Özgür Orhangazi on Venezuelan Economic Policies after Chávez

The last issue of the Review of Radical Political Economics (go here; subscription required) has an interesting paper by Özgür on the anti-Neoliberal policies of the Chávez Bolivarian Socialist government of Venezuela. The paper is important since, as noted by Mark Weisbrot (here), there is a lot of misinformation in the Western media about the nature of the Venezuelan society.

The paper can be downloaded in its Working Paper version here. From the abstract:

As neoliberal policies failed to fulfill their promises and instead produced various financial and social crises, one after another, left-oriented leaders took power in Latin America and began, to varying degrees, seeking alternatives to the neoliberal orthodoxy. Venezuela went further than others in reversing neoliberal policies, nationalizing key industries, reintroducing extensive social programs and promoting alternatives to the capitalist organization of production. While the view on Chávez’s politics and his government’s policies varied from seeing him as an authoritarian caudillo with populist tendencies to the leader of 21st century socialism, more recently several scholars discussed the radical nature of the economic policies implemented.
This paper contributes to this growing literature by analyzing the economic policies of the Chávez government. These policies mark, in general, a significant departure from the neoliberal orthodoxy with a focus on greater national autonomy, a return to some of the macroeconomic policies of the earlier eras, and increased state involvement in the economy through interventions and social programs; and have resulted in improved social indicators such as declining poverty rates, increasing literacy rates, declining unemployment and so on. These policies, at the same time, provided space for a set of ‘transformative’ initiatives, including experiments with worker co-management, cooperatives and participatory planning, all of which seek alternatives to the capitalist organization of the economy, even though these ‘transformative’ attempts so far have been limited in terms of scope and success. Although the Venezuelan experience could be considered sui generis, especially with its dependence on oil and the resultant rentier economy and culture, a critical evaluation of the policies implemented in Venezuela can contributes to both discussions on the alternatives to neoliberal policies as well as to the question of what shape a 21st century socialism could take.

It should be noted that the greatest achievement of the Natural Resource Nationalism, which is the essence of Bolivarian Socialism, is the redistribution of the rents associated with natural resource extraction. Not surprisingly income inequality has decreased in South America in the last decade, against the global trend. However, it should be noted that there are risks in a development strategy that puts excessive emphasis on commodity exports. For a discussion of the limits of the current Latin American development strategy see here.

Graph/Table of the Week

Democrats are often seen as Big Government, tax and spend liberals, while Republicans are generally cast as small government libertarian/conservatives. The graph below shows federal spending, revenue and the fiscal balance (as % of GDP) since the Clinton administration (2014 is an estimate, and 2013 might be revised).

fiscalresults

It is clear that the traditional representation makes little sense. Spending and deficits have decreased with Democrats (Clinton and Obama). The brief surplus period at the end of the Clinton era vanished, not only as a result of the 2001 recession, but also because revenues continued to decrease (until 2006), in part following tax cuts mostly for the wealthy, with increased spending, a good deal of that caused by increased defense spending.

Since the recession, and the inherited 2009 budget, Obama has reduced spending, while revenues have been recovering with the rest of the economy (i.e. slowly). This year the federal deficit should be back in what could be considered normal levels. But that’s not necessarily good, from a Keynesian perspective.

Graph/Table of the Week

Back after a few weeks hiatus. Map below (from this old post by The Economist) shows that Mississippi where conservative McDaniel rants against deficits and government assistance to the needy is among the States that receive the most in fiscal transfers.

20110806_WOM959_0

Note that transfers to Mississippi by the Federal government are around 250% of the State’s GDP, and they are consistently in deficit all the time. In absolute terms, New York is the State that transfers the most to other members of the Union. In relative terms (with respect to the State’s own GDP), Delaware is the most generous State in the Union.

Graph/Table of the Week: The Working Poor Around the World

ImageThe World Bank poverty measures (US$ 1.25 and 2 per day) are not exactly the best ones. National poverty lines would provide a different view of the poor around the world. At any rate, this graph from the last International Labour Organization’s (ILO) Global Wage Report (available here) shows that a lot of the poor are actually employed.

URPE at the Left Forum

URPE will be sponsoring the following panels at the Left Forum (May 31-June 1, 2014).  Attend, participate, support URPE!

Prospects of the Global Crisis of Capitalism: Post-Keynesianism vs. Marxism?
A discussion on the prospects of the ongoing global crisis of capitalism. Convergence and divergence between the Post-Keynesian and Marxist views of capitalism
Speakers:
Matías Vernengo
David Laibman
David M. Brennan
Chair:
Julio Huato
Sat 10:00am – 11:50am
Room 9.68
http://www.leftforum.org/content/prospects-global-crisis-capitalism-post-keynesianism-vs-marxism

Financial Parasitism: Understanding the “Great Vampire Squid”
A discussion on the nature of modern capitalist finance to inform the struggles of the 99%
Speakers:
Michael Perelman
Michael Hudson
Julio Huato
Chair:
David Laibman
Sat 12:00pm – 01:50pm
Room 9.68
http://www.leftforum.org/content/financial-parasitism-understanding-great-vampire-squids

Iran: Is the Optimism Justified?
Analysis president Rouhani’s foreign policy, the state of the Iranian economy, and social challenges facing Iran, with emphasis on women status
Speakers:
Thomas O’Donnell
Hamid Zangeneh
Reza Ghorashi
Chair:
Hamideh Sedghi
Sat 12:00pm – 01:50pm
Room 8.67
http://www.leftforum.org/content/iran-optimism-justified

Challenging GMOs: Toward a More Transformative Movement
Discussion of case studies to better understand GMOs and the need for radical critiques of the food system
Speakers:
Andrea Brower
Amalia Leguizamón
Chaia Heller
Les Levidow
Chair:
Brian Tokar
Sat 12:00pm – 01:50pm
Room 1.92
http://www.leftforum.org/content/challenging-gmos-toward-more-transformative-movement

Latin America: Renewed Challenges and Opportunities for the Left
Renewed challenges and opportunities facing the Latin American left today, in light of the recent decline in oil commodities export
prices
Speakers:
George Ciccariello-Maher
Peter Bohmer
Chair:
Julio Huato
Sat 03:10pm – 04:50pm
Room 1.124
http://www.leftforum.org/content/latin-america-renewed-challenges-and-opportunities-left

Don’t Mourn, Organize!: The Radical Decentralist Politics of Social Ecologist Murray Bookchin
An overview of Bookchin’s politics of social ecology with particular focus on this radical decentralist program
Speakers:
Eleanor Finley
Chaia Heller
Brian Tokar
Damian White
Chair:
Debbie Bookchin
Sun 12:00pm – 01:50pm
Room 8.61
http://www.leftforum.org/content/dont-mourn-organize-radical-decentralist-politics-social-ecologist-murray-bookchin