Venezuela nationalized oil production in 1975 by creating the PDVSA to act as a holding company for oil companies operating in the country. Because the government now had such close contact with the oil industry, corruption became rampant. Politicians were incentivized to keep Venezuela dependent on oil because they were getting rich off of the industry. Consequently, even when oil prices fell and the government could not pay for their programs, politicians engaged in irresponsible economic practices (such as international borrowing and currency devaluation) rather than diversifying the economy.