CARACAS, Venezuela – After years of steady economic decline, Venezuela is in the grips of the deepest crisis of its recent history. The streets of Caracas are awash almost daily in tear gas, neighboring governments are issuing increasingly stern condemnations and President Nicolas Maduro just called for the re-writing of the country's constitution. How did a country once seen as a model for left-wing movements get here, and what comes next?
Here are the latest developments and background on the turmoil:
Venezuelans have been on the streets nearly every day for a month to protest the Maduro administration and demanding immediate elections. The protests were kicked off by a Supreme Court decision stripping power from the opposition-held Congress. That decision was quickly rolled back, but people have stayed in the streets to vent their anger over violent crime, crushing shortages and an economy in shambles. The unrest has left at least 29 dead in the past month. On Monday, Maduro said he would convene an assembly to rewrite the constitution and "restore peace."
For many years, elites controlled Venezuelan politics and the poor had little place voice. The late President Hugo Chavez won election in 1998 as a political outsider promising to upset the old order and funnel some of the country's enormous oil wealth to the poor. Poverty rates fell sharply during his administration, and many people continue to see him him as a beloved Robin Hood figure who gave them houses, free health care, better education and a place at the table in government.
OIL BOOM AND BUST
Chavez was helped by the fact that when he took over the presidency, oil was trading at about $10 a barrel, and when he died in 2013, it had risen to $100. Venezuela derives 95 percent of its export earnings from oil.
Shortly after Chavez's death, the price of oil fell by half. That's left his hand-picked successor Maduro struggling. The economy is forecast to sink 8 percent this year and the International Monetary Fund forecasts inflation will soar to four digits next year. The plunge in world oil prices has left the government owing money across the board, from foreign airlines to oil service companies. Most of the anti-poverty gains made under Chavez have been erased and people are grappling with severe food and medicine shortages.
Rebounding oil prices, which are up around 60 percent this year after dipping to a 13-year low, could buy Maduro some time.
Opponents say Maduro's bid to call a constitutional convention is a ploy to put off elections that polls say it would lose. The government was supposed to call regional elections this year, and a presidential contest in 2018. A constitutional rewrite process could delay elections for more than a year.
Venezuela's military historically has been the arbiter of political disputes and some in the opposition are encouraging it to step in. However, Chavez and Maduro have been skillful in winning over the top brass through patronage and powerful government jobs, and there is no outward sign of disgruntlement even at the junior levels. In fact, the military has been the main force on the street repressing the daily protests.
The opposition is vowing to continue massive protests until the government makes concessions, and Maduro has committed himself to a massive restructuring of the country's political structure. Both sides seem to be settling in for a long fight.
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