Venezuelans struggle with rampant inflation on miserly salaries

Caracas tower highlights the problems faced by citizens trying to eke out an existence on pittance wages in the face of rampant inflation

PUBLISHED : Thursday, 13 February, 2014, 8:50pm
UPDATED : Friday, 14 February, 2014, 9:36am

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Standing 52 storeys high and crowned with a heliport, the unfinished high-rise, originally conceived as a bank, was meant to stand as an emblem of Venezuela's booming economy of the 1990s.

Instead, with the country struggling with one of the world's highest inflation rates, food shortages and a currency black market where the US dollar trades at 10 times the official rate, La Torre, as the tower is known to locals, is an emblem of the state's failure to provide its citizens with housing, public transport and even safety.

The only thing that doesn’t go up here are people’s salaries

Illegally occupied eight years ago by more than 300 families, and featured as a hideout in the US TV spy series Homeland, this industrial-scale squat counts a policeman among its residents; not that Jorge Luis Cadena is proud to call it home to his wife and three children.

Cadena, 27, draws a police salary of 4,800 bolivars (HK$5,886) at the official rate, or just HK$511 unofficially, and sounds more resigned than angry at his situation.

"My job isn't important here, just like a teacher's job isn't important," he says. "We are in charge of people's safety and of our kids' education, but the salaries you make from jobs like these mean we are not important."

At least moving to the tower, away from Caracas' violent slums, has meant a safer life, relatively, for his family. "It allowed us to move out of my mother-in-law's, but I don't feel like I own this place," Cadena says. "I won't lose hope of owning my own home."

But squatting meant Cadena could use the 3,500 bolivars a month it would cost to rent a similar place to pay for the 1999 Honda Accord he bought from a friend. He uses his car to double as a taxi driver, a sideline that pulls in twice his police salary.

"All Venezuelans have to work two jobs," Cadena says, as he makes his way home up 26 flights of stairs. "We survive as if by an act of God."

Cadena also bought the car as a way to ward off inflation. At more than 52 per cent a year, Venezuela's inflationary economy and over-reliance on imported goods means "the only thing that doesn't go up here are people's salaries".

Because of Venezuela's dual exchange-rate system, only the few with access to foreign currency can benefit from the black market; for the vast majority, money simply evaporates.

Cadena makes enough for the family to get by. Half of his income goes on food, which is not only harder to find but also more expensive every week. "We used to rely on street vendors because they were cheaper," Cadena's wife Yecenia Polanco says. "But with the shortages, they've actually become more expensive than supermarkets."

Price controls imposed more than five years ago have led to the disappearance of basics such as sugar, cornflour and milk from supermarket shelves.

Yecenia trained as a hairdresser, but after a man she was shaving at a parlour was shot dead at point-blank range right in front of her, she prefers to work from home. She is slowly building up her clientele again.

In a good month, she can make 2,000 bolivars, but January has been slow, and to date she has only made 400.

And yet they refuse to give up on their aspirations. "I want to persevere in my dreams: a home and to give our children a better future," Cadena says. "We want what everyone wants."