By Javier Ávila:
Communism learns from its mistakes. Mao-Tse-Tung’s “Great Leap Forward” between 1958 and 1961 meant a fatal famine for China that killed 15-55 million people. This dark episode marked China to such an extent that ideological concepts about the country’s economy were progressively dismantled until it became the economic powerhouse it is today, thus generating a new strain of Communism that particularly threatens Latin America.
This strain is not an isolated case. Along with China, Laos and Vietnam present a GDP growth of 6.11%, 4.64%, and 7.01% in 2019, respectively. Despite being political systems under authoritarian Communist parties, they have embraced the market economy and private property to the extent that they generate wealth for their countries, but maintaining strong limitations on social freedoms.
In many countries, extreme vaccinations have been applied against Communist movements, even vetoing them. But this is not enough. The strategic mutation that Communism pursues uses the same organism of capitalism to reproduce itself and end democracies. Through free trade and private property, they have managed to consolidate the structure of Communist government through generations, and technological advances reinforce the tendency.
Situations like these continue to increase, contributing to the normalization of the Communist and socialist regimes. This quality has become the new Communist sneeze and is the main means of contagion due to its propagation.
In Latin America, Venezuela represents the population with the greatest contagion risk. The regime’s tight control and the opposition’s poor strength place the country in a scenario where it considers economic opening as a means to alleviate the crisis. The main political actors’ strategic interaction has forced the Venezuelan population to experience a depressing economic picture, which conditions them to accept the lesser evil of a socialist regime with a market economy.
The complicated part of the situation is that, beyond the fact that it is not the desirable scenario for promoters of freedom, it represents a Nash equilibrium where both parts (the general population and the regime) would improve their current condition, with the cost of sacrificing the freedom and dignity of Venezuelan citizens.
The international community is still has time to counteract this Communist strain, but as long as concessions continue to be given to these regimes, contagion will be inevitable.
Javier Ávila is a business economist, consultant in the areas of strategic planning and investment banking. He has a special interest in private equity funds. @JavierAvila7.