As part of the expansion of the pro-poor social programs — known as "missions" — promoted by the government of socialist President Hugo Chavez, Venezuelanalysis.com reported on July 26 that Chavez had announced plans for the construction of 15 new hospitals. The article reports that building new hospitals, along with the transformation of run-down existing public hospitals, make up the third and fourth stage of one of the government's best known and most successful missions — Barrio Adentro ("Into the Neighbourhood").
Barrio Adentro began with the construction of thousands of popular health-care clinics throughout the country to provide free and accessible health care, in the first place to the poor — many of whom had never had access to a doctor before — but increasingly to the rest of society as well. Venezuelanalysis.com reports that a recent survey by the Central Bank of Venezuela reveals the mission has directly benefited nearly 50% of households, including 62.3% of low-income households.
Speaking at the inauguration of the remodelled Perez Carreno Hospital in Caracas, Chavez pointed out: "We have seen equipment that did not exist in Venezuela before, now for the service of all Venezuelans. Some of them have been installed and operated for the first time." Health minister Jesus Mantilla reported that US$631 million had been assigned for the remodelling and upgrading of 62 public hospitals across the country.
The Chavez government's program of massive spending on social programs and public works is helping fuel sustained economic growth. Such social spending is a key part of the Bolivarian revolution, which seeks to redistribute the nation's significant oil wealth to eradicate poverty and develop the nation. A study released in July by the US-based Center for Economic and Policy Research, entitled "The Venezuelan economy in the Chavez years", which reports a growth in real GDP of 76% since the first quarter of 2003, claims that there is "no end in sight" for the current period of economic expansion. According to the report, under Chavez, government social spending has increased by over 170% per person in real terms. This figure does not even include the social spending carried out directly by the state-owned oil company PDVSA, which last year accounted for 7.3% of GDP. Unsurprisingly, this has led to a significant drop in poverty.
This growing social spending has been funded by government policies that brought more of the economy under state control, increased taxes on the wealthy and carried out a massive crackdown on corporate tax evasion. A July 30 Prensa Latina article reported that Venezuela now receives an additional $5.8 billion per year as a direct result of changes in government policy in the oil industry. These changes include significant hikes in taxes and royalties paid by private oil corporations operating inside Venezuela.
Also, the government's nationalistion in May of holdings of foreign oil companies in the Orinoco Belt, with private companies offered the opportunity to stay on as minority shareholders, is expected to generate an additional $800 million this year. Chavez has said the government plans to redistribute the additional income into health and education, as well as state steel, lumber and cement industries.
The crackdown on corporate tax evasion, which has forcibly closed corporations such as McDonald's, Coca-Cola and Microsoft for up to 48 hours for tax irregularities, has scored impressive results. The government tax agency, SENIAT, has already reached 63.7% of its overall target for this year, according to a July 11 Venezuelanalysis.com report — $17.2 billion compared to $11.9 billion by this time last year. This comes at the same time as Chavez has reduced the burden on the poor by lowering the value-added tax on basic goods and services, with the aim of completely eradicating it by 2009. Venezuelanalysis.com quoted SENIAT superintendent Jose Gregorio Vielma Mora, who said that tax evasion is a "common practice and manoeuvre of the world capitalists and neoliberals".
Venezuelanalysis.com reported on June 22 that unemployment had dropped to 8% in May — the lowest level in over a decade according to the National Institute of Statistics. Following the economic crisis caused by a bosses' lockout that attempted to remove Chavez from office, in February 2003 unemployment had reached just over 20%. The current figure is over 2% lower than this time last year. The percentage of the work force in the formal economy has increased by 1%, up to 55.9%. Before Chavez was elected, the majority of workers were in the so-called informal economy — which includes, among others, those eeking out a living as street vendors, in the black market, in workplaces of less than five workers or as domestic workers.
US film-maker Michael Moore's latest documentary, Sicko, is a devastating exposure of the horrors of the US health-care system, where ordinary people are at the mercy of a system that aims only to generate profit for private corporations. Venezuela is moving in the exact opposite direction, and partially funding it at the expense of the often US-based large corporations — which goes a long way to explaining the incessant hostility of the US government towards Venezuela and the Bolivarian revolution.