Sunday, June 19, 2016

87% of Venezuelans "out of money!" to buy enough food

"Out of  money!" falsehood strikes again.

Hey lefty idiot/morons,  just let the disgraced material oriented people "make money!" and all of this goes away tomorrow.


John said...

All this goes away? Like it did pre-Chavez? Pre-Chavez, the country was a horror story, but because it was a neoliberal madhouse all was good.

Before you say it, yep, neoliberal conspiracy!

Kaivey said...
This comment has been removed by the author.
Kaivey said...

It's all a neoliberal conspiracy because it is all a neoliberal conspiracy. A small handful extremely rich businessmen control the world. I'm reading a book on it right now called, The Racket, by Matt Kennard. They might not all work together, indeed, some may hate each other, so it's not a conspiracy in that sense, but they control the US government and all Western governments. So they can destroy capitalism everywhere they go, and bring in their financially controlled system instead. It talks like capitalism, and indeed, they force all the companies they own into competition with each other, so workers complete against each other lowering their wages.

As investors, they can own shares in all the different companies and in this way they are beyond competition. They can own $millions in shares in Apple and $millions in Samsung, and whoever is winning they can swap their shares around in an instant to get the best deal. So these big investors can increase competition but not lose out themselves. Although sometimes they lose but it is just just part of the game, they always remain on top.

Because the Western One Percent can't control Russia and China they are threatening to start WW3 to overwhelm them into submission, but this highly risky policy could nuke us all.

Their type of capitalism is to privatize everything in a country and then they come and along and buy it all up. So its looks like capitalism but it is really just a monopoly, or a duopoly, with just a handful of super rich rivals who get to own everything. This is an Orwellian state and we have to stop it, even if that means taking away all their money by bringing back in 90% to 95% tax rates, then so be it.

Ignacio said...

Two wrongs don't make a right...

Even the collapse of the USSR wasn't that bad, the incompetency of this government is unbelievable, and like it or not they should be out as they were voted out.

This is not helpful to any 'left' leaning party elsewhere, as usually, even if 'right' parties will blame their failures on the weather, the gods, or the markets it's not an excuse for this failure.

Kaivey said...

Washington staged a financial war against Venezuela and wrecked them. That tried to do the same to Russia but failed because Russia is more powerful and is now diversifying. I read Saudi Arabia is struggling now and will be bust within a few years. They and the US brought down pull prices deliberately to wreck the economies of Russia and Venezuela.

Wars can be fought against countries using finance now, look at Greece, the One Percent are buying up all it resources and state owned companies. Years ago they would have had to have a war to grab all that.

But they can't destroy Russia's and China's economy so easily so they are threatening WW3 instead. This is the unthinkable, so they are hoping both Russia and China will give in and submit to their demands.

The Western world is run by a evil and criminal elite. Nothing is unthinkable to them.

Ryan Harris said...

Not only money is constrained but also plentiful real resources are scarce and dangerous, as they are produced by rentiers who disagree with the politcal leaders, so they must be controlled, regulated, shut down to ensure that people doing the right kind of development, with the right set of motivations. Don't think of it as hunger, think of it as 'An Investment in future sustainability.' Of the red shirts.

Ryan Harris said...

Pinning this on the US, is a bit rich, Kaivey. The US certainly isn't fond of the Venezuelan govt, but if you read the venez. government policy on currency, setting prices of groceries and other distribution policy works, it's very simple and understandable how and why this happened. You really don't need a complex conspiracy theory to describe it. People earn more by exporting goods from stores to neighboring countries than they can earn from working. It turned common people into unproductive market rentiers who arbitrage domestic and foreign markets, which is ironic for a government that despises markets.

And it should be a cautionary tale to leftists everywhere about the limits of creating artificial scarcity and subsidies to promote ideology. The problem is that I don't think leftists in venezuela, europe, or the US even realize they are engaged in ideology because they think they are enlightened, driven by a higher good, saving the world from evils and promoting ever greater society. The world needs pragmatic policy that just works, with out all the wonky puritanical philosophy of orthodox and marxist economists.

Bob said...

I read somewhere that the private sector of the Venezuelan economy is larger now than it was when Chavez took power. This is socialism for the 21st century works??

André said...

Out of money falsehood? Why? People are already poor and becoming even more. They literally don't have enough money to buy food. Can't see what's wrong.

Andrew Anderson said...

Their type of capitalism is to privatize everything in a country and then they come and along and buy it all up. Kaivey

Often aided by government-subsidized private credit. How's that for irony?

God is not mocked should be the lesson Progressives learn, ie. an ethical society cannot be expected from an unethical money and credit system.

Andrew said...

@Ryan Harris,

Can you explain a bit more about the policies and associated problems of Venezuela?

Tom Hickey said...

For an in-depth analysis, see Does Venezuela’s Crisis Prove Socialism Doesn’t Work? by Ryan Mallett-Outtrim at Counterpunch (May 25, 2016), previously linked to here at MNE then.

Ryan Harris said...

I think Tom's article is okay, but it over complicates the matter. Venezuela has a tiered sort-of-pegged currency with a progressive design. Tom's article shows how big companies and government officials profit from it on a large scale. But it is profitable to subvert even at the individual scale as well, imagine if you were a peasant laborer that lived in a slum, you could go to the doctor or bodega and you could buy drugs or food staples then instantly turn around and sell them and earn more than you would being a laborer. Because of the foreign exchange subsidy, direct subsidy, and price setting the potential profits are very large indeed. A person could get a prescription for an imported drug, pay the subsidized price of 10 currency units a pill, instantly turn around and sell the drug for maybe 100 a pill in Brazil or on the black market domestically. And if the person only makes 30 or 40 a day by working as a laborer, they are compelled instead to look for more opportunities to subvert the government program. With these sorts of profits, people start to organize themselves into criminal gangs and they corrupt politicians and law enforcement and everyone in the system feeds on it until there is nothing left to help the poor who the system is designed to help.

Why not just give the money directly to poor people instead? Or give them a JG to put a floor under wages and ensure they engage in produce, social constructive behavior instead?

The subsidy system used in California for solar is designed almost identically to the venezuelan system with multiple levels of subsidy and groups that can receive subsidies and other groups that can't, which creates black markets, foreign opportunities for re-export and a wildly profitable criminogenic environment.

The pattern repeats itself with German factories producing multi layered subsidized real goods for exports....

These programs always start out with the best intentions and pro-social goals, but they morph into exceedingly perverse programs that have anti-social effects and ultimately become self-defeating.

Andrew said...

Why wouldn't Venezuela just let their currency float? Wouldn't that encourage local production and reduce the dependence on imports?

Tom Hickey said...

Why wouldn't Venezuela just let their currency float? Wouldn't that encourage local production and reduce the dependence on imports?

Import substitution takes some time, the elites have to cooperate, and the country needs to be able to pull it off.

Russia, a big country with lots of resources and ability, was hard pressed to do this, and the level of success is still not completely clear.

Floating the currency looks like a no brainer, but would Venezuela be capable of doing this successfully under the conditions it faces? There probably is no good alternative to it other than caving to neoliberalism, which is what the opposition is working toward.

Calgacus said...

Ignacio:Even the collapse of the USSR wasn't that bad

The collapse of the USSR was much, much worse. Life expectancies nosedived, comparable to a very major war. Many have noted that there is no other example in history of such a demographic catastrophe outside of war, plague and famine.

Andrew:Why wouldn't Venezuela just let their currency float?

Mark Weisbrot says that much of the Venezuelan left has the idea that fixed rates are "marxist" and floating rates are "neoliberal". (!!) Of course floating and other MMT / Keynesian policies would quickly succeed. As Weisbrot, IMHO the best overall analyst, notes, Venezuela's enormous oil assets give it a great deal of room for maneuver.

Tom: There probably is no good alternative to it other than caving to neoliberalism, which is what the opposition is working toward.

Sheer defeatism. Maybe if you stop burning your own flesh & stabbing yourself, you will be run over by a bus. But probably not. Maintaining a baroque exchange rate system is what takes effort - not floating, which is doing nothing. It is always a good idea to stop attacking yourself and subsidizing your enemies. And then see what happens.

Of course the US is sponsoring financial "war" against Venezuela. But unlike physical war, this doesn't work too well, especially against a country as naturally rich as Venezuela unless there is substantial local collaboration. In Venezuela there are two parts: a very disloyal "elite" opposition, but even worse, mental colonization of the government by loony tunes "economic" ideas.
The most potent weapon in the hands of an oppressor is the mind of the oppressed. Crazy economic beliefs & the defeatism which one sees everywhere, which can rise to the level of snatching defeat out of the jaws of victory, as in Greece, are such weapons.

Tom Hickey said...

I am and have been for floating and I am for China. I don't see it as much of an issue for China but I don't know enough about Venezuela to say. I rather doubt that just flowing would miraculously save Venezuela thought owing to rather complicated conditions there politically. When I said no alternative I meant no other choice. It's sink or swim. The longer they wait, the more the balance will tip to caving to neoliberalism.

Bob said...

They had 25 years. Cannot save the clueless.