Panelists Discuss the Crisis in Venezuela

What began as a recession in Venezuela has resulted in the worst economic crisis in the country’s history —a crisis that is also political, social, and even humanitarian. But what are the effects of this crisis, and what does the future of the country look like?

These and other questions were addressed at a panel discussion directed by BC’s Organization of Latin American Affairs (OLAA) on Tuesday, October 24. The panel was moderated by Fr. Gustavo Morello, and featured experts Miguel Ángel Santos (from Harvard’s Center for International Development) and Ricardo López (from the Brandeis International Business School). It also included two of BC’s own students, Andrea Mauco (CSOM ‘19) and Rodolfo Postigo (MCAS ‘19).

The event began with the remarks of student speakers Mauco and Postigo, who shared their personal experience of the crisis. Postigo, who was born and raised in Venezuela and often returns during vacation, described its social toll: the effects of crime, poverty, and education. Whereas education is typically considered a solution to social problems (such as child delinquency), the public education system in Venezuela does not meet that expectation. The structure of schools is precarious, and at a time of great political turmoil, students have little incentive to study. The political situation has also motivated them to protest in the streets. Postigo commented on the more than 100 deaths inflicted by the government since the tumultuous months of April, May and June of 2017. Protestors opposing President Nicolás Maduro were shot with marbles, high-power hoses, and tear gas bombs. Postigo stated that if he was a student in Venezuela, he “would be in the front lines with [his] fellow students,” and expressed a sentiment of profound guilt at not being able to support his country in this way.

Mauco, who emigrated from Venezuela at age 6, echoed Postigo’s regret. She did, however, mention examples of how she and others have been able to help while abroad—for example, bulk-buying non-perishable items to send to relatives. Such projects have been critical; the crisis has brought scarcity in basic necessities such as food, baby formula, and diapers, and inflation has rendered many other items unaffordable. As regards the social and political climate, Mauco quoted her mother’s words upon their departure from Venezuela: “Things are different. This country is different. This has never happened before… it is not the country I grew up in.”

Dr. Miguel Santos and Dr. Ricardo López offered their professional insight regarding the larger trajectory of the crisis. Santos highlighted the oil boom that Venezuela had been enjoying in the years prior to the crisis—but the red flags existed even then, when the country relied too much upon its oil and multiplied its foreign debt by six.

Scaling down its imports did not help Venezuela. Instead, as López noted, the country’s GDP is steadily decreasing. Inflation is at an exorbitant 1000%, with a basket of groceries often costing four times the minimum wage. Over 80% of the population is considered impoverished. Income inequality, a 20% unemployment rate, and strict currency controls have caused a massive exodus of talented individuals, further hurting Venezuela’s future and economy.

Santos and López highlighted the systemic nature of the problem.

“As an economist,” López stated, “I feel mad, actually, because the economic policies are so wrong.”

Santos, on the other hand, expressed his frustration with the election system, stating that “elections will never bring a transition in Venezuela.”

The opposition party has no access to any media, and emerging leaders are prosecuted, jailed, or silenced. Referring to numerous attempts to change the situation, Santos remarked, “We have exhausted everything. We have exhausted everything domestically.”

What then, are the hopes for the country moving forward? Santos pointed to the international community, which could help lift Venezuela from the crisis through loans and sanctions. Both Santos and Lopez emphasized the radical, “deep reforms” that would have to happen within the country itself. These include cutting fiscal deficit, increasing privatization, eliminating price controls, opening to foreign investment, and facilitating the operation of businesses. Santos went so far as suggesting a possible change of currency. He added that many of these changes cannot happen under President Maduro, and a military coup may be necessary.

Despite seemingly grim prospects, Mauco and Postigo maintained their faith in their people, voicing a message of hope.

“I can’t tell you what will happen in the future,” Mauco admitted, “But one thing that I do know is that Venezuelans will keep fighting. The fire in our bellies will not be extinguished. And no matter how many times we are pushed down, we will continue fighting to get our country that we know and love.”