(AG)Student response #1
There are a variety of factors that contribute to the decline of Venezuela. Venezuela was once a thriving country with one of the fastest-growing economies with one of the largest oil reserves. The downfall of Venezuela’s economy was when Nicolas Maduro was elected. Under President Nicolas Maduro, Venezuela has become heavily reliant on its oil reserves, which according to Cheatham and Labrador, took Venezuela’s economy on an “exhilarating but dangerous boom-and-bust ride.” Being economically reliant on oil meant that the labor and capital of factors of the economy, for instance, agriculture and manufacturing, plummet. Venezuela’s economy also suffered when oil prices dropped from $100 per barrel to under $30 per barrel. Maduro’s mission to restore the economy hasn’t been successful; he even tried to raise the minimum wage three separate times in 2017, all of which only provided short-term relief but long-term issues.
Venezuela’s political impasse is another main contributor to the country’s current crisis. The collapse of Venezuela is so severe that more than five million citizens have fled to other countries (Cheatham, Labrador, 2021). Political decisions, even from the early 2000s, are still impacting Venezuela today. For example, President Hugo Chavez’s decision in 2002 to fire thousands of PDVSA workers. This ultimately left Venezuela’s oil industry without important individuals that were experts at producing and exporting oil. Other decisions Chavez made throughout his presidency played a role in Venezuela’s collapse, for example, his decision to end term limits and to take control of the Supreme Court (Cheatham, Labrador, 2021). Chavez’s death in 2013 ultimately left Venezuela into a new set of hands, Nicolas Maduro, also known as a dictator.
(CL)Student response #2
How did Venezuela, the country possessing the world’s largest crude oil reserve, end in crisis? According to Jo-Marie Burt, “the decline of oil prices, massive social spending of Chavez and Maduro, US sanctions, economic mismanagement and corruption” led to Venezuela’s collapse. Once Chavez was elected president of Venezuela, he embarked on massive social spending sprees which redirected the country’s oil profits to issues of social inequality. As Chavez rallied support from the working class for reducing poverty and opening social programs, he sparked a sharp increase on oil dependence.
Without a diversified economy, Chavez began exporting oil at below-market rates to neighboring countries for revenue. Venezuela’s oil prices declined and the economy plummeted. In addition to the economic struggles facing the country, a change of regime took place. In 2013, Maduro became presdient of Venezuela. Maduro’s power hungry-self slowly implemented his authoritarian regime, stopping at nothing to increase his power. Maduro began arresting his opposition and censoring media/news outlets. In 2017, Maduro orchestrated an illegitimate election extending his presidency and igniting public outcry. Currently, Maduro faces his opposition– Juan Guaido– as interim president of Venezuela. This has notably enraged Maduro, trickling down to the violence and chaos being seen in Venezuela today.