Venezuelan socialism accomplishes the impossible, starts importing oil

The country claiming the world’s largest oil reserves is now reduced to importing oil. Walter Russell Meade of The American Interest compiles the information:

The management acumen of Venezuela’s President Nicolas Maduro continues to amaze. Reuters:

Algeria is in talks to export crude oil to fellow OPEC member Venezuela, Algerian Energy Minister Youcef Yousfi said on Tuesday, confirming a Reuters report.

Last week, a document from Venezuela’s state-run energy company PDVSA seen by Reuters showed Venezuela was considering importing crude oil for the first time and could use Algerian light crude as blending stock to boost sales of its own extra-heavy oil.

“Yes, we are in talks,” Yousfi told Reuters when asked whether Algeria was planning to export crude oil to Venezuela. He declined to provide details.

More details come care of the Miami Herald:

It turns out that Venezuela’s own production of light crudes has plummeted since the late President Hugo Chávez took office in 1999, and the country desperately needs light crudes to blend with its Orinoco Basin extra heavy crude oils. Without such a blend, the Orinoco Basin’s extra heavy crude is too dense to be transported through pipelines to Venezuelan ports and exported abroad.

Venezuela’s oil production, which accounts for 95 percent of the country’s export earnings, should be used in world classrooms as a textbook case of what happens when a populist government starts distributing a country’s wealth in cash subsidies, without investing in maintenance and innovation. Much like happened with Cuba’s once flourishing sugar industry, Venezuela’s Chávez-inspired populism has destroyed the goose that laid the golden eggs.

In 1999, when Chávez took office, PDVSA had 51,000 employees and produced 63 barrels of crude a day per employee. Fifteen years later, PDVSA had 140,000 employees, and produced 20 barrels of crude a day per employee, according to an Aug. 14 report by the France Press news agency.

Venezuela’s net oil exports have plummeted from 3.1 million barrels a day in 1997 to 1.7 million barrels a day in 2013, according to U.S. Energy Information Administration estimates.

That’s not the only horrible outcome of Venezuela’s excursion into Marxism. Nick Miroff of the Washington Post reports on the ruination of the Venezuelan steel industry:

Long before Hugo Chávez launched his socialist revolution, government planners came here to Venezuela’s eastern frontier, where the mighty Orinoco and Caroni rivers converge, and envisioned an industrial workers’ paradise.
President Rómulo Betancourt, a key partner in John F. Kennedy’s “Alliance for Progress,” founded the city in 1961, inviting his countrymen to turn Ciudad Guayana into a tropical Pittsburgh.
More than a city, “it felt like you were building a country,” said Alfredo Rivas, who arrived as a young engineer and went on to become president of the huge steelworks here.
A half-century later and 15 years after Chávez came to power, Ciudad Guayana’s factories are crippled, starved for investment and roiled by labor disputes.
So faint is Betancourt’s vision that his own monument is coated with rust amid weeds and knee-high grass in the city’s Founders’ Park, where national guard troops are bivouacked.

OK, maybe so, but the workers are being looked after in this workers’ paradise, right? Maybe not so much:

The troops opened fire Aug. 11 on protesting steelworkers, injuring three. The workers’ standoff with President Nicolás Maduro — Chávez’s successor and a former union leader himself — has turned Ciudad Guayana into a crucial battleground for the socialist government as it faces economic meltdown and political infightingwithin the Chávez movement.
The labor tensions have left a government that prides itself on its proletarian bona fides sitting uncomfortably on the management side of the bargaining table — and its representatives sounding increasingly like the beleaguered executives they have spent much of their political careers opposing.

Socialism is a catastrophe for all involved – except the Marxist governing elite and its cronies. Venezuela ought to be one of the richest counries in the world, based on its treasure trove of natural resources. Instead, it is a wreck, and getting worse by the day. Nonetheless, fools like Sean Penn embrace it, and fools like President Obama and much of the Democratic Party refuse to learn the lesson.

http://www.americanthinker.com/blog/2014/09/venezuelan_socialism_accomplishes_the_impossible_starts_importing_oil_.html#ixzz3Clzfa3rp