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Old June 26th, 2016, 08:56 AM   #1
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Congratulations To Bolivarian Socialism - Venezuela Now Faces Imminent Famine

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Venezuela has been held up for years as a glorious example of what socialism could do for a country. And of course now we can still hold up Venezuela as a glorious example of what socialism can do for a country. Which is, if current reports are to be believed, manage to create actual famine in a middle income country. It’s really a quite extraordinary result for any economic policy at all, to be able to manage that. And it does need to be put down to that Bolivarian socialism, not to anything that has happened to the oil price. And it’s most certainly not because of any conspiracies by the US nor even any domestic opposition. This is simply what happens when gargantuanly stupid economic policies are imposed upon a place. Adam Smith did indeed note that there’s a lot of ruin in a country but “a lot” is not synonymous with “infinite amount”.

We ourselves also need to take note of what that gargantuanly stupid policy was. I don’t, and I would not, claim that a $15 minimum wage, nor an extension of rent control, are going to turn New York or LA into downtown Caracas. But they are the beginnings of that same policy mistake, the belief that prices don’t matter, that prices can be arbitrarily applied.

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Old June 26th, 2016, 09:05 AM   #2
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more from the article


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And so what was it that Bolivarian socialism did wrong?

Also, even now, with oil below USD $50/barrel, Venezuela has an export income larger than that of Peru, a country with identical population and where there are zero reported shortages of any kind.

The estimate for Venezuela’s export income this year would place it at an amount almost equal to that of Colombia, a country with nearly double the population of Venezuela. Thus, it is incontestable that the decline of oil income is not the cause of the tragic situation in which Venezuelans find themselves.

So, it’s not the oil, is it?

The fact is that Venezuela, while still pumping oil, no longer has a functioning economy. Seventeen years of nationalizations and confiscation of private industries, farms, cattle ranches, distribution companies, sugar mills, and even shopping malls have completely destroyed not only the local production, but the distribution networks necessary for the normal functioning of the economy.

Ninety percent of confiscated and nationalized companies and farms no longer produce anything.

That’s bad but this is the real killer:

In addition, a draconian system of price controls that forces most local businesses to sell their wares at a loss has halted any attempts by local entrepreneurs to keep their businesses alive.

That’s the complete killer. Prices tell those producers what people want to consume and what they’re willing to pay for it. Without that information no one, not even soldiers given factories for free, know what to produce nor do they have an incentive to produce anything. And thus everything stops actually happening.

I am not convinced that famine is about to break out in the next few weeks in Venezuela but I am absolutely certain that it will in time unless things are changed. Simply and entirely because an economy without a price system just does not work. We cannot just randomly assign numbers as we wish them – there’s too much important information in market prices for us to be able to do that.

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Old June 26th, 2016, 10:02 AM   #3
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Without the incentive for personal wealth innovation stops.
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Old June 26th, 2016, 12:21 PM   #4
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Without the incentive for personal wealth innovation stops.
Oh, there is personal wealth in Socialism. There is even capitalism. Its just capitalism is denied to the peasants.

Here is your personal wealth
Maria Gabriela Chávez Net Worth: Hugo Chávez's Daughter Richest Woman in Venezuela, Worth $4.2 Billion : World : Latin Post
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Old June 27th, 2016, 04:53 PM   #5
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The capitalist nations plotted against Venezuela and Comrade Chavez. The bourgeois will suffer for this.
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Old June 27th, 2016, 09:43 PM   #6
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The capitalist nations plotted against Venezuela and Comrade Chavez. The bourgeois will suffer for this.
Perhaps. Presently the proletariat is suffering under Venezuela's inept leaders who are, ostensibly, socialists.
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Old June 27th, 2016, 10:14 PM   #7
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I have wondered how well Libya would do if the factions there would just drop their damn weapons, come together, get the oil revenue working back at 100 percent and develop the beachfront property they have to lure Europeans and Brits to come to their sunny hotel/beach/casino resort.

Seems to me that most people would be employed, the country is basically four towns and a shitload of empty space, so homes there could be built at a very moderate price. Libya could be a country where most people are employed at a decent wage, living in low cost housing, either in the private, public, retail/production, oil or tourist industry. The country only has 6 million people which is the size of Tennessee. Seems to me that even at a depressed per barrel price, Libya could maintain a modest social program, "free" medical care for the poor, with proper hospitalization for all at a discount.

Or the small nation of Equatorial Guinea (EG) where oil was discovered there in abundance and all the wealth has been literally robbed by the ruling family. The EG is basically a dinky island (once called Fernando Po!) and a small square of land with about 800,000 people. The people are impoverished living on less that $1 a day. There is enough money that everyone there can have a comfortable standard of living, which would actually grow their economy, which is what I would want as a leader. I am not a dictator that will be fair and honest, and I will take my skim and wear my bling, but how many golden toilets do I need? I would be sort of embarrassed for people to come to my country and see people living in mud huts and bloated stomachs while riding in my Bentley.

So Venezuelan Communism is still better than Libya with dumbasses shooting one another for Allah, or a literal family of crooks and killers in EG. Or those weird, towel wearing, woman hating, mustache loving Saudis. Would rather live in Venezeula where I can drink cheap booze and talk to the ladies.
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Old June 28th, 2016, 07:19 AM   #8
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Originally Posted by senor boogie woogie View Post
I have wondered how well Libya would do if the factions there would just drop their damn weapons, come together, get the oil revenue working back at 100 percent and develop the beachfront property they have to lure Europeans and Brits to come to their sunny hotel/beach/casino resort.

<snip>
But it's hard to do when you are tribal, each tribe hates each other and are always in a state of declared war or undeclared ongoing fighting. They aren't enough of a unit to even call it civil war.
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Old June 28th, 2016, 05:17 PM   #9
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Perhaps. Presently the proletariat is suffering under Venezuela's inept leaders who are, ostensibly, socialists.
The capitalists used embargoes and violated humanity by starving my comrades into this inhumane situation. Hugo Chavez was a great leader. His taking of the means of production was just beginning! It was destined to spread through South America, into Mexico, its tentacles reaching into the very heart of the United States. A communist dream was so close,and the capitalist, protecting their profits and using their power and violating the will of the people killed it. It will not last long. The will of the people will not be denied and the bourgeois will suffer in the end.
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Old June 29th, 2016, 06:18 AM   #10
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The capitalists used embargoes and violated humanity by starving my comrades into this inhumane situation. Hugo Chavez was a great leader. His taking of the means of production was just beginning! It was destined to spread through South America, into Mexico, its tentacles reaching into the very heart of the United States. A communist dream was so close,and the capitalist, protecting their profits and using their power and violating the will of the people killed it. It will not last long. The will of the people will not be denied and the bourgeois will suffer in the end.
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