Socialism at his Best: Venezuela's "Death Spiral" A Dozen Eggs Cost $150 As Hyperinflation Horrors Hit
- The question of whether Socialism can be an effective economic system was famously raised when Margaret Thatcher said of the British Labor Party, “I think they’ve made the biggest financial mess that any government’s ever made in this country for a very long time, and Socialist governments traditionally do make a financial mess. They always run out of other people’s money. It’s quite a characteristic of them. They then start to nationalise everything.”
- There are dire reports of people waiting in supermarket lines all day, only to discover that expected food deliveries never arrived and the shelves are empty.
- There are horrific tales of desperate people slaughtering zoo animals to provide their only meal of the day. Even household pets are targeted as a much-needed source for food.
- President Maduro is doubling down on the proven failed policies and philosophies of “Bolivarian Socialism,” while diverting attention away from the crisis — pointing fingers at so-called “enemies” of Venezuela such as the United States, Saudi Arabia and others.
- A dozen eggs was last reported to cost $150, and the International Monetary Fund “predicts that inflation in Venezuela will hit 720% this year.
“[a]t present it does not appear that the current economic expansion is about to end any time in the near future. The gains in poverty reduction, employment, education and health care that have occurred in the last few years are likely to continue along with the expansion.”
“I think they’ve made the biggest financial mess that any government’s ever made in this country for a very long time, and Socialist governments traditionally do make a financial mess. They always run out of other people’s money. It’s quite a characteristic of them. They then start to nationalise everything, and people just do not like more and more nationalisation, and they’re now trying to control everything by other means.”
” …markets expect Venezuela to default on its debt in the very near future. The country is basically bankrupt. It is not easy for a nation to go bankrupt with the largest oil reserves in the world, but Venezuela has managed it. How? Well, a combination of bad luck and worse policies. The first step was when Hugo Chávez’s socialist government started spending more money on the poor, with everything from two-cent gasoline to free housing. That may all seem like it’s a good idea in general — but only as long as there’s money to spend. And by 2005 or so, Venezuela didn’t have any.”
“What began as a war against the ‘squalid’ oligarchy in order to build what he called ’21st-century socialism’ — cheered on as he was by many leftists from abroad — has collapsed into an unprecedented heap of misery and conflict.”
Maduro has refused to accept help from international charitable organizations, including the Vatican-sponsored Caritas Internationalis, which through different affiliates has tried to send medicine and food.“Denying that there’s a crisis and refusing to let the world send medicine and food is not possible,” said Cardinal Jorge Urosa Savino, archbishop of Caracas.The prelate believes that Maduro is refusing to accept help in an attempt to hide the “very grave situation of total shortage,” which far from improving, he said, continues to deteriorate.
“The Venezuelan Episcopal Conference, the organization of the nation’s Catholic bishops, issued a scathing statement condemning president Maduro for giving the military full control of the nation’s food supply, accusing him of being at the helm of a devastating “moral crisis” and crippling every aspect of life in Venezuela.”
“In a tale that highlights the chaos of unbridled inflation, Venezuela is scrambling to print new bills fast enough to keep up with the torrid pace of price increases. Most of the cash, like nearly everything else in the oil-exporting country, is imported. And with hard currency reserves sinking to critically low levels, the central bank is doling out payments so slowly to foreign providers that they are foregoing further business.“Venezuela, in other words, is now so broke that it may not have enough money to pay for its money.”
“The divergence between Venezuela’s revenue and spending started long before (the 2014) oil-price collapse. When oil prices hit their all-time high in July 2008, government revenue – 40 percent of which comes directly from oil — was already falling. The main problem was Venezuelan oil production, which dropped from 3.3 million barrels a day in 2006 to 2.7 million in 2011. It was still at 2.7 million in 2014, according to the latest BP Statistical Review of World Energy.”“Venezuela isn’t running out of oil. Its proven reserves have skyrocketed since 2000 as geologists have learned more about the heavy crude of the Orinoco Belt. But getting at that oil will take a lot of resources and expertise, both things that Venezuela’s state-owned oil company, Petroleos de Venezuela (PDVSA, best known in the U.S. for its Citgo subsidiary), has been lacking in since Chavez initiated a sort of hostile takeover starting in the early 2000s. First he kicked out 18,000 workers and executives, 40 percent of the company’s workforce, after a strike. Then he started demanding control of PDVSA’s joint ventures with foreign oil companies. One could interpret this in the most Chavez-friendly way possible — he was aiming for a more just allocation of his nation’s resources — and still conclude that he made it harder for PDVSA to deliver the necessary tax revenue.”
“The country’s runaway murder rate is just one of the factors driving opposition to President Nicolas Maduro in a country where shortages of food and basic goods are chronic, inflation is running rampant and the government is jailing political prisoners. But it serves as a bloody illustration of just how close to outright societal collapse Venezuela has come since the end of the 20th century, as gangs, guerrillas and militia defend their turfs and traditional authority structures fall by the wayside.”
http://nunezreport.blogspot.com/
Source: http://nunezreport.blogspot.com/2016/09/socialism-at-his-best-venezuelas-death.html
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