Friday, June 13

Socialism doing predictable things in Venezuela, part gazillion

Socialism in Venezuela continues to do the things it does everywhere: economy contracting, prices soaring and the local currency slumping:  on the black market dollars are worth 11 times the official government exchange rate. 

The reason is that Venezuela imports 70 percent of the goods its people consume, and you can't buy imports with bolivars.  As a result, one in four basic products were unavailable in shops in January, the last time the government published scarcity figures.

On the black market the bolivar has fallen to 71 to the dollar from 23 when President Nicolas Maduro succeeded Hugo Chavez in April of last year--a drop of 300%.  The official exchange rate, reserved for imports of food and medicine, is 6.3 bolivars per dollar.

The dollar shortage is turning Venezuela into a two-tier society similar to the Soviet Union and Cuba.  Venezuelans with access to dollars--foreigners, tour agents, airport taxi drivers and prostitutes--aren't hurt much by inflation because they can trade their greenbacks at ever higher rates. But those who can’t are seeing their living standards decline.

Maduro claims the black market was designed by the bourgeoisie to destroy his Socialist government.

The shortage of dollars has led to shortages of everything from bottled water to toilet paper, and pushed prices up:  Last March--the last month for which figures are available--prices were 59 percent higher than a year earlier.

Rising prices, increasing shortages and a jump in crime have fueled three months of anti-government protests that have killed at least 42 people.

Drinks vendor Luis Alberto Paredes lives with his sister and their 85-year-old mother. His walls and roof are adorned with flags and posters of Maduro, Chavez and the Venezuelan Communist Party.  Paredes, who lives on a minimum wage of about 4,200 bolivars a month (about $60 at the black market rate), says he has to buy coffee beans for his stand from street hawkers for nine times the regulated price, because the supermarkets are always out of...coffee.   

In Venezuela.

That's like not being able to buy corn in Iowa.

So why is all this happening?  Are all these problem caused by some policy of the socialist government?  If so, what's the policy?

Well, being socialists they believe business is bad, and that businessmen are filthy rich because they exploit the rest of the population.  So they set a cap on what businesses could charge.  If this cap turned out to be too low for the businesses to make a profit, tough shit--the socialists believed the businessmen would still work hard to provide goods even if they didn't make a profit.

Surprise, morons.  The businessmen said "We quit."  And the shelves went bare in about two hours.

Wait, hasn't the Obama administration (I was gonna say "our government" but it sure as hell ain't ours) put price caps on things here too?  Hasn't the government dictated what kinds of insurance you can sell, and what the insurance has to cover, and who has to buy it?

Why yes, yes they have.

But given the experience of other government attempts to control markets, isn't that...uh...sorta risky?

Ohh, no, citizen.  Because the emperor is way smarter than the guy running Venezuela.  You have nothing to worry about!

Just ask Jay Carney, or Eric Holder, or Jeh Johnson, or Valerie Jarrett.  These people are all really, really smart.  They don't make mistakes.  And if you think they made one you're wrong.

Oh, and a racist.

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