Socialism has its perks, according to BusinessWeek.
“It’s a bit like the … French Revolution,” Smith quoted Venezuelan American Chamber of Commerce President Edmond J. Saade. “Power to the people, death to nobility.”
Of course, many Venezuelans are fleeing the country, and businessmen who stay behind are watching their businesses crumble. And inflation is rising at a whopping 18 percent per year. But that’s in the last few paragraphs of Smith’s article.
One Venezuelan businessman, who feared government retaliation if he gave the press his name, reported “his company has shrunk to just 100 employees from 300 since Chávez came to power in 1999, and sales have fallen by half,” Smith wrote.
The media have had a bizarre fascination with the Venezuelan dictator over the last few months, as the Business & Media Institute has documented. BusinessWeek managed to put a new spin on it by suggesting Chavez’s ways are partly good for business.
According to the story, Chávez has been able to take oil revenue and spend $13.3 billion on wealth redistribution. “The poor, 58 percent of all Venezuelans, have seen their meager household incomes more than double since 2004 thanks to cash stipends, subsidized food and scholarships from the government’s social-development programs,” wrote Smith.
But Venezuela under Chávez is hardly a model for the world to follow. On a scale of 1 to 7, The 2007 Freedom House “Freedom in the World” report gave Venezuela a 4 on both civil liberties and political rights. (To put that in perspective, North Korea received a 7 in both categories and the United States received a 1).
The BusinessWeek story didn’t discuss human rights hardships in the country; nor did it discuss how Chávez’s “Bolivarian Revolution” has impacted poverty in the nation.
In 2002, prior to Chávez’s rise to power, Venezuela was ranked 55th overall in the world by the United Nations’ Human Development Index – a rating system that provides a comparative measure of life expectancy, literacy, education, and standard of living among the nations of the world. By 2006, Venezuela had fallen to 72nd and was outranked by its neighbors Colombia (70) and Brazil (69). (The U.S. was ranked 7th in the study.)
The country’s quality of life has declined. And Chavez has seized private business assets for his own state use, which Smith stated: “Chávez has already forced global oil giants, phone carriers, and power companies to hand over control of key assets. Now he says he might nationalize banks, hospitals, and steel companies.”
But Smith’s article pointed out that Chávez’s socialist programs are requiring the government to make huge purchases from American-based companies, including Coca-Cola (NYSE: KOF) and Ford Motor Co. (NYSE: F). “Companies are chafing under the fiery socialist. But in some respects, business has never been better,” the article said.