Intro to the Venezuelan Crisis

Venezuela, a socialist-run petrostate, has been severely affected by unprecedented inflation, caused by social program spending backed by a collapsed oil market, resulting in the current humanitarian crises and a drastic increase in authoritarianism.

The modern Venezuelan crisis began with the election of President Hugo Chavez in 1998, whose Bolivarian Revolution promised strong reform on governmental corruption coupled with improved support for the nation’s impoverished. In 2004, as oil prices began to surge, Chavez spent billons on new social programs effectively rigging the economy to work on total oil dependence. The nation, which hosts the largest oil reserves in the world, created an economic system that would be unsustainable if oil prices fell by fixing output and production and continuing to funnel money into social programs. In March 2013 President Chavez died of cancer handing power to his Vice Present Nicolas Maduro. Maduro was officially elected president in April 2013 amid a changing domestic economy. By 2014 the global oil market had collapsed; almost immediately Venezuela entered the worst recession in modern history and by 2018 the overall GDP of the country would fall by 35%, twice that of the American GDP during the Great Depression. As riots and unrest percolated the socialist society, Maduro quickly made efforts to fortify his power. In July 2016 President Maduro held elections for the new Constituent Assembly – a congressional body that would effectively eliminate opposition – however, unlike Chavez who held a referendum ahead of a proposed Constitutional reform, Maduro simply established the new legislative body and held one-party elections for the seats. With complete control of the country’s government Maduro easily won reelection in May 2018 amidst international outcry that the elections were fraudulent. The condemnation of the legitimacy of Maduro’s second-term led to a re-inauguration in January 2019, amidst both international and domestic protests.

Currently, Maduro’s opposition, fronted by National Assembly leader Juan Guaido, has resurged. Following the re-inauguration of President Maduro, Guaido called for national protests the week of January 21st, 2019 which ultimately led to the United States and its allies in the region deeming the opposition leader the legitimate head of state and the European Union calling for new elections. President Maduro maintains the support of Russia, China, Iran, Turkey, Cuba, and Mexico; however, his legitimacy has been called into question by multiple international organizations including the United Nations, the Organization of American States, and the European Union.

The international impasse stemming from Venezuela’s domestic crisis has created a vast array of global security threats which pertain to both regional stability and American national security interests. These threats include:

  • Russian Intervention in the Region: Russia, in late-December 2018, announced the construction of a nuclear-capable military base just north of Caracas following joint air force exercises with Venezuela
  • Mass Migration Crises: Colombia, Chile, Ecuador, and Peru have seen a dramatic increase in Venezuelan immigrants as over 2.5 million have fled the country since 2015
  • Venezuelan Intervention in the American Economy: PDVSA, the Venezuelan state-run oil company, owns a majority stake in American-based oil refiner Citgo – currently the Venezuelan government is holding five American Citgo employees in prison for charges associated with corruption and treason

Venezuelan Crisis Past Analysis

TitleDate
Maduro Likely to Maintain Power Through 31 March 2019 Despite Declining Support04MAR19