In August and September the Venezuelan government announced a series of macro economic reforms such as a currency reconversion, an exchange rate devaluation, a pegging of wages to the Petro cryptocurrency, a massive wage increase and tax reforms, amongst other things. The reforms were later accompanied by new gold and petro savings plans, a revision of state-subsidies, and a range of new fixed prices for basic goods, allegedly "agreed" upon with private businessmen.
Three months later, many of the problems which the reforms looked to address, including hyperinflation and shortages, remain unsolved. Journalist Jessica dos Santos brings us a first-person account of these 90 days.
Days before the monetary reconversion came into effect [in August this year], I went to the bank to withdraw cash. People’s faces had a different look. The line flowed really fast. Conversations had a glimmer of hope.
When it got to my turn, the bank teller asked me clearly: “how much do you wish to withdraw?” and my mind drew a blank. “Is she shitting me?”, I thought. “100 bolivars,” I replied with a smile.
A voice in my head kept repeating “Really? Suddenly something as common as having cash seems wonderful?”, but it did not manage to cool my immense joy: for the first time in a long time I felt someone had given me back a bit of normalcy, a bit of everyday life that I was missing so much.
In the subsequent hours, announcements came in a flurry: a quest for fiscal balance, new exchange controls, minimum wage at 1800 BsS, fixed prices, transportation census, the thousands of possibilities of the Petro.
The streets brimmed with expectation: Will I finally have enough money?
At the time, the SUNDDE [National Superintendency for the Defense of Economic Rights, an agency that inspects if fixed prices are being respected] started to show up in all businesses close to my house. The lines were huge, especially in butcher shops and delis.
As usual, I stayed away from them. I went into a grocer that was empty to buy an avocado. “I will stuff my arepas (1) with this,” I thought. But, as I went to pay, the police came in, and in a matter of minutes, the person in charge of the place started selling cartons of eggs at fixed prices. A police officer handed me one: “here.”
As I left, I felt overwhelmed: “we have been through this stuff before,” I told myself. Going into my building, a neighbor told me she had bought lots of stuff, including a pair of chickens. Nevertheless, her story ended with an ominous “hopefully the inspectors will not leave tomorrow.”
But they did leave.
The security officers, not so much. Nowadays some national guardsmen dedicate themselves to guarding businesses! A few days ago, I saw one comfortably seated behind the counter, with his uniform and gun at hand. This fucker is guarding a Chinese grocery store in the Chimborazo corner. Apparently he is paid to do that, in cash and products. “How awesome,” I said ironically, with frustration boiling up.
Today nobody remembers the fixed prices.
Or worse even: when they are mentioned it it is to blame the people for “not enforcing them.”
I ask the people who signed the price agreements, why the fuck do they exist then? How does one suppose the people can enforce fixed prices? Do we loot stores or destroy the buses that go on charging whatever fare they feel like? Do we start killing each other? What should we do when denouncing overpricing crimes has no effect and authorities leave us alone in the middle of the ring?
The new purchasing power lasted a mere 15 days, and in two months salaries have devalued 60-fold. Salary tables also complicated things: the unification of wage scales was done from the top down. In most public institutions, the higher salaries are around just 3,000 BsS and most bonuses have been eliminated.
My first Christmas bonus vanished on a pair of personal hygiene products, the same ones I had gone for months without being able to buy because my wage is totally spent on food. Meanwhile the authorities, ever more disconnected from reality, invite me to save in gold and petros… “to travel to Istanbul, buy a giant TV or a big time refrigerator in Chinese consortium Alibaba.”
“Don’t go spending the bonuses on beer (…) invest in petros rather than buying 70 beers,” President Maduro recently said. Unfortunately he is not aware that in Caracas even a beer can cost 200 BsS: 70 x 200 = 14,000 BsS. I don’t think anyone will have gotten this much with their first Christmas bonus.
The Economic Recovery, Growth and Prosperity Plan will soon reach 90 days of existence, a date that authorities had circled as a deadline for the necessary corrections. Well, open your eyes, because most of the program lines are not being fulfilled:
Line 3: Defense of salaries.
Line 4: Stability of prices.
Line 9: System of protection of the people (things are so bad that even the Homeland Card bonuses are having delays of over a week in becoming available).
But, more than that, open your hearts:
Enough of creating false expectations and producing statements so out of order they could be mistaken for cynicism. It is one thing to not admit defeat, and another to pretend to be the winner when most of the troops are severely wounded.
(1) Arepas are Venezuela's traditional food made from cornflour.
Translated by Ricardo Vaz for Venezuelanalysis.
The views expressed in this article are the author's own and do not necessarily reflect those of the Venezuelanalysis editorial staff.