Venezuela's Maduro Grinches Another Christmas

No toys on the shelves -- and no banknotes to buy them, either.

Santa helps those who help themselves.

Photographer: Carlos Becerra/Getty Images

The holiday season has always had a special place in the calendar of the Bolivarian Republic of Venezuela. For the late Hugo Chavez, it was a time to pardon select prisoners (minus the judge he’d jailed for a ruling that displeased him), bless mobile phone owners with Yuletide spam, or to remind his compatriots of his revolution’s divine inspiration by turning up alongside the baby Jesus in the manger of a nativity scene. 

With his charisma and theatrical flair, Chavez got away with the Santa shtick even when Venezuelans were struggling to make ends meet. Not so his subordinate Claus, Nicolas Maduro, who succeeded Chavez in 2013 and has since run the oil-rich economy and what’s left of its once-vibrant democracy into the ground.

Of course, Maduro isn’t completely blind to the Venezuelans’ plight. On Dec. 9, his price czar ordered millions of toys seized from a big national supplier accused of price gouging and redistributed them to the homes of the neediest. But because inflation is running rogue and the year-end is also a time to give back, Maduro also sent his compatriots on yet another economic Via Dolorosa. Venezuelans were given 72 hours to turn in their old 100-bolivar notes, each one worth pennies, for new bills of larger denominations, thereby creating yet more massive lines in a land whose harrowing consumer queues are already storied. Thing was, the newly minted 500- and the announced 20,000-bolivar notes weren’t yet available, which sparked riots over the weekend.

Nor will next year in Venezuela be any gift. Already regarded as the world’s worst-performing economy, Venezuela isn’t expected to do much better in 2017. The country’s golden goose, Petroleos de Venezuela, known by its initials PDVSA, is skirting default. The gathering economic disarray and escalating confrontations between the Maduro government and the dissident-led legislature have spooked investors. Even China, which has loaned about $65 billion to Venezuela since 2007 and rarely flinches at unsavory regimes, is hedging its position by locking up ever-larger stakes of the country’s oil output and reaching out to the opposition, in case Maduro falls.

That may not happen. Thanks to years of grabbing power under Chavez, Maduro has inherited a state machine run by friendly hands. The National Electoral Council has pulled every lever to stymie the opposition’s drive for a recall vote. The Supreme Court, paneled with Chavistas, has ruled to keep the regime’s most vocal critics in jail and thwarted the legislature, the one institution Maduro doesn’t control. And by naming top brass to command vital sectors of the economy, Maduro has so far placated the armed forces, where apostates lurk.

But Maduro’s erratic and increasingly belligerent rule belies a weakened hand. In fairness, it was Chavez who set up Venezuela for a fall -- by squandering one of the world’s most fabulous caches of oil wealth on the chimera of 21st-century socialism. “It is a tragic story of great potential with dismal performance,” said Venezuelan economist Francisco Monaldi. 

Now the boom is over, the revolution is running on empty, and the oil industry that’s been a proxy for Venezuela itself pumps less crude today than when Chavez came to power 17 Christmases ago. It’s a measure of Venezuela’s misery that Hugo Chavez is missed today.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.