Capitalist vs. Socialist State Intervention of the Economy
On the other hand, the Socialist State intervention prioritizes the most basic needs of people. This is the type of controlled and planned intervention that has been carried out by Hugo Chavez in Venezuela, while at the same time maximizing democracy, political consciousness, and the participation of the people in managing their own affairs. The enterprises that have been nationalized in Venezuela, such as the main communications company (CANTV), the iron and steel industry (SIDOR), and one of the principal banks of Venezuela (Bank of Venezuela), are highly profitable enterprises. In the case of CANTV, its nationalization cost the Venezuelan State roughly $1.6 billion; however, after a full year of operations this company earned nearly $400 million in net profits. At this pace, the Venezuelan State will recover its initial investment is just three years of operations. The resources that previously went into the pockets of rich people or became capital flight, are now being used by the government of Hugo Chavez to finance public heath care projects that are highly beneficial to the neediest people.
It is worth remembering that at the peak of neoliberalism in Latin America, during the 90’s, highly profitable publicly owed corporations were handed-over to the private sector. One close example was Venezuela’s national oil company (PDVSA). Although this company was never fully privatized, previous governments before Chavez welcomed transnational oil companies by signing “Conjuncture Agreements” with PDVSA that would allow them to extract oil by giving a small portion back to the Venezuelan State, 16% at the most. Thanks to a new Hydrocarbons Law drafted by the government of Hugo Chavez, these “Conjuncture Agreements” were replaced by Mixed Ventures where PDVSA will have the majority stake. Long before that, President Chavez was widely criticized by the Clinton administration for a trip made to OPEC countries in an effort to recover the price of oil, which used to be at $8 a barrel at the time.
Thanks to the Chavez government, PDVSA has been strengthened and its revenues have allowed the Venezuelan State to finance countless social projects, which include: primary medical care access for the entire population, along with secondary and third level medical care facilities free of charge, the complete eradication of illiteracy, infrastructural projects that run from the building of new schools, hospitals, bridges, roads, the enhancement of public transportation and the development of a huge train transportation system across the whole country. At the same time, the health of the economy has reached probably its best shape ever with international reserves and economic growth at its greatest level and the lowest unemployment rate in the history of Venezuela.
Certainly the recent hike in the price of oil has factored favorably for the Venezuelan economy. Nevertheless, this increment in the price of oil has been accompanied by the greatest weakening of the US dollar, which in real terms makes the price similar to the oil price hikes of 1981. However, back then the Venezuelan State was in the hand of capitalist and corrupt politicians and PDVSA was managed as a transnational corporation, rather than as a vital institution for the development and growth of the economy. As previously mentioned, today PDVSA has a greater participation in the production and exportation of Venezuelan oil than ever before and royalty increases for transnational corporations have allowed the Venezuelan State to collect a greater portion of profits than ever. Additionally, according to the Central Bank of Venezuela, the Venezuelan economy has grown not only in the oil sector but also in the communications, construction, and service sectors.
Clearly, how Venezuela and the US allocate public funds differs greatly. While the US government has abandoned the interest of its own people with its careless health care policies, dwindling education funding, increased military spending, and lowered taxes for the highest income bracket, the Venezuelan government has sought the careful use of public funds for developing an inclusive society, eradicating poverty, enhancing education and heath care facilities, and fostering the growth of a productive economy. All of which has been carried out by fomenting greater democracy and the participation of the people in all aspects of politics.
Martin Saatdjian is third Secretary at the Ministry of Foreign Affairs of the Bolivarian Republic of Venezuela.
 Figures gathered at: https://www.cia.gov/library/publications/the-world-factbook/ 
 Entire speech available at: http://www.un.org/ga/63/generaldebate/pdf/argentina_es.pdf 
 Chomsky (1996). Obtained from: http://www.un.org/ga/63/generaldebate/pdf/argentina_es.pdf