Venezuela - Chronicles in Socialist Success Stories!

[Loren Pechtel]

I think the evidence that Venezuela is currently a macroeconomic basket case is obvious. And, I think it is clear that the policies of Chavez and his successor helped create this mess. But if that is a damnation of "socialism", then clearly the last financial meltdown is a damnation of "capitalism". Okay, so now what?

Except what we are seeing in Venezuela is what any sane economist would tell you would happen with the policies that were implemented. Every time it's tried we see the same meltdown. Back when he was imposing those policies some of us called it correctly as to what would happen.

 

[Loren Pechtel]

Of course it is relevant.

How is the cause of something not relevant?

The US oligarchy and the remnant of the Venezuelan oligarchy have one goal in Venezuela.

Make things as bad as possible.

It is what the US does to any nation that tries to break from the oligarchical system dominated by the US.

Okay. Placing price ceilings on products generates shortages when the price is below the market price. That has nothing to do with oligarchies.

Personally, I find it hard to believe the USA really cares enough about Venezuela to devote much time or effort to destabilize the place.

And I can't imagine why they would try even if they cared. They are doing a fine job of destroying themselves, why would we bother to try to cause the inevitable?

 

[Loren Pechtel]

It costs me 3X to deliver a product or service but the government says I can only charge 1X or 2X for it. You don't think that might cause problems?

Certainly. Now show me this was the case.

The truth is I don't really care for the way Venezuela has moved since Chavez died.

But the truth is also that this is not some unmolested economy faltering. It is an economy under constant attack from within and without faltering.

Venezuela hasn't changed course. What we are seeing is simply a continuation of the damage that Chavez inflicted. It takes time to destroy the economy, for a while things looked rosy while they were eating the companies, now that is pretty much gone and they have crashed.

They were doing the equivalent of living on a home equity loan.

 

[RavenSky]

I really don't know, nor care, much about Venzuela either way. I do, however, want to comment on these pictures of "empty" shelves.



Above we have a picture of a section of shelves, in which four shelves seem to be mostly empty, yet the shelves above, below, and to both sides seem to be quite full. Also, above and to the left you can see a large mirror that shows longer sections of shelves on the other side of the store that seem quite full. Someone needs to brush up on their photoshop skills if they want us to believe the stores are truly that empty. Come on, cropping is not that difficult, people!

View attachment 2111

Yep.

This picture is also quite bad at showing how empty the store shelves are. We have an even shorter section of 3 empty shelves, surrounded by fully stocked sections to both sides. Compare these pictures to those of bare shelves in Soviet era Russia if you want to see what really empty store shelves look like. Actually, either one of the above pictures could have been snapped at my local supermarket after a big sale, if not for the "Made in Socialism" sign in the latter one.

Looks like every grocery store in Florida when a hurricane is headed our way. Particular sections are completely empty while other sections are stocked full.

 

[laughing dog]

I think the evidence that Venezuela is currently a macroeconomic basket case is obvious. And, I think it is clear that the policies of Chavez and his successor helped create this mess. But if that is a damnation of "socialism", then clearly the last financial meltdown is a damnation of "capitalism". Okay, so now what?

Except what we are seeing in Venezuela is what any sane economist would tell you would happen with the policies that were implemented. Every time it's tried we see the same meltdown. Back when he was imposing those policies some of us called it correctly as to what would happen.

I fail to the see relevance here. It's like saying people saw the relevant policies that lead to the financial meltdown, so capitalism doesn't work.

 

[Trausti]

I really don't know, nor care, much about Venzuela either way. I do, however, want to comment on these pictures of "empty" shelves.



Above we have a picture of a section of shelves, in which four shelves seem to be mostly empty, yet the shelves above, below, and to both sides seem to be quite full. Also, above and to the left you can see a large mirror that shows longer sections of shelves on the other side of the store that seem quite full. Someone needs to brush up on their photoshop skills if they want us to believe the stores are truly that empty. Come on, cropping is not that difficult, people!



This picture is also quite bad at showing how empty the store shelves are. We have an even shorter section of 3 empty shelves, surrounded by fully stocked sections to both sides. Compare these pictures to those of bare shelves in Soviet era Russia if you want to see what really empty store shelves look like. Actually, either one of the above pictures could have been snapped at my local supermarket after a big sale, if not for the "Made in Socialism" sign in the latter one.

Looks like every grocery store in Florida when a hurricane is headed our way. Particular sections are completely empty while other sections are stocked full.

Just like Florida.

[YOUTUBE]https://www.youtube.com/watch?v=0Ajw9L0jDHQ[/YOUTUBE]

 

[untermensche]

Venezuela has a capitalist economy.

And before Chavez had control millions were worse off than they are now.

Capitalist??? We are seeing these problems because the government is messing with private enterprise!

It is part socialist and part capitalist.

The question is; Which is the biggest problem?

Look at capitalist Guatemala and all the shortages and poverty there.

 

[Trausti]

Capitalist??? We are seeing these problems because the government is messing with private enterprise!

It is part socialist and part capitalist.

The question is; Which is the biggest problem?

Look at capitalist Guatemala and all the shortages and poverty there.

Oh how the Guatemalans suffer.

[YOUTUBE]https://www.youtube.com/watch?v=dvmpICgpjGM[/YOUTUBE]

 

[untermensche]

It is part socialist and part capitalist.

The question is; Which is the biggest problem?

Look at capitalist Guatemala and all the shortages and poverty there.

Oh how the Guatemalans suffer.

Look at the percentage of people living in poverty.

In capitalist Haiti it is 80%.

In capitalist Guatemala it is 64%.

In capitalist Honduras it is 60%

In capitalist Mexico it is 51%

And in "socialist" Venezuela it is 32%

http://www.photius.com/rankings/economy/population_below_poverty_line_2014_0.html

 

[Axulus]

It's a mixed economy. As much Socialist as Capitalist.

And of course some forget how bad it was in Venezuela for millions, mostly the indigenous non-white population, before Chavez.

View attachment 2106

Child malnutrition

View attachment 2105

Inflation

http://www.cepr.net/index.php/blogs/the-americas-blog/venezuelan-economic-and-social-performance-under-hugo-chavez-in-graphs

And it being bad before justifies criminally stupid policies why, exactly?

 

[Axulus]

For anyone who needs more photo evidence, simply do a search for #AnaquelesVaciosEnVenezuela on Twitter

 

[Trausti]

Oh how the Guatemalans suffer.

Look at the percentage of people living in poverty.

In capitalist Haiti it is 80%.

In capitalist Guatemala it is 64%.

In capitalist Honduras it is 60%

In capitalist Mexico it is 51%

And in "socialist" Venezuela it is 32%

http://www.photius.com/rankings/economy/population_below_poverty_line_2014_0.html

From your link: "Definitions of poverty vary considerably among nations. For example, rich nations generally employ more generous standards of poverty than poor nations." What definition does Venezuela use? From a pro-Chavez socialist website:

Before one can reach any definitive conclusions about poverty in the US and Venezuela, it is essential to first establish the stark difference in the way in which poverty is measured in the two countries. With respect to the US, poverty is measured purely by household income, with a certain threshold known as the “poverty line” determined by the Census Bureau. This measurement, based on a purely arbitrary delineation between poverty and “non-poverty”, is the one by which many make determinations about the state of the poor in the US. As should be self-evident, this system of analyzing poverty ignores the obvious fact that there is little tangible difference between the lives of those slightly over and slightly under the poverty line in that both live in a constant state of privation. Moreover, as increasing inflation, decreasing wages and other factors continue to impact the purchasing power and actual lives of the poor, the poverty line becomes even more problematic.
In contrast, the Venezuelan government has a distinctly different set of measurements to determine true poverty including: access to education, access to clean drinking water, access to adequate housing, and other factors.i Essentially then, in Venezuela, poverty is not a measure of income, but of quality of life. By measuring poverty in this way, the Venezuelan government provides a far more comprehensive picture of the socio-economic situation in the country. It is important to note also that, unlike in the United States, poverty statistics in Venezuela are one of the primary driving forces behind the formation of government policy. While in the US, poverty has become a dirty word (as evidenced by the subject’s total absence from last year’s presidential debates), Chavez and the Bolivarian Revolution have made it the centerpiece of public policy in all aspects.

http://www.counterpunch.org/2013/02/01/comparing-the-us-and-venezuela/#sdendnote1sym

Apparently access to food in grocery stores is not a factor examined.

 

[Axulus]

The socialist government has been undermining and "nationalizing" the private sector ever since Chavez took power.

Before Chavez the nation was a third world oligarchy where millions had zero opportunity because of their ethnicity.

All we are seeing in Venezuela is the way the oligarchy reacts to attempts to end this.

They murder people in the streets then use it as an excuse to try to remove elected leaders with force.

They shut down oil production to try to destroy the economy.

And now they continue to try to destroy the economy through manufactured shortages.

The problem in Venezuela is that the old oligarchy still has too much power, not too much socialism.

The denial of reality is strong in this one.

 

[Axulus]

What "oligarchs" are you talking about and why would anyone expect any producer or supplier (oligarch or otherwise) to supply the amount of service or output at any price? Really, this boggles the mind.

And, if these "oligarchs" and the US are determined to make things as bad as possible, why on earth would any "socialist" gov't play along?

The government does not have total control because it is a mixed economy not an entirely Socialist economy.

You have one part of the economy trying to make things as bad as possible by creating artificial shortages.

It is a difficult situation to deal with.

These paranoias about an oligarchical boogeyman always messing things up when bad policies inevitably lead to bad outcomes are exactly the kind of rationales used for totalitarian crackdowns on political opponents, which led to many a crime against humanity in communist regimes.

Why come up with paranoid conspiracy theories when basic economics 101 adequately explains what is happening? Venezuelan policy has put price ceilings on products and price ceilings on currency conversions. As predictable as the sun rises, this has lead to severe shortages.

 

[laughing dog]

It is part socialist and part capitalist.

The question is; Which is the biggest problem?

Look at capitalist Guatemala and all the shortages and poverty there.

Oh how the Guatemalans suffer.

[YOUTUBE]https://www.youtube.com/watch?v=dvmpICgpjGM[/YOUTUBE]

Guatemala has long suffered one of the highest murder rates in the world.

 

[Axulus]

You keep complaining about internal strife within countries/places that try and implement socialism. The attempt at socialism will create internal strife.

How many times was Chavez elected?

If people reject Socialism why was he so popular?

Because there was still some of other people's money left to spend, cushioned by high oil prices. Now the money is running out and oil is low, leading to disaster. The next shoe to fall will be a default on their sovereign debt in the coming months. The currency peg won't hold for much longer either, which will unleash a torrent of hyperinflation.

 

[Axulus]

Now that the glorious Cuban revolution is about to be sullied by capitalist wreckers, and the Castros are becoming agents of western imperialism, for entertainment we must turn to the last promise of Socialist Utopia - the stewards of a sea of oil and the Bolivarian revolution of the Chavezistas:



You know they have arrived when they their economy challenges the one true benchmark of "successful" socialism - ration lines for food. Lenin must be smiling.

http://qz.com/330119/long-lines-for-milk-and-tampons-are-sinking-venezuelas-government/

I have read through the entire thread and I have a few questions.

I don't see any conclusions drawn from the OP. It is certain that Venezuela is in poor economic health. And that before Chavez came to power the rewards from the economy were poorly distributed. Do they have to choose between these two extremes? Is there no middle ground?

What economy do you believe is the proper model for a developing economy? Mexico, China, Chile? Russia?

How about Russia. They were advised to institute a free market economy, to privatize everything as quickly as possible to allow the market to bestow its bounty on Russia. How did that work out in your estimation?

Mexico in the past decade or so, Colombia, Chile, Estonia, South Korea, and Taiwan are good examples.

Russia became a middle income country but suffers from massive corruption (the privatizations weren't done in a fair and open process) and suffers from severe cronyism.

Moscow is a modern world class city. It's not like they haven't developed at all since the fall of communism:

 

[Axulus]

How about Russia. They were advised to institute a free market economy, to privatize everything as quickly as possible to allow the market to bestow its bounty on Russia. How did that work out in your estimation?

And both Venezuela and Russia have economies dependent on oil.

And both are suffering because oil speculators have driven the price downward.

In other words, because of factors beyond their control.

Oil producers have driven the price downward. Once again, denial of basic economics:

Those who don't plan on massive price swings in the price of oil and mitigate risk accordingly are doomed to failure:

 

[Axulus]

You keep complaining about internal strife within countries/places that try and implement socialism. The attempt at socialism will create internal strife.

Then why the attacks? If the Socialist experiment is doomed to fail anyway, why not let it fail on it's own merits? This is analogous to the situation in Chile in the early 70's with the famous quote "Make the economy scream". The "strife" being referred to here is the petulance of one sector of the population reacting to being forced to play on the same level as everyone else.

The attacks are coming from those whose wealth is being confiscated or those whose business is being driven to bankruptcy with the change in policies.

And note most of the "attacks" are political attacks coming from the political opposition, which Chavez and now Madero have no qualms about crushing and throwing in jail on dubious charges and kangaroo courts.

Other so called purposeful shortages are really just businesses that have given up and stopped producing product because they realize that they will be driven to bankruptcy or will soon be due to the government policies. untermenche considers such actions a vicious attack by the oligarchy.

 

[Sphincterboy]

Oh how the Guatemalans suffer.

[YOUTUBE]https://www.youtube.com/watch?v=dvmpICgpjGM[/YOUTUBE]

Guatemala has long suffered one of the highest murder rates in the world.

Not only that, but to anyone who has actually been there, this video is totally ridiculous. This is where the ultra-rich can come to emulate their first-world role models free from molestation by the unwashed masses. Notice that not shown are the multiple imposing security guards with giant shotguns at the entrance to the mall. Almost everyone does their actual shopping at the giant mercados that are more akin to flea markets.