Redstate

Posted at 6:13pm on Nov. 24, 2007 In Which We Are Reminded Anew That Hugo Chavez Knows Nothing About Economics

By Pejman Yousefzadeh

One of the features of the Chavez economic "program" (the use of irony quotes are most definitely called for in this case) is the use of cooperatives as a means of implementing Chavez's socialist program. The Chavez regime's crafting and introduction of cooperatives in Venezuelan society is indeed an excellent way to showcase the nature of socialism to the Venezuelan people--along with the fact that cooperatives, like socialism, do not work:

Amid rows of softly humming sewing machines, with women calmly chatting among themselves as they go about their work, Margarita Morales picks up one of the bright red T-shirts from the production line.

"We're making these for people to wear at pro-government rallies," she says cheerfully, revealing a room stacked with T-shirts emblazoned with slogans such as "With Chávez, the people rule" and with images of Marxist revolutionary Che Guevara, as well as piles of military uniforms.

This small Venezuela Advances factory in Catia, a poor district in the west of Caracas, is one of Venezuela's showcase co-operatives, at the frontline of President Hugo Chávez's "Bolivarian revolution". Measures to promote such outposts of a `socialist economy' are one of the central planks of the changes Mr Chávez hopes to introduce to the constitution, expected to be approved in a referendum on December 2.

But not everyone is so optimistic about the prospects for the co-operatives. "So far there isn't a single example of a successful co-operative that I'm aware of," says José Luis Betancourt, the president of Fedecámaras, Venezuela's leading business association.

Despite the government having spent well over $1bn on grants and loans over the past few years, and billions more on social programmes designed to train workers in how to set up and run co-operatives, the results have so far been disappointing.

Although according to official statistics there were over 180,000 co-operatives at the end of 2006 - more than any other country - Gonzalo Gualdrón, the president of the government commission on co-operatives, says that in fact there are fewer than 80,000. Some census figures suggest there are fewer still.

While many co-operatives never got off the ground, due to misuse of government funds, others simply pocketed the money and ran, a situation that even Mr Gualdrón acknowledges.

Of course, as one might expect, apologists for the cooperatives movement have a ready-made excuse for the failure of cooperatives in Venezuela:

Supporters of the scheme say the biggest challenge is a deeply embedded culture of "capitalist individualism".

Translation: "If only the Venezuelan people would stop being so gosh-darned capitalist, then we could have some socialism around here!"

This is the point where readers may feel free to insert their own jokes concerning this . . . er . . . most curious of theories.

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