Mission Not Accomplished
July 16, 2008
Alvaro Vargas Llosa
WASHINGTON—For years, supporters of Venezuelan President Hugo Chavez have touted his social programs known as “missions” as a model of social justice. But this narrative is a myth, according to a comprehensive study by the Latin American Institute of Social Research.
The authors, Yolanda D’Elia and Luis Francisco Cabezas, are not ideological adversaries of Chavez’s government. They don’t even question the need for government-funded social programs. They simply trace the history of the missions and measure the results against the stated objectives. Their conclusion is devastating.
The mission project started in 2003, five years into Chavez’s government, with a political objective in mind—for Chavez to win a recall referendum. In a speech given at a military academy, the president explained that in a moment of desperation he had called Fidel Castro, who offered 20,000 Cubans to help boost the existing social programs.
From the beginning, the new programs were set up outside the formal channels of the state, constituting a parallel structure unaccountable to anyone but Chavez. The missions had different purposes. The goal of the Barrio Adentro mission was to place one Cuban doctor for every 250 poor families. Missions named Robinson, Sucre and Ribas promised to provide education at different levels starting with literacy courses, while Mercal aimed to make basic food accessible at very cheap prices. And so on.
After Chavez won the disputed 2004 recall referendum, he announced that the missions would serve as the basis for a revolutionary order that would supplant the republic. They are “nothing less,” he said, “than the seed of the new institutions.” The funds came from the government-owned oil giant, Petroleos de Venezuela (PDVSA): “Thanks to the control we now have of PDVSA … we have the necessary resources.” Then the short-term objective turned to winning re-election in 2006. The long-term objective, revealed immediately after he won that vote, was to build a permanent socialist state. Yet when in 2007 Chavez lost a constitutional referendum that would have given him the right to seek permanent re-election, he had to slow down his plans a bit.
The government claims that Barrio Adentro and Mercal, the two most important missions, cover 70 percent of Venezuela’s poor. But D’Elia and Cabezas found that even at its peak in 2004, Barrio Adentro reached no more than 30 percent. Today, it reaches no more than one in five poor Venezuelans, while six of every 10 citizens supposedly fed by Mercal are not really benefiting from that program.
Incompetence and corruption intrinsic to the politicization of poverty, not the lack of funding, are to blame. PDVSA has seen its revenue increase systematically thanks to the price of oil. It is estimated that Venezuela’s oil generates more than $50 billion a year (exact numbers are hard to come by because the books have been kept out of public view for years.)
There is an inversely proportional relationship between the increase in oil-related revenue and the drop in the reach and the quality of the social services paid for with that money. In the latter part of 2007, with oil at almost $90 a barrel, 30 percent of the clinics set up under Barrio Adentro were shut down. The drop in the number of Cuban doctors manning the clinics is staggering—60 percent of them have deserted. It would seem that many of the Cubans were pursuing emigration rather than altruism when they traveled to Venezuela to help Chavez establish Barrio Adentro.
In the case of Mercal, 96 percent of the supermarkets for the poor are private property—the ultimate socialist irony! The flaws in the storage and distribution systems, and the inability of the government to prevent its own workers from stealing the food and selling it under the counter at higher prices, have caused official sales to drop by more than 50 percent in the last couple of years. These problems are compounded by shortages arising from price controls and inflation. Chicken, meat, eggs and milk have become a luxury. One in five supermarkets has shut down in the last year. Today 65 percent of poor Venezuelans acquire their food—if they can find it—in retail outlets that do not participate in the Mercal network.
It has been my belief for some time that Chavez lost the constitutional referendum not so much because the masses want democracy but because the missions that tapped the populist mind-set of so many Venezuelans turned out to be a disaster. This study confirms my belief.
Alvaro Vargas Llosa is Senior Fellow and Director of The Center on Global Prosperity at The Independent Institute. He is a native of Peru and received his B.S.C. in international history from the London School of Economics. He is widely published and has lectured on world economic and political issues including at the Mont Pelerin Society, Naumann Foundation (Germany), FAES Foundation (Spain), Brazilian Institute of Business Studies, Fundación Libertad (Argentina), CEDICE Foundation (Venezuela), Florida International University, and the Ecuadorian Chamber of Commerce. He is the author of the Independent Institute books The Che Guevara Myth and Liberty for Latin America.
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