Archive for November 9th, 2010

While Hugo Chavez expropriates housing projects his own remain abandoned

November 9, 2010

As the Chavez administration takes over middle class apartment buildings in order to score points with the Venezuelan middle class, the truth is that it has failed to complete ots won projects, such as the picture above of a development in Vargas State, which sits abandoned, buildings already crumbing, despite the sign that hails “Welcome to anew project by the Bolivarian revolution”

The problem is that this project is part of the Vargas Plan 2005, an ambitious development plan for Vargas State, the most pro-Chavez one in the Nation, which was suppose to build some 13,000 apartments for the residents of that State. Only 230 of them have been completed.

This is the same Government that took over apartment complexes that were almost finished as a way of promoting its won image among the middle class. Sadly, they have been partially successful. Because there have indeed been abuses by the private construction sector, some induced by the ban of selling apartments indexed to inflation, but in the end the truth is the Government does even worse than the private sector. not only has the Government not completed these projects in Vargas, losing money and leaving them abandoned, but there are many others all over the place in the same condition. Because in the end the Government has become such a central part of all activities, that it is also failing at being a regulator. Thus, in the end it “intervenes”, “expropriates” and “takes over”, where it should be imposing penalties and regulating.

But it is all a matter of style. “Intervening” sounds threatening and ominous, exactly the image wants to convey. At the same time it sound bold and powerful, exactly what the Government wants the middle class to think. But in the end, it is all a war of words. In six months, the building projects will remain abandoned, forgotten in the same foggy cloud where most bold Chavista projects lie.

But perversely, many will keep a positive image of all these announcements. The image of a Government that cares for the people. A Government ready to step in and defend their rights. Unfortunately, their rights are being trampled once again when they are led to believe this has any meaning in their future.

In the end, it is actually the opposite. The private sector is more efficient than the Government despite all of its problems. But now that it feels and is threatened, it will simply stop building and investing which goes precisely against the goals of all middle class Venezuelans to own their own home.

The perverse thing is that it works in the end. These actions do give the Government popularity despite their overall negative effect. Proving once again, how populism can be successful even after a decade of failures.