Item 1: Venezuela’s population grows by about 450,000 people each year. At that rate, assuming 4.5 people per household, you need to build about 100,000 new homes every year just to keep up with population growth.
Over the length of the Chávez era, the government has been averaging about 12,500 new homes built each year, with the private sector adding another 30,000 or so. That’s a shortfall of over 57,000 homes every year: which compounded over the 12 years Chávez has been in power adds up to nearly 700,000 new homes that ought to have been built, but haven’t been. That’s over 3 million people who’ve wanted to strike out on their own and start new households, but have been forced to either stay on with relatives in increasingly cramped conditions or strike out to build shanties with their hands.
But it’s worse than that, even, because Venezuela already had a housing shortage back in 1999, which means the backlog is even bigger. We’re talking about, probably, a million-house backlog, which you’d need to clear while also building an additional 100,000 homes a year to keep up with population growth.
If you set out to clear that backlog over a reasonable time-frame – say, a six-year term – you’re talking 265,000 new homes per year or so. That’s about 6 times the current rate of home construction, mostly for very poor people with no access to credit and very limited ability to pay.
Figuring a very modest $20,000 per new home – and assuming you can magically clear all the building supply and human resource bottlenecks a drive on this scale would create – this would be a $32 billion proposition spread over 6 years. Assume you can somehow wring out half of that figure from the beneficiaries, and you’re still looking at a public subsidy north of $16 billion over six years.
Item 2: Some 16,000 – 20,000 Venezuelans are murdered each year – and just 5-7% of those crimes result in a criminal conviction. If we managed to increase the conviction rate to, say, a still unacceptably low 50%, we would be looking at 8,000-10,000 new murderers going to jail each year.
Except there’s nowhere to put them, because Venezuela’s prisons are filled well beyond capacity. Built for fewer than 30,000 inmates, Venezuela has 40,000 people in them – most, it should be added, awaiting trial.
In order to achieve something as basic as just making it more likely than not that if you kill someone you go to jail, Venezuela would have to install at least another 50,000 prison places over six years. Assuming you’re not ready to declare an amnesty on theft, rape, etc. and so you want to put more than just outright murderers in jail, you can easily double that figure.
But that’s just the start.
If you’re going to investigate, catch, prosecute, defend, judge, feed and guard those extra prisoners, you’re looking at a chain of new expenditures all up and down the justice system. You’d need to train, hire and equip thousands of new law enforcement professionals, build hundreds of new police stations, dozens of new crime labs and prisons.
The back of my envelope suggests that can’t be done for less than $18 billion over six years: about $3 billion per year. That would represent a 10-fold increase over the sums allocated to the Justice System in the 2011 budget, by the way.
Choices: Now, it’s 2012 and you’ve just been elected president.
Chávez, by some unexplained miracle, has agreed to hand over power to you.
You sit down to review the 2013 budget and realize that if you scrimp on absolutely everything else – freezing firefighters’ wages and school meal programs, cancelling all outstanding weapons buys and defunding every cultural institution in the country – and push your borrowing right to the edge of what your finance minister considers sane, you can free up $3 billion extra per year over the next six years.
What’s it going to be? Decent housing or basic safety?
Both are absolutely rock-bottom basic human necessities. You can afford one or the other, not both.
One way or another, one thing’s for sure: the firefighters are not going to like it.