On my first assignment for The Daily Journal, the English-language newspaper in Caracas, I found my way to the Venezuelan Congress, a gem of colonial architecture in a lush quadrangle of palm trees. Upstairs in the press gallery, the local reporters were hacking away at ancient typewriters as a legislator promised … what? My Spanish was inadequate; my ear ill-tuned to the thick criollo accents. “What is he saying?” I implored of one of the locals. “Pura mentira,” the journalist replied: “pure lies.” No matter, he didn’t stop taking notes for an instant.
That was 1978. Venezuela before Hugo Chávez was true to the description of the 19th-century journalist Tomás Lander, who characterized his country as “a nation of accomplices.” He meant that the ruling elites, the landowners, and the church were complicit in a corrupt system and silent in their acquiescence.
By the 1970s, the net of accomplices had broadened to include state oil barons, politicians, and bureaucrats—and possibly my journalist acquaintance, who dutifully recorded a legislator’s promises he knew would never come to fruition.
The more I acclimated to life in Caracas, the more I understood the wisdom of Lander’s description. One afternoon an official of the PDVSA, the state oil monopoly, was entertaining a bevy of journalists. PDVSA was considered a sacred national trust. Every schoolchild learned that Venezuela’s oil was not to be lustily consumed but, rather, to be “sown”—reinvested to create new local industries and jobs. Yet the Scotch was flowing freely. “How can you pay for all this?” I inquired. The oil official-accomplice gave a guilty shrug. “There’s plenty of oil,” he said.
Eventually I was invited to be an accomplice. Venezuela’s president was traveling to meet his counterpart in neighboring Guyana, and the government paid for a plane full of reporters, as if their summit were a second Yalta. On the press plane, each reporter was given a packet of credentials and instructions. To my surprise, the packet included $500 in crisp U.S. currency. (To the astonishment of a clerk in the presidential palace, I returned the money when I was back in Caracas.)
Payoffs to the press were routine. Publishers relied on the government for the advertisements that kept them in business. No specific favors were expected—just an acknowledgment of who was boss. Press criticism was fierce, but certain protocols were observed. The military in particular was never criticized.
The systemic corruption burned away at a Venezuelan Army tank commander named Hugo Chávez. Muzzled in his barracks, he dreamed of a Venezuela liberated from American influence, which he imagined would mean liberation from poverty and corruption and from the control of elite accomplices.
Resentment of America had long been an undercurrent in national life (in 1958 Vice President Richard Nixon’s car had been attacked by a mob on a visit to Caracas, though First Lady Jackie Kennedy, a few years later, got a rapturous greeting). American support of various local dictators hardly helped, nor did the arrogance of oil companies—even though their capital helped to raise the standard of living. My native-born colleagues used to kid me; “Cia!” they would say as I approached, playfully accusing me of working for the Central Intelligence Agency.
But in truth, resentment of gringos had lost its edge. Venezuelans themselves had overcome it. In the early 1960s the Army defeated a fierce insurrection financed by Fidel Castro. To its credit, even as it waged an internal security war, the government remained democratic. Some of the captured former guerrillas had even been reborn and accepted as law-abiding, office-seeking politicians.
When Chávez was elected president, his grievances were real, but his solutions were phony.
With seeming stability (financed by oil riches), Venezuela gained maturity. In keeping with a trend of Third World assertiveness, in the mid ’70s Caracas nationalized the oil industry, paying fair compensation to foreign drillers. Later, when it needed capital, it invited drillers back on a collaborative basis.
Venezuelan democracy wasn’t perfect (nor, good heavens, is America’s), but it was real. And for the Venezuelans of all classes whom I knew in the late 1970s and early ’80s, America wasn’t a villain, it was a model—just as it had been for Simón Bolívar, the Venezuelan liberator.
What went wrong? State development projects financed with oil dollars were inefficient and corrupt. Too much oil was used for support payments rather than for lasting improvements such as education. When the price of oil plunged in the 1980s, the country’s precarious stability was exposed. I’ll never forget the business mogul who told me, on a tour of the city, that the ranchos (slums) ringing Caracas were kept there only to embarrass the upper class. No wonder the resentment of poor people returned. The U.S. model of using capital markets for long-term development was also at fault. Luis Herrera Campins, the winner of the presidential election I covered, declared on the day of his inauguration that he had inherited “a mortgaged country.” He was right. Short-term credit is no basis for development; in Caracas as elsewhere, markets proved a fleeting ally.
As debt soared and oil prices fell, Chávez tapped the popular resentment and was elected president. His grievances were real, but his solutions were phony. He promised a new “Bolívarian” revolution; in truth, he dished out a failed recipe of authoritarian socialism and anti-Americanism. He gutted Venezuela’s flawed but vital democratic institutions, including the courts. He repressed (and in large part took over) the media. He terrorized opponents and turned democracy into a one-man cult. And even as oil prices soared again, he bankrupted the country by buying off votes with what were, in effect, transfer payments to the underclass.
Chávez’s allies and selected businesses—his friends—prospered. Power has been concentrated in a new political class, and in the wake of Chávez’s death, his cronies are clamoring to continue the arbitrary and closed system he fostered. They have become Venezuela’s new accomplices, to demagoguery and autocracy. My hope is that Venezuela will reclaim the openness and fairness that typifies the national character, which charmed me once and forever. For that to happen, Venezuelans will have to speak out and renounce the evils of the Chávez era—without returning to the elitism of the past. It is time for Venezuelans to prove Lander wrong. It is time to stop being accomplices.
Lowenstein, author of The End of Wall Street, is working on a history of the U.S. Federal Reserve. From our March 29, 2013, issue; Once Upon a Time in Venezuela.