Social policy planners in Venezuela today are like field doctors in a war zone: if they actually stopped to register emotionally the devastation all around them, they’d never be able to get any work done. Today, Venezuela is undergoing the most brutally painful economic and social calamities probably since the Federal War. Sitting around feeling horrible about it, though, is not a luxury policy planners can afford.

As the government pathetically tries to hide the scale of the crisis, researchers at UCAB, UCV and USB, through the ENCOVI survey, have gone to work doing the government’s job: quantifying poverty, pinpointing its location, understanding where the gaps are in the government’s safety net and laying the groundwork for what comes next.  

With this data, UCAB’s Luis Pedro España, probably Venezuela’s leading poverty scholar, teamed up with sometime Caracas Chronicles contributor José Ramón Morales and Douglas Barrios from Harvard´s Center for International Development, to write a paper to bring some insights into poverty and the main governmental strategy to address it: the Misiones.

Poverty-reduction policies ought to be targeted to those who need them most and focus on building capabilities or social infrastructure to make efforts sustainable. But as you read read this paper you realize that Misiones are not just regressive and inefficient they’re targeted at all the wrong people.

As España, Morales and Barrios point out,

“…according to data from ENCOVI, the beneficiaries of the social programs are mostly non-poor. Only 40% of the beneficiaries would belong to homes living in poverty measured by unsatisfied basic needs”. In the case of the state’s subsidized food provision program, Mercal, the authors noted that “ the current administration excludes 73% of those in structural poverty (unsatisfied basic needs), meaning that at least 7 out of every 10 poor declare that they are not beneficiaries from Mercal.”

On capacity building, what started out as programs seeking to tackle structural causes of poverty such as education and work through Misión Robinson, Ribas, Sucre and Saber y Trabajo quickly morphed, as the government went crazy and started handing out money to their political base in any way they could.

As the paper puts it,

“…Between 2014 and 2015 there is an increase in programs that offer health services and food, while those aimed to provide tools for structural change of the social situation of their beneficiaries (work and education) represent the biggest fall. Education Misiones (Ribas, Sucre and Robinson) show decreases between 70% and 45% while the formative (Saber y Trabajo) the reduction reaches 80%”

the current administration excludes 73% of those in structural poverty (unsatisfied basic needs), meaning that at least 7 out of every 10 poor declare that they are not beneficiaries from Mercal

During the same time, populist programs that addressed the consequences of poverty increased. A very clear and tragic example is provided again by España, Morales and Barrios when analyzing Mercal and Bicentenario. They highlight that the increase from 2014 to 2015 in beneficiaries for MERCAL is 5 million – Or 17% of the population – in one year! Misiones currently are like paying food with your credit card and forgetting how to make more income to pay it back.

Ok we know that Misiones were a partial success at best…but how deep in trouble are we?

There are two dimensions to it. The first is the current situation of poverty. As of 2015, slightly more than 3 out of every 4 people in the country were living below the income poverty line.

This measure reacts quickly to shifting economic conditions, so it’s not surprising the measure shot up from 55% in 2014 to 76% in 2015. I can’t even imagine the figures for 2016. Forecasting 2017 with the current situation feels like going to a talk after your girlfriend has told you “tenemos que hablar”, nothing good can come out of it.

The second dimension is how well is the State prepared to make significant changes in the short and medium run. Recall that, more and more over the span of the oil boom, the Chávez and Maduro administrations created a totally discretional parallel system that made people more dependent on oil rent distribution.  Why go to the trouble to set up a sustainable, planned pension provision when you can just hand out petrodollars to viejitos through Misión en Amor Mayor? And housing policy? Who needs BANAVIH when you can have Gran Misión Vivienda Venezuela and straight-up give out apartments (but not titles, obvio) to your political clients?

The country has no social protection program. The Misiones Sociales weren’t conceived as such.

Misiones were of questionable efficiency as policy tools, but they were highly efficient politically. They gave general subsidies to the population, simply to anyone who wanted to join. It is basically just giving money while doing nothing to increase people’s capabilities to allow people to escape poverty by their own means.

Misiones are not sustainable, they create dependency and do not even properly focus on those who really need them. Inversion Social has been undertaken for political benefits. Substituting the private sector in the provision of food with subsidies, for example, can only work in the short term with high oil prices.

So, how to address poverty and Misiones?

The authors give some hints in their conclusions:

The country has no social protection program. The Misiones Sociales weren’t conceived as such and therefore can hardly be the starting point of a social protection program. (…) limited reach (30%) leads to us to think that it will be necessary to develop a new, massive direct transference program complemented with a much more reduced indirect subsidies scheme.

Lastly, we believe that direct transfers should have to be complemented and form part of a structural reform of social programs. The strengthening of social and educational services, feeding plans focused on the most vulnerable, third age social assistance not covered by current services as well as all referred to access and cost of medicines can not be ignored in a short term social plan.

In any case, brace yourselves, hard times are coming.

22 COMMENTS

  1. Magnus populism, as Chavismo unleashed was lived by Argentina with Peron. The corruption to the Argentine physique, 60 years on, cannot kick the handout culture 70 years on.

    It will take a lot of wandering through the desert until Venezuela can purge this sin from its culture.

    Hard times and high political conflict for times to come.

    • It is really hard to change “Santa Claus” culture in many countries that went hard left and then expect them to switch to market based approaches.

      This is a systemic problem that take GENERATIONS to correct. I fear there will be little left for their future offspring to make sense of.

      But, it has to start at some point. Even if it is not an overnight process.

      • It’ll take less than half of a generation, actually, as it goes through a reform of the education system, the same thing that chavismo did to wipe any traces of democratic education from venezuelan children to turn them into zombified slaves that worship a megalomaniac.

        • Civilizations fall much faster than they ascend. Remember Polybius’ Evil Force: the downward trend superimposed on the cycles.

    • I think that it will take less time than a lot of people think. Nations, today, do not exist in a vacuum. The population of the world is more mobile than ever before in history. When the investment climate is improved, Venezuela will benefit from outside immigration bringing technology and culture transfer.

      Given the abundance of exploitable resources, I think that Venezuela could be a truly happening place in a decade.

      • Hope you are right. I think though that we will also need a lot of work in institutional reforms and citizen security to receive Venezuelans from abroad. In any case, the challenge is as huge as the potential

  2. Such a lack of understanding. The goal of every Marxist revolution is to make everyone poor — except the privileged ruling class, don’t for get them.

    Next step: slavery.

  3. Pedro Luis Espana, et. al., are to be highly-praised for their efforts/surveys defining the dire real situation of Venezuela’s 80%+ poor, relatively-uncomplaining to now, at least loudly/publicly, D-E socio-economic classes. Chavismo gave these vast majority lower classes what they wanted/still want-freebies, or a Mision Vivienda type lottery to freebies. Education Misiones–who wants to study, when they can rob/cheat/steal with impunity?–PLE’s own studies reveal 40% of 12-19 year olds aren’t in school. Saber Y Trabajo–that means real work, man, not in keeping with the typical downscale Venezuelan’s personal objectives/willingness/even psyche. Massive social/cultural change will take a long, long time, and many will find it easier to simply line up with their meager food rationing booklet in order to eat. FC knew his Pueblo well, and Venezuela’s Pueblo reverting to pre-oil bonanza misery doesn’t seem to be much different from Cuba’s resident population….

  4. This is another try at posting the following,(two posts in a row’), which was erased, because “You (I) are posting too quickly”–unexplainable, of course. Anyway, summing up my erased comment: PLE/et. al.,in my opinion, are indispensable to understanding what’s really happening socio-economically in Venezuela. Downscale Venezuelans, by nature/custom, have become used to handouts. Education Misiones fail (PLE says 40% of 12-19 year olds aren’t studying), because, why study, when one can rob/cheat/steal with impunity? “Saber Y Trabajo”-why, that’s hard work, man, who wants that, when one can get a Govt. chamba/join a Colectivo/get paid to march/bachaquear/hope for a Mision Vivienda lottery win/etc.? Meanwhile, the Venezuelan Pueblo slips deeper into pre-Oil poverty/misery, eventually clutching their meager food-rationing booklets, in exchange for toeing/voting the Party line. Changing this milieu/mind-set will be generational, if at all.

        • I don’t think that’s the issue. I think it’s a website issue.

          Every time I post a comment, it does not appear until I click on a different post.

          Once in a blue moon, the comment does go into a black hole.

          (And once in a while there is some editing, but you have to get really insulting or post inanities to get that treatment)

  5. Always remember to copy your comment text before posting, and also wait a bit so it gets posted later.

    Also, sometimes the page won’t accept comments that contain links to pages such as Amazon and Mercadolibre.

  6. Misiones were never meant to solve the problems they claimed they would because they were just political tools. A country solves its social problems by creating strong institutions and Chavismo, with all the power to do that, simply didn’t.

  7. that’s a great report, very comprehensive
    those researchers are doing such an incredibly important job – we know we are in dip shit, just how much and where exactly, are aspects that cannot be overlooked
    simplistic assessments of the catastrophic failure of government that the Chavez regime turned out to be, are vague at best, amarillista at worst

    To know where we are at, where we stand, is the first step to realistically begin to get out of this mess – it enables Venezuelans to create accurate policies that actually have a fighting chance to work, to be successful

    If all the efforts of the misiones had worked, we would have a quite different situation today
    it is such a loss that all that money, planning… was squandered (much of it possibly pocketed, possibly stolen), that the misiones didn’t reap the widespread benefits that they were supposed to create…

    We need good planning, sound methodologies, measured statistics – efficiency, practicality, getting down from the rhetoric and into the dirty work, the hard stuff, the actual titanic work that needs to be done in order for us to be able to see the country that we all want

    I think it is commendable and fantastic that these researches are doing the grunt work, that they create the opportunity to devise good policies and that thus, we could be approaching the day in which all of the false praise that chavez has received abroad for his “amazing poverty-reducing policies” will finally stop – it will have to stop, in the face of unquestionable, solid proof that reports such as these offer.

  8. The myth of Chavez as a defender of the poor is based on the Misiones. It is now deeply rooted in conventional, shallow journalism and, together with Venezuela as the country with the world’s largest oil reserves, it has come to represent one of the two greatest frauds of the Chavez government. Misiones did not take ONE single Venezuelan out of poverty. It put money in their pockets while the money lasted but, as this article mentions, did nothing to empower the poor to become self- starters. Now the poor are poorer than ever, more dependent than ever on the paternalistic government. Chavez and Maduro should be given life sentences. For Chavez is too late, for Maduro there is still time to do it, if there were enough balls.

  9. GUERRA ECONOMICA EXISTE IN FACT!!

    The regime is right. There is indeed a guerra economica. It is waged against socialism. It is waged against the regime. To them, the “laws” of economics, the workings of economics, of production, of supply, of demand, of distribution, and the laws of finance, the workings of finance, inflation, monetary debasement, capital requirements … all of these are a deliberately waged guerra economica!

    These “attacks” by the “Imperio” simply will not allow our unlimited goods to be distributed for free! These “attacks” will not allow our unlimited printing of money! These “attacks” will not allow those of us in power and prosperity to dip into the coffers which would be – WOULD BE – constantly refilled … were it not for the incessant malicious attacks waged in the guerra economica!

    All the regime is asking is an immediate suspension of economics! Stop these attacks! There IS NO INFLATION!! Why can’t everyone see that “myth” and “fabrication” is part of the guerra economica? That is the psychological warfare aspect of it all, trying to subliminally alter the thought, trying to convince people that inflation and capital and supply and demand all exist! It is not necessary to pay airlines and petroleum logistics companies! They can grow their own food in their own urban gardens! We have shown them how! Their irrational demands for payment are counter-productive to the revolution! They are simply not working with us!

    So just STOP these attacks! And everything will work out perfectly! STOP THESE NEFARIOUS ECONOMICS ATTACKS!! That is nothing more than an attack by the rabid Imperio! Economics is envious of the regime’s astounding success in all areas, and is trying to destroy it so that economics can have it all for itself under its own rule after it has eaten the revolution!!

    Somehow it reminds me of a t-shirt I saw weeks ago:
    “Everyday, thousands of innocent plants are killed – by vegetarians – help stop the violence – eat pork.”

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