You Don’t Say? Everyone is Benefiting in Venezuela?

"It's ironic, this revolution.

The rich are even richer now." (link)

Once the ultra-wealthy elite stopped their extralegal attempts to sabotage Hugo Chavez's economic policies through a USA-backed coup* and worker lock-outs (interestingly dubbed "strikes" in the USA media), it didn't take long for Venezuela's economy to rack-up economic statistics like these for 2006:

Venezuela's gross domestic product — a measure of all the goods and services in the economy — rose 10.2 percent from July to September compared to the same three-month period in 2005, the central bank reported in a statement Thursday. (link)

Contrary to the popular myth that Chavez's policies damage the private sector and the successes are seen only in the oil sector, we read:

Private sector economic activity rose 12.3 percent, while the public sector grew by 2.7 percent, it said.

Venezuela, the world's fifth-largest oil exporter, has seen strong economic growth on the back of high energy prices.

Third-quarter growth, however, was mostly generated in the non-oil sector whose measure of GDP increased by 11.7 percent, while oil-related business declined by 1.8 percent.

Manufacturing, retail, construction and communication sectors all posted double-digit growth propelled by higher levels of liquidity in the economy, the bank said. (link)

The effects of this growth are seen in a variety of sectors of the economy:

• Sales of Scotch jumped 55% last year to 2.6m boxes of imported and domestic whisky, cementing Venezuela's reputation as the biggest whisky drinker in Latin America and among the world's top 10.

• Vehicle sales are expected to double this year to 300,000, fuelled by a petrol price of just 6p a gallon - cheaper than mineral water.

• Banks have grown in every quarter since 2003 and have seen assets surge by a third to over $20bn. Billboards advertise loans for almost everything, including cosmetic surgery.

• New hotels are rising over the island resort of Margarita, a playground for the rich, and new restaurants are mushrooming across the capital, Caracas.

• Property prices in Caracas have exploded, with estate agents reporting tripling and quadrupling of prices in the Chacao district since 2002. (link)

Although the poor of Venezuela have already benefited from free health care, universal education for children, adult literacy programs, food subsidies, increased wages, increasing housing assistance, the opportunity to cooperatively own and operate former bankrupt companies, micro-credits to start new businesses, etc., it seems that the poor are not the only beneficiaries of the Chavez economy:

"The revolution is blah blah blah. We don't feel threatened," said one of the trio, a shoe factory owner.

Much of the country's elite, it seems, feel the same way. President Hugo Chávez has warned that "capitalism will lead to the destruction of humanity" but seldom has there been a better time to make, spend and enjoy money.

The economy is surging at 9.4% and banks and credit card companies are reporting exponential increases in deposits and loans. Car sales are expected to more than double this year to 300,000, many of them luxury models, and property prices rival Manhattan. (link)

Imagine that. Raise the economic conditions of the underclass, give them the means to learn, develop skills, and become productive, and all that economic activity benefits everyone. It's not necessary to concentrate wealth in a few hands and hope for a "trickle" of crumbs from the very wealthy that will provide a "stimulus" to the economy.

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* The principal coup plotter, Pedro Carmona, who became the dictator of Venezuela for two days, now resides with the protection and support of the USA in Miami, FL.