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viernes, octubre 21, 2005

Poverty down, but not far enough

First, some good news: unemployment and poverty are both down in Venezuela. Unemployment dropped to 11.5% in September, down from 12.1% in August and 14.5% one year ago. That's an impressive decline in just a year.

Venezuela's National Institute of Statistics (INE) also announced that by the end of 2005, the proportion of Venezuelans in poverty is expected to drop to 35%, down from 47% for 2004. Not sure what it means that they "expect" it to go down to that level; I'd rather hear what the poverty level is right now (for the first half of 2005 it was 38.5%.) But still, good news.

The economy is growing at an extremely fast pace, making up for the losses incurred during the lockouts and the coup, and this growth is helping people to find jobs and climb out of poverty. Undoubtedly the drop in poverty is also helped by government programs providing subsidized food, free health care, job training and access to microloans. If poverty does decline to 35% in the next two months, it will be substantially below the 42% rate when Chavez took office.

Nevertheless, the number of Venezuelans in poverty and/or unemployed is still high.

Clearly, Chavez hasn't solved Venezuela's deep-rooted economic problems. But he didn't create them either. Poverty has been growing pretty much continuously since 1980.

And not just in Venezuela. Throughout Latin America, the last two-and-a-half decades spent following supposedly pro-development reforms, heavily promoted by the West -- and known collectively as "the Washington Consensus" -- have led to economic and social devastation. Latin American people are increasingly revolting against what they call the "neoliberal" regime of dropping tariffs, privatizing public services, eliminating labor laws, and throwing the doors wide open to international investment.

There can be little doubt that these policies have spectacularly failed Latin America. As Weisbrot points out, even the basic economic statistics are damning, without considering the massive growth in poverty and inequality:

For the region as a whole, growth in GDP (or income) per person -- the most basic measure of economic success or failure -- was about 80 percent from 1960 to 1979, but only 11 percent for the 1980-1999 period and a mere 3 percent for 2000-2004.

Has Venezuela found a way out and forward, or is this just a temporary respite from the ravages of the "global economy"? Time will tell. But it's certain that Latin America urgently needs an alternative path.

Good to have you back.

Poverty is already down to 38.5% in the first half of 2005. So they are just probably just looking at the trend to get the 35%. And as you say, there is still obviously much to be done.
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