Moisés Naím on corruption in South America and the link between commodity-based economies and populism

Following the publication of his novel Two Spies in Caracas in English, the Venezuelan journalist and writer Moisés Naím was interviewed (a) by Roger Lowenstein. Naím makes a few interesting observations about failed states.

On the current state of corruption and institutional failure in Venezuela:

Lowenstein: What has happened to the oil wealth in Venezuela? Production in 2020 fell to roughly a half million barrels a day. Before Chávez, it was more than three million. Now, as you have written, gasoline shortages are a fact of life.

Naím: Petróleos de Venezuela [the state oil company] is a cage of thievery. It doesn’t exist [as it did]. They have run it into the ground. It doesn’t have the money, the people, the technical talent, the engineers. The company has lost the capacity to tap its own resources. […]

Venezuela will have a very hard time if it continues to be run by a cartel of criminals.

On the relationship between underdeveloped (commodity-based) economies and populism:

Lowenstein: Venezuela isn’t alone in turning to leftwing populism. Peru, Ecuador, Bolivia, Argentina — even Mexico — are moving or have moved leftward. Why this leftwing surge at the ballot box when established models such as Cuba haven’t succeeded?

Naím: The main defining variable is commodity prices. […] In countries where commodities are 50% or more of exports, give me the price and I’ll tell you what the political mood is. When prices are low the economic situation becomes dire and that opens the way to unemployment, inflation, budget cuts and cuts in social programs. You get a very foul mood in society.

Lowenstein: Why didn’t the previous parties succeed at reinvesting the oil wealth?

Naím: That is a very desirable goal. All governments have economic diversity and export diversity as a goal. Very few succeed. In that sense Venezuela is normal. Look at Chile. A great success — but it’s still [about] copper. In Russia, it’s still oil.

You can point to Norway, or the U.S. but these exceptions are countries that had a state, and state institutions, deeply grounded before the discovery of oil. Petrostates have a difficult relationship with democracy.

On the interplay between Chávez and Cuba:

Lowenstein: The 19th century essayist Thomas Lander called Venezuela “a nation of accomplices.” Was he right — was there a consistent flaw in the political culture that accommodated rule by caudillos?

Naím: You can say that about any country.

Lowenstein: Who were the accomplices to Chávez? Was it the Cubans, or was it previous generation of democratic leaders, whose mismanagement led to Chávez’s election?

Naím: The Cubans were not just accomplices. They were facilitators.

Lowenstein: But don’t the old establishment liberal parties — Democratic Action and the Social Christians, deserve some blame?

Naím: Of course. They mismanaged the power they had. They didn’t realize that the oil wealth had to be better invested and distributed. Yes, the political parties were a disgrace. The intelligentsia, the businesspeople, the professional middle class were also negligent or short-sighted. But the narrative that corruption and poverty was the reason for Chávez? If you look at United Nations statistics, Venezuela was corrupt but far less corrupt than Brazil, Mexico or Peru. We had inequality but Brazil was the world champion in inequality. We had poverty, but income per capita was one of the highest in Latin America.

Lowenstein: Are you saying that Chávez was a puppet? In the book, even the Cuban agent struggles to figure him out.

Naím: Chávez wasn’t a puppet. He surely invited the takeover, the infiltration of Cubans. Cubans have been running the intelligence services; they have had a huge role. [But] you cannot call Chávez completely a puppet. Fidel Castro and Chávez had a very strong personal bond.

You cannot say that of Maduro. He does not have the charisma, the knowledge, the smarts. He was trained in Havana, he there studied there. He was and is a Cuban operative.

Finally, he also makes interesting remarks about how legitimacy can be forged:

Lowenstein: You write in the book of a ceremony to recast Simón Bolívar, known to Venezuelans as “the Liberator.” Bolívar, of course, was a descendant of Spanish aristocracy. In the book, Chávez, with Cuban assistance, reinvents Bolivar as a mestizo — to symbolically bolster Chávez’s claim to power.

Naím: I describe the exhumation of Bolívar. That happened on camera [in 2010] (a). There was a whole spectacle, quite surreal. You have Chávez and military escorts open a casket and take samples. After the cameras left something else happened. This I know from different sources. After the public event there was a private event, with Cubans, where it was decided that Bolivar had been assassinated by oligarchs. It shows a different picture of Bolivar — that he was [like Chávez] more mestizo than white. The genetic evidence is completely fake. The Cubans more or less anointed Chávez. It gave him the power of legitimacy.