The collapse of Venezuela is often narrated in the West as a simple morality play – a cautionary tale of socialist overreach and the inevitable rot of authoritarianism. Francisco Rodríguez’s “The Collapse of Venezuela” dismantles this caricature, showing with unusually rigorous economic evidence that roughly half of the country’s catastrophic decline was caused not by ideology alone, but by escalating US sanctions that choked off access to finance, oil markets, and essential imports. This review examines his account of Venezuela’s internal political and economic unraveling. It also highlights a major new study Rodríguez co-authored in The Lancet Global Health showing that Western sanctions worldwide are associated with more than half a million excess deaths per year, a toll comparable to that of modern wars.
Few economic collapses outside of wartime have been as sudden and as devastating as Venezuela’s. To understand how a country with the world’s largest oil reserves saw its economy shrink by more than seventy percent in less than a decade, one must look beyond the slogans and study the interaction between domestic power struggles and an external sanctions regime that steadily constricted the country’s economic lifelines. Francisco Rodríguez, a leading Venezuelan economist and former head of the Venezuelan National Assembly’s Congressional Budget Office, provides this necessary autopsy in his meticulous study, The Collapse of Venezuela: Scorched Earth Politics and Economic Decline, 2012–2020. Rodríguez, who currently serves as a professor of international affairs at the University of Denver and has spent decades at the intersection of high finance and public policy, brings a rare blend of technical rigor and historical perspective to a subject too often surrendered to polemicists. Central to his findings is the startling empirical demonstration that roughly half of Venezuela’s total economic catastrophe was caused directly by United States sanctions.
His career has long been marked by a fierce independence that drew fire from all sides; notably, during his tenure at the Congressional Budget Office, he came under intense pressure from both a radical opposition that detested his objective findings and government officials – including a then-legislator named Nicolás Maduro – who sought to suppress economic data that contradicted the official narrative. His work matters now because it challenges the convenient consensus that Venezuela’s ruin was entirely self-inflicted, demonstrating instead how a combination of domestic mismanagement, an escalating conflict between the government and the opposition and unprecedented American sanctions created a humanitarian catastrophe of historic proportions.
The Pre-Chávez Purgatory and the Ghost of the Caracazo
To understand the rise of Hugo Chávez, one must first confront the wreckage of the era that preceded him. The decades leading up to his 1998 election were defined by a profound disconnect between a wealthy oil-exporting elite and a growing underclass living in the sprawling ranchos of Caracas. Throughout the 1970s and 80s, the “Puntofijo” pact – a power-sharing agreement between the country’s main centrist parties – maintained a veneer of democratic stability. But beneath this surface, the social fabric was tearing. Despite being the richest country in South America, Venezuela’s wealth remained concentrated in a tiny fraction of the population, while the majority saw their purchasing power evaporate.
This era culminated in the 1989 Caracazo, a series of massive anti-government riots sparked by IMF-mandated austerity measures that hiked gasoline prices and bus fares overnight. The state’s response was not one of negotiation but of terror. A brutal military crackdown left hundreds, perhaps thousands, dead in the streets of the capital. The Caracazo was the death knell for the old order; it proved that the democratic facade could no longer contain the social pressures of a nation where millions lived in extreme poverty. The blood on the pavement in 1989 created the moral and political vacuum that Hugo Chávez, then a young paratrooper, would eventually fill. When he was elected in 1998, it was a populist rebellion against an indifferent elite that had presided over decades of stagnation and state violence.
The Bolivarian Promise: Prosperity and Institutional Decay
The initial years of the Chávez era were marked by a genuine, if flawed, attempt to redistribute oil wealth. As Rodríguez notes, the “Bolivarian Revolution” was not merely a rhetorical exercise. Through the creation of social missions – the misiones – the government poured billions of dollars into healthcare, education, and subsidized food programs. For the first time in Venezuelan history, the state made its presence felt in the slums, not through police truncheons, but through clinics and literacy programs. Poverty rates plummeted from over fifty percent at the start of the decade to nearly twenty-five percent by 2012. This tangible improvement in the lives of the poor secured Chávez’s enduring popularity and allowed him to win multiple internationally monitored elections.
Rodríguez is skeptical of many flagship anti-poverty programs under Chávez, suggesting that several were inefficient or poorly designed and that a substantial share of the observed poverty reduction would likely have occurred anyway during a period of exceptionally high oil prices that boosted state spending across the board. He also points to Chávez’s 1999 constitution as a turning point in the erosion of institutional balance, arguing that the redesign of the political system progressively weakened checks and balances and concentrated power in the executive, which deepened mistrust and hostility between the government and the opposition. In a context with no meaningful power-sharing arrangements and where control of the state meant control over vast oil revenues, politics became a zero-sum game, helping drive both Chavismo and a radicalized opposition into an increasingly desperate struggle in which losing office carried existential economic and political consequences.
The democratic mandate of the revolution was almost immediately met with violent resistance from a radical opposition that enjoyed significant backing from the United States. In 2002, this faction launched a short-lived military coup that briefly ousted the democratically elected Chávez, an act of extra-constitutional aggression that was immediately recognized and supported by the U.S. government. This support for a putsch exposed the hypocrisy of a Western “democracy” discourse that was, in reality, driven by a desire to protect old-guard interests and oil access. When the coup failed due to a massive popular uprising, this same radical opposition pivoted to an all-out oil embargo and general strike in late 2002 and 2003, effectively paralyzing the nation’s economy and causing immense suffering among the civilian population. This was the first time a scorched-earth strategy was deployed in the modern era – a precedent showing that the opposition was willing to destroy the nation’s primary source of livelihood to get into power.
The seeds of future ruin were also sown in how the subsequent prosperity was managed. The government relied on a massive expansion of state spending fueled by record-high oil prices. Rodríguez emphasizes that Chávez’s government saved little in stabilization buffers, leaving the country highly exposed and fiscally fragile when the oil market eventually turned downward. Institutional checks and balances were dismantled in favor of a personalistic rule that often prioritized political loyalty over technical competence. When Chávez died in 2013, he left behind a nation that was more equitable but also profoundly fragile, its entire economic architecture resting on the volatile price of a single commodity.
The Scorched Earth and the Sanctions Force Multiplier
The transition to Nicolás Maduro coincided with a catastrophic perfect storm: the death of a charismatic leader, a sharp, unexpected decline in global oil prices, and the exhaustion of a state-led model that had failed to diversify. By 2014, Venezuela was in a deep recession, but it was not yet a terminal collapse. Rodríguez’s most significant contribution is his empirical breakdown of what happened next, identifying the specific point where a manageable crisis turned into a historic catastrophe.
He argues that US sanctions, particularly those imposed in 2017 and 2019, fundamentally altered the trajectory of the decline. Before 2017, the Venezuelan government still had access to international credit markets and could maintain its oil infrastructure. The August 2017 executive order signed by the Trump administration effectively barred Venezuela from the US financial system, preventing the government from restructuring its debt or accessing international financing. Rodríguez uses a rigorous counterfactual analysis to show that while the Maduro government’s mismanagement caused the initial recession, the sanctions served as a “force multiplier” that dramatically accelerated the decline.
The most lethal blow came in 2019 with the imposition of an oil embargo. Venezuela’s refineries, built to process heavy crude with American machinery and diluents, were suddenly cut off from their primary market and source of supply. Rodríguez calculates that nearly half of the total economic contraction during this period – a loss of revenue and GDP staggering in its scale – can be traced directly to the severing of Venezuela from the global financial system. The sanctions did not just target the regime’s bank accounts; they targeted the state’s ability to generate the revenue needed to maintain the power grid, water systems, and public health infrastructure. This was the “scorched earth” politics: a deliberate strategy by both internal actors and external powers to treat the national economy as a battlefield where the civilian population was the primary casualty.
The Moral Cost of Financial Warfare
The moral weight of this evidence lies in the recognition that the “maximum pressure” campaign was a conscious choice by Western powers to prioritize regime change over human life. By framing the conflict as a battle for “democracy,” the US and its allies justified policies that they knew would result in widespread deprivation. Rodríguez documents how the freezing of Venezuelan assets abroad, including the seizure of CITGO and the nation’s gold reserves in London, left the country without the means to import essential medicines and food even during a global pandemic.
This was not a passive failure of policy but an active strategy of suffocation. The opposition, led by Juan Guaidó and backed by Washington, gambled that the suffering of the populace would eventually force the military to turn against Maduro. It was a gamble that failed the political test – the military remained loyal – but succeeded in destroying the social fabric of a nation. The results were quantifiable: a collapse of public services, the return of eradicated diseases, and a mass exodus of over five million refugees, the largest such displacement in the history of the Western Hemisphere.
Global Sanctions Kill Over Half a Million People Every Year
Rodríguez’s work on Venezuela is part of a broader research agenda on the human consequences of economic warfare. In a landmark study called “Effects of international sanctions on age-specific mortality: a cross-national panel data analysis”, which was published in The Lancet Global Health – one of the world’s most prestigious peer-reviewed medical journals – Rodríguez and his co-authors analyze the global mortality effects of sanctions across more than 150 countries over five decades.
Using four advanced statistical methods designed to identify causal effects in observational data, they estimate that unilateral economic sanctions by the US and Europe are associated with approximately 564,000 excess deaths per year in recent years – a number comparable to, and in some estimates exceeding, annual war deaths worldwide. The heaviest burden falls on children and the elderly, with more than half of the deaths occurring among children under five.
Although the paper often uses the technical term “unilateral sanctions,” the data show that the mortality effects are driven primarily by sanctions imposed by the United States and, to a lesser extent, the European Union, while UN multilateral sanctions show no statistically significant mortality effect. Sanctions reduce government revenues, restrict access to foreign exchange, disrupt imports of medicine and food, and generate financial over-compliance that blocks even humanitarian transactions. In effect, the study suggests that modern financial sanctions function less like targeted diplomatic tools and more like broad economic sieges whose primary victims are civilians.
Read alongside The Collapse of Venezuela, the Lancet study broadens Rodríguez’s argument from a national tragedy to a global pattern. Venezuela becomes not an outlier but an extreme case of a wider phenomenon: the use of financial power by wealthy states in ways that impose humanitarian costs on populations with little influence over their governments. If the book documents how sanctions helped turn a deep recession into a societal collapse, the Lancet paper suggests that similar, if less visible, dynamics may be unfolding across much of the sanctioned world.
Conclusion: The Laboratory of Imperial Ruin
In the end, Rodríguez’s work reveals a haunting truth about modern international life: that the tools of global finance can be as destructive as any conventional weapon. Venezuela was not just a victim of its own leaders’ hubris, but a laboratory for a new kind of imperial warfare – one that operates through banks and treasuries rather than battalions. The book serves as a devastating indictment of a world order that allows the most powerful states to starve a population in the name of their own imperial agenda.
Rodríguez is sharply critical of the role of the United States in backing hardline sectors of the Venezuelan opposition that embraced extra-institutional, confrontational, and at times openly undemocratic strategies, arguing that Washington’s recognition policies, sweeping sanctions, and recurrent regime-change rhetoric further radicalized the conflict and poisoned an already polarized political environment. By increasing the perceived stakes of losing power and strengthening actors on both sides who favored maximalist approaches, US policy, in his account, made negotiated compromise less likely and deepened Venezuela’s institutional and economic collapse. For Rodríguez, the only viable path out of this destructive equilibrium lies in sustained negotiations that lower the stakes of political competition through credible power-sharing arrangements and mutually accepted institutional guarantees – steps he sees as essential for restoring economic stability, political coexistence, and the conditions for a genuinely democratic system.
Rodríguez underscores that Venezuelan public opinion has consistently favored a negotiated, peaceful solution over confrontation: survey data he cites show that nearly two-thirds of respondents – 64.8% – support resuming negotiations between the government and the opposition, while only a quarter oppose them. At the same time, an overwhelming majority reject external economic pressure – 75.1% favor easing economic sanctions. These figures, drawn from multiple surveys, suggest that ordinary Venezuelans prefer dialogue and de-escalation, yet their preferences have been sidelined by hardline strategies on all sides: Maduro’s government, a US policy built around sanctions and regime pressure, and a radical wing of the opposition aligned with that approach have each, in different ways, pursued zero-sum tactics that run counter to the population’s clear desire for negotiations and relief from economic warfare.
The tragedy of Venezuela is a reminder that when the elephants fight, it is the grass – the millions of ordinary people who simply wish to live in dignity – that is trampled into the dust. The history of Venezuela in the twenty-first century is thus a story of a country that tried to reclaim its sovereignty from an indifferent elite, only to find itself crushed between the incompetence of its protectors and the cold-blooded resolve of its enemies. Francisco Rodríguez has provided more than an economic study; he has written a requiem for a republic that was sacrificed on the altar of geopolitical ambition. A nation’s ruin is rarely a solo performance; it is a symphony of local greed and global cruelty, played out to the silent accompaniment of those too hungry to scream.
