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How Chavez Has Helped the Poor
By Bernardo Alvarez Herrera
Foreign Affairs
July/August 2008

When President Hugo Chávez was first elected, in 1998, his critics, many of whom have published in these pages, argued that he would slowly move Venezuela away from democracy. After 12 elections, including the December 2007 referendum, which he narrowly lost, that claim has finally crumbled under the evidence. Now the argument against Venezuela has shifted, and instead of being called undemocratic, Chávez's social programs are labeled as inefficient and his economic management categorized as catastrophic. Much like the first accusations against Chávez, the new criticisms, put forth by Francisco Rodríguez in "An Empty Revolution" (March/April 2008), simply do not stand up to the facts.

This much is undeniable: poverty has decreased in Venezuela under Chávez's administration. According to the 2007 Social Panorama of Latin America, a report released by the United Nations' Economic Commission for Latin America and the Caribbean, between 2002 and 2006 Venezuela decreased poverty by 18.4 percent and extreme poverty by 12.3 percent, an achievement second in the region only to that of Argentina. The report attributed these dramatic decreases to "rapid GDP growth and the ongoing implementation of broad social programs" and recognized that the "swift pace of progress considerably brightens the prospects for further reductions in poverty and significantly increases the feasibility of meeting the first target associated with the first Millennium Development Goal."

Rodríguez seeks to dismiss these advances not by claiming that they have not occurred but by arguing that they are just not good enough. He posits that the government's social-spending patterns have not changed from prior governments, that the social programs have not met their goals, and that Chávez's management of the country has not led to any significant redistribution of wealth. On all counts, he is wrong.

According to the Central Bank of Venezuela, social spending as a percentage of all government spending grew from 38.6 percent in 1997 to 44 percent in 2007. Looking more broadly, figures from the National Budget Office show that social spending accounts for a higher percentage of all spending than it did in 1992 -- Rodríguez claims otherwise -- or during the oil-boom years of the 1970s. But more important is that since 2003 the state-owned oil company, PDVSA, has contributed significant sums to social programs -- a point that Rodríguez ignores. In 2004, PDVSA announced that it would spend $1.7 billion a year on social programs, a sharp increase from the $400 million it had been spending in years past. In 2006 alone, it contributed $13.3 billion, or 7.3 percent of GDP, to social programs. According to a report by the Center for Economic and Policy Research, when PDVSA's contributions are factored in, social spending during the Chávez administration has grown by an incredible 314 percent per person in real terms.

Venezuela's social programs, many of which have been funded by PDVSA, have been both effective and popular. Rodríguez seeks to dismiss them by quoting isolated and questionable statistics, but he fails to fully consider the gains they have achieved. According to the Central Bank's System of Social Indicators, school attendance at every level increased between 1998 and 2006, and today nine times as many children have access to free meals at school. Through the health mission Barrio Adentro, doctors located in Venezuela's poorest communities have provided more than 200 million checkups, saved over 47,000 lives, and overseen 3,100 births in the 715 different offices and specialized clinics built throughout the country. The treatment provided to HIV/AIDS patients is indicative of the larger commitment to health under the Chávez administration: whereas in 1999 only 335 patients received antiretroviral medications, in 2006 the number was over 18,000. The many social missions have been so well received that during the 2006 presidential campaign, the opposition candidate Manuel Rosales pledged to keep them in place if he won the presidency.

Policies enacted since Chávez was elected have also helped redistribute the gains of Venezuela's record economic growth. Unemployment is down, employment in the formal sector is up, and the minimum wage has increased notably. More important, income has grown fastest for Venezuela's poorest. According to the polling firm Datanalisis, from 1998 to 2006 Venezuela's poorest sectors saw an increase in income of 445 percent, and the wealthiest saw a gain of 194 percent. These gains have come despite a concerted effort by certain sectors of the opposition to throw the country into crisis in 2002 and 2003. In a shocking omission, Rodríguez does not mention that the sabotage of the oil industry in late 2002 and early 2003 bled Venezuela of 24 percent of its GDP. By comparison, during four years of the Great Depression, the United States lost 29 percent of its GDP.

The policies of the Chávez administration have served to help lower poverty, increase access to necessary social services, and better distribute Venezuela's resources. But more than trust the numbers, one can turn to public opinion to verify this. According to a 2007 Latinobarómetro report, Venezuelans rank their country among the most democratic in the region, second only to Uruguay. On a number of measures -- equality between the sexes, the protection of private property, equality of opportunity, solidarity with the poor, social security, employment opportunities, and even income distribution -- respondents ranked Venezuela highest in the region. When asked how their families' economic situations would be in 12 months, 61 percent of the Venezuelan people said "much better" or "a bit better," higher than the figure for Brazil (60 percent) and the regional average (46 percent). On education and health services, 64 percent and 74 percent, respectively, expressed their satisfaction.

None of this is to say that the Venezuelan government is perfect, much less that it does not face ongoing challenges. It does, as Chávez recognized after his December 2007 referendum loss. One of the main challenges, inflation, has already decreased this year, and food shortages have similarly abated. More important, Venezuela will continue growing its economy, with eight percent expansion expected for 2008.

Trying to argue that Venezuela's economic growth and social gains are all a myth sustained by effective international lobbying and public relations both underestimates the intelligence of the Venezuelan people and does a grave disservice to the facts. Contributors to Foreign Affairs may not like Chávez personally, but they should not keep looking for unsubstantiated reasons to attack Venezuela's efforts to create a vibrant and equitable democracy.

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