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Lessons from the collapse of Latin American socialism

Posted December. 09, 2015 08:43,   

Venezuela`s opposition has won by a landslide for the first time in 16 years. In the election held on Sunday, the Unity Movement Alliance has won a majority of 167 seats in the National Assembly, taking 113 of them. This was a consequence of the fact that the country’s economy has been hit hard by the continued fall in oil prices, its main export. The result gave another blow to the so called “pink tide” of Latin America, taking place after the winning of a center-right candidate in Argentina’s presidential poll in 12 years and Brazilian left-wing president Dilma Rousseff’s facing impeachment.

Such collapse of socialist regimes in the continent was fueled by populism, economic downturn, incompetency and corruption of the governments.

Venezuela, the only OPEC member in the continent, was blown by maintaining populist welfare policies adopted during the Hugo Chávez regime from 1999 to 2013, when the oil prices soared 10 times. Excessive free welfare and anti-market policies led to the fall of the domestic manufacturing sector, and Venezuelans are suffering from chronic shortage of necessities and 200 percent annual inflation. Within just two years since Nicolás Maduro took office after Chávez, the nation’s per capita GDP dropped to the level of the 1950s.

Argentines chose a change after realizing that at the end of excessive welfare was a failing economy. In the country dominated by "Peronism" for seven decades and currently facing challenges such as fiscal deficit, high unemployment, 30 percent inflation, and negative growth, a right-wing businessman Mauricio Macri was elected with his pledges focused on revitalizing the economy.

Populism has left great scars in Latin American countries by allowing politicians to churn out policies that give them advantages to win elections. The fall of socialist parties represents the peoples’ anti-sentiment toward incompetency and corruption of their leaders. This holds many implications for Korea’s politics, which has been pushing forward irresponsible populist welfare policies, when the economy has been remaining stagnant for years.