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.
Venezuela: mass famine is imminent due to the Chávez-Maduro regime’s destruction of the productive economy.
A humanitarian crisis, the likes of which have never been seen in the Western Hemisphere, is brewing in Venezuela and it will be inevitable in a few weeks.
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.
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.
The Venezuelan opposition confirmed Sunday that it is ready to start the process to bring about the referendum to revoke the mandate of President Nicolas Maduro, even if they deprived of their liberty.
The mayor of Caracas, Antonio Ledezma, imprisoned since February 2015, released a message in which he congratulated the Venezuelan people for "the heroic journey made this week," noting the effort resulted in hundreds of thousands of citizens validating their signatures to trigger a referendum.
On Friday, after a five-day effort, the National Electoral Council (CNE) validated 1.3 million signatures needed to start the recall.
Throughout the five days, the Venezuelan opposition gathered at the Democratic Unity Roundtable (MUD) reported that, the ruling party put up electoral obstacles to block this process of validation and therefore only about 400,000 signatures had been validated.
Now the opposition hopes to connect with the will of 20 percent of the Electoral Registry, equivalent to about 4 million people.
In his message today, Ledezma issued a series of guidelines for activation of the referendum and asked to identify and overcome obstacles, as well as incorporate all the opposition sectors.
"We need to face the chicanery that slyly pretends to follow the rules of the CNE, in boycotting compliance with the new stages of the recall referendum," said the mayor, who is under house arrest.
At this point Ledezma, who has been accused of conspiring against the government of Maduro, said the "unexpected supervening rules" of the CNE and its requirement of 1 percent is what he called "a sign to know what to expect."
Also, the head of the Venezuelan opposition bloc in Parliament Julio Borges, said that the House issued a report on the abuses suffered by hundreds of people during the validation process of signatures.
Hundreds of Venezuelans have reported that during the validation period they were victims of harassment and ill-treatment by Chavista military units and other groups.
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