THERE IS NO ALTERNATIVE TO LIBERALISM:

The limited Chevron license has important strings attached to ensure the money it generates plays a constructive role in ending Venezuela's woes. The new permit was issued only after representatives of the Maduro regime and the political opposition resumed secret talks in Mexico City, which came after Maduro was reelected nearly four years ago in an election widely recognized as fraudulent. (As a result, the US government does not recognize Maduro as Venezuela's legitimate president.) Once the talks resumed, both parties agreed to establish a fund to be managed by the United Nations. Up to $3 billion dollars in frozen assets from the Maduro regime, now held in foreign banks, will be gradually released to the new fund and can only be spent on basic needs such as medicine, food, and other humanitarian aid for Venezuelans.

One of the most important goals of the negotiations, both for the opposition and for the US government, is to ensure democratic and transparent elections in Venezuela in 2024 -- something that Maduro naturally resists. But his willingness to come back to the table signals that he is in desperate need of relief; he wants more sanctions lifted.

Crucially, the new license prevents any cash payments from going to the Venezuelan government and will allow Chevron to export oil only to the United States. Still, many Republicans opposed Biden's move and suggested it would prop up Maduro's socialist regime. Mike Pompeo, who served under former president Donald Trump as secretary of state, tweeted that he "worked to sanction Venezuela's communist dictatorship. Reversing our sanctions won't help Venezuelans -- but it will help Maduro."

While that's always a possibility, there is no guarantee that Maduro will reap anything from the Chevron license. Nor is there any certainty that the Biden administration will continue to lift those sanctions if this step has unintended consequences. But Maduro does have an incentive now to cooperate with the opposition and the US government: The worldwide energy crisis derived from Russia's invasion of Ukraine offers him a unique opportunity to come out of global isolation. 

Low denomination bills are scarce in the headlong capitalism that is gripping Venezuela. Everybody is thinking about money. Daily life is governed by greenbacks. The country, through Chavism, has moved on from the unsuccessful application of the Socialist Bolivarian revolution to a process of opening up branded in the forges of liberalism. The phenomenon has caused a mirage of economic recovery to appear.

Gone are the days of rigid controls. Up until very recently, Venezuelans hid their dollars because it was a crime to possess them beyond the watchful eye of the state. People had to queue for hours to buy rationed food at regulated prices and bolívars, the local currency, were few and far between. The panorama now is completely different. The use of the dollar as everyday currency, the lifting of price controls and tariff-free imports have changed the reality under which Venezuelans previously attempted to subsist.

The economy, says Luis Vicente León, an economist and president of the polling company Datanálisis, rebels against the established order faster than societies themselves. "What is happening in Venezuela, as it did before in China or Russia, is that people are looking for imaginative solutions to the control and interventionism of the state. When the government experienced problems due to sanctions and international isolation, they started to realize that riding this surfboard that society had created was more of a solution than a problem. And the government jumped on." And exactly the same thing happened with the dollar, which went almost overnight from being demonized to providing some guarantee of a certain stability.

The dollar is now used in almost 70% of commercial transactions, according to some economic observers, and in a distorted economy it has also been infected by inflation: more and more dollars are required to buy the same thing. Ecoanalítica noted that the dollar lost 50% of its purchasing power in Venezuela in 2021 and it forecasts another chunk being taken out of it this year. Life in dollars, in which those who can afford to seek refuge, is also becoming more expensive and retailers have taken to camouflaging prices in non-denominated amounts with the abbreviation Ref, for reference. The price of a pair of imitation shoes brought in via containers on which tax has not been paid in a shop in a commercial center is marked as Ref 30, which is to say, $30.

Nobody knows how many hours Venezuelans waste every time they open their wallet. Even the smallest transactions require a mental calculation of a few minutes to work out if the exchange rate applied by the shop is beneficial, which varies depending on the currency being used and convenience: if the extra tax has to be paid because a buyer only has dollars and their use has spiraled in recent months; if the price has to be rounded up because there are not enough low domination bills or coins for change; or if there is no other choice but to pay more for a product because they are only carrying devalued bolívars. In Venezuela's convoluted economy, everything ends up being more expensive.

Paying for anything in Caracas creates scenes worthy of a Marx Brothers movie. One morning, for example, a woman turns to a stranger in the queue to pay for a parking lot with a dollar in her hand: the parking place costs five bolívars, a few cents more than the dollar at the official exchange rate. The stranger with bolívars on his card pays for her and keeps the dollar, which means she avoids paying 3% more because of the Large Transaction Tax (the difference between large and minimal is obviously irrelevant). Just paying for parking can be an odyssey.

The sui generis capitalism being practiced in Venezuela has created a bubble of expenditure and redistribution in which four million people are living, particularly in Caracas. It is an island of consumerism in the middle of a precarious economy. Traffic in the capital has been restored to the diabolical levels of any major Latin American city whereas previously, due to a lack of gas, the roads were practically empty. Entrepreneurs are opening nightclubs, restaurants, supermarkets, stores and pharmacies. Internationally famous singers are returning to perform. One of the trendiest spots, Bar Caracas, has a price list identical to clubs in New York. That doesn't stop it from being jam-packed from Wednesday to Sunday. Bar Caracas is a terrace in a five-star hotel, the Tamanaco, where businesspeople from around the world stay, with local news on Google alert to try and understand what is happening in Venezuela. They have the feeling that if they get in quickly, before house and business prices start to recover, there is money to be made.

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