Chavez versus Obama: Facing Presidential Elections in 2012
James Petras
Introduction
Two incumbent presidents are running for re-election in 2012, Hugo Chavez in
According to the experts and politicians, the socio-economic performance of each President will be decisive in determining whether either President will be re-elected in 2012.
Measuring the Performance of Presidents Chavez and Obama in the Face of the Economic Crises
Over the past three years, both presidents faced a deep socio-economic crises resulting in increased unemployment, economic recession and popular demands for political leadership in formulating an economic recovery program.
President Chavez responded via a large scale program in public spending on social programs. Billions were allocated in a massive housing program designed to create one million homes over the next several years. Chavez lessened military tensions and reduced frontier conflicts by negotiating a political agreement with the rightwing
Chavez increased the minimum wage, social security and pension payments, increasing consumption among low income groups, stimulating demand and increasing revenues for small and medium size businesses. The state embarked on large scale infrastructure projects, especially highways and transport, creating jobs in labor intensive activities. The Chavez government sustained living standards by instituting price controls on food and other essentials, which sustained popular demand at the expense of profiteering by the owners of super markets. The Chavez government nationalized lucrative gold mines and repatriated overseas reserves in the course of financing its demand driven economic recovery program, eschewing tax concessions to the rich and bailouts of bankrupt banks and private businesses.
Obama rejected any large scale long term public investments to create jobs: his proposed “Jobs for
Obama ignores mortgage foreclosers of over 10 million families – increasing homelessness and habitation downgrades, in favor of bailing out banks and home mortgage swindlers.
Obama increased military spending, multiplying overseas combat troops, clandestine terror operations and the domestic spy apparatus, increasing the deficits at the expense of productive investments in education, technology skill upgrades and export promotion.
Unlike Chavez who makes a point of highlighting positive job and education policies for Afro and Indo-Venezuelans, Obama ignores the 50% unemployed big city young (18-25) Afro-Americans and Latinos in favor of serving white Wall Street bankers.
In contrast to Chavez who pegged pensions and wages to inflation and enforced price controls, Obama froze federal salaries and social security payments resulting in a seven percent decline in real income over the past three years.
According to the latest US Census Bureau data (September 2011)under Obama over 46.2 million Americans live in poverty,the highest figure ever.Median household income dropped 2.3%between 2009-2010.The number of Americans in poverty increased from 13.2%in 2008 to 15.1%in 2010.Nearly one out of four children live in poverty in 2010,as over 2.6 million more US citizens were impoverished in a single year.In contrast,and in line with Obama’s trickle down
economic policies,the number of wealthy Americans –earning over 100,000 dollars- have suffered little or no impact: luxury specialty stores ,like Tiffenys report a 15% increase in sales.
The lowest 10%of the population suffered the most,a fall in income of 12.1% between 2009-2010 while the 10%with the highest income saw a decline of 1.5%.Of the 34 members of the OCED the US along with Mexico,Chile and Israel has the worst social class inequalities.Obama’s top down stimulus policies saved the bankers by sacrificing the working and middle class
Political and Economic Consequences of Top Down and Bottom Up Economics
The political and economic consequences of Obama’s “top down” and Chavez “bottom up” socio-economic polices are striking in every respect.
While US unemployed remains above 9% and combined with underemployment rose to over 19%,
Chavez social expenditures have augmented the number of public universities, secondary and primary schools and clinics. Millions have lost their homes as Obama ignored the forced evictions of the mortgage banks, while Chavez has made a start in solving the housing deficit via one million homes.
Obama lends at virtually no interest to private banks who fail to lend to productive enterprises to create jobs, preferring overseas speculation in overseas (Brazilian) bonds with higher interest rates. Chavez invests directly in productive labor intensive infrastructures programs, agricultural self-sufficiency projects and developing downstream processing plants,refineries and smelters.
As a result of the reactionary top down economics he practices and his overt threats to cut basic social programs like Medicare, Medicaid and Social Security, Obama’s popularity has fallen over the past three year from 80% to 40% and heading downwards. Moreover, his pro-Wall Street fiscal and militarist policies – deepening an extending Bush and Rumsfeld’s wars and terror operations – has turned the US political climate further toward the extreme right. As of the last quarter of 2011, Obama appears vulnerable to electoral defeat.
In contrast President Chavez, riding the wave of economic recovery, based on positive programs of social expansion and public investments, has seen his popularity rise from 43% in March 2010 to 59.3% as of September 7, 2011. The
Chavez is vulnerable on issues of personal security, administrative corruption and inefficiency. But he is seen to have taken important steps to correct these problem areas. Graduates of a new police academy provide honest, efficient community linked policing, which, in pilot projects have reduced violent crime by 60%. Efforts to end bureaucratic corruption and inefficiency are still pending.
Conclusion
Comparing Chavez and Obama’s presidency presents a sharp contrast between a successful bottom up socialist informed economic recovery program and a failed top down capitalist stimulus program. While the American public expresses its hostility to private banking’s pillage of the treasury, government threats to the last remnants of the social safety net and Obama’s failure to lower persistent high levels of un and underemployment, Chavez’s popularity rises along with the positive “good feeling” among three-fifths of the electorate to his presidency. If the Chavez government continues and deepens his ‘bottom up’ economic stimulus program and the economy continues to expand and he recovers from cancer he will in all likelihood be re-elected by a landslide in 2012.
In contrast if Obama continues to truckle to the corporate and financial elite and slash and burn social programs he will continue his downward slide into well-deserved defeat and oblivion.
Venezuela’s economic recovery via advanced social programs is a powerful message to the American people: there is an alternative to regressive ‘top down’ economic policies: it’s called democratic socialism and its advocate is President Chavez, who talks to and works for the people as opposed to the con-man Obama who talks to the people and works for the rich.
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