Venezuelan Dreaming: Charter City Fans See an Opportunity

“Only a crisis — actual or perceived — produces real change,” the “free-market” fetishist Milton Friedman once wrote, “When that crisis occurs, the actions that are taken depend on the ideas that are lying around.” 

Mark Lutter, founder and Executive Director of the Charter City Institute, is one of those guys whose job it is to come up with, or at least promote, some of these lying-around ideas. In his case, the idea is the charter city, basically a city in which the developer gets a country’s government to give it some land for almost nothing so they can develop cities, or at least small facsimiles of cities, in which they pay only tiny amounts of taxes and can basically make up their own laws.

Needless to say these cities are only really appealing to countries that are corrupt or in a terrible mess. (Look at Prospera in Honduras for an example of how this can work out in practice, if it works out at all.)

Enter Venezuela, a country already corrupt and already in a terrible mess, one that Trump has just made so, so much worse. Where you or I might look to Venezuela and see a tragedy, Lutter sees an opportunity for what he’s now euphemistically calling a “Freedom City,” a term of art borrowed from Trump. 

“Venezuela doesn’t need to become another Iraq,” he posted on X a couple of days after Trump’s attack. “It needs a Freedom City.” In a subsequent post, he explained, with a kind of colonialist smugness, that such a city could “show Venezuelans the benefits of rule of law and economic freedom.” 

Even on X, overrun as it is with fascists, the posts did not go over well. “A ‘Freedom City’ meaning a feudal fiefdom where the only ‘freedom’ will be the freedom of rich foreigners to exploit the native population,” wrote one commenter, pretty much nailing the central dynamic of these supposed “freedom” supposed “cities.” Another commenter put it a little more bluntly: “Get the fuck out. #techfascist city is more like it.” 

Lutter hopes to have a bit more luck with the Trump administration, noting in another X post that “nothing says they wouldn’t be open to it.” And he may well be right. Nothing is too stupid for the Trump administration to embrace. This is an administration talking seriously about taking over Greenland, possibly because it looks so freaking huge on those Mercator projection world maps we all grew up with and Trump likes having things that are huge. Sorry, “yuge.” 

Trump himself promoted the idea of “Freedom Cities” in America during the 2024 campaign. Staffers of the Charter City Institute and promoters of similar ideas like the “Network State” are reportedly talking, at least casually, to members of the administration. Freedom cities may not have gotten anywhere in the U.S., but in Venezuela, at least in a Venezuela “run” by Trump, as he has promised to do, the idea might be a lot more palatable. After all, as Friedman noted, it’s in crises that “the politically impossible becomes politically inevitable.” That’s how “disaster capitalism” works. 

Ironically, Trump is having trouble selling actual capitalists on disaster capitalism in Venezuela, despite serving up disaster to them on a silver platter. He is eager for American oil companies to go in and plunder the considerable stores of oil there, but the oil companies themselves are much less enthusiastic about the idea, with the CEO of Exxon Mobil declaring the country “uninvestable.” 

But these charter city people, like Lutter, aren’t just capitalists; they’re ideologues, some would say fanatics, and they may well be prepared to plunge in where others fear to tread. Or, at least in the case of Lutter, to offer advice to the plungers from his offices in Washington D.C. Nice work, if you can get it. And if you’re either a true believer (as he seems to be) or completely lacking a moral compass.

As Nafeez Ahmed reveals in Byline Times, Lutter has been dreaming of bringing his peculiar notion of progress to Venezuela when "Maduro gets removed" since 2019, if not earlier. "Assuming this transfer of power does go through," Lutter explained in an interview nearly seven years ago on the podcast 80,000 Hours, "they’re basically looking at what is a wholesale development plan like rejuvenation plan for Venezuela, and they’d be willing to adopt ideas that otherwise they might not be willing to adopt."

And that's disaster capitalism in a nutshell, a perhaps too perfectly on-the-nose illustration of Friedman's thesis about how crises open people up to otherwise "politically impossible" ideas. It's just that sometimes these lying-around ideas have to lie around for a quite a while before they find the requisite opportunity.

In subsequent posts, I will explain in greater detail just how utterly terrible charter cities and projects adjacent to them are for the people in the countries that have to put up with them. And I will of course report if anything happens with Lutter’s Venezuelan suggestion. Stay tuned! 

Thanks to Nafeez Ahmed of Byline Times and Gil Duran of The Nerd Reich for putting me on to this story.