The whole Venezuelan mess has been caused because the Venezuelan capitalists decided to blow up the economy. You as well as I know that there is no such thing as a shortage of anything that can be made or imported in a market economy. Bottom line is the whole economy is run by the capitalists. There are shortages of everything and tremendous demand for all of these products.
Well shit. If I were a Venezuelan capitalist, I would try to import as much of those things for which there is a shortage as possible and sell as many of them as I could! Well the capitalists are sitting on tons of money and all they have to do is make more of the shortaged products or import them. Easy peasy. But they refuse to do it because this is another one of their coups. The “economic coup!” And in case you are wondering the capitalists always do this in all democratic transitions to socialism. They did it to Allende, they did it to the Sandinistas, they did it to Mugabe, they do it to everyone.
If you wonder why revolutionary Leftists say that the peaceful road to socialism is crap and that those who advocate it are parliamentary cretins as Lenin said, this is the reason. There is no peaceful road to socialism. This is what happens every time you try to do it. This is why the revolutionaries say “power never gives up anything without a struggle” and why they even advocate violence in the first place.
Keep in mind: all they have to do is make more of the products under shortage! How hard is that! The capitalists are refusing to do so! Not only that, but the government keeps finding huge warehouses full of shortaged products all over Venezuela! These are products that the capitalists made that are being kept off the market in warehouses to deliberately create shortages.
Alternatively, the capitalists could simply import the shortaged products as they refuse to manufacture them. If something cannot be made, surely it can be imported, no? The capitalists lie and say that they have no money to import anything. The government knows they are lying but can’t do anything. So they play along. The government wants to cooperate with the capitalists so they have been giving them many many US dollars to use to import products because you generally need to use dollars to import things in Venezuela. See fiat currency for more.
Well, the capitalists take those dollars and invest them in the US in real estate and stocks and bonds! They waste most of it in purely speculative capital investment in the US apparently because they think they can make more money that way. This is the case really in all Latin American countries.
I know in particular that in Peru, the oligarchs or elite or rich take all of their money and ship it out of the country. They refuse to invest it in the country. They take all of their money and put it in stocks, bonds and real estate and other forms of rentier capital in the US. In other words, they make almost every nickel in the country but they take every penny of it and secrete it away in the US in the forms or rentier speculative investment. Result: no investment for the Peruvian economy! Which leads to: Peru, another Latin American basket case.
They government finally had enough of the Venezuelan capitalists wasting the dollars the government gave them on rentier investment in land and equities in the US, so they started restricting the amount of dollars they were giving to the capitalists, which of course led to a new problem, “government won’t give the capitalists any money to import the shortaged products.” The evil government ruining the economy once again. As you can see, you can’t win with the Venezuelan opposition. Everything you do is wrong and is set up to fail. There’s nothing you can do fix these problems either.
The capitalists do import shortaged products to Venezuela. However, fully 1/3 of these products are immediately shipped to Colombia where you can sell the same thing for a higher price. Much of the rest of the imported products are quickly diverted to the black market. Of course, due to the artificial shortages, a black market for just about everything sprung up as they always do in these cases. You can see X shortaged product for $X on the real market or you can divert it to the black market and sell it for maybe $2X the market value and double your sales income.
Of course, the presence of a black market and the artificial shortages are causing inflation. Inflation always happens with demand exceeds supply. It is an iron rule of economics. The government has taken tremendous measures to reduce the inflation but these also have come under withering critique by the Chavista-haters. First they blame the government for the inflation and next they blame the government for the measures taken to reduce the inflation! I told you you can’t win with these types. This is what happens when you go against Pax Americana.
Ever since Chavez won his election, mysterious shortages of all sorts of products have mysteriously appeared in the month or two before the election. In 95% of cases, these artificial shortages were not enough to throw the election, but it looks like the last one did.
Inflation has been a chronic problem in Venezuela dating back may decades, so the inflation in the Chavista era is nothing new. It’s just typical Venezuelan inflation, a structural feature of the economy. If you want to know the source of the inflation look up “The Dutch Disease” and there you go.
The Venezuelan capitalists as well as the capitalists in Bolivia, Ecuador, Argentina, Paraguay and Brazil are all on record saying to interviewers that they would blow up the economies of each of those countries in order to throw out the Leftist governments. Coups have been attempted in all of those countries except for Brazil and Argentina and in Brazil the PT heavily caved in to neoliberalism so there was little need for a coup. The capitalists made not one but repeated coup attempts in Venezuela to try to get rid of the Chavistas. This latest one, the economic coup, seems to have been successful.
The vile US media has played its usual sick, lying role. They have never told the truth about one single thing in Venezuela since Chavez took over. it’s been nonstop basically wartime propaganda for a decade and a half now. Consequently almost everything Americans “know” about Venezuela is a smoking pack of lies.
All of the coup attempts were blamed on the Chavistas! This latest one, the economic coup, has sickeningly been conflated with “failed socialism” in order to smear the Bolivarian experiment. The truth is that the Venezuelan economy remains a capitalist one and the capitalists make or import much of what is sold in the country. The government only runs a few “commanding heights of the economy industries.
The government has been buying large quantities of all sorts of products from food to furniture to kitchen accessories and has been selling them for cheap in state stores. There are long lines to get into these state stores to get the deals. They did this because the Venezuelan capitalists typically jack up prices so high that 90% of the population can hardly afford to buy anything. So in order to make foodstuffs, furniture and household and kitchen items available to the masses, state stores were set up. These state stores have caused zero economic problems. Their only effect was allowing the masses to buy all sorts of things they could never afford and discounted and affordable prices.
Admittedly, command Communist economies where the state ran all industry and sold everything in state stores caused all sorts of problems. But that is not going on in Venezuela at all because nothing of this sort is occurring. Yes products are sold in state stores, but those products are purchased on the capitalist market and sold for discounted prices. Shortages and poor quality are not typical problems in those state stores because the products are coming from the capitalist market rather than state industries in a planned economic sector.