July 18, 2007

Torres for dummies

Quico says: Yesterday's post was probably too long and convoluted, so today I'll make it as simple as I can. Everybody loves a PowerPoint, right?

Here, in barest outline, is how distributing natural resource rents directly to people would change the way money and power flows through Venezuelan society.

(Solid arrows represent money flows:)

Petrostate clientelism works by reversing the dependence relationship between the state and the individual. Instead of the state depending on people for its livelihood, people depend on the state for theirs. This is a structural feature of the Venezuelan state, driven by the incentives inherent to state control over vast mineral wealth.

How can I be sure it's structural? Because, in a variety of guises, petrostate clientelism has survived all kinds of political shocks over the last 90 years. Rulers of vastly differing ideology, personality and personal probity have all wound up replicating it. Gómez may have had nothing in common with Caldera, CAP may have been the polar opposite of Pérez Jiménez, Chávez is as different as one could be from López Contreras. Yet the incentives for petrostate clientelism proved so strong that all of them ended up reproducing some version of it.

The only way to end petrostate clientelism is to get the state's hands out of the oil revenue cookie-jar. That is what's at stake here.