Why The US Is Sanctioning Venezuela


Narrator: Venezuela has been suffering a humanitarian crisis for years. The situation is so dire that an estimated 3 million Venezuelans have fled their homeland. After the country’s economy collapsed in 2014, it’s been
plagued by hyperinflation as well as food and medicine
shortages and power outages. Narrator: And at the heart
of it all are two men, Venezuela’s president Nicolás Maduro and the leader of his
opposition, Juan Guaidó. For years, Maduro denied
the country’s issues and blocked aid deliveries
coming from most countries. Guaidó set up a parallel government and pledged to deliver aid. Other countries got involved and pushed the UN to intervene. Mike Pence: It’s time for
the United Nations to act. Narrator: In April, Maduro finally acknowledged
the country’s crisis and allowed the Red Cross to deliver aid. Things haven’t always been
this way in Venezuela. In fact, its large oil
reserves once made it one of the richest countries in Latin America. So what happened? It starts with Hugo Chávez. He was elected as president
of Venezuela in 1998, in large part thanks to his
21st century-socialism message that promised to clean up corruption and balance economic inequality. As it happens, fortune was on his side. Will Martin: So Hugo Chávez came to power in Venezuela in 1999, and that coincided with a really big spike in oil prices in 2000. So effectively what happened is that overnight, Venezuela managed to have pretty much
double the oil revenues that it had previously, which allowed Chávez to
fund a lot of the spending that he’d pledged in
his election campaigns. Narrator: The country was booming, but it was spending money
faster than it was coming in. Martin: The issue with Venezuela is that they spent so quickly that the tax revenues weren’t able to keep up with government spending, which created this big gap. Narrator: Then on March 5,
2013, Chávez passed away. It was his fourth term in office. Nicolás Maduro was voted
into office a month later when the country’s luck was drying up. Martin: What had happened
in the intervening years is that the Chávez presidency
had nationalized a lot of the country’s businesses, manufacturing plants, that sort of thing, and was therefore relying
very heavily on oil to bring in revenue for the government. Beatrice Christofaro: So
when oil prices plunged, suddenly the government didn’t have money to pay for the social programs that were so popular
amongst the lower classes. But also, it didn’t even have the money to import all the things that it needed. Venezuela really imports almost all of its basic necessities, from food to medicine, cars, all of that. So when suddenly all
this oil revenue wasn’t coming in anymore, the country was faced with severe shortages. Narrator: The shortages were so severe that a national survey found
that between 2015 and 2016, 74% of respondents lost
an average of 19 pounds. At the same time, Maduro’s opposition was
swiftly gaining strength. In 2015, they gained a two-thirds majority in the National Assembly, threatening Maduro’s
position as president. In response, Maduro
stacked the Supreme Court with justices on his side. Then in 2017, Maduro created the National
Constituent Assembly that would rewrite the
constitution and effectively bypass the opposition-controlled
National Assembly. And to make things worse,
hyperinflation set in. It’s basically like inflation on steroids. Prices increase more and at a faster rate. For example, in August of 2018, a roll of toilet paper in Caracas
cost 2.6 million bolívars, the equivalent of 40 American cents. The bolívar is so devalued that Venezuelans need large sums of cash to buy small amounts of items. Martin: And so basically,
that’s the issue is that Venezuelans can’t afford the goods and services they need to live
basic, normal, happy lives. Narrator: In January of
2019, tensions grew even more when the opposition leader, Juan Guaidó, claimed the presidency, citing emergency powers
in the constitution. The US quickly backed Guaidó, and Maduro responded by
ordering all US diplomats out of the country. Christofaro: About 50
countries, including the US, the UK, a lot of Latin American countries, have recognized Juan Guaidó as the legitimate leader of Venezuela, which is significant in the sense that it shows that he has
international support, that his government is
considered legitimate by a lot of people. Narrator: But there’s another problem. Maduro still controls the military. And beyond the military’s strength, its officers hold influential
positions in the government. In February, Maduro blocked aid coming from the Colombian border. Later in the month, he closed
the southeastern border, again blocking aid from
entering the country because the government
thought admitting aid would basically mean admitting defeat. Christofaro: The government has also said that if they were to accept US aid or from any other imperialist country, they would be acknowledging that Guaidó’s government is legitimate. Narrator: There was backlash
against Maduro’s leadership. Hugo Carvajal, Venezuela’s
former intelligence chief, called out Maduro, making accusations that his inner circle is corrupt. Christofaro: All the
high-ranking officers, which Guaidó actually needs on his side, feel very comfortable in
this position of power that they’ve had. Of course, under Maduro,
they have a lot of power, but they’ve also been implicated in a lot of problematic things such as corruption and are just afraid that if they go to the other side, they might be reprimanded for that. Narrator: In a New York Times op-ed, Guaidó said he has been secretly meeting with members of the armed forces and has offered amnesty to defectors who have not committed
crimes against humanity. Christofaro: Right now, he
is trying to oust Maduro, and they’ve been in this
political tug of war for the past few months
where he has been meeting with international leaders, where he has been appointing
opposition ambassadors around the world and has been
calling for mass protests, and his goal right now
is to get the military on his side and to call for new elections. Narrator: The US is Venezuela’s
largest oil customer and is supporting Guaidó by
imposing financial sanctions, directing US companies to withhold payment from Maduro’s state-owned oil company. Steven Mnuchin: We will
continue to use all of our diplomatic and economic tools to support interim President Guaidó, the National Assembly, and the
Venezuelan people’s efforts to restore their democracy. Narrator: In April, the US enacted another round of sanctions, trying to prevent Maduro’s government from trading oil for Cuban
intelligence services, and Vice President Mike Pence
lobbied the UN to back Guaidó. Pence: And so the United States is calling on the United Nations to live up to its very purpose, reject
the failed leadership of Nicolas Maduro, stand with us, stand with nations across the world, across this hemisphere, to help the people of Venezuela
forge a brighter future. Narrator: A week later, with 7 million Venezuelans living in need of humanitarian aid, Maduro reversed his aid policy, allowing the Red Cross to
start a large-scale effort to feed and provide medical attention throughout the country. However, Venezuela is still in one of the worst economic
depressions in modern history. The International Monetary
Fund has predicted the country’s economy will
shrink by 25% this year. Narrator: This crisis is far from over. The country’s infrastructure
and economy need repair. But the Red Cross intends
to fight malnutrition and disease in what it
estimates will be one of its largest humanitarian efforts since the beginning of
the Syrian Civil War.

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