AHC: Make Venezuela as rich as Saudi Arabia

Venezuelan economy: *collapses thanks to a drop in oil prices and crippling US sanctions*

Conservatives: 'Why would socialism do this?'
Iran faced the same drop in oil prices and its sanctions are , if anything, even stricter then Venezuela's and yet they didn't (and don't) have people digging through garbage dumpsters for food. Also Venezuela raised tariffs through the roof a considerable time before the sanctions hit.
 
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Venezuelan economy: *collapses thanks to a drop in oil prices and crippling US sanctions*

Conservatives: 'Why would socialism do this?'
Supplying Cuba and others with near free Oil didn't help.
Chavez gave away a lot while he was in, to help the cause of exporting and supporting what he called socialism.
 
Most of the Americas give citizenship by birth in the country.
Bring in people and not allowing them citizenship create a subclass with no stake in society and who tend to get deported when the money runs out.
I know that. I'm saying that needs to be changed and then the POD is easily met. How to do it specifically would need to be answered by someone well versed in Venezuelan history and I'm not that person but it's not an impossible task.
 
Couldn't building up domestic refining capacity since the 1970s help offset the high sulfur content?
They'd still fall on the resource trap, though (and so has Saudi Arabia, after all)
It could help, yes - though I'd suggest doing it much sooner than the 1970s. Oil as a fixture of the Venezuelan economy dates back to the early 20th century, and was further consolidated under Juan Vicente Gómez who freely gave out contracts in exchange for a huge amount of corruption to line his pockets, eventually evolving into the classic magical state. Compare that with Argentina, which around the same time under Mosconi created YPF, which did pretty well for itself throughout much of the 20th century. If Gómez is completely removed from the picture and democracy takes root in Venezuela (along with a better non-oil economy from the get-go), the development of Venezuela's oil industry (including the domestic refining capacity) would have taken a different course, either through an YPF-like direction (let's call it YPFV) or a compromise towards an ARAMCO-like direction, but with a stronger presence of the state through YPFV or something else. But to make it work so that the resource curse could be avoided, I would think the ideal solution would be to delay the development of the oil economy as much as possible and focus on building up its industrial capacity first. I hate to call it "pulling a Meiji" because it carries all sorts of connotations that don't really work outside of Japan, but maybe something similar could work in this case - and take advantage of the prevailing progressive mood in the US at that time. Then, once the Depression hits, at least Venezuela would have some sort of cushion that could also be used to help out other Latin American countries as their traditional European clients erect major tariff barriers.
 
Simple no socialism and deversfy the econmy
I think the autarky, corruption and overspending were bigger problems.
Venezuelan economy: *collapses thanks to a drop in oil prices and crippling US sanctions*

Conservatives: 'Why would socialism do this?'
Venezuela's problems aren't as simple as "capitalism vs socialism". Nationalization of the country's oil industry started under a US-friendly "capitalist" administration; as George Mason University associate professor Jo-Marie Burt puts it, "Venezuela has long been dependant on oil revenues, and the Bolivarian revolution of Hugo Chavez did not fundamentally alter that situation."
 
Venezuela's problems aren't as simple as "capitalism vs socialism". Nationalization of the country's oil industry started under a US-friendly "capitalist" administration; as George Mason University associate professor Jo-Marie Burt puts it, "Venezuela has long been dependant on oil revenues, and the Bolivarian revolution of Hugo Chavez did not fundamentally alter that situation."
There is a difference between largely dependent on oil revenue and literally having people digging through garbage for food. There are a lot of countries out there that are largely dependent on oi revenue and yet didn't have their entire economy collapse to the point people were digging through garbage to find something to eat.
 
There is a difference between largely dependent on oil revenue and literally having people digging through garbage for food.
That's not the point. The point that's being made there is that Venezuela has always had this problem ever since the discovery of oil. What was originally rural poverty became urban poverty once cities like Caracas began to grow and Gómez (later Pérez Jiménez) moved the oil industry towards directions favorable to him. It's not a matter of ascribing simple explanations to things until you dig deeper into what's really going on. The structural problems leading to that could have been addressed at the earliest possible opportunity in the early 20th century if Gómez's regime is avoided at all costs, while taking advantage of the prevailing moods of the era. Tackle the problems with the agricultural sector and build up Venezuela's industrial capacity first, then handle the oil issue separately and responsibly. That would significantly reduce a good portion of the problems associated with poverty in Venezuela, and in tandem with modernizing the state à la Uruguay and Costa Rica.

It's a more complex/complication response to the AHC, but it can work. In this case, the prevailing ideology would be positivism - and not just any sort of positivism, either with political applications. We view it today through regimes like Porfirio Díaz in Mexico (and especially through the work of the científicos) or Brazil's Old Republic or Cuba under the de facto US protectorate (and, yes, Juan Vicente Gómez), but there were other applications of it that point towards a different direction, and that's where I could see Venezuela if Gómez is removed. Administrations like Benito Juárez's in Mexico or José Batlle y Ordóñez in Uruguay provide reasonably good reference frameworks for what to do. Even Costa Rica (ignoring Tinoco for a moment, whose's very much an exception) could work as a possible example even then, despite the huge differences between it and Venezuela. Taking the other route Comtean positivism allows could work in this case.
 
Venezuela's problems aren't as simple as "capitalism vs socialism". Nationalization of the country's oil industry started under a US-friendly "capitalist" administration; as George Mason University associate professor Jo-Marie Burt puts it, "Venezuela has long been dependant on oil revenues, and the Bolivarian revolution of Hugo Chavez did not fundamentally alter that situation."
Dependency on oil exports was not the problem. A lot of other countries are one product exporters. The problem is overspending and failure to build up reserves when the prices of oil go down.
 
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Saudi Arabia and Qatar are headed toward being diversified , Venezuela is not.
LOL. Buying tons of raw materials and components abroad (using oil money), and then paying people (mostly imported serfs) to process them locally (using oil money) and then selling the results at loss (subsidised with oil money) is not ‘heading towards being diversified’.

The gulf states have managed to avoid the absolute worst excesses of petro-populism which wrecked Venezuela mostly because they are not democracies and so don’t have politicians engaged in competitive vote-buying. Instead the political elite can limit themselves to buying just enough popularity to avoid popular uprising.
Another factor is that in Venezuela the popularity-buying was almost exclusively done with petro-cash and petro-jobs. The gulf oligarchs similarly did that a LOT but also made use of alternatives such as: pandering to religious fundamentalism, importing serfs to do menial jobs, and offering a special ”not being viciously oppressed” status to those who avoid criticising them. That’s their real diversification success.
 
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There is a difference between largely dependent on oil revenue and literally having people digging through garbage for food. There are a lot of countries out there that are largely dependent on oi revenue and yet didn't have their entire economy collapse to the point people were digging through garbage to find something to eat.
Well, since you compared Venezuela to Iran upthread...
According to the United Nations, Venezuela produces only 30% of its food supply. Historically, this has been a problem in Venezuela, Morris said, that was "much more exasperated" under Chávez, even though the large reliance on importing food existed before him.
Source: USA Today

Meanwhile, in Iran:
Abbas Keshavarz, acting Minister of Agriculture of Iran, said... "Our self-sufficiency in food production reached 81% percent last year, and our forecast is that this number will increase and reach 83% this year [2020]"
Source: Hortidaily

Again, Venezuela's food vulnerability problem predates "socialism".
Dependency on oil exports was not the problem. A lot of other countries are one product exports. The problem is overspending and failure to build up reserves when the prices of oil go down.
Agreed.
 
Could someone other than Carlos Andrés Pérez (who presided over the oil boom IOTL) create this cushion?
While most of what we know about the cushion and all that is largely very modern and all that, I could possibly see something like that occur in the 1920s and 1930s (particularly as far as the Depression is concerned), but it would have to be a wholistic process that takes into account the entire economy (at least if we date the changes, as I do in my suggestions here, to avoiding Juan Vicente Gómez and prolonging Cipriano Castro for a bit). Granted, it would be much more modest and would be nothing like we would expect now - it's impossible for someone in the early 20th century to think that far ahead into the future - but basic elements of it, under democratic oversight, could be put down very early as part of a responsible framework for managing oil. It would certainly avoid the corruption involved with the early oil contracts that Gómez encouraged, including bribes and kickbacks to get things moving and enriching his régime (sound familiar?).
 
IMHO, comparing V dump-digging to Iran is skewed: Iran since Shah is mostly run by the religious elite and the 'revolutionary guards'. If they disapprove of something, such as dump-digging, sanctions are dire...

whimsy:
Venezuela throw-in with Northern Columbia and Southern Panama to join US Canal Zone, subsequently become US States...
/
 
That's not the point. The point that's being made there is that Venezuela has always had this problem ever since the discovery of oil. What was originally rural poverty became urban poverty once cities like Caracas began to grow and Gómez (later Pérez Jiménez) moved the oil industry towards directions favorable to him. It's not a matter of ascribing simple explanations to things until you dig deeper into what's really going on. The structural problems leading to that could have been addressed at the earliest possible opportunity in the early 20th century if Gómez's regime is avoided at all costs, while taking advantage of the prevailing moods of the era. Tackle the problems with the agricultural sector and build up Venezuela's industrial capacity first, then handle the oil issue separately and responsibly. That would significantly reduce a good portion of the problems associated with poverty in Venezuela, and in tandem with modernizing the state à la Uruguay and Costa Rica.

It's a more complex/complication response to the AHC, but it can work. In this case, the prevailing ideology would be positivism - and not just any sort of positivism, either with political applications. We view it today through regimes like Porfirio Díaz in Mexico (and especially through the work of the científicos) or Brazil's Old Republic or Cuba under the de facto US protectorate (and, yes, Juan Vicente Gómez), but there were other applications of it that point towards a different direction, and that's where I could see Venezuela if Gómez is removed. Administrations like Benito Juárez's in Mexico or José Batlle y Ordóñez in Uruguay provide reasonably good reference frameworks for what to do. Even Costa Rica (ignoring Tinoco for a moment, whose's very much an exception) could work as a possible example even then, despite the huge differences between it and Venezuela. Taking the other route Comtean positivism allows could work in this case.
Not to this extent, Venezuela was the richest country in Latin America with a poverty rate around 20%, it is now 90%
 
LOL. Buying tons of raw materials and components abroad (using oil money), and then paying people (mostly imported serfs) to process them locally (using oil money) and then selling the results at loss (subsidised with oil money) is not ‘heading towards being diversified’.

The gulf states have managed to avoid the absolute worst excesses of petro-populism which wrecked Venezuela mostly because they are not democracies and so don’t have politicians engaged in competitive vote-buying. Instead the political elite can limit themselves to buying just enough popularity to avoid popular uprising.
Another factor is that in Venezuela the popularity-buying was almost exclusively done with petro-cash and petro-jobs. The gulf oligarchs similarly did that a LOT but also made use of alternatives such as: pandering to religious fundamentalism, importing serfs to do menial jobs, and offering a special ”not being viciously oppressed” status to those who avoid criticising them. That’s their real diversification success.
Buying raw materials abroad, manufacturing products and exporting them is not anything new. Nor is "dumping" exports when you are starting out. I said they were beginning to diversify, not that they were diversified.
 
Not to this extent,
I would argue even up to this extent. The difference pre-oil was that most of the poverty was rural and had been part of Venezuelan life for a really long time. When cities like Caracas started growing, alongside Gómez's regime and the beginnings of the oil industry, the poverty was transferred to the cities as well - hence the barrios and all the shacks that you see surrounding cities like Caracas. It's always been there, but either hidden, or unknown, or (however you describe it) manageable. Hence my thinking that the sooner it gets resolved pre-oil, the better off Venezuela would be when engaging with oil. One cannot look at the present and very recent past (much of it being something more suited for Chat) without looking deep into Venezuela's history and its place within Latin America overall.

Venezuela was the richest country in Latin America with a poverty rate around 20%,
I would dispute the whole "richest country in Latin America" bit, but that's me. The presence of abundant oil wealth alone did not make Venezuela rich, just like how the presence of abundant copper reserves did not make Chile rich (although it helped). It only served as a mask for hiding what was actually happening, although it did provide a temporary base for democracy to flourish. What I think would best fit the AHC is to make the economic and political roots of Venezuela much deeper than OTL so that it's not as dependent on the oil and the benefits of prosperity would reach even more people than OTL. Now, I'm neither Venezuelan nor am I an expert of Venezuelan history, but I know a little of Cipriano Castro and positivism in Latin America, and figured those two together would be a better option. I'm constrained here because the furthest back I can go in this section is 1900, so I have to make do with what I have. To me, focusing solely on the last two decades of the 20th century and into the 21st century just doesn't work because it's not fixing the core problems with the model. Even if the 1973 oil crisis is avoided or severely mitigated, that's only still kicking the can down the road until it's too late - in which case you'd still have a similar situation as now, only this time instead of (INSERT CHAT REDIRECT HERE) you have a government by patronage that has abused the system. That's why I see the early 20th century as the best option for fixing that so Venezuela would truly be one of the richest countries of Latin America, instead of only fleetingly. What cannot be done is making it an equal of Saudi Arabia. Saudi is its own thing, a product of certain conditions that really only work for Saudi Arabia and the rest of the Gulf states. Venezuela could never reach the heights of Saudi Arabia, even if it wanted to (for one thing, geography would work against it); what it can do is better manage everything else through a comparatively more gradual route, which is much more achievable.
 
Socialist government in Venezuela pushed for large investments in education, retirement, social safety net and more and always spent as much as it could on it as well as wagering the market and investing more than it can in hope the oil prices will go up. The thing with that is once people are given something they don’t like it taken away, especially if they can vote democratically. Cutting the pensions or SSN could save the economy but ruin your career. Thus politicians are encouraged to double down on it. Until you crash like Venezuela did.
To save its economy don’t implement such large social programs and invest the surplus into diversification and use that to increase the SSN.
 
Could someone other than Carlos Andrés Pérez (who presided over the oil boom IOTL) create this cushion? The man was pretty corrupt so he himself is out.
I was about to say, having somebody other than CAP prevail in 1974 - maybe Fernandez defeats him straight up, or Burelli Rivas makes another go at it, or Betancourt makes a comeback, there’s a variety of options - would be a big butterfly, perhaps allowing Caldera’s philosophy to take root instead
 
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