The Cargo Cult Revisited

Eight years ago, I wrote about the state of New Mexico's insane desire to build their very own cargo cult.  Now that the state has actually gone ahead and built it, it is time to see what the state got for several hundred million dollars. 

Note:  I was reminded of the topic after reading an excellent series of articles by NMPolitics.Net.  Obviously, I am not the only one concerned about New Mexico’s very own cargo cult.

What is a cargo cult?  During the second world war, natives on several small islands in the South Pacific were suddenly confronted with the advanced technology of the US Army as we set up airfields in order to defeat the Japanese military.  To the islanders, these bases were the sources of unbelievable wealth and abundance.  Even the trash dump of a military base was, at least to the natives, a Super Walmart of treasure.

When the war was over, however, the Walmart closed as the foreigners left.  No more planes full of treasure arrived.  There was only possible solution—somehow the natives had to convince the gods to send the planes back.

The islanders cleared the jungle and built dirt runways.  They constructed bamboo control towers, waved flags, and wore headsets.  Well, the two coconut halves covering their ears looked like headsets.  Islanders tried to imitate the behavior of the soldiers they had seen, hoping the gods would send the cargo-bearing airplanes back to the island. 

Anthropologists call this a Cargo Cult.  In New Mexico we call it a Spaceport.

Let’s summarize the events of the last ten years.

After Burt Rutan won the Ansari X prize by sending a suborbital spaceship into low space twice within two weeks, the billionaire Richard Branson hired Rutan to design and build a larger version of the spaceship to carry passengers into space.  Branson started a new company, Virgin Galactic to market the new industry of Space Tourism.

Rutan’s design would use a large mother ship to carry a new spaceship up to about 40,000 feet, then the rocket motors would ignite, carrying the spaceship to 62 miles above the Earth, to the edge of space.  The spaceship would then glide back to Earth and land on a long runway.  This process is known as a horizontal launch as opposed to the vertical launches such as NASA has done at Cape Canaveral.

It is important to remember that while Rutan’s spaceship actually made it to space, Virgin Galactic is using a completely different vehicle that has not yet gotten close to space.

To accomplish this, Branson needed a long runway at an airport remote enough not to interfere with regular commercial air traffic.  New Mexico would be perfect for that since the state is lousy with long runways left over from wartime flight training.  And since no airline operates out of an airport anywhere in the Southwest quarter of the state and there are large areas of restricted flight zones…you could take your pick of locations.

Branson was not just selling a ride in an overgrown airplane, he was selling a dream.  The would-be astronauts would be ponying up close to a quarter million dollars per flight, and for that kind of money, there is no romance seen in flying out of a dingy industrial park wrapped around a seventy year-old airport outside of Deming, New Mexico.

Richard Branson didn’t become a billionaire by selling ham sandwiches—he was selling a sizzling steak covered with space sauce.  For that, Branson wanted a new custom Spaceport built far from anything familiar, so his customers could fly in on private planes (remember, no airline service anywhere nearby), hop onto the mother ship, take a quick trip to space, land about three hours later and fly away exhilarated, even if slightly poorer.  Branson certainly didn’t want to use any of the three long runways already existing in Southern New Mexico.

Somehow, Branson talked a couple of gullible politicians to push through legislation that provided him with exactly what he wanted.  The state government spent $209 million to build a Spaceport in Sierra County, miles from anywhere.  Both Sierra County and Dona Ana County would raise their sales taxes to pay for operating the new Spaceport.  Despite the fact that the Spaceport is not in Dona Ana County, the citizens of that county would generously pay roughly 94% of the taxes to support it.

As I write this, years and years later, there is still no paved road from Dona Ana to the Spaceport.  And from the middle of the county to the Spaceport is over a hundred miles if you want to stay on a paved road. 

Perhaps we should feel grateful that this Spaceport isn’t twice as big.  Back in 2005 when governor Bill Richardson started to push this project, coincidentally timed to coincide with his campaign for president, he was talking about 5,000 new jobs, three interlocking runways, two towers, and suborbital cargo flights to Paris in three hours.  Evidently, we were going to ship them fresh green chile.

Though considerably smaller than the monster launch facility Richardson predicted, we still built one hell of a boondoggle.  The Spaceport has a single runway—with no taxiways—and one hangar belonging to Virgin Galactic.  The runway runs north/south, despite the fact that the prevailing winds are east/west, meaning that crosswind landings would be the norm…  Well, this place is never likely to be used as an airport anyway, since all the large neighboring towns already have much closer airports where the runways run the correct direction.

The only other significant building at the Spaceport is a large concrete dome housing a fire department with state-of-the-art equipment.  Two firetrucks and an ambulance are manned 24 hours a day, seven days a week—even though Virgin Galactic (or anyone else) has yet to begin operations.  If I’m reading the budget correctly, we spend $2.9 million dollars a year to run a fire department at a spaceport that is not yet in operation.  This is roughly the same amount of money required to run about 40 small volunteer fire departments.  Fire Departments that actually have something to do.  (I hear the Spaceport firemen have gotten really good at removing rattlesnakes from Virgin’s parking lot.)

As for Virgin Galactic…  Well, they say the launches are coming.  Richard Branson has made a lot of such claims, such as the three-day music concert by Lady Gaga that will culminate with her blasting into space.  50,000 people will somehow travel down a two-lane road to be at a concert in the middle of nowhere, with minimal facilities of any kind, while attending the music event of the century.  All of this, according to Branson, will occur three years ago this coming January. You still have time to buy your tickets!

Branson has been promising eminent launches for nine years.  It is time for a little reality.  There have been two versions of SpaceShipTwo built so far.  The first crashed, killing the pilot and injuring the copilot.  The highest altitude attained so far has been thirteen miles—far short of space.  The second spaceship—while it has been tested on glider flights—has not yet flown under power and is a long way from being certified by the FAA for commercial flight.  Virgin is testing its third version of a prototype engine, and there are doubts that this spaceship will ever be capable of flying passengers high enough to reach even "near" space.  While the FAA "strongly suggests" (but does not require) an emergency escape system for such vehicles, SpaceShipTwo has no such emergency system. 

Burt Rutan is a genius.  If Rutan told me he was going to the moon in a galvanized trash can using a rubber band for an engine, I’d beg to be his copilot.  But, Rutan is not going to fix the problems on SpaceShipTwo.  He has retired and his company has been sold to Northrop.  Sadly, I suspect that Northrop is not exactly wild about blasting Lady Gaga into the side of a mountain.  The company building the new spaceships is owned by Virgin Galactic (see above).

Well, if the Spaceport is unlikely to be used by Virgin Galactic, and it won’t be used as an airport, could other space companies use it for horizontal launches?  This is also unlikely, since single stage rockets can't reach space, and multiple stage rockets require a safe place for the primary stages to land.  This is why most spaceports are located near oceans and this is exactly why the US government stopped launching rockets from White Sands and moved to Florida.  While the Spaceport doesn't have a lot of close neighbors, all it takes is one spent first stage landing on one ranch house...or in Las Cruces, or...Deming, or…

While the Spaceport Authority endlessly repeats that its facility is the “first purposely designed Spaceport”, it is far from the only operating spaceport.  There are at least ten licensed spaceports to choose form in just the United States.  Bill Richardson, the former governor who saddled us with this black hole of tax money has lately been working in California to promote its new Spaceport.

The facility is not generating a lot of tourist dollars either.  The lone tourbus company licensed to bring tourists has stopped offering tours.  For the last week, I have tried calling every phone number listed for both the bus company and the Spaceport Authority and either the phones were disconnected, or no one answered, or there was a brief recording.  Tourists who show up unannounced at the gate are refused entrance by armed guards.

Note.  Do not drive out there to see for yourself.  It’s a long drive and for a lot of it, you are out of cellphone range.  There are no bathrooms, no gas stations, or anything else for the last half hour of driving.  This is not a good place to have car trouble.

The Spaceport has generated some income.  It was used as a movie set and a motorcycle company filmed a television commercial there, and a few companies used it briefly as a research location.  While the Spaceport Authority does not like to release a lot of details (despite the fact the facility is owned by and financially supported by the taxpayers), it appears that the facility generated $1.6 million in income for at least one year.  This is far short of the millions a year the facility costs to operate.  And don’t forget the interest the state is paying on those bonds sold to finance construction.

The bottom line is that the state spent hundreds of millions of dollars on pure speculation—and continues to spend the taxpayers' money on this!  We speculated that if we built a spaceport, it would attract rockets.  So we went out in the desert and constructed a giant purple martin house and sat back waiting for the birds to fly in carrying bags of gold.

In other words, we are a cargo cult.

The Wake Continues

Last week, I wrote a blog about the declining business conditions and job market in New Mexico and the resulting stagnation in the state’s population growth.  I was surprised when the post went viral. 

The short blog post, R.I.P. New Mexico, was read by 50,000 people within three days, the majority of whom live in New Mexico.  For my blog, at least, this was a record.  Obviously, I had unwittingly hit a nerve.  I was surprised by the response and pleased about the new subscribers and the nice jump in revenue from the advertisers who pay to push their wares on my blog (I'll be careful to not spend the $17 all in one place!)

And then the letters started pouring in.

The response was out of this world.  Hundreds of messages came in, as well as several hundred comments on Facebook, over a hundred emails directly to me (my email address is at the top of the page) and a few dozen comments posted directly on the blog’s webpage.

Overall, the messages were heartbreakingly sad.  When I wrote the original piece, I was talking about tax rates and population growth among age groups….and I was emotionally detached from the piece, as if I were a spectator watching a slow motion car wreck staged in an action movie.  That was before all those New Mexicans wrote to me about the reality of their situation.

Almost every week, people write me about something I have written.  A large number of astute people passionately believe that I’m an idiot and take the time and trouble to tell me so.  I get the occasional death threat (I once even got a fatwa from someone claiming to be an Imam from Saudi Arabia).  Lots of people do not appreciate my sense of humor and many people are alarmed at my disregard for the rules of grammar.  (They should see the original draft before my patient and loving wife labors mightily over my writings.  She claims I mix tenses on purpose just to annoy her.)

Occasionally, I do get friendly letters.  I received a very nice letter last night from a lady who had read something I wrote to my granddaughter, Alice.  She said it was just the thing she needed at the end of a long and hard day.  Her letter was exactly what I needed, too.

The letters this last week are different.  To be sure, I had quite a few from people who were angry with me.  My ideas were denounced by county political party leaders from both political parties.   I was called a socialist, a liberal professor, and a secret paid blogger for a right-wing conservative think tank.  One letter suggested I go home to Berkeley.  To set the record straight, I’ve only visited the Berkeley Library, and if I’m working for a think tank, it’s a secret from me, too.  (Though they should feel free to send me my paycheck.)

I got a few angry responses from those who support employee unions because I suggested that more employers might move to the state if we were a right-to-work state.  None of those writers seems to have noticed that I actually proposed a compromise that would keep the existing public service unions—the only large unions in New Mexico—as closed-shop unions while allowing new unions to be right-to-work.

Overwhelmingly, the angriest letters of the week defended turquoise.  To be exact, I said that New Mexico sells mountains of ugly turquoise to tourists.  I did not say that all turquoise is ugly.  And whether you like it or not, some of the tourist shops in Santa Fe are peddling mountains of Chinese imitation turquoise, some of it just polished and dyed concrete.  (Don’t take my word for it, do a Google search or read about the investigation done by Albuquerque’s KRQE.  The television station discovered that both the Smithsonian store and the Museum of New Mexico were selling fake turquoise).

The remainder of the letters were the ones that were tragic to read.  I received letters from parents who told me about children who had been forced to move out of state to find jobs.  Dozens of heartsick parents wrote that they missed their children, but were glad they had found jobs, even if out of state.  A lot of the letters were similar to this:

…the cost of living keeps going up year after year and your pay keeps going down year after year. That's why I made sure my son pushed him self in school he's now a junior at highlands university and I been preaching to him get your education and move to different state a state that will pay you good money for your education. A place to raise a family so your kids will have a future. So you won't have to live paycheck to paycheck.

An almost equal number of letters were from people who had moved out of New Mexico to find work.  Some of them owned homes back in New Mexico and dreamed of the day they could move back.  More than one letter discussed the possibility of moving back after retirement.

Was born and raised there and headed to Texas at the age of 28 because of lack of opportunity. Like everyone else, I'll move back when I'm ready to retire.

Many people wrote to justify why they had already moved.  You could tell they wished they were still in New Mexico, but felt they really had no choice.

So I was born and raised in New Mexico and it was great growing up but as soon as I graduated from college in Albuquerque I immediately was ready to move out because there is literally nothing there and they have no promise of growing…

Try living in Las Cruces and Raising a family on $2000 a month. This place is a joke! I recently traveled to Oklahoma and decided to take a look at jobs and there are plenty , not your typical Las cruces $9 an hour job either.

With federal/state/GRT (Gross Receipts Tax) many of the so called professionals pay more than 50% income tax rate on income. Why would you do that if you could pay 10% less tax living in a neighboring state with a thriving economy and many more choices of big cities to live in?

I am NM born and raised. I left as soon as my children were school age. We chose Colorado because it was in the top tier education wise, decent cost of living, and at the time in the bottom tier for DWIs and drug usage. Exact opposite of NM.

The letters I remember best were from people who wanted to move out, but felt they couldn’t because they had to stay and take care of family.

I am stuck until my mother passes away. I try and try to get good work and it just does not happen. I will leave as soon as I can family cabin in Eagle Nest since 1956 but living and surviving here is damned difficult. I vote and try to change things but it seem our politicians do not care about anything but lining their own pockets.

I’m no longer dispassionately removed from the problem.  Although I am retired, I can’t ignore the lack of employment in this state anymore.  I am tired of politicians who argue about the issue without being willing to try new ideas.  This is not a debating issue where you win points against your opponent.  We are long past this being a partisan issue where politicians give rote lip service to approved talking points just before an election, only to ignore the problem afterwards. 

From the data Google provides me, roughly one out of every 50 people in New Mexico read last week’s blog.  More if you consider the population of the state includes a lot of children, university administrators, and other people who either cannot or won’t read.  Can you guess who didn’t write me during this week?  Not a single elected official.

If you want to know what is really ugly, it’s not New Mexico turquoise.  It is the poverty in the state.  It is the families divided because their children cannot find good jobs in the state, so they must leave the state to find good jobs.  Why do our politicians rail about the division of the families of undocumented immigrants who face deportation, but ignore the plight of the divided families who have elected them to office, whose children suffer "economic deportation"?

R.I.P. New Mexico

The new population figures are in, and since the 2010 census, the population of New Mexico has grown by a staggering 1%.  Or perhaps a better term is stagnation.

Most of the states surrounding New Mexico, the remaining states of the Southwest, had robust growth.  Texas grew by over 10%, Arizona by more than 8%.  While official numbers do not exist, it is rather obvious that if you discount immigration from Mexico, the population actually shrank.

The news gets even worse:  While roughly the same number moved out of the state as into it (about 50,000 people), the only age groups that are growing are the retired and the young adults (ages 20-24).  Working age (which you should read that as "tax-paying age") New Mexicans are shrinking in number--and the situation is not likely to improve soon.

New Mexico is losing its seed corn--well, it’s losing the young working-age adults, ages 25-40)--and way too many of them are college-educated young professionals.  New Mexico goes to great expense to educate these young people, with fine public colleges and then we lose them.

There are so many college graduates leaving that, despite the large graduating classes of the numerous state universities, in some recent years the total number of graduates residing in the state actually decreased.

Over the years, I have asked the students in a number of my classes how many of them planned to leave the state after graduation and the answers were always depressing.  Except for a few non-traditional students (that’s educationalese for "older students")--many of whom were already retired--and a few married students with extensive local family connections, the answer was overwhelmingly in favor of emigration to find jobs.  The most popular destinations were Texas, Colorado, Arizona, and California.

When you consider that tuition covers only a small part of the cost of educating a college student, it is commendable that a poor state continues to pay such a large amount (some estimates put it as high as $56,000 a student) to educate workers who promptly leave New Mexico. 

It is possible that the most expensive export crop from New Mexico is not our green chile, our pecans, or even the mountains of ugly turquoise we sell to tourists:  It is our educated young--our seed corn.  

As the population of New Mexico continues to age, the need for social services and health care will continue to rise, continually increasing the drain on state funds while, paradoxically, the number of tax payers will actually shrink.  Will the state government raise taxes forcing more businesses to leave the state?  Would the government dare to cut programs?

Unemployment in the state is rising, and new employment in the traditional industries is unlikely to rise.  Our largest employers are the research labs, the military bases, state agencies, the state education system, and hospitals--all of which depend on tax revenues.  In the face of shrinking budgets, some of these employers have already started laying off employees.

Obviously, the state needs to attract new employers so that we can create jobs.  New Mexico has a business income tax higher than any of our neighbors have, and while the state has started to lower the tax, this was done--predictably--in small steps.  While the rate has been lowered a little, we will not be competitive with any of the other states in the Southwest until 2018, at which time we will be slightly lower than…Oklahoma...but still much higher than the rest of the states.

I doubt the remaining tax decreases will ever happen.  Already, politicians are proclaiming that the experiment has failed:  “Taxes were lowered and no new jobs appeared.”  There are already cries to raise business taxes to help balance the budget.

It is very hard to determine what effect cutting business taxes have actually had on the economy of New Mexico.  The tax cut was small, recent, and occurred while the state had large fluctuations in the prices of oil and natural gas.  This is a small state, with a population equivalent to Houston's.  As the price of oil and gas fluctuates, so does the New Mexico economy.  When the price of oil dropped in 2016, the state coffers ran dry.  As the price has recovered slightly this year, the economy has improved--marginally.

There are lots of proposals on how to attract employers to the state, all of them made by politicians who have never employed anyone.  Among the suggestions are expanding high-speed internet, increasing spending on education, increasing intercity rail traffic, legalizing marijuana, and providing more job training.  The state has a long history of promoting unorthodox schemes to boost revenue:  We have built a deserted Spaceport, we have an empty tourist train, and we have loaned millions to Hollywood producers who will never pay this money back...All to no avail.

I’m sure that all of these innovative proposals might be attractive to some prospective employers, but I have a simple question I would like answered before the state spends the money on the next get-rich-quick scheme.

Why are there so many employers in El Paso?

Thirty miles south of New Mexico along Interstate 10, is the city of El Paso.  This will never be my favorite city, as it is dirty, crowded, badly laid out, and seems to be run by politicians too stupid to even be allowed in the New Mexico legislature. 

If you drive south from New Mexico, as you enter Texas, the highway is almost continuously lined with warehouses, factories, and businesses.  If any of these had located in New Mexico, it would have been big news.  Our governor recently made a speech because Facebook is building a facility in the state that will employ a hundred people.  If they were to hire two hundred people, we might declare a state holiday.

El Paso does not have high-speed rail, super-fast internet, or any more job fairs than New Mexico does.  They also do not have a Spaceport.  My university classes were full of Texas students for two decades, and they seemed intellectually on par with those from New Mexico.  While I support education, if there is a lack of it in New Mexico, it is not the reason there are no employers rushing to the state.

I'd like to offer three suggestions to attract employers.  First, finish lowering business taxes.  They are currently at 6%:  I would lower them to 4.5% to match Colorado, which is notoriously business friendly. 

Second, New Mexico needs to be a Right to Work State, like Texas, Arizona, Utah, Oklahoma, and Nevada.  This state strongly protects union jobs that the state has never had and since closed shop states rarely have expanding industrial bases, it only makes sense to stop being a closed shop state.  Since the only large unions in the state are all for public employees, perhaps we could compromise with the unions and allow those for government employees to remain closed shops.

The last suggestion is almost impossible to achieve, because it is simply not in the nature of New Mexico.  However, since I have already suggested the near impossible, why not ask for the moon?

New Mexico needs a stable legislature--one that will not reverse itself every two to four years.  The state needs to project the image of a state that will not, on a whim, pass legislation repealing the law of gravity, or making pi equal to 3.0 so it will be easier to teach to children.  Our state government needs the type of maturity and stability that will reassure potential employers that shortly after a new business opens here, the state will not decide on a whim to outlaw electricity or to allow businesses to be open only three days a week.  Getting the "Land of Mañana" to that point will take some time, so we need to get started (yesterday)!

Venezuela and the Dutch Disease

You would be excused for believing that riches mean wealth.  Not always...In the case of Venezuela, her abundance of oil has made her poor. 

Two terms describe Venezuela: Rentier and the Dutch Disease.  A "rentier" state is one in which the country receives so much income from the export of petroleum, that the leadership becomes autocratic, ignoring the needs of society.  This so obviously describes the governments of the late Hugo Chavez and Venezuela’s current madman, Nicolas Maduro, that it really needs no further explanation.  But, what is the Dutch Disease?

Forgive me, for as a historian, no explanation is possible without a little back story. 

Venezuela has always had oil.  Long before the Spanish arrived, the oil seeped to the surface, particularly around the area of Lake Maracaibo.  The natives called the floating oils and accumulated asphalts mene and used it to make medicine, torches or caulk for the seams of their canoes. 

After the arrival of the Spanish, the uses of the seeping oil pretty much stayed the same.  The boats got larger, and some of the thick oil was used to waterproof canvas sails, or lubricate the ship’s cannons.  The first documented petroleum export from the new world was a single barrel of oil that was shipped from Venezuela back to Spain as medicine to treat Emperor Charles V for gout in 1539.

Note.  Not that this has anything to do with Venezuela, but the story is just too creepy not to discuss.  How, the reader will ask, do we know that Emperor Charles V actually had gout?  Well, the kings of Spain are taken after death to a vault deep under the castle, El Escorial, and left to rot for decades before the bones are moved to a burial vault.  Even as you read this, a dead king, and his wife have been rotting away there for a couple of decades.  In Charles’ case, before his corpse was placed in—and I swear I’m not making this up—The Royal Rotting Room, one of his fingers was cut off and saved as a Holy Relic.  Recently, the Church was convinced to part with microscopic traces of the bone examined.  Yep, King Charlie had gout.  The results of the test were published in the New England Journal of Medicine—which for some mysterious reasons—did not even mention The Royal Rotting Room.

Even when oil began to be refined and used commercially, Venezuelan oil was ignored.  For most of the 19th century, Standard Oil of Pennsylvania supplied almost all of the world’s need for refined petroleum products.  The only thing Venezuela exported was asphalt.  The first paved roads in America were covered with Venezuelan asphalt.  If you dig down deep enough in front of the White House, you will find the first layer of asphalt on Pennsylvania Avenue came from Venezuela. 

Little changed until the First World War  As late as 1900, the entire Venezuelan government ran on the export duties primarily garnered from coffee.  The wealthy elite of the agricultural country depended on the incomes they received from their vast cattle herds on the lowland plains.  What little industry existed in the country was clustered in the coastal towns.

Oil, long ignored, was affected by laws very different from those in America.  By law, the underground oil belonged to the state—it was not the property of the owners of the land above it.  Second, the president of the country had exclusive rights to lease or sell the rights to that oil.  These laws had long-lasting impacts on the oil industry.

Since Standard Oil believed it had limitless resources in North America, it was left to Europeans to begin development of the Venezuelan oil reserves.  It was the Royal-Dutch-Shell conglomerate that first began exploring the oil fields around Lake Maracaibo.  The difficulties were enormous:  There were no roads, no settlements, no power plants, no trained workers. There was, however, an overabundance of mosquitoes.  In addition, deep-draft vessels could not enter Lake Maracaibo. Neither did the lake's  seaports have developed harbors.  Still, the potential profits were enormous, so the oil companies slowly continued to explore.

On December 14, 1922, at a depth of only 1500 feet, drillers hit an enormous pool of oil.  The gusher blew the drilling rig apart, blasting heavy crude oil 200 feet in the air, flowing at 200,000 barrels a day.  It took 9 days to cap the flow.  From that point on, the Venezuelan oil boom never slowed down.

Immediately, vast sums of money flooded into the country, changing the economy forever.  Workers left agriculture for better paying jobs in the oil industry.  With a flood of foreign cash, it was easier to buy foreign manufactured goods than to produce them domestically.  Industry—and the jobs it provided—simply dried up.  With cash pouring in, the Venezuelan government no longer had to tend to the needs of the populace, of whom only a small minority was employed by the oil industry.  The government became increasingly corrupt and dictatorial, culminating in the disastrous governments of Hugo Chavez and Nicolas Maduro.

With an ever increasing amount of money competing for a shrinking supply of goods, prices invariably rose.   Increasingly, the country was dependent on foreign imports, not only for manufactured goods, but even for food.  Today, Venezuela imports almost everything, including a large variety of distilled petroleum products.  As prices spiraled upward, the government imposed price controls, decreasing incentives to produce and worsening the shortages. 

The flood of foreign money also collapsed the exchange rate of the Bolivar, the Venezuelan currency.  If you use the official exchange rate, the most expensive city in the world to live in is Caracas.  The black market exchange rate is roughly 1% of the official rate.

This condition is called the Dutch Disease, after the economic collapse the Dutch experienced after basing their economy on a single commodity, natural gas.

For the rest of the 20th century, the wealth continued to pour in.  Venezuela was one of the founding members of OPEC.  During the boom years, while oil commanded high prices, Venezuela borrowed money, built lavish public works, and greatly expanded its military.  But, the country was completely dependent on the price of a single export commodity. 

For the last five years, the price of oil on the international market has been dropping.  The price for Venezuelan oil has dropped by more than 50%, and the Maduro government is strapped for cash. 

Ironically, Venezuela, the country with the largest oil reserve in the world, is going bankrupt.