Is War Between Colombia and Venezuela Inevitable?

Analyst Douglas Hernandez looks at the multiple dimensions of the Venezuelan economic crisis and Colombia's role in escalating it.

By Douglas Hernandez
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Products meant for Venezuelan consumption are sold illegally in “La Parada.” (La Opinion)
Products meant for Venezuelan consumption are sold illegally in “La Parada.” (La Opinion)

Promoting or supporting sanctions, wars, or “humanitarian interventions” is easy, any fool can do it.

The difficult thing is to see the whole picture of the issue, or what intellectuals call having a holistic view. When one makes an effort to look beneath the surface, one begins to notice great complexities, half-truths, lies, and even sometimes discover that the good are not so good, and the bad are not so bad. Venezuela seems to be one of those cases.

Now that the issue of Venezuela is in fashion — mainly because of the massive and heartbreaking migration of Venezuelan citizens — it has been said that what could be necessary is a change of regime, which repeatedly is called a “dictatorship.”

According to many western critics of Venezuela’s socialist government, the cause of the humanitarian crisis is the “dictatorship” led by President Nicolas Maduro and the “21st Century Socialism” of his predecessor, the late Hugo Chavez.

It is true that the inflammatory discourses of Chavez and Maduro – filled with accusations, self-victimization, accusations and threats – generates rejection and division, both within Venezuela and of other governments. It also generates rejection and suspicion among the citizens of other countries.

It is also true that to see that Venezuela has armed itself significantly, and possesses weapons, equipment and state-of-the-art systems, that generate sincere concerns among many, including ordinary citizens.

“21st-century socialism” has yet to fail or succeed

In spite of its declared good intentions and interesting projects in the fields of economy and social services, the “Bolivarian” government of Venezuela has not been able to consolidate most of its domestic policies. Much of this is due to the lack of committed, capable and even honest personnel. Nor has Caracas been able to maintain its international policies, due to the complex and changing dynamics of geopolitics.

Until a few years ago, Latin America had different leftist governments that supported each other. Today, once again, there has been a shift to the right, which disrupts, minimizes or repudiates the achievements of previous governments.

Venezuela, with its experiment of “21st century socialism,” is increasingly isolated. Big capital needs that experiment to fail, and it is failing.

For them, it would be inconvenient that the good things that have been done (or tried) in Venezuela become examples that shake the structure of economic, cultural and military domination in which we are immersed.

US President Donald Trump said in the UN General Assembly that he does not rule out a military intervention in Venezuela, and asked for support to “restore democracy” in that country after pointing out that a military coup in Venezuela could succeed very quickly.

All his statements are undoubtedly a manifestation of hostility, and go beyond the thin line of diplomacy.

But the US president makes everything clear when he alludes to Venezuela’s political-economic model, saying that “people flee Venezuela because of Maduro’s socialism… socialism has led to poverty in Venezuela, which used to be a very rich country.” What Trump basically is saying is that socialism once again failed, that it is a model that serves no one, and that the capitalism the US president represents is the panacea.

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Graffiti depicting late President Hugo Chavez in Caracas. (Wikipedia)
Graffiti depicting late President Hugo Chavez in Caracas. (Wikipedia)

Venezuela is not a dictatorship

Let’s tackle the Venezuela issue in parts. In the first place, it is important to clarify that the government of Nicolas Maduro is not a dictatorship. There were presidential elections in which he was elected, so he is the constitutional president of a sovereign country, and enjoys no less legitimacy than other Latin American countries with weak electoral systems, for example Colombia.

Inside Venezuela there is a heated political debate between the followers of the ideas of Chavez or “Chavistas” and the opponents of the government.

Unlike Colombia, where in one way or another traditional elites continue to divide power and contracts, in Venezuela the Chavista government keeps the opponents out of the bureaucracy.

It is clear that, since they are not represented, the opponents are not directly responsible for the government’s mistakes, except in the governor’s offices and mayors’ offices that they have won by popular election.

In another sense, Maduro’s government has done everything possible to close spaces to the opposition, violating the healthy balance that prevents a concentration of power in a group or in a person, and thus prevent possible abuses.

He is also blamed for the indoctrination and politicization of the military, which defines itself as “Chavista and anti-imperialist.”

All of which seems to suggest that – although Maduro is not a dictator because of his legitimate origin – it could be argued that his actions excluded political participation of the opposition, and by co-opting all state agencies for his political project, he would be moving away from democratic way towards something similar to a one-party state.

Maduro, who is despised for coming from a trade union and for having been a bus driver, has been more astute than all his opponents, who enjoy international funding, and massive political and media support. Despite all the combined forces striving to destroy him, Maduro and his 21st century socialism have consolidated power.

The immense forces that oppose the Venezuelan political project, who have not been able to defeat it politically or economically, now consider doing so militarily. After all, they have already weakened him enough.

But we must clarify that that war against Venezuela not is a future possibility; this war has been going on for years.

Warfare is more than exchanging bullets and bombs

Modern warfare is multidimensional, and doesn’t necessarily involve the deployment of ships, tanks and planes, in order to – as Carl con Clausewitz would say – subdue the adversary to your will.

Perhaps, given that the succession of political, diplomatic, economic or psychological operations has failed to bring down the Venezuelan “regime”, direct methods will now be tried, using military force.

This is bad in itself, since the international system advocates the peaceful resolution of conflicts and the self-determination of peoples, condemning interventionism.

But it gets worse when the idea is that Colombia should play a role there.

President Ivan Duque‘s intervention before the UN General Assembly shows that Colombia will be an important actor in the tightening of the ongoing siege against the Venezuelan government, which has begun with the signing of a document asking the International Criminal Court to initiate an investigation against the Venezuelan government for crimes against humanity.

This request is also signed by the governments of Argentina, Canada, Chile, Paraguay and Peru, and other countries may join in the coming days.

Maduro arrived in New York almost surprisingly, to speak before the UN General Assembly, carrying “the truth of Venezuela,” defended his position, told some of the things his government is doing to stabilize his country, spoke about Syria, asked for the end of the blockade of Cuba, and expressed once again his support to the Palestinian people.

He also blamed the United States for the recent attacks against him, in which explosive drones were used. Finally, he was emphatic in stating that he was willing to meet with Donald Trump to reach agreements, but within a framework of equality and transparency.

At the end of his speech he was applauded, which was not the case with Duque. Trump’s speech even generated laughter in the auditorium. What did those diplomats who gave him a standing ovation see in that bus driver that others do not see?

The humanitarian crisis in Venezuela is very real

The crisis in Venezuela became completely evident because of the migration tragedy. How can one deny a crisis when thousands and thousands of people leave the country, even on foot?

The first thing one must ask is, what does the crisis consist of?

For a humble Venezuelan, things are not simple. Many, many companies and businesses have closed, so it is difficult to get a formal job and there is a dramatic shortage in food and medicine. Wages are low and the prices of products found in commerce are high. There is a hyperinflation that causes prices to rise every day.

Venezuela’s Bolivar is depreciating against the dollar, which spurs inflation even more. But in addition, strangely enough, cash disappears from the streets and disrupts all trade.

People lack the capacity to save, and if they do, it is pointless saving money that is devalued every day. In such a complicated economic situation and in the face of the need to survive, people resort to strategies that go against their own collective interest, such as contributing to price increases, hiding/selling cash, trading in dollars, hoarding products, and relaxing ethics by engaging in morally questionable activities like prostitution or crime.

In short, in Venezuela you can’t find a good job and if you do you are underpaid, the money you receive is depreciated every day and loses purchasing power. If you want to buy food, there is shortage, and what you find is exaggeratedly expensive or they want to sell it to you in cash, but cash is not available, you can only make bank transfers.

Since you don’t have cash you can’t pay for bus tickets (the drivers don’t have a point of sale), you can’t eat a hot dog in the street or buy a beer or a soda, you can’t give money to a beggar, you can’t contribute to the church, nor can you give something to your children for the school meal.

If you want to have cash, you must buy it at 700% of its actual value, sometimes even at 1000%, whatever money traders decide. You make them a bank transfer and they give you cash. The opposite also happens, they buy your cash and then resell it. Meanwhile, your goods deteriorate, your shoes wear out, your underwear wears out, your pants wear out, your TV stops working. If you barely have enough for half a meal, you’re not going to be able to replace your deteriorating property.

The situation is so sad that even the brothels have disappeared, not because there are no prostitutes or gentlemen who need their services, people lack solvency to go whoring.

So, many Venezuelans began to migrate to neighboring countries, and told others about the improvement in their living conditions, and about migratory requirements. This generated a wave of migrants that has only now slowed down, due to the limitations that are being established.

Currency control, free market and the mafia

Is Maduro to blame for all this tragedy? In large part, yes, due to bad decisions and the confrontational attitude of his government. He has also contributed to the legal insecurity in Venezuela, which drives away investments and discourages entrepreneurs.

But other factors that influence the crisis and worsen it cannot be ignored.

The internal confrontation in Venezuela, propitiated by Chavez, is a conflict between social classes, which still continues.

Businessmen gradually withdrew from the market and today, after 20 years of socialism, the Venezuelan productive sector is only a pale shadow of what it once was. Those who remain are true business wizards, who sustain themselves in such a complex environment, should be teaching at universities.

However, some of them also engage in malpractice, such as hoarding and speculation, which generates or worsens shortages, or tax evasion or bribery.

Faced with a shortage of basic necessities, the Venezuelan government has resorted to subsidizing imports of raw materials or finished products, putting products on the shelves at prices far below their equivalents on the international market.

This has proved a too attractive temptation for smugglers, who, especially from Colombia, have for years massively and blatantly been smuggling, generating millions of dollars in profits for them.

The issue is so complicated that even though the Venezuelan government closed its borders to vehicular traffic.

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Venezuelan migrant selling arepas in Peru (Wikipedia)
Venezuelan migrant selling arepas in Peru (Wikipedia)

If you visit San Antonio del Tachira in Venezuela, you will see that there is an overwhelming shortage in good. When you cross the bridge and visit the “La Parada” sector in Villa del Rosario in Colombia you will see a multitude of businesses with merchandise up to the roof. The curious thing is that these businesses sell mainly Venezuelan products.

Even a stupid person can understand that there is a serious smuggling crisis, carried out in collusion with the national guards and other officials in charge of customs. There was corruption before the economic crisis, and this has worsened with the crisis.

Right there, in “La Parada”, there are multiple money exchange businesses where transactions are made in pesos, bolivars and dollars. The value given by the Venezuelan government to its own currency is irrelevant there; the invisible hand of the market comes into play. It is supply and demand that defines the price on the bolivar, or at least that is the official version.

I have observed that the Venezuelan website dolartoday.com works with a kind of mafia from the Colombian border city of Cucuta to which many (or all) money changers seem to subscribe voluntarily or involuntarily, and through which the bolivar is gradually devalued, contributing enormously to the Venezuelan economic crisis.

Without pretending to be an economist, there are obviously ill-willed attempts that seek to disrupt Venezuela.

For example: when the government of Venezuela establishes that the exchange rate for the day is 20 bolivars to the dollar, dolartoday.com (which does economic sabotage with the support of various media and businessmen) says no, that the “real” exchange rate in the street is 40 bolivars per dollar.

Because the Venezuelan government’s currency control, obtaining dollars legally is virtually impossible. There are two ways to buy dollars in Venezuela; one is on the black market, where the price is defined by dolartoday, and the other is to go to Cucuta, where the dollar is cheaper, and even more if you buy it in cash.

Venezuelans who want dollars because they need to travel, or need foreign currency to buy something abroad or save money, carry their cash to Cucuta, and the bolivar bills disappear from the streets of Venezuela.

After several years of this procedure, plus repeated – and malicious – warnings about cash shortages by opposition media, people began to hoard their cash, effectively aggravating the problem.

Then the business of buying/selling cash emerged. Let’s say that in any city traders buy your cash at 130% of the official value and sell it at 140%, a very profitable business for those who commit these kinds of financial crimes.

But there’s more. If you sell your cash in Cucuta, Colombian money changers would buy it at 150% of its value. In other words, if you take them 100 bolivares in cash, they transfer 150 bolivares to your bank account. These numbers are fictitious and only meant to exemplify what is going on.

The reality is that today people are buying Venezuelan cash at 400% of its original value. Imagine that cycle happening massively every day: cash is taken out of the economy, but virtually 400% (or more) of what was physically taken out is reinserted digitally.

At the same time, every day, through a suspiciously coordinated operation between the Colombian exchange houses and, among others, dolartoday, the Venezuelan currency is depreciated while cash is disappearing.

The Colombian government knows this, and does nothing to prevent it.

Now, if you’re one of the mafia bosses with the power to move millions every day, you really are in big business. If you help depreciate the bolivar, you can buy a lot of cheap bolivars with which you can buy subsidized Venezuelan products, then smuggle them to Colombia, where you sell them at the Colombian market price. This way your wealth multiplies several times in a very short time.

I have yet to mention Venezuela’s gasoline, which is the cheapest in the world, and has been tremendously popular among Colombian smugglers. An entire illegal industry has prospered, also in Cucuta.

A Venezuelan analyst told me once that he believed Cucuta’s economy has prospered over the past decades mainly because of smuggling from Venezuela, in association with related crimes such as drug trafficking. Having explained all of the above, it is understandable that he believes that.

Faced with this complex panorama, and in order to overcome especially food shortages, the Venezuelan government created a house-to-house supply system called CLAP (Local Supply and Production Committees), by means of which basic food supplies are delivered to people’s homes at cheap prices on a monthly or biweekly basis.

These inputs would have been previously acquired from the national producers, but mainly imported, and paid with the oil revenue. This has prevented the collapse of Venezuelan society or its surrender to hunger.

In Colombia, several containers of CLAP boxes were recently retained for no compelling reason. Other governments have also sabotaged the sale or delivery of food purchased for that purpose.

Venezuela’s provisional reaction

As oil production in Venezuela hit historical lows, and its main source of foreign currency is the oil industry, it is very important for that country to have its foreign exchange in order to be able to acquire more food and continue supplying the population.

The United States has blocked accounts of the Venezuelan government and has subjected it to a series of economic sanctions that prevent or hinder international business, limiting access to foreign exchange and therefore to food and medicine that must be purchased abroad.

It is undeniable that there is an economic war against Venezuela, which adds to the errors of the government of that country, and the aggravation of the humanitarian situation in Venezuela.

If we acknowledge that the incompetence and errors of the Venezuelan government are not the only causes of the crisis that the country is going through, there are other internal and external factors that fuel it.

The hyperinflation, the lack of food and medicine, the lack of cash in the streets, unemployment, political polarization, the progressive decrease in the quality of life, among many other factors that make life difficult if not unbearable, are elements that together have generated the massive migrations to other countries that we have seen in recent times.

There is more than one solution

It is clear that a change of government in Venezuela could be a solution, but it could also trigger a civil war that would further destabilize that country and the region.

There are presumably many other ways to help Venezuela overcome its humanitarian crisis and prevent its state system from failing.

For example, the US government could stop happily and unilaterally sanctioning the Venezuelan government by unfreezing its foreign currency accounts, lifting the ban on trading new debt or bond issues by the Venezuelan government or the PDVSA company, as well as ceasing to prevent the payment of dividends to the Venezuelan government.

All those currencies that now do not arrive in Venezuela, would undoubtedly help to acquire more food and medicines, and in general would reinforce the social plans in the South American country.

Blaming Maduro for the crisis is absurd and even perverse, when you do everything possible to tie his hands and prevent him from overcoming Venezuela’s problems.

From Colombia’s side, we could start by not seeing Maduro as the spoke in someone else’s wheel, but look at our own humanitarian crisis and our own problems, both political and economic.

To then understand that for decades Colombia’s internal problems spilled over to Venezuela with phenomena such as drug trafficking, violence by illegal armed groups, extortion, kidnapping, forced displacement, and all sorts of crimes of different magnitudes.

We must also remember that Venezuela received millions of Colombians who migrated there in search of better living conditions. Colombia is not and never has been Switzerland; we have multiple problems, just like Venezuela.

A turn of fate has changed the direction of migration. Now we are the ones who must attend to and help those people who flee their country.

But more importantly, the Colombian government must stop turning a blind eye to the cross-border crimes that occur along the 2,219-kilometer border with Venezuela, and especially in border towns like Maicao, Cucuta, Arauca, and Arauquita.

The smuggling of gasoline, food, medicine or any other merchandise affects both countries – because in neither of the two countries they pay taxes – but affects Venezuela more. The items that were initially subsidized for consumption within that country do not only generate shortages when taken, but cause a significant economic detriment.

Smuggling these products only enriched Colombia’s mafias, who are surely involved in other crimes that affect Colombian society.

But perhaps more importantly, the freedom with which the exchange houses of Cucuta are operating, behind which there are people or governments with a lot of money, is structurally affecting the Venezuelan economy and worsening its crisis.

The Colombian government cannot continue turning a blind eye to this situation, because doing could imply criminal complicity.

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Some shops in San Antonio de Tachira, on the Venezuelan side of the border, have been forced to close because there is nothing to sell. (El Estimulo)
Some shops in San Antonio de Tachira, on the Venezuelan side of the border, have been forced to close because there is nothing to sell. (El Estimulo)

The US’ provisional reaction

Because the depreciation of the currency triggers all other problems, Venezuela has tried to make fundamental changes to curb it. Caracas created the “Petro” cryptocurrency, guaranteeing that this cryptocurrency is backed by Venezuela’s oil and gold reserves.

So, in order for the Petro to be negatively affected, the oil and other markets would have to collapse simultaneously.  The government later said that the bolivar will be anchored to the Petro and not to the dollar.

As it seems a good idea, that would help macroeconomic stabilization if it works, the US government sabotaged the measure and issued an executive order prohibiting transactions in Petros, specifically prohibiting “all transactions related to, provision of financing for, and other dealings in any digital currency, digital coin, or digital token issued by, for, or on behalf of the Government of Venezuela on or after January 9, 2018 wherein US jurisdiction is implicated.”

Here, Washington’s desire to sabotage the Venezuelan economy becomes clear, and it is clear that an economic war is indeed underway and is being waged on different fronts, and of which Colombia is a part through its exchange houses.

The measures with which the Venezuelan government is attempting to confront the economic aggression to which it is subjected include the entry into circulation of a new currency as of August 20, 2018.

This time they have removed five zeros from the currency to make transactions more manageable. They have decreed a new national minimum wage (plus an additional bonus), and have agreed with the producers a price scale for basic necessities, which make it possible for the population to resume purchases and at the same time allow profitability for the producers.

Additionally, the process of acquiring dollars through public auctions has been simplified, and exchange houses will be opened throughout the country where dollars will be traded at official prices that are much cheaper than those on the black market, and where international transfers can be made.

Until now, remittances sent by Venezuelans abroad arrived in Venezuela without paying taxes. With this new measure there will be greater control over these remittances and additional income for the state.

The government ordered Venezuelan banks to block the accounts of those who manage their accounts from abroad, without having previously announced that they would leave the country. This would minimize the flow of ghost capital and increases controls.

In addition, the Petro was effectively linked to the price of a barrel of oil, and the Bolivar to the Petro. The minimum wage was also anchored to Petro.

Furthermore, a system was put into practice to save in gold by buying certificates of deposit guaranteed by the Central Bank of Venezuela, an effective return to the safe and reliable gold standard, which cannot be affected by inflation. This way, savings do not lose value.

Finally, a national transport census was carried out to find out exactly how many cars there are in the country and where they are. From there, an increase in the price of fuels was planned, to link them to international oil prices, with a direct subsidy to Venezuelans who possess a so-called “Carnet de la Patria,” an ID card that allows all citizens access to social services

This is very interesting because it effectively links a biosecure identification system to gasoline purchases and prevents the mafias from buying the cards to continue smuggling gasoline at low prices.

As the border with Colombia is where Venezuela suffers the highest crime rate, smuggling of extraction and presence of destabilizing factors, the Venezuelan government is making an effort to have a greater presence there, and above all to be more efficient by curbing the corruption of state agents.

One month after these measures were taken, the trend has been positive and the situation seems to be stabilizing little by little.

Venezuela has received international support from China and Russia, as well as Cuba, Bolivia and Nicaragua, among other small countries.

Confidence is recovering to the point that several thousand Venezuelans abroad have asked their government for help to return to their country, and in this context the “Return Home Plan” has been activated to arrange their return and grant them some facilities for their social and economic readjustment.

At the time of writing and in less than a month, 3,364 Venezuelans have returned to Venezuela. This being so, this is the only case in which people who had left a socialist country, return to “a dictatorship” on their own free will.

The measures Venezuela has taken are unorthodox, divergent, and tend to grant it economic sovereignty. Now with the Petro issue, the only crypto currency backed by a State, and backed by oil reserves and gold reserves with which Venezuela is going to conduct its international business, the country has an opportunity to return to the path of prosperity.

From economic to ballistic warfare?

Venezuela is a country that resists political and economic domination, that for decades has endured an economic war, that has been destabilized in different ways, and where – this cannot be denied – its government has made countless mistakes and abuses, but in which it has fundamentally defended the right of the people to a dignified life.

It is also this country that has the largest proven reserves of oil in the world and occupies the top position in proven reserves of gas and gold. This is a very appetizing prey for big capital.

With its wealth, which could be converted into welfare for its population, and under a different ideological, political and economic model, Venezuela could become a “bad example” for the rest of the world, and people could want to imitate its model.

As big capital and its allied governments have not been able to defeat the “Bolivarian revolution” in Venezuela after 20 years of attempts and dozens of elections, and now risk that the measures for economic stabilization and prosperity may work. So, a wave of attacks and accusations has been unleashed to justify military intervention and remove the chavistas from power. This is where the problem lies, in my opinion.

It seems to me that a war between Colombia and Venezuela can be avoided if society as a whole rejects it on the basis of a more holistic knowledge of the situation.

But, given the intellectual capacity of the masses in Colombia, who were proposed the option between peace and war, and war chose war, where they were asked to choose between transparency and corruption, and they chose corruption, it is possible that the masses succumb to the strategies of psychological warfare that are being applied.

It should be made clear that military war has its own complexities, which we will analyze later.

Author Douglas Hernández from Colombia is the founder and director of military website Fuerzasmilitares.org, and a journalist specialized in security and defense. He is a contributor to the Air and Space Power Journal, the institutional magazine of the United States Air Force, and Brazilian military magazine Segurança & Defesa. He is a Sociologist and has a Master in Education from the University of Antioquia, where he is also a PhD student. He also has a degree in International Relations.

The views expressed in this article are the author's own and do not necessarily reflect those of the Venezuelanalysis editorial staff.