Buenos Aires is famous around the world for birthing the Argentine Tango, but on July 16 the most watched cultural event in the land of pampas and Peron was a foreign import. On that cold and rainy Sunday morning, some 20,000 or so Venezuelans residing in Argentina’s capital and other municipalities came together, in lines up to ten blocks long, to participate in the Rescue for Democracy—an unofficial referendum on the upcoming election for a Constituent Assembly scheduled by their estranged president, Nicolás Maduro. In a remarkable display of civic-mindedness, expatriate Venezuelans in 100 countries in Europe, Africa, and elsewhere in the Americas also cast their votes.
Although non-binding, the referendum, which was organized by the Democratic Unity Roundtable, the opposition coalition that constitutes the largest voting bloc in Venezuela’s national legislature, dealt a heavy blow to the legitimacy of Maduro’s July 30 special election.
By an astounding 98 percentage points, Venezuelans around the world registered their opposition to forming a Constituent Assembly to draft a new Constitution, affirmed that the armed forces should abide by Venezuela’s current Constitution, and called for free and transparent elections. All told, an estimated 7.1 million Venezuelans voted against Maduro’s agenda—and revealed their hope that the road to their country’s restoration be civic, peaceful, and democratic.
For months the Maduro government has faced unrelenting pressure from internal dissenters and criticism from the international community. Hoping to deflate the ranks of the opposition, on June 8 it released from jail its best-known political prisoner, Leopoldo López, a likely candidate for the 2018 presidential race, and sent him home to live under house arrest. Nevertheless, the street demonstrations continued—as did the government’s crackdown—yielding the current tally of about 90 protesters killed, hundreds wounded, and 3,000 arrested. A day after the worldwide Rescue for Democracy referendum, Maduro said the July 30 election will be held anyway, so as to defeat the “coup d’etat” he blames for the wave of mass protests.
The conflict shows no tangible signs of letting up, either by the government, the organized political opposition, or the street protesters who call themselves La Resistencia. Most Venezuelans believe that constitutional reform in the present circumstances poses an existential threat to the return of the rule of law.
Under the 1999 Bolivarian Constitution, Venezuela’s president has no authority to convene a Constituent Assembly, leaving that power exclusively to a popular referendum with delegates chosen by universal, direct, and secret vote. Constitutional reform as envisioned by Maduro would evade that provision. It would also establish an electoral process that could keep Maduro in power with just 20 percent of the vote—roughly equal to the president’s current approval rating—sparing him the need to rig the outcome of next year’s anticipated elections.
How did Venezuela get to edge of the political abyss? The problem is not, as some have argued, that Venezuela is a “failed state”; the state in many ways has succeeded in promoting its own interests. Rather, the root cause is that Venezuela, like the Soviet Union in the previous century, shows why Ludwig von Mises was correct in saying that a socialist system could not produce a socialist economy, but only planned chaos. The key mechanism of an economy, the Austrian School economist explained, is its price system, which enables buyers and sellers to calculate a variety of trade-offs and thereby coordinates and harmonizes their economic plans with one another. In Venezuela, however, the possibility of economic calculation and synchronization has been decreed out of existence.
Maduro didn’t begin the ceaseless onslaught against the price system and rational economic planning; his predecessor and mentor Hugo Chávez accelerated the decades-long assault. But since taking the reins of power in 2013, he has intensified the state’s war on economic and civil liberties. Along with short-circuiting the price system, attacking freedom of speechand political dissent, and hi-jacking the Supreme Court, his government has taken over a host of companies in basic industries such as mining and commodities, farming and food distribution, electricity and transportation, and communications and the media.
Adding fuel to the fire, Maduro has further impoverished the people through the brutal manipulation of the money supply, made possible by a politically subservient central bank. The resulting inflation rate, which under Chavez was more than five times as high as the Latin American average, is now the highest in the world, with an implied annual rate of 789.64 percent, according to the Troubled Currencies Project.
The mix of price controls, inflationary central-bank policies, and assault on independent institutions and private-property rights, has created, as such assaults on liberty always do, major shortages of products essential for daily life. Food is scarce, forcing some to subsist on rice. Shortages of medical supplies, including pharmaceuticals, have pushed the public health system to the brink, prompting thousands of healthcare workers last May to protest against Maduro’s policies in a March for Health.
An estimated 20,000 doctors have fled the country, according to opposition leader Henriques Capriles, who placed second in the 2013 presidential election. Indeed, last year alone more than 150,000 Venezuelans, fed up with the hellish life of daily shortages, petty violence, and police-state abuses, left the country for the United States, Spain, and other Latin American nations. An estimated 1,000 enter Argentina every day.
“None of us wanted to leave Venezuela, but we had no choice,” said Ingrid Mogollon, who moved to Argentina last September and cast her vote against Maduro in the July 16 referendum.
Jeannie Montes, a 21-year-old in Buenos Aires’s Palermo neighborhood, agreed. “The President of Venezuela wants to do a Constituent Assembly, to revoke the power of the National Assembly,” she said. “We are here to defend ourselves and not let him destroy our Constitution.”
Whatever the outcome of the July 30 special election, one can reasonably take issue with cynics who downplay the July 16 unofficial referendum as “merely symbolic”—especially when so many people voice their outrage over a dictator’s power grab and encourage their compatriots to stand up for a future of liberty.
Based in Buenos Aires, Gabriel Gasave is a Research Fellow and Director of elindependent.org at the Independent Institute. Carl Close is a Research Fellow and Senior Editor at the Independent Institute at its headquarters in Oakland, Calif.