R2 Neg

Nathaniel and I negate “Resolved: the US should end its economic sanctions against Venezuela.”

Contention 1 is global sanctions.

US policy extends far beyond Venezuela. For decades, we’ve imposed sanctions to show there are
consequences to aggressive actions, lifting them only when major concessions are made, such as the
Iran nuclear deal.

This builds credibility in our threats. Daniel Drezner of Stanford writes in 80 percent of cases, the US only
needs to threaten sanctions to gain concessions. 1 Following through on the other 20 percent makes
these threats credible.

Venezuela is an example of the US following through. Tom Phillips of the Guardian writes in 2019 that
sanctions target those responsible for Venezuela’s economic decline, and as they target the state-owned
oil company, are attempting to alleviate the crisis that’s resulted. 2
1
US threatened
DANIEL DREZNER 03 of Stanford (2003, "The Hidden Hand of Economic Coercion", doa 1-10-2020,
https://www.jstor.org/stable/pdf/3594840.pdf?refreqid=excelsior
%3Aa01651db7121acfd87cd42bee391371e) NY
Tables 1, 2, and 3 display the pattern of sanctions outcomes with regard to trade concessions, labor standards, and environmental protection, respectively. These tables offer strong support for the selection effects thesis. Table 1 displays the pattern of threats and outcomes when the

The data shows that in more than 80 percent of the observations,

United States uses Section 301 as a way to force other countries to reduce their trade barriers.

the United States threatened, but did not impose, sanctions. The success rate was considerably higher
for those sanctions that ended at the threat stage (56 percent) than those cases in which sanctions were actually imposed (33 percent). The statistical significance of the correlation just misses the ten
percent level, but the trend supports the selection effects argument.

2
Motivation of sanctions
TOM PHILLIPS 19 of Guardian (1-28-2019, "Trump steps up Maduro pressure with sanctions on
Venezuelan oil company", doa 1-5-2020, https://www.theguardian.com/world/2019/jan/28/trump-
venezuela-sanctions-oil-pdvsa-maduro-guaido) NY

The Trump administration has tightened the screws on Venezuela’s embattled president, Nicolás
Maduro, announcing sanctions against the country’s state-owned oil company PDVSA in what the US national security adviser

At a briefing in the White House, the US treasury secretary, Steve Mnuchin,

admitted was partly an attempt to counter strategic threats from Cuba and Iran.

told reporters the sanctions would help punish “those responsible for Venezuela’s tragic decline” and boost Juan

“It is a complete tragedy to have a humanitarian

Guaidó, the opposition leader who last week declared himself Venezuela’s rightful interim president and was recognized by the United States.

crisis in a country that has very rich resources,” Mnuchin said. The sanctions – which represent the US’s
toughest economic move against Maduro to date – come five days after Guaidó’s dramatic declaration sparked Venezuela’s latest political crisis. The national security adviser, John Bolton, said

$7bn of PDVSA assets would be immediately blocked as a result of the sanctions while the company
would also lose an estimated $11bn in export proceeds over the coming year. the sanctions were an Bolton said

attempt to alleviate “the poverty and the starvation and the humanitarian crisis” currently gripping
the South American nation and stop “Maduro and his cronies” looting the assets of the Venezuelan
people. “Now is the time to stand for democracy and prosperity in Venezuela,” he said, calling on “all responsible nations” to back Guaidó.

stability and democracy in Venezuela are in the

However, Bolton also conceded US strategic interests were in play, including concerns about the presence and activities of US foes in the region. “We think
By affirming, we lift sanctions before Venezuela diversifies their economy sufficiently. Timothy Peterson
of the International Studies Quarterly quantifies in 2013 that when the US capitulates on sanctions
before reaching their objectives, other countries see a lack of willingness to follow through, and the
probability of their acquiescence to US threats decreases by 83 percent. 3

By sending this signal, countries we sanction and the many more we’ve threated would take the
opportunity to step up aggression and human rights abuses, forcing re-imposition of sanctions on what
would’ve been mere threats otherwise.

Contention 2 is breaking the oil curse.

Peter Kanzacheev of the Cato Institute finds Venezuela was one of the most well-off countries in Latin
America, with a mere 2.4 percent living in poverty and higher GDP per capita than Germany, Italy, or
Japan.

Importantly, Carlos Rossi of the International Association for Energy Economics finds in 2011 after
Venezuela discovered the largest petroleum reserve in the world, oil has grown to make up 98 percent
of their exports, collapsing the agriculture and industrial manufacturing that used to make up the
country’s economic base.4

direct national interests of the United States right now ,” Bolton told reporters. “The authoritarian regime of Chávez and Maduro has allowed the penetration by adversaries of the United
States, not least of which is Cuba.”

3
Uh oh
TIMOTHY PETERSON 13 of the International Studies Quarterly (12-2013, "Sending a
Message: The Reputation Effect of US Sanction Threat Behavior", doa 1-10-2020,
https://www.jstor.org/stable/pdf/24014641.pdf?refreqid=excelsior
%3A966da4dde05c82f12da1243f82e79926) NY

Beginning with aggregated US sanction threat behavior, I find that the coefficient for US backed down is
negative and significant in the acquiescence equation of both Models 1 and 2 suggesting that (p < .01 in both),

targets are less likely to acquiesce when the United States has previously demonstrated a lack of
willingness to impose sanctions against resistant targets. Substantively, the impact of a previous year
capitulation by the United States on the current target's likelihood of acquiescence is considerable—
the probability that the target acquiesces falls by 83% by approximately 65% (from 0.41 to 0.14) in Model 1 and (from 0.45 to 0.08) in Model 2.

4
Oil now
CARLOS ROSSI 11 of the International Association for Energy Economics (2011, "Oil
Wealth and the Resource Curse in Venezuela", doa 1-4-2020,
file:///C:/Users/ndy15/Documents/Debate/2019-2020/PF/January/Files/311rossi.pdf) NY

Today oil accounts for over 95% of Venezuela’s exports, 50% of government revenues and 30% of GDP
directly. According to official figures, imports tripled between 2000 and 2008 to the unheard of level of
US$ 49.4 billion , before they collapsed 22.3% the following year due to policy instigated recessions6 . Venezuela’s populist president, Hugo Chavez, has presided over untold oil wealth and a recognizable reduction in Venezuela’s worst poverty levels (through

has also presided over a collapse in the production of all of

‘missions’ geared towards extreme hunger alleviation by handouts, free education and health care)

Venezuela’s agriculture and much of the industrial apparatus even some energy intensive , including crude oil production and

sectors like steel and aluminium. Venezuela has opted for

In contrast to other socialist nations that focus on socialist distribution while leaving production issues to private enterprise,

the ill defined “productive socialism’’ were the state interferes with basic production decisions of key
This is the oil curse. Rossi furthers with minimal investment in other industries, Venezuela has become
solely dependent on oil to import staple goods they used to make themselves, meaning shocks on the
global market can easily push their poor into starvation and death. 5 As a result, since Venezuela
discovered their petroleum reserves, poverty increased eightfold and their economy declined by 25
percent.6

industries. This socialist production model has exacerbated rent seeking and Dutch disease, and the constant “expropriations’’ have scared off would be investors in virtually all economic sectors. It is not that his socialist production model is not working, but that it can’t
work; it is socially-physically impossible for it to work (100 years of productive capitalism is enough time to teach us how companies must be managed to produce.

5
Very bad!
CARLOS ROSSI 11 of the International Association for Energy Economics (2011, "Oil
Wealth and the Resource Curse in Venezuela", doa 1-4-2020,
file:///C:/Users/ndy15/Documents/Debate/2019-2020/PF/January/Files/311rossi.pdf) NY

Here we will only

Dutch Disease is a complex economics phenomenon that occurs to mineral rich nations when a sudden burst in the demand for its product is recorded. It has been widely analysed and documented from various sources.

describe the elements that explain why the oil wealth rent that has accrued to Venezuela has come
with a double edge sword that has contributed to moving the country into a renter and unproductive
society. 1.It has overvalued the national currency and weakened the competitive edge in the production
of other staple goods that used to be made and now are imported . 2. Since oil related activities are
much more lucrative, this has caused many entrepreneurs to abandon their traditional areas in the rural
sectors in favour of flocking to the urban cities in search of a piece of the “oil pie’’. a For example, in the 1970’s,

government decision was made to cancel all agricultural related debt in the hopes of eliminating this
financial burden and increasing agricultural production. The result was the opposite. Most landowners
simply sold or closed their latifundios and moved into the construction business or other urbanite
ventures. Massive internal migrations and foreign immigrations to the urban core of principal cities
3.

were caused collapsing all social services

, creating the infamous poverty belts, Lavish and resulting in rampant crime. Venezuela’s population tripled since the first oil boom in 1973. 4.

spending on huge industrial projects that were ill conceived and badly managed were induced, wasting
valuable resources, creating the need for permanent subsidies and international debt. Rampant rent seeking and corruption by both

In 1949 Venezuela’s GDP per-capita income was higher than West Germany, Italy
state ‘technocrats’ and private contractors occurred.

and Japan. It made the nation more dependent on one commodity for hard currency
Now it ranks number 44 in the world. 5.

earnings to pay for imports, which include both final food and medical goods, as well as in parts and
inputs for industrial plants. It made the country totally dependent on the Government for all
6.

economic activity, including both public and private production since it is the state that controls
foreign currency for imports of spare parts and finished goods. It has transformed the political 7.

conditions of the country. As opposed to virtually all other developing countries,

This last effect is probably the least understood.

where the means of production (land, capital, companies) is privately held, Venezuela is different for
two reasons by the constitution oil belongs to the state
: 1) Because, and 2) because it is a full grown democracy. This means that the vote from the poor people count, and since the country
has a lot more poor folk that rich, they count a lot. Hugo Chavez champions the poor people because he not only comes from within their ranks but has developed a great rapport with them. He has improved their lot and hastened their hope and dignity but he has done it charitably, not

by Venezuelan law whomever governs the state also governs the fate of the
productively nor sustainably. The phenomena arises since

countries lucrative oil reserves. This dramatically hastens rent seeking but in the reverse. It is not the
rich who have control of the lucrative means of production and the poor who want access to it, but
just the opposite. the rich who want access to what the poor (or some) have; the power
The real paradox in Venezuela is that it is

over the oil wealth . It is a political-sociological pyramid turned on its head.

Without the external pressure of sanctions, the regime was content to survive on oil revenue, neglecting
their population entirely. Ellen Wald of Princeton writes in 2017 the government even refused foreign
relief aid, fearing losing control.7

Thus, Kenneth Rapoza of Forbes finds in 2019 Venezuela’s economic problems began long before
sanctions, which instead aim to align the goals of the government with the needs of the people. In the
short-term, Rapoza finds the most significant and common sanctions are those against Venezuela’s
state-owned oil company, which has dropped production to historic lows. 8

6
Wow oil really fucked Venezuela
PETER KANZACHEEV 17 of the Cato Institute (1-11-2017, "Curse or Blessing? How Institutions
Determine Success in Resource-Rich Economies", doa 1-4-2020,
https://www.cato.org/publications/policy-analysis/curse-or-blessing-how-institutions-determine-
success-resource-rich) NY

Although some economists have raised doubts about the role of natural resources in economic
development, up until the late 20th century, no significant efforts had been made to study the possible
negative impact of resource dependency. One of the possible reasons for that was the commonsense view that a country's natural resources should positively affect its economic growth. Several authors have argued

That approach started to change in the 1990s with the

that natural resource — notably coal as a source of energy — were among the primary drivers of the Industrial Revolution.4

publication of several notable studies. American scholar Terry Lynn Karl spent two decades studying the
experience of troubled petrostates. She identified some of the
The results of that research are contained in her 1997 book The Paradox of Plenty: Oil Booms and Petro-States.5

resource economies with the most evident institutional failures. One of the most notable cases is that
of Venezuela. Venezuela's economy is remarkable in several ways. With regard to its real gross
domestic product (GDP) per capita, Venezuela went from being one of the most well-off countries in
Latin America and worldwide in the 1950s to a period of stagnation and even decline . Over two
decades, its real income per capita declined by 25 percent. In 1988, 2.4 percent of Venezuelans were
living below the poverty line. But by 1998, when Hugo Chávez was elected president, that figure had
risen to 18.5 percent. Few people realize that Venezuela's current oil reserves are the largest in the
6

world. They are about a dozen times larger than what Venezuela had at its disposal in the 1980s. An oil-
abundant and oil-dependent autocratic government need not concern itself with income per capita,
poverty, inequality, and other indicators of the well-being of its general population, but one would
imagine that it would at least maintain oil production in order to fill government coffers. Yet Venezuela's example refutes even
that intuitive assumption. It is hard to believe, but Venezuela's overall oil production is actually lower today than it was half a century ago.7 Venezuela is not the only country that has failed to realize its hydrocarbon potential. Iran is another peculiar case. It possesses the largest combined
oil and gas reserves in the world and is second only to Russia in natural gas reserves. It could clearly have been a frontrunner in natural gas exports with a booming economy. But although sitting on enormous reserves, in 2014 it was actually a net gas importer.8

Something must be wrong with a country's institutions and policies if even its own oil and gas industry, a
government cash cow, can go into stagnation. Apart from Venezuela and Iran, Libya represents one of the most unfortunate examples of institutional failure among oil-exporting countries. As shown in Figure
2, Libya's GDP per capita went through a rapid adjustment from six times the world average in 1977 to below the global median income in a quarter of a century.

7
Blocked aid
ELLEN WALD 17 of Princeton (I earned an A.B. magna cum laude in history from Princeton
University with specialties in Near Eastern studies and creative writing. As a graduate student at Boston
University, I studied the American and Middle-Eastern energy industries with both an economist and a
foreign relations specialist. I have conducted significant research on geopolitics and energy markets at
the American Heritage Center at the University of Wyoming, the National Archives, the British
Petroleum Archives, and the British National Archives. 5-16-2017, "Venezuela's Melt Down Explained By
The 'Oil Curse'", doa 1-9-2020, https://www.forbes.com/sites/ellenrwald/2017/05/16/venezuelas-melt-
Mayela Armas of Reuters elaborates in 2019 while Venezuela’s oil industry is cut off by sanctions, its
private sector is completely unhindered, with 140 new businesses emerging since 2017. Armas specifies
as result of sanctions, Venezuela is diversifying to non-oil exports by approving more permits and
loosening export restrictions, quantifying Venezuela’s private sector has grown to make up a quarter of
the economy for the first time in decades. 9

In the medium-term, Argus Media finds in December throughout 2019, sanctions on Venezuela’s oil
have forced the regime to lift nearly all its domestic economic controls, which has tripled remittances

down-explained-by-the-oil-curse/#1ab2b6a9282b) NY

Venezuela is starving. The people of the once prosperous nation are now literally suffering—and in some
cases, dying—from hunger. The socialist government, under President Nicolas Maduro, will not allow
foreign relief aid, presumably because the government fears losing control . Protests continue, despite the lack of attention from much of the rest of the
world, and the government continues to kill dissidents at a slow but steady pace.

8
Venezuela’s econ already sucked. The sanctions aren’t the cause. Plus, they target
the elites and oil.
KENNETH RAPOZA 19 of Forbes (I've spent 20 years as a reporter for the best in the business,
including as a Brazil-based staffer for WSJ. Since 2011, I focus on business and investing in the big
emerging markets exclusively for Forbes. My work has appeared in The Boston Globe, The Nation, Salon
and USA Today. Occasional BBC guest. 5-3-2019, "No, U.S. Sanctions Are Not Killing Venezuela. Maduro
Is", doa 1-4-2020, https://www.forbes.com/sites/kenrapoza/2019/05/03/no-u-s-sanctions-are-not-
killing-venezuela-maduro-is/#71999f0f4343) NY

The ruling Socialists United of Venezuela is, point blank, the only reason why Venezuela is a mess. And

Maduro governs a failed state. Fifty other countries, including Colombia, Brazil, the U.K.
president Nicolas Maduro is its leader.

and Spain, all agree . Brazil and Colombia are currently catering to around one million Venezuelans who have fled the country. Some have preferred taking their children out of school and living in United Nations tents in Colombia instead of Maduro's
Venezuela. Maduro's incompetence, of which the Socialists United rallies around, is killing Venezuela. Not Trump. Not Elliot Abrams. Not Secretary of State Mike Pompeo. This is not a pre-emptive strike, searching for terrorists under beds and weapons of mass destruction in the Middle

The economy began its deep decline years ago, in the Obama years. It has been in an economic
East.

depression for three years. Obama first sanctioned members of the Maduro Administration in 2015.
Trump later sanctioned Maduro's Vice President Tareck El Aissami for drug trafficking in February 2017.
Later that year, U.S. companies were banned from providing financial assistance (as in loans) to one
company only, oil firm PdVSA. Talk of the U.S. banning food and medicine shipments to Venezuela is
not entirely true. So long as those shipments are not going to sanctioned individuals, it's not breaking
sanctions law. In 2018, the U.S. sanctioned trading in PdVSA bonds in the secondary market. All of
those bonds but one were already in default long before those sanctions were announced. Then in
2019, the U.S. asked PdVSA crude oil importers like Chevron to wind down its purchases , demanding
PdVSA keep its cash receipts from U.S. sales in its U.S. bank account and not repatriate it to
Venezuela. And last week, total bans on PdVSA crude oil shipments to the U.S. began. Venezuela's
economy was in dire straits way before this. Worth pondering, if the U.S. sanctions, of which the most
serious were only enacted this year, were driving Venezuela to the poor house, why are even worse
economic sanctions against Russia not hurting that country just as bad? "Without hard currency exports to the U.S., the Venezuelan regime is under extreme

The objective of U.S. sanctions is

duress," says Agathe Demarais, global forecasting director for The Economist Intelligence Unit. She says it is hard to quantify the impact of sanctions on an economy unless there is a total embargo. "

to collapse support for Maduro from within the regime comes with amnesty offers to military ," she says, adding that it

officials in exchange for free and fair elections . National Assembly President Juan Guaido has been orchestrating protests all year. Guiado declared himself interim president in January until new elections
and increased foreign investment. As a result, food and medicine imports have rebounded, quantifying
an additional 15 percent of the population has avoided starvation. 10

Overall, Harry Nitzberg of American University finds in 2018 this diversification is the crucial solution to
Venezuela’s oil curse. By investing in other industries, such as manufacturing and agriculture, Venezuela
can sustain their population by being less reliant on oil for economic growth, and less reliant on imports
of food and medicine to survive.11

could be held. He has gone so far as using those powers to appoint new diplomats at its embassies. Tens of thousands more people come to Guaido rallies than come to Maduro's counter-rallies. Yet, despite Guaido's ability to woo some defectors from the National Guard, he has yet to

Guaido's strategy is more like death by a

make any big splash moves. Top officials and military commanders remain supportive of Maduro. No A-listers have said they have had enough of this chaos. However,

thousand cuts. Time is on his side and not on Maduro's . As the economy deteriorates, more National Guardsmen are expected to defect. This opens a new element in the crisis: an opening

nti-Maduro bureaucrats and politicians in the U.S., like Senator Marco Rubio,
among the military and PSUV officials to negotiate Maduro's resignation. A

could literally stop saying a word about Venezuela and it would not change Maduro's fortunes one bit.
"Omar has no idea what she’s talking about,” Rubio told Trish Regan on Fox's Primetime last night. "She's just making it up. She doesn't even follow this issue....It's actually embarrassing." Alejandro Arreaza, an emerging markets research analyst for Barclays in New York, said the protests
this week chip away at Maduro's strength in Caracas. "The situation remains very fluid. But the government position seems to have been weakened more," he says. Venezuela's international isolation, coupled with its self-inflicted economic collapse, have not been enough to give anyone
at PSUV a true "come to Jesus" moment. They have dug in. Their political ideology, after all, demands it. They have a reputation to uphold: they are revolutionaries fighting for the downtrodden and the natives, robbed by colonials and later robbed again by American corporations. That's
what Maduro tells his soldiers they are up against. It's a historic battle, an academic "decolonial" battle that the left is fighting even here in the U.S., and if it must be won, then why not win it? Most of the rank and file in Venezuela's army must believe it. Higher ranks might care less about
Maduro's post-colonial theory, but they have bigger things going on -- running drugs and extortion rings, for instance. Their lives depend on PSUV staying in power. Since the founding of PSUV by revolutionary Hugo Chavez, the party reluctantly paid Wall Street bondholders, while

They ruined the country long ago. They were more interested in the past, and their
preaching its brand of anti-capitalist, Cuban-style Marxism.

role in erasing it, than they were interested in investing in Venezuela's future. After years of lackluster
investment in infrastructure, their entire power grid is buckling. Real GDP declined 15% in 2018, back
when the only sanction was on PdVSA bonds, hardly an economic mover. Demarais of The Economist
Intelligence Unit says she expects further contractions this year and next. A forecast recovery in 2021 to 2023 rests on the assumption that Maduro (and PSUV)

Venezuela's GDP has fallen by around 50%

are gone. Then the International Monetary Fund, Chavez's old enemy, will come in to fund this mess. PSUV's worst nightmare would have come true...all thanks to them.

since 2013. Demarais thinks oil production falls to 900,000 barrels a day over the coming quarters. Less oil out
of Venezuela, an OPEC country, will have an impact on oil prices. Then again, oil at $100 a barrel won't do much to save Venezuela so long as PSUV is running it.

9
Increased non-oil exports
MAYELA ARMAS 19 of Reuters (10-23-2019, "In hungry Venezuela, food producers step up
exports to survive", doa 1-7-2020, https://www.reuters.com/article/us-venezuela-exports-insight/in-
hungry-venezuela-food-producers-step-up-exports-to-survive-idUSKBN1X215M) NY

Shrimp farming is booming in this western Venezuelan city, but little of the shellfish is destined for
tables in this malnourished nation. About 90% of this shrimp is headed for Europe and Asia - with the
blessing of President Nicolas Maduro. Venezuela’s leader has lauded food exports on television as a
way to raise hard currency to stabilize an economy in crisis. And he is paving the way for more foreign
sales. His administration has loosened restrictions to allow more production to go abroad , 10 food
industry entrepreneurs and executives told Reuters. In addition to seafood, Venezuelan cheese,
avocados, citrus, breakfast cereal and candy are finding international buyers. These new foreign sales are tiny, with most companies billing less than $1

the numbers signal a shift for a government that has long

million per year. Venezuela remains almost entirely dependent on oil exports, which amounted to $29 billion last year. Still,

blamed the private sector for shortages of basic goods. Business Maduro and his predecessor, Hugo Chavez, for years accused food companies of hoarding and profiteering.

leaders say empty shelves were the result of state policies such as price and currency controls and the
nationalization of farms and factories. Since 2017, 140 Venezuelan businesses have begun exporting for
the first time, half of them selling food products, according to data provided by Scottsdale, Arizona-
based advisory firm Import Genius, which collects customs data for the import-export industry. Some
veteran exporters, meanwhile, are leaning more heavily than ever on foreign sales as Venezuela’s
currency has collapsed. the withering of consumer spending power at
Fernando Villamizar, the head of a Venezuelan shrimp industry association, said

home has forced producers to look abroad for growth. On a recent morning at a facility owned by a
An OECD study quantifies in 2018 by decreasing dependence and increasing other productive industries,
every 1 percent decrease in the share of oil in exports causes a 0.7 increase in overall economic
growth.12

Overall, the decreased reliance on oil is driving economic recovery. Paul Dobson of Edinburgh University
writes in 2018 Venezuela is making significant progress in diversifying its economy by increasing non-oil
exports by 27 percent, marking a key reversal of the past four years of decline. They conclude the
economy is set to grow throughout 2020, effectively dragging the country out of recession. 13

member of the trade group, dozens of workers in baggy smocks, plastic gloves and face masks cleaned
shellfish and put them in boxes to be frozen. An order that day was bound for France. The plant also
ships to Spain and Vietnam. “We have to sell outside the country” to survive, Villamizar said.
Venezuelan companies sold $81 million worth of shrimp abroad last year, up from $54 million in 2016 ,
making it the country’s 4th-largest non-oil export, according to figures from the Venezuelan Association
of Exporters. Maduro’s enthusiasm for non-oil exports comes as U.S. sanctions have hurt
CHEESE SPREAD CROSSES BORDERS

Venezuela’s petroleum sales. To earn hard currency, his government is scrambling for alternatives. In
July, Maduro toured a factory outside Caracas that ships chocolate to Japan, television cameras in tow.
He said the goal of these and other exports was to generate “euros, rubles, yuan and cryptocurrencies.”
Food producers looking to export need to obtain a variety of government permits. Under Chavez, the
state frequently denied those permissions, delayed them or never acted on them, the food industry
entrepreneurs and executives told Reuters. They said Maduro’s administration is now granting more
permits, allowing them room to maneuver. The government this The Information Ministry did not respond to requests for comment on Maduro’s exports strategy.

year has also largely given up controlling prices, three of the food industry executives said. More
goods have returned to Venezuelan stores. But even with more products available, Venezuela’s hyperinflation means few can afford to buy. Compared to five years ago, the daily calories now consumed by the
average citizen have fallen 56% to 1,600 calories, according to Caracas-based Citizenry in Action, a nutrition-focused nonprofit. That is well below the 2,000 to 2,500 calories per day recommended by the World Health Organization. Millions depend on government food handouts and

Lack of demand has spurred two large Venezuelan food companies - Empresas Polar and rival
subsidized staples.

General de Alimentos Nisa CA, or Genica - to export products that until now had only been sold in
Venezuela, said two people involved in those operations and a third with knowledge of them. The two
companies last year exported a combined $59,000 worth of merchandise, mainly to Argentina and Chile.
Among the items headed abroad was a once-popular melted cheese spread made by Polar. Genica told
Reuters it was entering new markets, but would not elaborate. Polar did not respond to requests for comment. The Venezuelan unit of another major firm, Nestle SA, as of June
had exported 18 tonnes of instant cereal worth $18,600 to the United States, according to port records. Convenience foods are now beyond the reach of Venezuelan shoppers such as Doris Molina, a 28-year-old accountant. “I don’t give my son cereal anymore because it’s so expensive,”

Nestle said in a statement that its exports generate

she said, walking with her four-year-old at a Caracas mall. The local price of Nestle’s instant cereal has increased around 3,400% since last year.

foreign exchange it needs to acquire raw materials, and that these sales comply with Venezuelan law.
Such sales do not violate U.S. sanctions, which forbid American firms from doing business with
Venezuela’s government or state-run companies such as oil giant Petroleos de Venezuela SA.
Venezuela’s private sector companies are free to sell to U.S. buyers. Attorney Daniel Sanchez opened a
fish farm in central Venezuela three years ago to raise tilapia, which is largely unknown in Venezuela. He
has buyers in Colombia and is eyeing the United States. Showing off outdoor tanks teaming with fish,
Sanchez said he sells tilapia for $2 a kilogram. “The idea is to produce That’s the equivalent of more than a week’s pay for Venezuelans earning the minimum wage.

for export,” Sanchez said. Ramon Goyo, head of the Venezuela Association of Exporters, said a new
company joins his trade group almost weekly to seek advice on how to sell abroad. “They’re looking for
hope,” Exports by Venezuela’s private sector companies increased
Goyo said. “There’s no (way to make it) in Venezuela’s hyperinflation. There’s no spending power.”

by 26% in the first quarter of 2019 versus the same period a year ago , even as the economy
contracted by 27%, according to the most recent central bank statistics.
Without sanctions, Venezuela would remain an oil state, neglecting the growth that could help 25
million people currently living in poverty. Michael Ross of Princeton University concludes while most
nations in the developing world have made significant economic and political progress over the past
decades, Venezuela is no richer, no freer, and no more peaceful than it was in the 1980s. 14

Thus, we negate.

Underview: Give me 30 speaks. Three warrants.

10
Reforms solving now – decreasing inflation, increasing foreign investment and
remittances, increasing food/medicine imports
ARGUS MEDIA 19 (12-19-2019, "Venezuela defies sanctions with dollar-driven upswing", doa 1-9-
2020, https://www.argusmedia.com/en/news/2037897-venezuela-defies-sanctions-with-dollardriven-
upswing) NY

US sanctions have failed to dislodge Venezuelan president Nicolas Maduro so far, but they have
compelled the government to ease economic controls this year , modestly improving the Opec
country's 2020 economic outlook. The sanctions "have forced the Maduro government throughout this
year to erase most price controls, loosen capital controls, tighten controls on commercial bank loan
operations and accept informal dollarization as it seeks to capture new hard currency streams and
reduce hyperinflationary pressures," Maduro's biggest economic achievement this a Venezuelan central bank economist tells Argus.

year has been to curb hyperinflation, the economist said. Opposition-controlled National Assembly advisers acknowledge the slowing inflation, but caution that inflationary pressures

The advisers estimate cumulative inflation from January through November at over
persist on years of structural distortions.

5,500pc compared with the central bank's 2018 inflation estimate of 130,000pc. They now believe it is
likely that 2019 inflation could average about 7,000pc, a marked improvement over end-2018
forecasts from entities such as the International Monetary Fund that anticipated 10mn pc inflation in
2019. The US sanctions imposed on state-owned PdV in January
In October the IMF reduced its 2019 inflation forecast to 200,000pc, rising to 500,000pc in 2020.

constricted oil revenues that historically accounted for up to 90pc of Venezuela's income. The sanctions
"accelerated PdV's crude output decline, crippled oil export operations by discouraging many buyers
and logistics operators and suppliers from doing business with the company, and blocked our access
to international financing," The US sanctions forced Maduro to gradually erase most
a PdV board member tells Argus.

domestic price controls and loosen capital controls in a bid to encourage foreign investment and
facilitate remittances from Venezuelans abroad, oil ministry and central bank officials said. PdV's crude production has
rebounded to more than 800,000 b/d in recent weeks, partly by quietly transferring operational and procurement controls to PdV's minority joint venture partners, including Russia's Rosneft, China's CNPC and Spain's Repsol, although fresh investment is still on hold.

Maduro's efforts to channel remittances totaling up to $4bn this year compared with about $2bn in
2018 Remittances
through government-approved banks and exchange houses have largely failed because no one trusts the government, says Jose Guerra, a former central bank chief economist and current opposition deputy in the National Assembly.

in 2020 are expected to jump to about $6bn, equivalent to almost 80pc of the central bank's current
hard currency reserves of $7.5bn. The trends are driving a robust black market in dollars and euros. Up to 55pc of non-oil commercial transactions are conducted in non-Venezuelan currency. In oil-producing Zulia state, almost

Dollarization is a necessary "pressure release valve" that is

90pc of transactions are in dollars. Zulia lies on the border with Colombia, which hosts the bulk of Venezuela's diaspora.

allowing private-sector companies to secure hard currency to finance imports, Maduro said in October,
adding "thank God for dollarization." Food and medicine imports have rebounded, benefiting about
15pc of the population Venezuelan business chamber Fedecamaras said
with access to dollars. The other 85pc scrape by on the equivalent of $1-$2/day.

this week the private sector will account for the first time in decades for up to 25pc of GDP in 2019
and likely more in 2020.
1. I’m maving, so a) if you were giving me above 15 speaks, double it to 30 to account for my partner,
and b) it’s harder to mav so adjust speaks up to compensate.

2. Speaks are subjective, only straight 30s are universally objective

3. Reject a system that’s biased towards white male paradigms of what makes good speakers

11
Break oil curse by investment in other industries, especially agriculture
HARRY NITZBERG 18 of American University (3-2018, "Cauterization and Infection: Trying to Fix
the Venezuelan Economy", doa 1-6-2020, https://cpb-us-
w2.wpmucdn.com/wp.towson.edu/dist/b/55/files/2018/05/SPRING-2018-NITZBERG-ARTICLE-
1t195ce.pdf) NY

Once inflation has been decreased and government revenues have been refilled by reinvigorated oil
production, the Venezuelan government will not have much time to celebrate their short-term victory,
they must focus on sustainability. Under the umbrella of sustainable economic growth is one
necessity, economic diversification. In the case of Venezuela, economic diversification would entail a
decrease in the percentage of GDP that can be tied back to the oil sector. To put the dependence of the Venezuelan oil exports in perspective, 95 percent of

With Venezuela’s large amount of oil reserves, should oil prices

Venezuela’s export earnings and 25 percent of Venezuela’s GDP are from oil and gas exports.70

continue to steadily rise, Maduro’s government may be tempted to just ride the wave of growth that
would surely follow— directly into an economic trough when prices fall again. This is what economists
call a “resource curse” or stagnation in economic development that accompanies booms and busts in
the price of the product that an economy overly depends on. When the price of the main export is 71

high, the value of the country’s currency rises. When a country’s currency becomes stronger, that
country’s exports become more expensive. As the other industries’ prices rise, their ability to compete
in international markets is decreased.72 Without the ability to compete, these firms die off. When the 73

domestic firms that are needed for technological development die off, economic development is
hindered. Rather than wholeheartedly throwing the percentage of oil revenue that the government
would receive on social programs and in oil production investment (extraction related machines/labor
or land surveying), the Venezuelan government can attempt to counteract the “resource curse” by
reinvesting a portion of the revenue in what economists call “infant industries.” An infant industry is a
group of new companies in a country that cannot sell their product at a price that is competitive in the
international market for that good. To help these infant industries compete and grow, governments
often give them some sort of help, whether it be in the form of subsidies, tax credits, money to foreign
firms to buy domestic goods (as the American Import/Export Bank does), tariffs on imports of the good
that the foreign firm is selling, etc. In the case of Venezuela, the temptation to rely
The use of any of these strategies is called “protectionism.”

on oil is so great that government protectionism is necessary to develop infant industries. Without the
aforementioned protectionist measures, Venezuelans will continue to rely on the import of basic
necessities, which become scarce in times of crisis. The main industry to be developed in the
meanwhile is agriculture As the current crisis in Venezuela is
, an industry that former president Hugo Chavez passively attempted to grow during his presidency.75

showing, food production infrastructure is vital to sustain the Venezuelan population during sustained
periods of low oil prices. With protectionist policies to protect the infant agricultural industry and
removal of price controls on food, Venezuela may be able to better sustain downturns in oil prices in
the future and become less reliant on oil revenue at the same time.
12
After controlling for other exports, trade, investment, inflation, 10% increase in oil
share decreases GDP 7% (controls not highlighted)
EVGENY KAKANOV 18 of the OECD (10-22-2018, "Resource Curse in Oil Exporting Countries", doa
1-5-2020, http://www.oecd.org/officialdocuments/publicdisplaydocumentpdf/?
cote=ECO/WKP(2018)59&amp;docLanguage=En) NY

Table 2 presents the long run estimates for these regressions. The coefficients of the baseline regression including investment, education, population and a dummy for minor

The coefficient of the oil

conflicts (column 1 “baseline”) have the expected signs12, though education is insignificant likely due to the inclusion of country specific time trends which capture the slow and gradual impact of education on GDP13 .

share (column 2 “share”) is negative and significant at the 1% level, pointing at the prevalence of
resource curse. The coefficient suggests that, ceteris paribus, a 10 percentage point increase in the oil
share is associated with a 7% lower GDP per capita level in the long run To ensure that this result is 14.

not driven by a relevant but omitted variable, several robustness checks are carried out . oil share  The

could have a negative impact mechanically when total exports fall (and thus oil share increases) which would have a negative impact on GDP. This is

controlled for by introducing total exports still show a negative and (value, real terms, PPP-adjusted) in the regression (column 3 “Exports”). The results

significant impact of the oil share Countries with high resource dependence could also be less open,
.

with barriers to trade negatively affecting GDP. However controlling for trade openness delivers (column 4 “Trade”)

similar results Another dimension of openness relates to capital controls: more resource dependent
.

countries could impose more constraints on capital movements to limit impacts of oil price shocks . Using the Chin-

still a significant negative impact of the oil share

Ito index of capital account openness (Chinn and Ito, 2006) resource dependent (column Capital) is found.  Finally,

countries could potentially suffer from inadequate monetary policies leading to higher inflation.
Controlling for inflation (column Inflation) produces qualitatively the same result .  Finally, a potentially nonlinear impact of the oil share using a
quadratic term (Share2) is examined. Results (columns “Nonlinear” and “Nonlin Exp” controlling for exports) suggest that the negative impact of being an oil exporter becomes stronger when the oil share increases.

13
We’re good now
PAUL DOBSON 18 of Edinburgh University (Paul Dobson is an MA graduate specialised in history
and philosophy from Edinburgh University. He has lived, worked, and extensively knows nearly every
different region of Venezuela, having lived there since 2006. Paul is currently involved in a range of
political projects including being an active member of Venezuela's Committee of International Solidarity
(COSI) and a number of grassroots collectives ranging from communicational projects to ecological
issues as well as his communal council. He is also a specialist on the Venezuelan electoral system. 10-18-
2018, "International Economic Forecasts Point Towards Easing Venezuelan Recession in 2019", doa 1-8-
2020, https://venezuelanalysis.com/news/14107) NY
The United Nations Economic Commission for Latin America and the Caribbean (ECLAC, or CEPAL in
Spanish) has updated its economic forecast for the region , predicting a 15 percent contraction in Venezuela’s GDP this year followed by a lesser contraction of 8 percent in 2019 in a
report published Wednesday. The CEPAL predicted 1.3 percent and 1.8 percent growth for the Latin American and Caribbean region in 2018 and 2019 respectively, largely driven by strong anticipated growth in Paraguay (4.6 percent), Bolivia (4.3 percent), and Chile and Peru (both 3.9

According to the 45-

percent). All countries except Venezuela, Argentina, and Nicaragua are expected to return positive growth in the next two years, which the CEPAL attributes to a general trend of increasing internal demand pressure.

nation body based in Santiago de Chile, this year is set to be Venezuela’s fifth consecutive of economic
recession, which was triggered by exchange rate distortions and a collapse of global oil prices, and has
been compounded by US-led financial sanctions and unbacked deficit spending. However, the CEPAL
predicts a moderate easing of the country’s crisis in 2019, which coincides with recovery trends
indicated in figures released by the International Monetary Fund (IMF) and New York-based financial
consultancy firm Torino Capital. In July, the International Monetary Fund forecast an 18 percent
contraction in the Venezuelan economy this year followed by a lesser contraction of 5 percent in 2019. The
Washington-based body also released headline-grabbing predictions of a 68 percent GDP contraction by 2023 this week. The IMF also predicts that inflation will reach 1.37 million percent in 2018, 10 million percent in 2019, and 12 million percent in 2023, well up from its April forecast of

The organization’s methodology has, however, been seriously questioned by economist Steve
14,000 percent.

Hanke, who contends that it is impossible to accurately predict the duration of hyperinflationary
episodes. Venezuela’s opposition-controlled and defunct National Assembly also released competing figures this month, estimating current accumulated inflation to stand at 81,043 percent so far in 2018, with year-on-year inflation sitting at 342,161 percent. For his part,

Torino Capital Chief Economist Francisco Rodriguez also paints a less grim picture in his weekly
economic report on Venezuela. According to Rodriguez, who advised opposition presidential candidate
Henri Falcon earlier this year, the Venezuelan economy is set to contract by 6.3 percent this year and
record 2.1 percent growth in 2019. A predicted strong fourth quarter in 2018, recording 10.6 percent
quarter-on-quarter growth, is set to spur the economy, which is expected to grow in three of 2019’s
four quarters, effectively dragging the country out of recession. Torino also forecasts that Venezuela’s
monetary base expansion, which has largely been blamed for soaring inflation levels, will be checked
back from a staggering 230,628 percent in 2018 to 648 percent in 2019. One of the main reasons Rodriguez cites for 2018’s poor performance is collapsing oil
production, which has occurred despite rising oil prices and in a context of underinvestment in the industry, corruption probes, and US-led financial sanctions. “Venezuela’s oil production suffered a decline of 42 thousand barrels per day (tbd) (- 3.2 percent) in September, according to a

“Production has fallen by 705tbd (-37.1%) in the last 12 months and

series reported by independent agencies to OPEC published last Thursday,” the report indicates.

by 1.12 million barrels per day (-48.4%) since September of 2012.” Recent oil production figures placed the country’s output at a mere 1.197 million barrels per day (mbd),

Torino does, nonetheless, indicate that Venezuela is making progress

on a par with production in 1960 and well down from 1998’s 3.5 mbd and 2005’s 2.7 mbd.

in its goal of diversifying the economy so as to shield it from the distorting effects of international oil
price fluctuations. “Historically, the oil sector has accounted for 94 percent of the country’s total export
revenue,” “ Non-oil exports rose from US $693mn to US $874mn in the first half of 2017, a
Rodriguez reported in July.

25.9 percent increase. [First half of 2017] non-oil exports are also 19.3 percent higher than their
[second half of 2016] levels. If sustained, this would mark a key change of trend after four years of
decline or stagnation.” The various projections follow a series of macro-economic reforms unveiled by
the Venezuelan government in August, including re-launching the currency, establishing mechanisms
to stimulate savings, reforming fuel subsidies and taxes, and a pledge to impose fiscal discipline. It is unclear what
role, if any, these reforms may have had in the forecasted improvement for 2019.
14
Bad things!
LEIF WENAR 16 of Foreign Affairs (6-3-2016, "How to End the Oil Curse", doa 1-4-2020,
https://www.foreignaffairs.com/articles/2016-06-03/how-end-oil-curse) NY

The unaccountable power of oil explains what the political scientist Michael Ross calls “the oil curse.”
Oil states are 50 percent more likely to be authoritarian than are non-oil states, and between 1980
and 2013, oil-producing autocracies were four times less likely to transition to democracy than their
non-oil-producing peers. Oil states in the developing world are also more than 200 percent more likely
to suffer civil wars According to Ross, oil states are today no richer,
; 25 percent of oil states are currently embroiled in one (compared with 11 percent of non-oil states).

no freer, and no more peaceful than they were in 1980—a marked contrast to most states in the
developing world, which have made significant economic and political progress since then. More than 50 percent of the world’s
traded oil today comes from authoritarian or failed states.