Hugo Chavez ruined his oil-rich country to solidify his power at home and to broaden it to other Latin American countries. He gave away oil to buy influence. Then he fired almost all the technical experts at the PdVSA, the national oil company - and expected to maintain the level of oil consumption. He strangled the private sector, including food distribution. Then when prices climbed he required price controls, which led to food shortages (always does). And he also caused shortage of medicine.
The bill came due so he extended his credit lines and his countries problems. Now the collector has is coming inside.
The government is providing dollars to selected businesses so they can import food and medicine. But that is like working on the roof while the building is falling due to structural failure.
Walter Russell Meade
He is quoting FT: “The total supply of foreign exchange to the economy via Cadivi [old system for getting foreign currency] and Sicad [the new system] is still likely to undershoot the overall demand in the economy for dollars,” [Goldman Sacs economist Alberto] Ramos said. He said to control the black market Caracas must fix underlying problems including high inflation, an unfriendly business climate, a misaligned currency, and exacerbated political and economic risk.Meade further observes about this failure of socialism.
Venezuela’s economic woes are telling. Apologists for Chavez mentor Fidel Castro blame Cuba’s sixty years of economic problems on the US embargo. If it weren’t for Uncle Sam, they say, Castro would have built a socialist paradise by now.The photo: Angel Falls in Venezuela. How does a waterfall form at the top of a mountain? Actually it is a large, flat plateau; must be wet. Source BeautifulPlacesToVisit.com; they don't credit it.
Venezuela is the test for this talking point. Not only is there no US embargo in Venezuela, but the country also has huge oil reserves. And what does it have? Food and medicine and foreign currency shortages. A socialist paradise, indeed.