In 1980, Venezuela was deemed to be the fourteenth most economically free country in the world. Today, it’s a veritable train wreck, having failed in every conceivable way. How did this happen? Was it just bad luck? No, quite the contrary.
Venezuela’s prosperity was fueled primarily by the export of oil. The downward spiral began in the 1980’s, as a result of a drop in the world oil price. Until that time, there had been strong public support for the free market, but diminished oil receipts resulted in a decline in living standards for most all Venezuelans, which left them open to claims by collectivist political candidates that the whole problem was the free market.
In 1999, they elected Hugo Chávez, who promised to solve the problem through collectivism – the promise of a chicken in every pot .