CARUZO: Socialist Venezuela Raises Minimum Wage By 1,757% – to $1 a Day

CARACAS — The socialist government of Venezuela decreed a 1,757-percent minimum-wage raise in the month of March.

While a raise of such magnitude does indeed look good on paper, it instantly falls apart when you realize that it is only roughly equivalent to $30 per month — or $1 per day on average.

The raise, which brings the country’s monthly minimum wage from seven bolivars (roughly $1.50) to 130 bolivars, is still below the $1.90-per-day threshold that the United Nations considers extreme poverty.

This is not the first time the socialist regime has raised the minimum wage to a $30 equivalent. In 2018, socialist dictator Nicolás Maduro decreed a minimum wage anchored to half the value of the regime’s scam cryptocurrency, the Petro, which it deemed worth $60. That raise did not last long, courtesy of years of rampant hyperinflation and the obliteration of the Venezuelan legal tender that demolished Venezuelans’ purchasing power. If anything, the raise temporarily brings us back to 2018.

The socialist regime also updated the wage tables across the public sector. Those with high school education will earn an amount that ranges from $30 to $45 a month, while those with a higher education can earn between $78.70 and $88.24.

The raise is hardly sufficient for a Venezuelan to live with ease. The Venezuelan market basket was estimated to cost $365 in January of 2022. It would take an entire year’s worth of baseline monthly minimum wage to cover a single month’s worth, and that is excluding any potential extra expenses and expenses such as health, education, and leisure.

If you’re among those like me who are not entitled to the regime’s subsidized gasoline rations (that are hard to come by and involve long queues anyway), then the $30 will pretty much cover a full tank refill and that’s it. Non-subsidized Venezuelan gas prices have been set by the socialist regime at a rate of $0.50 per liter (about $0.13 a gallon).

Public transportation will eat up most of the new monthly minimum wage, if not all. By December of 2021, it was not uncommon to spend up to ten bolivars (roughly $2) in daily bus fares in the city of Caracas.

Private sector wages, which are now majorly dollarized, were estimated to average $89.10 as of December 2021 – also falling short of covering the basic food expenses of a family. While Maduro has announced the end of Venezuela’s hyperinflationary spiral, inflation’s entropy continues to chip away at Venezuelan citizens. According to the Central Bank of Venezuela, Venezuela’s 2022 inflation has been 6.7 percent in January and 2.9 percent in February.

The substantially reduced inflation rates have not translated into an improvement in the livelihoods of Venezuelans and the stagnation of the exchange rate has diminished the purchasing power of the currency that is holding together the country: the U.S dollar.

Prices continue to noticeably increase with each passing week and dollars, whether obtained through remittances or as payment, buy less and less. The reality lived on the streets is different from the official inflation statistics — that much I can attest to, as well. Monthly adjustments in groceries and food have been the norm of Venezuelan life, such are the effects of permanent inflation.

The elderly pensions were also raised from $1.50 to $30. Right before the announcement of the raise, Venezuelan elders went to the streets to protest the “death pensions” that the socialist regime had them living on.

The raise, which was announced shortly afterwards, has not quelled the protests of the elderly.

In addition to having to be the required age (women must be 55 years old, while men must be 60 years old) to receive an elderly pension in Venezuela, a citizen must also have paid 750 weeks’ worth of social security throughout their life — excluding weekends, holidays, and any vacation time.

Putting this in perspective, the end result of an elderly Venezuelan’s entire life’s hard work and social security payments only netted them $1.50 per month throughout 2021, and $30 per month now.

The socialist regime also continues to assign monthly stipend bonuses through its Fatherland System that range from seven bolivars to ten bolivars ($1.50-$2.14). Maduro has stated that he intends to increase the monthly minimum wage to $300 in the future.

Protests demanding better wages and demanding the socialist regime respect Article 91 of the constitution – which states that “every worker has the right to a salary sufficient to enable him or her to live with dignity and cover basic material, social and intellectual needs for himself or herself and his or her family“ – have continued to take place, with a new one scheduled for April 6.

While Venezuela’s new monthly minimum wage will start in effect on March 30, March’s wages will retroactively receive the raise as well.

Christian K. Caruzo is a Venezuelan writer and documents life under socialism. You can follow him on Twitter here.