Mr. Speaker, as we plan to celebrate Independence Day on the Fourth of July, it is important for us also to recognize a human rights tragedy and an abomination of democracy as totalitarian rulers of Venezuela are suppressing their people…
Mr. Speaker, as we plan to celebrate Independence Day on the Fourth of July, it is important for us also to recognize a human rights tragedy and an abomination of democracy as totalitarian rulers of Venezuela are suppressing their people in our southern hemisphere.
To call attention to this tragic situation where thousands of people are being suppressed, where armed mobs are running around the streets intimidating people, and where Venezuelans cannot achieve the basic necessities of life, I include in the Record an article that recently appeared in The Wall Street Journal, ``The Last Battle for Democracy in Venezuela,'' and to call attention to the human rights tragedy which is occurring in South America.
[From The Wall Street Journal, June 23, 2017]
The Last Battle for Democracy in Venezuela
Under Nicolas Maduro, a county that had been one of Latin America's wealthiest is having its democratic institutions shredded amid rising
poverty and corruption
(By David Luhnow and Jose de Cordoba)
Almost two decades after Venezuela's late president, Hugo
Chavez, came to power in an electoral landslide, his
country's transformation seems to be taking an ominous new
turn. A country that was once one of one America's wealthiest
is seeing its democratic institutions collapse, leading to
levels of disease, hunger and dysfunction more often seen in
war-torn nations than oil-rich ones.
Mr. Chavez's successor, President Nicolas Maduro, has
called for a National Constitutional Assembly to be elected
on July 30 to draft a new constitution, in which ill-defined
communal councils will take the place of Venezuela's
traditional governing institutions, such as state governments
and the opposition-dominated Congress. The new assembly
appears to be rigged to heavily represent groups that back
the government.
The Maduro government says that the new assembly will find
a peaceful way forward for
a country enduring an economic depression and standing on the
brink of civil conflict. The government says it is building
on the legacy of Mr. Chavez, a military man who vowed to
fight corruption, dismantle the venal old political
establishment and be a voice for millions of poor
Venezuelans. But the opposition, which is boycotting the
assembly vote, calls it a naked attempt to end democracy and
turn the country into a Cuba-style communist autocracy. The
government's own attorney general calls the vote illegal.
The 545-member assembly, a modern-day soviet, would hold
unlimited power while it writes a new governing charter,
which could take years. Meantime, the assembly is widely
expected to scrap next year's presidential elections.
``This is the last battle for democracy in Venezuela,''
says David Smilde, a Venezuela expert at Tulane University.
For the U.S., the prospect of a new Cuba sitting atop
trillions of dollars of oil reserves is profoundly
unpleasant. For the past decade, Venezuela has aligned itself
with Russia, China, Iran and Syria. Whether it thrives or
implodes, Mr. Maduro's petrostate could cause far greater
headaches to the U.S. and Latin America than isolated Cuba.
An implosion could mean bigger shipments of cocaine to
Central America and the U.S., as well as a massive increase
in the current flow of tens of thousands of refugees already
fleeing the country for the U.S., Colombia, Brazil and
elsewhere. And a consolidation of power could let Mr. Maduro
deepen his partnership with U.S. adversaries.
The Trump administration has criticized Mr. Maduro's plans
to change the constitution, urging ``respect for democratic
norms and processes.'' The U.S. has called for Venezuela to
free political prisoners, respect the opposition-controlled
congress and ``hold free and democratic elections.''
Mr. Maduro's move has aggravated Venezuela's political
crisis. The opposition, sensing a do-or-die moment, plans to
ramp up daily street protests. Some 80 people have died in
such demonstrations in the past three months, and the
president is unlikely to ease off on the tear gas, rubber
bullets and water cannons. ``Maduro's ultimate aim is to turn
Venezuela into Cuba. And we will not accept being put in that
cage,'' says Julio Borges, the head of the opposition-
dominated National Assembly.
Venezuela's momentous new step isn't taking place amid the
kind of revolutionary euphoria that Mr. Chavez may have
imagined before he died of cancer in 2013. Rather, it is
being pushed by an unpopular government trying to keep power
amid an economic implosion.
By year's end, Venezuela's economy will have shrunk by
nearly a third in the past four years--a plunge similar to
Cuba's after the fall of the Soviet Union, and one rarely
seen outside of conflict zones. In a nation estimated to be
sitting on as much oil as Saudi Arabia, it is common to see
poor families rummaging through garbage for food, even as the
wealthy pack nearby gourmet restaurants.
Inflation was estimated by the International Monetary Fund
at 720% this year; it is expected to surpass 2,000% next
year. Shortages are so acute that three out of four
Venezuelans lost an average of 18 pounds last year, according
to a survey by Venezuelan universities. Diseases not seen
there in decades, such as malaria, are back.
``The government is desperate because they know the next
presidential election will be their last,'' says Cesar Miguel
Rondon, a popular radio host. When the host recently tried to
leave Venezuela on a business trip to Miami with his family,
he had his passport seized. ``I'm a hostage in my own
country,'' he said.
Amid the economic crisis and protests, the government has
headed down an increasingly authoritarian path. It has raised
the number of political prisoners over the past year to 391,
according to the Venezuelan human-rights group Foro Penal--
nearly four times the total from a year ago. Most are being
tried in military courts. And the government is seeking to
remove its rebellious attorney general through a case in the
supreme court. The government didn't answer requests for
comment.
The so-called Bolivarian revolution has become less about
ideology and more about money. Venezuelans often call it a
``robolucion'' rather than a ``revolucion,'' using the
Spanish word for robbery. If Cuba is an ideologically
motivated communist dictatorship, Venezuela is something
different; as oil-rich as Saudi Arabia, as authoritarian as
Russia and as corrupt as Nigeria.
Spectacular accusations of drug trafficking and corruption
have sullied Mr. Maduro's own family. Two nephews of
Venezuela's first lady, Cilia Flores, are awaiting sentencing
in New York after being found guilty last year of conspiring
to import 800 kilos of cocaine to the U.S. through Honduras.
They pleaded not guilty.
The interior minister, Gen. Nestor Reverol, has been
indicted in the U.S. for drug trafficking; Vice President
Tareck El Aissami is on the U.S. Treasury Department's
kingpin list for allegedly protecting drug traffickers; and
the head of Venezuela's supreme court is on another Treasury
blacklist far gutting the country's democratic institutions.
They all say that they are innocent and accuse the U.S. of
trying to destabilize Venezuela.
In some ways, analysts say, the extent of these accusations
has made a negotiated solution to Venezuela's crisis more
difficult. ``The regime's connection to crime and drugs is
what makes it difficult for them to give up power,'' says
Harold Trinkunas, an expert on Venezuela at Stanford
University. ``Many have to be worried that if they step down,
they will be put on a plane to the U.S.''
In Cuba, the Castro dynasty has kept power despite decades
of disastrous economic policies due to devotion to the
charismatic Fidel, popular achievements such as universal
free health care, ideological loyalty to Marxism, discipline
enforced by security forces, and the nationalist frisson of
facing off against the U.S. In Venezuela, aside from a
similar devotion to Mr. Chavez, the glue that has held the
regime together is simpler; oil-soaked corruption on an epic
scale.
Former planning minister Jorge Giordani, one of Mr.
Chavez's closest confidantes, said in 2015 that of an
estimated $1 trillion in oil revenue received during the
Chavez years, two-thirds had been distributed to workers
through subsidies and cash transfers. The rest, more than
$300 billion, had ``fallen through the cracks,'' he said. Mr.
Giordani quit Mr. Maduro's government in disgust in 2014 and
now lives in a quiet neighborhood of Caracas.
This year, the U.S. Treasury Department put Samark Lopez, a
Venezuelan businessman, on a blacklist, accusing him of being
a frontman for Vice President El Aissami, an alleged drug
trafficker. Announcing the seizure, Treasury Secretary Steven
Mnuchin said that the U.S. had frozen assets worth ``tens of
millions'' of dollars when it seized a slew of properties and
firms owned or controlled by Mr. Lopez in the U.S., the U.K.
and elsewhere. In a statement, Mr. Lopez denied any
wrongdoing and called the accusations ``politically
motivated.''
The government didn't respond to requests for comment, but
in the past, Mr. Maduro and other officials have dismissed
accusations of corruption, economic mismanagement and
repression as part of an ``economic war'' being waged by
Venezuela's private sector, in cahoots with the U.S., to
destabilize and overthrow the socialist government.
As in many petrostates, oil accounts for 95% of Venezuela's
foreign-currency earnings. Since the government administers
the oil, one sure way to get ahead is not by creating a new
business but by getting close to the government to secure
access to oil rents. Venezuelans call the enterprising class
following this model ``los enchufados''--the plugged-in ones.
The path to power in Venezuela is often said to run through
the army and oil. Once in power, the populist Mr. Chavez went
after the oil, eventually firing 19,000 employees of the
state-run oil firm Petroleos de Venezuela to stack the
company with his yes-men. After a brief and unsuccessful coup
against him in 2002, he also cleaned out the barracks,
handing over indoctrination and training to his Cuban allies.
In the following years, oil prices rose sharply, and Mr.
Chavez spent lavishly. He saved none of the windfall, ran
large budget deficits even at peak-oil prices, raided the
country's rainy-day oil fund, and borrowed heavily, first
from Wall Street and then from the Chinese and the Russians.
He handed out billions of dollars worth of cut-rate oil to
Cuba, Nicaragua and even Boston and London to show off
Venezuela's growing energy clout.
The number of government employees doubled, to five
million, and spending skyrocketed. Printing so much money
caused inflation, so the government set prices, sometimes
below the cost of production. Companies that refused to sell
at a loss were seized, aggravating shortages. Less local
production made the country ever more reliant on imports.
But once the price of oil began to drop in 2014, Venezuela
could no longer afford the imports, which have fallen from
$66 billion in 2012 to about $15.5 billion this year. And
there is little domestic industry left to pick up the slack.
``It is classic Latin American populism on steroids, and
now we have the worst hangover in history,'' said Juan Nagel,
a Venezuelan economist living in Chile.
Beyond some new public housing, little was built. Mr.
Chavez left Venezuela littered with the bones of ambitious,
half-finished public-works projects. Among them was a $20
billion scheme to build a train network, which now lies
abandoned. In Caracas, a new subway line ended up being just
one additional stop on an existing line, prompting local wags
to call it the Centi Metro (centimeter) rather than just a
plain Metro.
Unperturbed, the flamboyant leader focused on projects like
changing Venezuela's time zone by half an hour. He renamed
the country the Bolivarian Republic of Venezuela. And to mark
the shift in Venezuela's political course, he changed the
direction of a wild stallion on the country's coat of arms,
making the horse gallop left instead of right.
Mr. Chavez's revolution attacked the old elites, sending
nearly two million Venezuelans--and billions of dollars--
packing in the past 10 years. But in their stead rose a new
elite: the so-called Boliburgueses, or Bolivarian
bourgeoisie, who enjoyed a life of premium wines, Scotches
and cars as poverty levels rose.
``You don't see that in Cuba or Vietnam. But here, you see
Hummers, private jets and obscene new mansions,'' says Miguel
Pizarro, an opposition leader whose father was a Marxist
guerrilla in Venezuela and whose mother served in Mr.
Chavez's first political party in the mid-1990s. ``These guys
literally bought the homes where Venezuela's elite lived,
tore them down and built even bigger ones.''
Few enjoyed la dolce vita of Caracas more than Wilmer
Ruperti, a businessman who earned Mr. Chavez's loyalty in
2002 when he helped break an oil strike. Mr. Ruperti was a
familiar sight in Caracas, riding in an armored Jaguar
accompanied by two North Korean bodyguards. The magnate
cemented his friendship with Mr. Chavez by buying a pair of
Simon Bolivar's pistols for $1.7 million in a New York
auction and presenting them to the Venezuelan leader.
Last year, Mr. Ruperti paid the multimillion-dollar legal
fees for the criminal defense of Mr. Maduro's nephews. At the
same time, Mr. Ruperti's firm won a $138 million contract
from the state oil company. Mr. Ruperti said it was his
patriotic duty to pay the nephews' legal fees as a way of
relieving the pressures on Mr. Maduro. He denied any link
between the payment of the fees and the state oil-firm
contract.
Corruption helps the government maintain political control.
And no tool has been more effective than exchange controls,
initially adopted by Mr. Chavez in 2002 during a national
strike to control capital flight. Fifteen years later, they
have reshaped Venezuela's economy and given the government
enormous power to pick who gets dollars from the country's
oil wealth--often at absurdly low rates.
For instance, firms and others who import food get dollars
at the official rate of 10 bolivars. But they can turn around
and sell those dollars on the black market for 8,300
bolivars.
Venezuela's army recently got the rights to set up its own
mining and oil companies, and the armed forces are in charge
of most critical imports. In 2016, 18 generals and admirals
were tasked with importing key foods and sanitary items. One
brigadier general was put in command of acquiring black
beans; another was charged with acquiring toilet paper,
feminine napkins and diapers. Logically, an admiral was
placed in charge of acquiring fish.
No one knows how much money has been lost. Mr. Giordani
estimated that a third of the $59 billion that the government
handed out to companies to bring imports into the country in
2012 might have ended up in fraudulent schemes.
``It's a terrible economic model, but it's great for
politics and power,'' says Asdrubal Oliveros, a prominent
Venezuelan economist.
The opposition and the regional governments don't know how
to turn the tide. An Organization of American States
resolution this week urging Venezuela to return to democracy
was supported by every major country in the hemisphere but
blocked by Venezuelan allies like Nicaragua and a handful of
statelets like St. Kitts and Nevis.
Many in Venezuela hope that parts of the army haven't been
tempted by money and will want to honor the country's
democratic past. Ibsen Martinez, who helped write some of the
country's most beloved soap operas, says that hope is likely
in vain.
``The army is now a criminal organization,'' he said in an
interview from Bogota, where he now lives in exile. ``But in
every culture, there are mythical creatures. In Venezuela, it
is the idea of an institutional military man, who will come
out like Captain America to resolve everything.'' That
instinct, he added, led to Mr. Chavez in the first place.
His revolution's mournful impact can be seen everywhere.
Venezuela's national baseball league now plays to empty
stadiums and is considering suspending this year's season.
The Teresa Carreno theater, an architectural masterpiece in
Caracas, used to produce some of the region's best operas and
dramas; it now mostly hosts government rallies. In the nearby
Caracas Museum of Contemporary Art, water drips into buckets
near paintings by Picasso and Mondrian. The museum is so
empty that a thief replaced a Matisse portrait with a fake
without anyone noticing for several years.
Alberto Barrera, the author of a biography of Mr. Chavez
who now lives in Mexico City, thinks that the time is fast
approaching when he and the opposition may need to say
goodbye to their hopes. ``I wonder when I will wake up and
realize, `They beat us.' That it's all over and the county I
knew is gone,'' he said.
Mr. Speaker, it is vitally important that we stand up on this Fourth of July, not just for democracy here in the United States, but for democracy in other parts of the world as people are struggling.
Mr. Speaker, I thank my colleagues, and Happy Fourth of July to all of our countrymen around the United States of America.