While everyone is busy talking and worrying about these intentionally symbolic US sanctions against Venezuelan state oil company PDVSA, there is a real news story happening in Venezuela that is getting little play. The Caracas Metro is tripling its fares, from 0.50 bolivars to 1 bolivar in June and 1.50 in December. Meanwhile, a friend who takes language classes at a Bolivarian University, President Hugo Chavez’s new public university system, tells me that the university abruptly announced it would start charging tuition. Retroactively.
Now, I neither have a strong opinion about these fee hikes, nor do I feel I have much of a right to an opinion — this is the definition of an internal matter. However, I think it’s worth pointing out that the biggest Venezuelan public subsidy is to motor fuel. It’s hard to quantify exactly, but if you take PDVSA at their word that they sell 442,000 barrels a day of gasoline and diesel to the internal market for an average of about $7.21 a barrel, that’s currently an effective subsidy of about $110 a barrel, or $48 million a day, or $18 billion a year. Each year, that money could buy about a dozen new entire Metro lines (at least if they were the economical kind, rather than the gold-plated stuff pushed by gringo export-pushers in the 1970s). And language tutors for all.