Ricardo Hausmann Is Taking Milton Friedman's Lessons to Venezuela

For a few years now, there has been a tendency to compare Donald Trump to Richard Nixon, but the more urgent comparison in the face of the Venezuelan crisis is one between two well-pedigreed economists: Milton Friedman and Ricardo Hausmann.

Under Nixon's reign, Milton Friedman was the "intellectual" who started to gain excessive power. Friedman was a trained economist, earning a doctorate at Columbia University, with teaching and research stints at the Universities of Chicago and Stanford.

And under Trump, we have another trained economist: Ricardo Hausmann. He received his doctorate from Cornell University and is the director for the Center of International Development at Harvard University.

For years now, Ricardo Hausmann has been suggesting that the solution for Venezuela's socialist "crisis" is a U.S. invasion or "intervention."

What we are seeing in Venezuela is not a sudden rise in the people demanding new leadership by Juan Guiado, a man they just heard of in late January 2019. Rather, this "crisis"--a word that reinforces the illusion of an abrupt disaster--is a careful and hyper-theorized plan that was concocted in the office of a Harvard University professor.

What we are seeing in Venezuela is not a sudden rise in the people demanding new leadership by Juan Guiado, a man they just heard of in late January 2019. Rather, this "crisis"--a word that reinforces the illusion of an abrupt disaster--is a careful and hyper-theorized plan that was concocted in the office of a Harvard University professor. A year ago, Hausmann posted on his own blog a solution that asks the National Assembly to impeach Venezuelan president Nicolas Maduro. His expert suggestion is that "the Assembly could constitutionally appoint a new government, which in turn could request military assistance from a coalition of the willing, including Latin American, North American, and European countries."

Direct violations of Article 2(4) of the United Nations Charter aside, Hausmann openly compares his plan to the U.S. "liberating" Panama in 1989. Do Americans really want to be asked for reparations in 20 years for Venezuela? Currently, the United States is facing such demands for Panamanians with support from the Inter-American Commission on Human Rights (IACHR). Thousands of lives were lost in Panama, countless lives ruined. And Hausmann is asking the United States to repeat this devastation.

Last year was not the first time Hausmann openly spoke of destabilizing Venezuela. In 2014, after Hausmann advocated for Venezuela to default on its loans, the economist was called out by President Maduro for attempting to destabilize Venezuela. It was at this time that Hausmann was given the nickname "academic hitman" by Maduro, who planned to bring legal action against the Harvard professor for speaking on behalf of the agencies that were supporting his well-funded and pro-International Monetary Fund (IMF) research.

Hausmann has been referred to as the informal mentor to Juan Guiado. Indirect might be a better word to describe the mentorship, as there is a middleman between Hausmann and Guiado: Leopoldo Lopez, the leader of Popular Will. It is through Hausmann's mentorship of Lopez (who brought Guiado under his wing and "plotted" his rise to lead the coup) that Hausmann's plans are now coming to action. And, as with Milton Friedman in his time, the relationship between Lopez and Hausmann gives us further insight into the use of academic capital to assert its will and, in turn, gain power.

In 2014, when Maduro arrested Lopez for inciting violence in Caracas, Hausmann got Harvard University to rally behind the anti-socialist agitator and give him an honorary degree from the prestigious institution.

It is this ongoing attempt to bring Venezuela to its knees through the strategic use of highbrow higher education and the formal education of economists that conjures up memories of Friedman's role with Chile. Friedman was able to successfully implement a neoliberal system in Chile by way of Chilean economist Sergio de Castro--whom Friedman trained in a way that Hausmann's training of Lopez echoes.

Both Lopez and de Castro were indoctrinated with ideas rooted in Milton Friedman's 1962 manifesto Capitalism and Freedom, where he states:

"The kind of economic organization that provides economic freedom directly, namely, competitive capitalism, also promotes political freedom because it separates economic power from political power and in this way enables the one to offset the other."

It is this tricky and somewhat contradictory sentence that people across the globe have been duped into believing--that if we have absolute freedom in the marketplace, we will, therefore, have absolute political freedom. Milton carried on with selling the idea that political freedom and economic freedom were somehow separate, but he did so only by intertwining the two. Somehow, divesting the people of public space--everything from schools to forests--for the sake of privatization was not considered a violation of political freedom. And the fact that individuals would be sharing their freedoms with corporations, in addition to the general lack of equity and capital shared by most individuals, got lost in his rhetoric.

The Friedman promise was--and continues to be--so great that absolute faith in the market became commonplace.

The Friedman promise was--and continues to be--so great that absolute faith in the market became commonplace. Hausmann's plan for Venezuela is an inheritance of that faith. But if Hausmann's plans to oust Maduro and bring the IMF into Venezuela are successful, it will not be because of the people's faith in the market; it will be because of the increasing faith held for elite education.

Maduro was right to call Hausmann a "financial hitman" in September 2014. The term alludes to John Perkins' Confessions of an Economic Hitman, 2004 book about professionals who convince underdeveloped nations (Venezuela in Hausmann's case, as well as other countries of the Global South generally) to accept development loans that are designed to benefit the already-elite. Hausmann snapped back at Maduro by calling the president a "tropical thug"--the use of "tropical" here suggests an old-school, Jared Diamond-era geographic bias against the Global South. This attitude might be more easily visible in his own economic theories of "Original Sin" that propose bringing a single currency to emerging markets, leaving them absolutely dependent on the Global North.

In addition to being a "financial hitman," Hausmann could also aptly be described as an "academic hitman," as both Maduro and Bloomberg Business Week have done. For the latter, the power of the academic hitman does not come from the individual's corruptive practices or sales skills. Rather, an academic hitman's power comes from blind faith in education institutions, especially the ones who are open to making bedfellows with development agencies and corporations that have too much to gain from the fall of elected socialist leaders.

Ricardo Hausmann is both an economic and academic hitman, one who is willing to sell off his own birth country--a task Milton Friedman never had to face.

This article was produced by Globetrotter, a project of the Independent Media Institute.