Is Venezuela an example of socialism?

Question

I've been hearing a lot about Venezuela in the news lately. And it seems there is a big debate over whether it was socialism or not, or whether it was implemented properly.

Is it safe to assume that it was indeed a socialist experiment?

What would make it not socialist?

Answer 1

Venezuela's economy
Venezuela is a communist planned economy with an authoritarian government. It is, therefore, an example of Socialism. Under Chavez and Maduro, Venezuela's economy became a planned economy based on oil production, with few other industries, its oil industry has been nationalized since 1973, and there were significant petrol subsidies for its citizens.
https://en.wikipedia.org/wiki/Venezuela
https://en.wikipedia.org/wiki/Economy_of_Venezuela

In 1973, Venezuela voted to nationalize its oil industry outright, effective 1 January 1976, with Petróleos de Venezuela (PDVSA) taking over and presiding over a number of holding companies; in subsequent years, Venezuela built a vast refining and marketing system in the U.S. and Europe.

Under the tenures of Hugo Chávez and his successor Nicolás Maduro, many businesses abandoned Venezuela. In 1999, there were 13,000 companies in the country. By 2016, less than a third of companies remained in Venezuela, with only 4,000 companies operating in the nation.

Venezuela has large energy subsidies. In 2015, the cost of petrol was just US$0.06 per gallon, costing 23% of government revenues.

Although Venezuela's economy was planned around a single industry, they are beginning to diversify.

A range of other natural resources, including iron ore, coal, bauxite, gold, nickel and diamonds, are in various stages of development and production. In April 2000, Venezuela's president decreed a new mining law and regulations were adopted to encourage greater private sector participation in mineral extraction.

Some reasons for the failure of Venezuela's economy:

At first, the economic decline was due to low oil prices, but it was fueled by the turmoil of the 2002 coup attempt and the 2002–2003 business strike. Other factors of the decline were an exodus of capital from the country and a reluctance of foreign investors.

The 1999 Vargas tragedy was a disaster that struck the Vargas State of Venezuela on 15 December 1999, when the torrential rains and the flash floods and debris flows that followed on December 14–16 that killed tens of thousands of people, destroyed thousands of homes, and led to the complete collapse of the state's infrastructure.

Venezuela as an example of failed Socialism in debate
A lot of internet conversations use Venezuela as an example of Socialism failing, and they often do it in response to discussions of Democratic Socialists in America, and the viability of Democratic Socialism at large. Undoubtedly, this argument is the main driver for the existence of this stackexchange question and quite a lot of other stackexchange questions about Venezuela. This attempt to associate Democratic Socialism with Authoritarian Socialism is a mistake for multiple reasons:

• Although many political candidates in the United States are now self-identifying as "Democratic Socialist," they tend to model their principals after Nordic Model Social Democracy. Social Democracy and Democratic Socialism are somewhat close in many ways, but Social Democracy is a bit more like a well-taxed Capitalist economy with social benefits; whereas Democratic Socialism has more government control over the economy, property and institutions are more public than private, and there are more elements of a decentralized planned economy.
• Democratic Socialism and Authoritarian Socialism are not the same thing and do not have equal track records.
  From https://en.wikipedia.org/wiki/Democratic_socialism

Democratic socialists oppose the Soviet economic model, rejecting the authoritarian form of governance and highly centralized command economy that took form in the Soviet Union in the early 20th century.

Authoritarian Socialism, as well as any Authoritarian government combined with any economic system, has a consistent track record of poor quality of life, weak civil rights, poor democracy, and sometimes a poor economy. Democratic Socialism (and other kinds of Social Democracies, democratic Mixed economies, and democratic Social Capitalism) offers many success stories of countries with good economies, strong democracy, strong quality of life, strong social progress, and good economic freedom (seriously, open up some of these rankings and go looking for Denmark, Finland, Sweden, Iceland, Norway, Switzerland, Australia, Germany, and Canada). If a politician says that they want to model the economy after Denmark, it is simply dishonest to say that the economy will instead turn out to be like Venezuela.

Here is a list of examples of Authoritarian countries, Socialist and otherwise.

• Socialism itself has many economic flavors, creating a broad opening for weakly informed people to equate countries with very dissimilar economies.

From https://en.wikipedia.org/wiki/Socialism

Socialism is a range of economic and social systems characterised by social ownership and workers' self-management of the means of production as well as the political theories and movements associated with them. Social ownership may refer to forms of public, collective or cooperative ownership, or to citizen ownership of equity. There are many varieties of socialism and there is no single definition encapsulating all of them, though social ownership is the common element shared by its various forms. Socialist economic systems can be divided into non-market and market forms. Non-market socialism involves the substitution of factor markets and money with engineering and technical criteria based on calculation performed in-kind, thereby producing an economic mechanism that functions according to different economic laws from those of capitalism. Non-market socialism aims to circumvent the inefficiencies and crises traditionally associated with capital accumulation and the profit system. By contrast, market socialism retains the use of monetary prices, factor markets and in some cases the profit motive, with respect to the operation of socially owned enterprises and the allocation of capital goods between them. Profits generated by these firms would be controlled directly by the workforce of each firm, or accrue to society at large in the form of a social dividend. The socialist calculation debate discusses the feasibility and methods of resource allocation for a socialist system.

• Some people don't understand, or act like they don't understand, that national economies exist along a continuum. Economic systems are not binary. They are almost never entirely capitalist, and rarely entirely socialist. Most countries fall in the middle, and simple variances in tax rates, social benefits, or business regulations can subtly move a country along the continuum; not into an entirely different, discrete box. America's form of Welfare Capitalism and the Nordic Model's form of Social Democracy only vary mildly in terms of government regulation, tax rates, social programs, etc. This article even lists the United States alongside the Nordic countries as examples of welfare states. However, it seems that the small differences in tax rates and social programs between the United States and the Nordic countries were enough to create a large difference in their income inequalities.

Answer 2

It does somewhat depend how you define Socialism, but it most definitely falls within the broader definition. This can be seen in various policy positions the people currently running the country take, especially economically. The thing that would not make it socialist is corruption and the near dictatorship, but these are general things that occur in various political systems, and seem especially present in more "pure" socialist systems (as opposed to what is increasingly referred to as democratic Socialism)

Answer 3

There has been a lot of straw manning here. You can find many other people straw manning what socialism is elsewhere too, and when someone corrects them, they say they are committing the no Scotsman fallacy - so be careful. Here are some corrections:

"Venezuela is a communist planned economy with an authoritarian government. It is, therefore, an example of Socialism." If Venezuela was communist, it would follow that it is socialist, but it isn't. Communism is socialism without a state, class, or money. The confusion is understandable because Communist parties have called themselves such because communism is their end goal.

Furthermore, it being authoritarian doesn't have anything to do with socialism - some anti-authoritarians are socialist because of socialism being against a form of authoritarianism (which I will explain later). It being a planned economy doesn't make it closer to socialist either - there are many socialists who are market socialists.

This raises the question of what socialism is. It is usually defined as one of these four:

Worker ownership of the means of production

Social ownership of the means of production

Democratic ownership of the means of production

Collective ownership of the means of production

Or a mix of them. All of them revolve around at least the workers owning the means of production. "Ownership" is sometimes replaced with "control", as ownership is about who has control over an object. What is important is that socialists argue for socialism by critiquing capitalists mode of production, where "private individuals to own the means of production, with the goal of extracting a profit from the sale of commodities produced by wage workers" as BSA puts it. One such critique is that the private owner/s can be authoritarian.

Some socialists argue that public ownership of the means of production fit into these definitions because the people (including workers) control the state, and the state controls the means of production. This never means that socialism is exclusively where the means of production are publicly owned.

---

Venezuela is currently trying to become socialist in the Bolivarian Revolution. It is far from it, as the private sector dominates:

In another part of his speech, Víctor Álvarez affirmed that the economy has become more capitalist because the contribution of the private sector to GDP increased from 65% in 1999 to 71% today, while the State's contribution fell from 35% to 29%. Álvarez does not take into account that the State captures part of the private GDP through the tax on surplus value (mass of profit) and thus obtains as much income as the private sector. Government revenues have multiplied by 25 since 1999. The fact that the State loses relative weight in total production with respect to the private sector does not mean that it loses weight in the collection of monetary income. The truth is that the Venezuelan State has not lost ground in the face of capitalist property.

• translated from here

Edit: That statistic is very old. Venezuela may actually be more socialist now, so if anyone has more recent statistics please send them to me. I haven't found any.

Answer 4

As you can imagine, politics is often complicated by a very partisan and politically/historically illiterate approach to definitions.

Socialism, like other political terms, is a broad classification which allows for a considerable degree of variation in practice. What makes a socialist society "socialist" is "public ownership" of the "means of production". Socialist politics attempts to create an egalitarian society by "sharing" ownership of industries which typically are owned almost exclusively by an aristocratic elite. Socialism is a political response to inequality.

It's worth noting that Communism is a variety of socialism where society is governed by a one-party state, whose purpose is to lead the people towards greater equality. Considering that Lenin said: "Communism is Soviet power plus the electrification of the whole country" ... it's fair to say the exact definition can vary considerably.

There are many different examples which are relevant to contextualise the point. The Soviet Union is the most famous, but even within Soviet history there were arguments about how society should be organised. The USSR switched between leaders who, generally speaking, prioritised the survival of the state (Stalin, Brezhnev) and those who prioritised the empowerment of the individual (Khrushchev, Gorbachev). Lenin even proposed the "New Economic Plan", which advocated the Communist state's industry should become for-profit. Stalin disagreed.

Lenin believed, without global revolution, the Communist state had to be pragmatic and manage capitalism over the long term to survive. Stalin believed that, without global revolution, the Communist state needed to rapidly industrialise to provide the military-industrial capacity to protect its short term survival.

What's interesting here is that Mao's policies were essentially Stalinism for peasants, but after his death China's Communist party adopted the NEP under Deng Xiaoping's leadership. All of this is socialism, because the means of production is owned and run by the state, (in principle) for the benefit of the people.

Communism is a top-down system, where the leadership make decisions which must be obeyed by the people. The two main alternatives, Democratic Socialism, and Anarcho-Syndicalism, represent other ways of distributing power.

The simplest way of describing the difference is to say that in Communism power is given to the Party, in Democratic Socialism power is given to the voters, and in Anarchism power is given to the workers. Again, these are all legitimately socialist systems, just governed by different philosophies.

After the Second World War the United Kingdom voted for the socialist Labour Party. Their policies were to nationalise many industries (coal, steel, transport, healthcare, defence, etc) and create public housing after clearing the slums. This was the socialism which George Orwell wrote 1984 and Animal Farm in defence of, in opposition to Stalinism. British socialism came to an end with Margret Thatcher's election victory in 1979.

The Labour Party became "New Labour" with the abandonment of Clause IV in 1995. This clause in the party's constitution made the party socialist, by requiring the public ownership of the means of production, and without it Labour transitioned into a Social Democratic party.

Venezuela's economy consists of a large public sector of nationalised industries, in an attempt to create an egalitarian society. That's quintessentially socialist. However, Venezuelan Socialism appears to be transitioning from a Democratic Socialism which emphasised the empowerment of the individual, into something more Stalinist, which emphasises national survival. It's all socialist, but whether it is any good is another question.

Answer 5

Was socialism "implemented properly" in Venezuela? That tends to beg the question. There's always been widespread disagreement about what's proper in economics, and what's not. But suppose, for the sake of argument, that the science of Economics is now perfected, and proper methods of implementing any given economic system are known and obvious to the whole world, and never controversial. Even if that were really so, a nation's mere aggregate failure or success is insufficient evidence, since...

1. A nation could implement an economic system improperly and yet be quite successful due to various other factors; say a meteor of gold falls from the sky and saves an incompetent government from ruin. Or an incompetent government is supported by a powerful ally, who rescues them just to spite a rival. Etc.
2. A nation could implement an economic system properly and yet fail, due to various other factors; say an immense meteor of lead falls on the capital, effectively assassinating the entirety of a competent government. Or the small nation could be opposed by a larger adversarial nation that sets out to ruin the small nation by various underhanded but well-funded means, and then install its own eager to please puppet government. Thereafter the larger nation denies, distracts, and justifies the results of its efforts, and forever blames the victim.

In this instance Venezuela is opposed by a larger adversarial nation, (with a mostly unapologetic history of "destabilizing", covert and otherwise), that wants its own favorite economic system implemented in Venezuela. In which case, the larger nation might have already deployed its usual methods of destabilizing to "make an example" of Venezuela.

So the answer is: It's hard to tell whether Venezuela is a failed example of socialism. A building is shaking! It looks ready to collapse! It might be bad design. Or shoddy contracting. Or it might be that guy with the ski-mask and the blowtorch melting a few I-beams in the basement.

(Note: of course being ruined by a larger nation is no proof of competence. The point is such action changes the experimental design.)