made sure that civil society remained committed to the status quo, betting all cards on oil while its biggest buyers in the international market (Europe, Canada, and the United States) were strategically diversifying their oil supply markets.

Venezuelan leaders should have seen the crisis coming in the 1970s when the Western world shifted its attention to the oil producing countries in the Middle East, in the 1980s when they began to center their attention on African oil producing nations, and in the 1990s when new technologies allowed transnational oil companies to tap the oceans and deeper grounds in countries like Canada and Colombia. By the end of the Betancourt administration (1964) it was already clear that the exceptional Venezuelan-US relationship was coming to an end, as new oil producing nations began to surface across the international market. By the 1980s it was a distance relationship that got even colder in the 1990s, and by the time Hugo Chávez (1999-2013) took office it was “a fling of the past.”

The images of the late 1950s and early 1960s are no different then the images today, the masses combating the police state, demanding justice and claiming for the support of the international community. Democracy and human rights being violated by dictators in power, this time from the left, as the international community watches, this time from their cell phones. Back then at least the international community had some motivation thanks to the Cold War, some rallying against the communist cause and other supporting the subversive initiative.

Today the international community does not even have that choice. Some react to the human rights atrocities, others react to the violations of democracy, but the majority do not really care. The last time Venezuela was important was when the barrel of oil was above $100 dollars and Hugo Chávez was in power. The popularity of the socialist regime plummeted as the price of the barrel of oil went down and culminated with the death of Hugo Chávez. Under Nicolás Maduro Venezuela lost resonance within the international system, even as a humanitarian and refugee crisis escalated.

The United Nations has not reacted to the incidents that have surfaced since 2013 and that have intensified since 2016. The United States has kept quiet on the issue, leaving it in the margins of its Latin American policy even during the election year. In Europe the refugee crisis and their own economic recovery has left Venezuela off the radar, while in Latin American circles the corruption crisis in Argentina and Brazil, the peace agreement in Colombia, the violence in Mexico and across Central America, and the general turn to the right has absorbed the region’s attention.

Except for those Venezuelan’s that left the country and the millions that are confronting the human rights abuse, poverty, starvation, and political persecution on the ground, the rest of the world is just watching and waiting with disinterest. I am saddened to see this happening; we have lost our humanity to the point that over the weekend CNN had to publish “5 Reasons why we should Care about the Crisis in Venezuela.”[8] The title says it all, people just do not care; we care more about Trump’s Tweets and the ridiculous circus of American politics and not about the life threatening crises being experienced by people across the world. We did not use to be a selfish nation and that is what actually made this country exceptional; of all the Western nations it was the US and its people, through their politicians and their own initiatives that globalized the struggle for democratic rights and freedom.

I support the idea that the solution to the crisis must come from within Venezuela but the international community must lend a hand, facilitating the possibilities for democratic dialogue and negotiations. We cannot be selective; we need to fully commit to the defense of democracy and human rights in Venezuela just like we do in other parts of the world. Maduro must step down just like Assad must step down in Syria. Venezuelan elites must be prepared to accept a reconstruction of the democratic structures that will lead to a nation building process based on greater social equality and redistribution of wealth. Economic development planners and policy makers must be willing to reconstruct the economy by moving away from oil dependency and the development of a self-sufficient industrial and food production model must become to the top economic development priority. Finally, the international system and the multilateral system must provide the flexibility for the nation to transition away from their oil dependency model.

The international community must impede this situation from snowballing into another genocide that may result in an unmanageable refugee and internally displaced crisis. The western powers must assume their historic responsibility for this outcome and so should the Venezuelan elites that comfortably fled the country and moved their capital overseas. Meanwhile the Colombian government must take responsibility for their permissiveness, allowing an informal economy of human trafficking and contraband trade to flourish on front of their eyes and ultimately capitalizing on the suffering of other human beings.

Nevertheless, the possibility of this actually taking place is remote. Ultimately there is a lot of money to be made out of conflicts like the one in Venezuela, specially now under a globalized system where transnational stakeholders profit from internal war, human rights violations, and the emergence of informal markets. At the end the interests of these stakeholders prevail over the interests of the victims themselves. To illustrate this reality just take a look at the history of Colombia since the end of the Second World War. It took the citizens of that nation close to seventy years (1948-2017) to resolve their internal conflict, after overcoming the pressures from internal and external stakeholders that were willing to prolong the civil war as much as they could and at the expense of the lives of hundreds of thousands of Colombian citizens in order to secure their economic and political gains. Over that long period of time the international community became passive and desensitized from the atrocities that unfolded in Colombia, even Colombians became disconnected from their internal realities as pockets of safe zones within the nation constructed a parallel reality for those locals and foreigners that could afford such pleasures.[9]

Based on historical evidence it can be concluded that peace in Venezuela is not within reach. The political elites and its police state placed a lid on the civil conflict that erupted back in the 1950s to cover up the internal conflict for the sake of foreign investment confidence, only to be exposed in 1999 under Hugo Chávez. The repressive realities of Venezuela’s democracy have not been altered since Pérez Jiménez was ousted in 1958; the only difference is that those infringing repression now represent socialist ideals and not capitalist ones. The problem is systemic and it centers on the nation’s oil dependency model, and until this is altered nothing will change. The solution is in the hands of Venezuelans but the internal and external stakeholders committed to the oil agenda are too influential and powerful at this point, and those capitalizing from the internal conflict are just beginning to see the return on their investment.

[1] Watch for example a 1956 documentary on Maracaibo, Venezuela. Creole Petroleum Company. “Maracaibo-Venezuela 1956.” April 2012. Accessed August 2, 2017.

[2] “Venezuelan Documentary FALN (1965) 1 of 2.” May 2017. Accessed August 2, 2017.

[3] J.H. Carmical. “U.S. Stake is Safe, Venezuelan Says.” New York Times, February 2, 1958, 1.

[4] Royal Dutch-Shell Group controlled about one-third of Venezuela’s production and the other ten percent was controlled by local interests; Ibid.

[5] Ibid.

[6] In 1958, 36 percent of Venezuelan oil went to the US, 10 percent went to Canada, 15 percent went to Eastern Europe, and the other 39 percent was sold to Latin American, African, and Caribbean nations; Ibid.

[7] “Venezuelan Documentary FALN (1965) 2 of 2.” May 2017. Accessed August 2, 2017.

[8] Doug Crisis. “5 Reasons why we should Care about the Crisis in Venezuela.” CNN, August 3, 2017. Accessed August 3, 2017.

[9] That includes my father who was transferred to Colombia from Alabama during the 1960s in order to open market for cotton machinery and technology.

Stefano Tijerina

About Stefano Tijerina

My name is Stefano Tijerina and this blog’s objective is to connect Maine’s social, environmental, economic, cultural, and political issues to the global system, centering on how the local impacts the global and how the global impacts the local or what is known in Global Studies as the "Glocal" effect. In our present era of globalization it is crucial for the general public to understand how the new dynamics of the international system impact our lives here in Maine and how our local decisions impact the earth. These are my personal views, and they do not express those of the University of Maine System or the University of Maine.