Posts Tagged ‘Nicolas Maduro’

Venezuelan Socialism Out-Grinches Itself

Monday, December 26th, 2016

The ongoing failure of socialism in Venezuela is one of those continuing stories that always threaten to turn post-worthy. This week’s Christmas season hook: the government’s Grinch-like seizure of toys:

Caracas, Venezuela (CNN)Venezuelan officials have confiscated nearly 4 million toys from a toy distributor, accusing the company of planning to sell them at inflated prices during the Christmas season.

On Saturday, the government initially said it had confiscated 4.8 million toys. It revised the figure Sunday, putting it at 3.821 million.

Critics say the consumer protection agency, which targeted the toy warehouse this week, has become “the Grinch that stole Christmas” because many families won’t be able to buy the confiscated toys for the holiday.

Agency head William Contreras disputed that, saying executives at toy distributor Kreisel-Venezuela, the largest of its kind in the country, “don’t care about our children’s right to have a merry Christmas.”

Lack of toys are not the biggest problem for children in Venezuela. Thanks to the Magic Power of Socialism™, a child’s scrapped knee can mean death. (Hat tip: Stephen Green at Instapundit.)

Last month’s death of Cuba’s communist dictator Fidel Castro shouldn’t eclipse the ongoing collapse of Venezuela, Latin America’s other failed socialist state:

Except for Nicaragua in the 1980s, Venezuela has more wholly adopted Castro’s economic and ideological model than any other Latin American nation. The late Hugo Chávez took his cues from Castro on everything from his fondness for army fatigues to his 10-hour speeches. Chávez also adopted the Castro model of seizing private property, suppressing the independent media, hounding political opponents and making cause with rogues in Damascus and Tehran.

For a while Venezuela escaped some of the inevitable consequences thanks to a flood of petrodollars. That’s over. Inflation is forecast to reach 1,640% next year. Caracas is the world’s most violent city. Hospitals have run out of basic medicines, including antibiotics, leading to skyrocketing infant mortality. There are chronic and severe shortages of electricity, food and water, as well as ordinary consumer goods like diapers or beer. Nicolás Maduro, Chávez’s handpicked successor, has put his leading political opponents in jail.

And there’s hunger. An estimated 120,000 Venezuelans flooded into neighboring Colombia to buy food when Mr. Maduro briefly opened the border in July. Desperate Venezuelans are trekking through the Amazon hinterlands to make it to Brazil. And, like Cubans, they are taking to boats, risking their lives to make it to the nearby Dutch colony of Curaçao. Where there’s socialism there are boat people.

Zero Hedge has been keeping track of the twists and turns of Venezuela’s ongoing hyperinflation:

  • First Maduro’s idiot socialist government threw in the towel and announced they were printing currency with denominations 200x larger than the previous currency.
  • The results were swift: The bolivar crashed 22% in one week.
  • Then, following the moronic lead of Narendra Modi’s India, Venezuela announced that they were pulling 100 boliver notes from circulation, ahead of larger bills being available.
  • Then they closed the borders to prevent “currency smuggling.”
  • And yet, despite all this, despite children starving to death in the street, opposition parties cannot get their act together to oppose Maduro’s socialists. (Hat tip: Instapundit.)

    As long as the government keeps failed socialist policies and printing money, the economic nightmare plaguing the people of Venezuela will continue.

    Venezuela: Socialism Is Death

    Wednesday, May 18th, 2016

    When socialists run out of other people’s money, everything falls apart. In Venezuela, socialism is killing babies:

    By morning, three newborns were already dead.

    The day had begun with the usual hazards: chronic shortages of antibiotics, intravenous solutions, even food. Then a blackout swept over the city, shutting down the respirators in the maternity ward.

    Doctors kept ailing infants alive by pumping air into their lungs by hand for hours. By nightfall, four more newborns had died.

    “The death of a baby is our daily bread,” said Dr. Osleidy Camejo, a surgeon in the nation’s capital, Caracas, referring to the toll from Venezuela’s collapsing hospitals.

    Also this: “At the University of the Andes Hospital in the mountain city of Mérida, there was not enough water to wash blood from the operating table.” With a picture to match.

    (Hat tip: Althouse.)

    Is this the point where the bankrupt socialist regime changes course and implements economic reform? Of course not. “Venezuelan President Nicolas Maduro announced a sweeping crackdown Saturday under a new emergency decree, ordering the seizure of paralyzed factories, the arrest of their owners and military exercises to counter alleged foreign threats.”

    Naturally the democratically elected opposition refuses to knuckle under to Maduro’s unconstitutional decrees.

    “Opposition leader Henrique Capriles also said the army must decide whether it is ‘with the constitution or with Maduro,’ a day before nationwide protests demanding the president’s ouster through a referendum.”

    The Atlantic offers up a photo essay on how little food Venezuelans have to eat. (Hat tip: Instapundit.)

    And all this has come to pass thanks to The Magic Power of Socialism™:

    The government doesn’t just control the oil industry, imposing windfall taxes as high as 50 percent on the few private sector projects that remain. The government has nationalized rice mills, large producers of agricultural products, and expropriated millions of acres of farmland; it has acquired some banks and shut down others; nationalized the cement sector; tried to nationalize gold miners; nationalized the country’s largest steel mill and the country’s largest telecommunications company; expropriated the nation’s largest power producer (remember those rolling blackouts?), and more.

    People close to the regime have benefited from many of those deals. Corruption has skyrocketed since the beginning of Venezuela’s “Bolivarian revolution.” According to the Cato Institute, $22.5 billion in public funds have been transferred from Venezuela to foreign accounts with no plausible explanation. Relatives of President Nicolas Maduro have been implicated in drug trafficking, with suspicions of drug money used to finance his campaign.

    Oh, and Venezuela’s capital has earned the distinction of being the murder capital of the world.

    All of these tragedies were avoidable. They are all the result of a mentality that sees only nails for the hammer of government control. Chavez and Maduro kept saying that everything that was wrong with Venezuela was the fault of markets and that if the government either eliminated or regulated those markets, things would get better. They implemented their agenda and it has been a disaster. This socialist brand of economic authoritarianism had the predictable consequence of political authoritarianism, corruption, and a breakdown of the rule of law.

    How many more babies have to die before Venezuela abandons its failed socialist experiment?

    Venezuela Runs Out of Money to Print Money

    Thursday, April 28th, 2016

    The Magic Power of Socialism™ has finally dragged Venezuela far enough down the slope that the economy is going to hell at an ever accelerating rate.

    First and foremost, the country is so boned that they can’t even afford to print money anymore.

    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.

    Snip.

    Last month, De La Rue, the world’s largest currency maker, sent a letter to the central bank complaining that it was owed $71 million and would inform its shareholders if the money were not forthcoming. The letter was leaked to a Venezuelan news website and confirmed by Bloomberg News.

    “It’s an unprecedented case in history that a country with such high inflation cannot get new bills,” said Jose Guerra, an opposition law maker and former director of economic research at the central bank. Late last year, the central bank ordered more than 10 billion bank notes, surpassing the 7.6 billion the U.S. Federal Reserve requested this year for an economy many times the size of Venezuela’s.

    When you run out of money to print money, perhaps you should take that as a sign the express train to you socialist paradise has permanently derailed.

    As part of its ongoing economic collapse, Venezuela’s government is now going from a four-day workweek to a two day workweek. Given the bang-up job the socialists have done running the economy, I suspect that will hurt less than the shortages of food and toilet paper.

    No wonder the people are flocking to sign a recall petition to oust socialist President Nicolas Maduro. But that’s not an easy road either:

    His adversaries first need to collect nearly 200,000 signatures, representing 1% of the nation’s more than 19 million voters. The National Electoral Council, which is closely allied with the government, has 20 days to authenticate them. If that drive is successful, the opposition must then collect nearly four million signatures over three days before the end of the year to trigger an actual recall vote. To win that new election, they would have to garner more votes than the 7.5 million Mr. Maduro got in the 2013 election.

    Typically this is the point (or long past it) where a third world nation’s military would declare “enough!” and depose El Presidente themselves. So far neither armed forces leader Vladimir Padrino Lopez nor National Guard leader Nestor Reverol have shown any signs of doing so…

    (Hat tip: Ace of Spades HQ.)

    Venezuela’s Economy Burns

    Thursday, February 4th, 2016

    While one of the two leading Democratic contenders for President openly calls for socialism, let’s check in on how one socialist paradise is doing:

    The only question now is whether Venezuela’s government or economy will completely collapse first.

    The key word there is “completely.” Both are well into their death throes. Indeed, Venezuela’s ruling party just lost congressional elections that gave the opposition a veto-proof majority, and it’s hard to see that getting any better for them any time soon — or ever. Incumbents, after all, don’t tend to do too well when, according to the International Monetary Fund, their economy shrinks 10 percent one year, an additional 6 percent the next, and inflation explodes to 720 percent. It’s no wonder, then, that markets expect Venezuela to default on its debt in the very near future. The country is basically bankrupt.

    Inflation has gotten so bad that Venezuelans are now paying more than 1000 bolivars to the dollar on the black market. Which is why the government is flying in planeloads of money. As P. J. O’Rouke said of similar hyperinflation in Nicaragua’s own socialist paradise economy: “You have to go to Moscow University two or three times to make money worth this little.”

    But with the opposition party having defeated the socialists in parliamentary elections, they can turn things around, right? Well…

    Socialist president Nicolas Maduro has changed the law so the opposition-controlled National Assembly can’t remove the central bank governor or appoint a new one. Not only that, but Maduro has picked someone who doesn’t even believe there’s such a thing as inflation to be the country’s economic czar. “When a person goes to a shop and finds that prices have gone up,” the new minister wrote, “they are not in the presence of ‘inflation,’ ” but rather “parasitic” businesses that are trying to push up profits as much as possible. According to this — let me be clear — “theory,” printing too much money never causes inflation. And so Venezuela will continue to do so. If past hyperinflations are any guide, this will keep going until Venezuela can’t even afford to run its printing presses anymore — unless Maduro gets kicked out first.

    But for now, at least, a specter is haunting Venezuela — the specter of failed economic policies.

    Philip K. Dick once noted that reality is that which, if you ignore it, doesn’t go away. Socialists may not believe in hyperinflation, but hyperinflation very much believes in socialism…

    Venezuela Says “No Mas” To Socialism

    Tuesday, December 8th, 2015

    It turns out that 100% inflation, widespread repression and corruption and endemic shortages of basic consumer goods are not a recipe for electoral success:

    Electoral authorities in Venezuela say the opposition coalition won a key two-thirds majority in the National Assembly in legislative voting.

    The National Electoral Council has published on its website the final tally of results from Sunday’s elections showing that two previously undecided races had broken in favor of the opposition, giving them 112 out of 167 seats in the incoming National Assembly. The ruling socialist party and its allies got 55 seats.

    The supermajority gives the opposition a strong hand in trying to wrest power from President Nicolas Maduro after 17 years of socialist rule. It now has the potential votes to sack Supreme Court justices, initiate a referendum to revoke Maduro’s mandate and even convoke an assembly to rewrite Hugo Chavez’s 1999 constitution.

    Sooner or later, socialists always run out of other people’s money.

    Though Maduro is still President, there are a lot of things the new government can do to improve the lives of their citizens:

    To end food shortages, the new congress can immediately lift price controls so entrepreneurs have an incentive to produce or import. The only way to strengthen the “strong bolivar,” as the late Hugo Chávez named the currency, is to make it valuable enough for people to hold. That means lifting capital controls and ending the central bank’s multiple exchange-rate system so business can get access to dollars. On current course Venezuela will run out of international reserves and face default in 2017. Restructuring debt now with creditors would make that prospect less painful.

    Which brings us to oil. Chávez used the country’s energy wealth to buy permission in Latin America—and Massachusetts; remember Joseph Kennedy’s Citgo PR campaign—for his many human-rights violations. As long as governments in the Caribbean were getting low-priced petroleum from Venezuela, they voted with the military government in Caracas at the Organization of American States.

    Chávez and Mr. Maduro have also traded oil for security help from Cuba’s intelligence apparatus. Putting an end to these trades would retain more resources inside Venezuela and send a signal that the days of government repression are numbered. Meanwhile, rejoice that one of this hemisphere’s lost countries has a chance at revival.

    Venezuelans Now So Screwed They Can’t Afford to Get Screwed

    Wednesday, February 4th, 2015

    Thanks to the Magic Power of #Socialism™, in Venezuela a 36-pack of condoms now costs as much as an iPhone:

    Venezuelans who already must line up for hours to buy chicken, sugar, medicines and other basic products in short supply now face a new indignity: Condoms are hard to find and nearly impossible to afford….

    On the auction website MercadoLibre, used by Venezuelans to obtain scarce goods, a 36-pack of Trojans sells for 4,760 bolivars ($755 at the official exchange rate), close to the country’s minimum monthly wage of 5,600 bolivars.

    It take a special kind of socialist magic to make your people too poor to have sex.

    In other Venezuela news:

  • The Maduro government has seized a supermarket chain. I’m sure that will do wonders to make more basic goods available to people.
  • They’re also arrested pharmacy owners for “conspiring” to create long lines out their stores. Maybe Maduro thinks business owners can conjure hard currency out of their own asses.
  • Interview with opposition leader Henrique Capriles.
  • One wonders if The Road to Serfdom or Economics in One lesson have ever been translated into Spanish…

    Venezuela Takes The Express Lane To The Dustheap Of History

    Thursday, December 11th, 2014

    There’s been a lot of talk of how low oil prices are screwing Russia, but Venezuela is, if anything, more screwed thanks to the Magic Power of Socialism™:

    U.S. currency is vital to Venezuela, which imports as much as 80% of what it consumes; 96% of its exports are petroleum products…In effect, the one-third decline in the price of oil means that the state oil company must either raise or divert enough production because Venezuela effectively owes China 67 million barrels of oil, roughly 27 million more than it did before, for this loan alone. And there are billions of dollars in other loans to consider.

    And the outlook for the immediate future is equally grim:

    Venezuela’s economy is expected to contract in 2014 and 2015, and even though it’s already recognized as the 14th least competitive economy in the world (according to the World Economic Forum) and the eighth-worst economy for doing business (according to The World Bank), [President Nicolas] Maduro’s laws seem to discourage private investments even more. The new laws reinforce bureaucracy and the difficulty of doing business in the country, particularly in the area of taxes.

    “Increasing numbers of low-income Venezuelans are souring on Maduro as they suffer a declining economy, the highest inflation in the Americas, chronic shortages of basic goods and one of the world’s highest murder rates.”

    If Venezuela’s economy collapses, they might take Cuba down with them, since the Castro brothers are so heavily dependent on Venezuelan oil subsidies to prop up their own moribund economy.

    Compounding Venezuela’s crises is the fact that it’s probably going to default on its bonds. So they’re finally reaching the point in socialism where the run out of other people’s money. Next to that singular problem, U.S. sanctions on government Venezuelan officials for killing protestors are a trivial irritation…

    Venezuela: A Ray of Light Amidst the Encroaching Darkness?

    Wednesday, April 9th, 2014

    When last we checked, Venezuela had come down with a case of Terminal Socialism. Here’s an update.

    Faced with crippling inflation and a shortage of basic goods due to endemic cronyism, horrible mismanagement and laughable official exchange rates, Nicolas Maduro’s socialist government has finally thrown in the towel and instituted floating exchange rates… sort of:

    A dollar will cost you 6.3 bolívares if you are the government, or if you can persuade Cencoex (the government’s foreign-trade body) that you intend to import vital goods such as food or medicine. Then there’s the Sicad I rate, currently just over 10 bolívares to the dollar, but contingent on irregular, “auctions” (which are nothing of the sort). The new Sicad II process, which is as close to a free market as the government will allow, opened at a whopping 50 bolívares to the dollar. But even that is a bargain compared with the unofficial exchange rate, which at the time of writing stands at almost 68 bolívares.

    Meanwhile, shortages of basic goods mean Venezuelans get to enjoy that classic staple of late stage socialism: waiting in line to get food:

    And the violent crackdown against opposition protesters continues:

    Naturally, as a prelude to cracking down on the opposition, they followed the old socialist playbook by outlawing private ownership of guns. It’s always so much easier to oppress people once they’ve been disarmed. Even so, as the following video (via Legal Insurrection) shows, police don’t always get the upper hand:

    Security forces have also committed dozens of documented instances of torture.

    Are there any rays of home in the grim situation? Yes, Maduro’s government and opposition leaders have agreed to talks. Whether these can actually accomplish anything remains to be seen, but the fact that Maduro “ruled out any changes to the course of what he calls the Bolivarian revolution, the distinct brand of socialism created by his predecessor in office, Hugo Chavez,” tends to indicate that the prognosis is still grim.

    Other Venezuela news:

  • An interview with the jailed opposition leader.
  • Two relative of opposition figures murdered.
  • Globovision assignment editor Nairobi Pinto kidnapped.
  • Spain halts shipments of riot gear.
  • Things Are About To Get Really, Really Ugly in Venezuela

    Tuesday, November 26th, 2013

    The Venezuelan Parliament just passed an “enabling law” to give Socialist President Nicolas Maduro dictatorial powers.

    Gee, you know what other Socialist President had his country pass an “Enabling Law” to give him dictatorial powers?

    Go ahead.

    Guess.

    Maduro’s opponents? Not happy.

    Earlier this month, Maduro sent the army to seize electronics store and force them to sell goods below cost, i.e. at the laughable “official exchange rate” of 6.3 bolivars per dollar rather than the real black market rate, which is some eight times higher. (They even tried to get Twitter to block unofficial exchange rates.) And Maduro is looking to loot more stores ahead of the December 8 elections. Given that Hugo Chavez has been hollowing out the country since 1999, I’m not even sure it’s possible for the opposition to win a large enough victory to escape the margin of voter fraud anymore.

    Inflation is running at 54%. Oil prices are at 16 month lows, and the country’s oil production has been declining for a while. That, and the crazy Socialist looting, have sent Venezuela bond prices into a tailspin and sent their interest rates to an all-time high. Crime is also high, with Caracas being the murder capital of the world (yes, even worse than Chicago).

    Maybe that’s why Goldman Sachs has a scheme to help Venezuela swap gold for dollars.

    It’s almost as if Maduro read Atlas Shrugged and saw it as a blueprint rather than a cautionary tale. Imagine Greece, if hyperinflation was just getting started and they didn’t have German taxpayers to bail them out.

    You can decree imaginary exchange rates the same way you can decree that π be set to exactly 3, and the reality will ignore and punish your delusion. Watch inflation skyrocket and business collapse as sellers are unable to buy goods and unwilling to sell at a loss, guaranteeing that a far-from rich country is about to get a whole lot poorer.

    The only question now is whether Venezuela’s economic collapse will bee Argentina bad, or Weimar Germany bad.