I’ve seen little analysis of the disaster in Venezuela. This article is one of the few that tries to sort out the mechanics of the failure. The consensus is that the problems are a populist revolt and what might be called “socialism done in the worst possible way”.
But I wonder if the problem is deeper than that. It’s been noted that Venezuela’s petroleum industry requires a high level of reinvestment of the proceeds to remain productive, and that Chavez robbed those funds to keep the masses happy when the price of oil declined.
What does that reinvestment mean? Most of that money will go to paying the people who labor to maintain the petroleum infrastructure. That is, a lot the money from oil will go to paying the workers in the oil company.
My suspicion is that when Venezuela struck oil, it had to import a lot of specialist workers to exploit the oil, but then a great deal of the export earnings went to paying those workers. This looks good in the national statistics, raising the average income, but if you look at those workers as a separate class, they’re getting most of the money. The class of people who were in Venezuela before may have seen little of the money, and indeed, the net profits from P.d.V.S.A. may have been low except when the price of oil was very high.
The linked article notes that Venezuela had a serious poverty problem before Chavez, and I suspect it had a vicious class divide — the recently immigrated petroleum workers, consuming much of the oil export earnings, and the old-time Venezuelans, who were getting little of the money. Chavez took the money from the carpetbagging oil workers and gave it to the masses. But that wasn’t sustainable.