There’s a good deal of clearthinking, nonsense, and empty platitudes about Venezuela in this particular thread. It’s a subject I’ve followd for years now and whiel I don’t claim to be an expert at all, I wanted to put my thoughts down. You’ll forgive me for taking my time and deciding what aspects to write about.
First, I noticed several posters have claimed that Venezuela was somehow foolish to make their economy depend so much on oil before Chavez. This is technically correct (the very best kind of correct) but is also monumentally silly. Oil gave Venezuela a huge wealth advantage compared to its neighbors and was a major cause of development and foreign investment. Saying that tapping that resource is a bad thing ignores that Venezuela had few economic advantages otherwise. Oil was a springboard for them. And it did legitimately add diversification of the economy, providing cash and interest in a variety of technical and scientific fields.
Oil also was eventually why the whole system came crashing down, however. Venezuela was never entirely autocratic, but they had a string of coups and petty dictators in their history. What eventualy happened, though, was not that oil prices fell but that it proved an easy target for a real tyrant. It’s no accident that oil-rich nations have a tendency to descend into some flavor of absolutism, because he who controls the [strike]spice[/strike] oil controls the [strike]universe[/strike] state.
Venezuela also was never egalitarian by any stretch. It’s long been a country with a pretty high level of inequality, to which oil money added a new wrickle. Oil wealth absolutely enriched the country, but the bounty didn’t get spread very evenly. There was also a pretty strong stench of corruption in Caracas, but it survived political parties of varying ideological stripes. I do want to point out that even ordinary people received real benefits from the oil money in the long run, but that can be a hard argument to make when the people struggling to get by look down into the valley and see mansions.
Hugo Chavez was able to tap into that and ride a populist wave to power. The reaction to Chavez among anyone with education was much the same as the reaction to Trump in the United States, and for basically the same reason. Chavez, like Trump, spoke directly to the people in their language (metaphorically) and didn’t give a fig for “proper” politics. And like Trump, Chavez was almost immediately up to his eyeballs in questionable government decisions and demanded unquestioning loyalty from all his subordinates.
I won’t go into all the politics, but the country was becoming more authoritarian ever year under Chavez. He got stymied once or twice, but even before the coup attempt Chavez was constantly trying to consolidate power into his hands and evade any limits on his term of office. It’s sort of a bad thing to skip the politics, because it’s part and parcel of what’s happening in Venezuela today, but I need to simplify. The two major factors that we need to know from his era are that, first, he slowly suppressed or destroyed any and all independant media, until almost no-one could publicaly speak against him at all. And second, he used public money to consistently buy elections, offering fat handouts more or less to stuff voters with sugar (sometimes literally). Of course, you usually can’t do this in any functioning democracy and what Chavez did was unethical and probably illegal - but who was going to stop it? He controlled the only allowed media, the courts, law enforcement, and military. And if that wasn’t enough, he was building a private militia on the side to ensure votes went his way.
However, while Chavez kept building up a personal political fortress, he was also undermining its foundation. The stones he piled up on top were pulled fom the bottom.
Several posters have pointed out how Chavez pulled money out of PDVSA. This went into social spending - but it wasn’t being used in some kind of different productive purpose. It was going into rewarding politicians for delivering votes and buying off wavering groups in the short term. This money was simply wasted. In the long run, Venezuela would have accomplished the same as if he had taken the lot in cash and burned it in a bonfire.
Worse yet, because of the nature of Venezuela’s oilfiuelds, they needed a lot of investment in order to keep production steady, much less grow it. What happened next is well-known: during the boom years of the 2000’s Chavez had plenty of money, but the moment oil prices turned everything began a slow slide downward. PDVSA couldn’t invest and also push money into propping up an increasingly autocratic regime. Of course, when politics and economics clash, politicians demand their candy now and damn the consequences for later. As a result, Venezuelan oil production has cratered over the last decade. They produce less every year.
And yet, they are more and more dependant on that pathetic trickle of oil. Because it turns out (who knew) there’s another consequence of tyranny and the arbitrary confiscation of wealth and the destruction of people leave if they can. Millions of the country’s best and brightest simply walked away rather than live under Chavez. This took a critical opposition vote out of the country, so of course he was happy to see them go. But it also bled the economy of labor, ambition, talent, and energy. And the same thing happened in government. The only people in power are corrupt to the core, or sycophants without an ounce of self-respect, or ideologues with no trace of honesty. Sometimes all three at once.
In the end, Chavez died before the real ruin of the country arrived - but it was already crumbling before then. Maduro was his handpicked successor basically because Maduro always told him yes. He was a talentless toady who sold whatever cinders remained of his soul to Chavez long ago.
Which mostly brings us to recent events. The problem is that Chavez destroyed so much of the country’s poltical and economic foundation that there’s nothing left. The tax base is simply gone. But they’ve engaged in so many openly criminal acts that they’re probably bound for the headsman’s axe if they ever leave power - and hthousands of others could be punished harshly if honest-administered law every returns. So they are desperate to maintain control. Unfortunately, they can’t actually buy votes anymore and so are resorting to more and more despotics acts. Unfortunately, unfortunately, the regime has crippled itself so much that it can barely even manage that. Instead, they’ve taken to trying to play whack-a-mole on any political threat, trying to disrupt any political opposition before it can build enough momentum to push them out of power.
This is what led Maduro to try his most outrageous stunt, which may be what finally destroys the Chavista regime. The problem he faced was that even with the deeply-entrenched regime couldn’t actually win votes anymore, and and so Maduro tried to do an end-run around the already hilariously regime-friendly Consitution, which had been re-written by Chavez so many times. He thought, or hoped, that if he could make a fake rubber-stamp legislature that maybe, somehow everything would work out. But this was the last straw for most foreign governments and the population at large. (Maduro also did some crazy end-runs where his court appointees approved things that were blatantly, obviously against the Constitution, but nobody really cared at that point.) In effect, this would be as if Donald Trump panicked at the prospect of losing an election and tried to create a legislature composed only of his supporters, and declared it equal or superior to Congress. And also just ignored the last election and stayed in power because why not at this point.
Additionally, Maduro was out of money and resorted to running the printing presses in order to pay the bills. Of course, that just made the already-bad inflation problem worse and worse by the day, which is why Venezuela has had to re-issue its currency and still faces hilarious inflation.
In the end, Maduro is basically holding the country hostage. The Chavez regime can’t leave power safely, and have made so many enemies across the world that nobody respects them anymore. There’s nothing left except to hold on by their fingernails and try outlast everyone. But that won’t fix the problem and sooner or later they will fall.