How Venezuela went from a rich democracy to a collapsing dictatorship
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Re: How Venezuela went from a rich democracy to a collapsing dictatorship
#2Socialism.
Re: How Venezuela went from a rich democracy to a collapsing dictatorship
#3Venezuela is simply suffering one of the worst cases of Dutch Disease in the world. The oil prices don't keep up with the spending. With a destroyed economy there is more opportunity for a dramatic system change.
This happened before in Venezuela in the 80s/90s and eventually led to Chavéz getting into power.
Re: How Venezuela went from a rich democracy to a collapsing dictatorship
#4I hope Trump doesn't read this article as a how-to guide.
Re: How Venezuela went from a rich democracy to a collapsing dictatorship
#5Venezuela is simply suffering one of the worst cases of Dutch Disease in the world. The oil prices don't keep up with the spending. With a destroyed economy there is more opportunity for a dramatic system change. This happened before in Venezuela in the 80s/90s and eventually led to Chavéz getting into power.
If their economy wasn’t centrally planned and controlled by the government, it would be more resilient
Re: How Venezuela went from a rich democracy to a collapsing dictatorship
#6I thought this paragraph was the most enlightening:
Chávez was an innovator in how he spent money, but he did little to improve how Venezuela actually makes money. He paid no attention to diversifying the economy or investing in domestic production outside of the oil sector. The country relies on imports for many of its most basic goods and services, include food and medicine.
You could probably put the greatest economic minds in the world in charge of a big country like Venezuela and they would still fail to diversify the economy.
Markets are necessary for successful diversification - avoiding shortages and economic collapses when key industries suffer downturns.
I'd say social democracies in Europe have shown pretty conclusively that the way to fund broad social programs to help the poor and middle class is via taxation of market economies. Let a healthy private sector self-organize the production of the economy, and let taxes pay for social programs.
Re: How Venezuela went from a rich democracy to a collapsing dictatorship
#7Venezuela is simply suffering one of the worst cases of Dutch Disease in the world. The oil prices don't keep up with the spending. With a destroyed economy there is more opportunity for a dramatic system change. This happened before in Venezuela in the 80s/90s and eventually led to Chavéz getting into power.
If their economy wasn’t centrally planned and controlled by the government, it would be more resilient
That's true, I think that Socialists should abandon older and rigid methods of central planning; research has been active within the Socialist community for finding new methods of planning, such as the work of Paul W. Cockshott.
That said, Venezuela is far from a centrally planned economy.
Re: How Venezuela went from a rich democracy to a collapsing dictatorship
#8I thought this paragraph was the most enlightening: Chávez was an innovator in how he spent money, but he did little to improve how Venezuela actually makes money. He paid no attention to diversifying the economy or investing in domestic production outside of the oil sector. The country relies on imports for many of its most basic goods and services, include food and medicine. You could probably put the greatest econ…
>Markets are necessary for successful diversification - avoiding shortages and economic collapses when key industries suffer downturns.
Out of interest, why do you think this is true?
(Edit: Why does this comment have a score of -2? What can I do to improve the quality or relevance of my comments? Will the downvoters explain, please?)
Re: How Venezuela went from a rich democracy to a collapsing dictatorship
#9Venezuela is simply suffering one of the worst cases of Dutch Disease in the world. The oil prices don't keep up with the spending. With a destroyed economy there is more opportunity for a dramatic system change. This happened before in Venezuela in the 80s/90s and eventually led to Chavéz getting into power.
If their economy wasn’t centrally planned and controlled by the government, it would be more resilient
This same thing happened under a more liberal capitalist government before. That's literally how Chavez got into power. The biggest difference between then and now is the severity of the oil price drop. An exacerbating factor is that the same forces that tried to coup Chavez in 2002 are of course still politically active and, rationally given their interests, using their economic connections to exacerbate the economic collapse through various means. The United States recently freezed some Venezuelan government finances which is obviously intended to further destabilize the government.
Venezuela is a shitshow, to put it bluntly. But the shallow analyses which focus purely on ideology instead of the physical reality on the ground is asinine, bordering on propaganda (Vox tends to swing randomly between center-left progressivism and center-right neoliberalism). Is the government of Venezuela incompetent? Probably as incompetent as most. Are they dealing with an unprecedented economic collapse caused by structural factors? Yes. On the other hand, most people don't actually know how the Venezuelan economy is structured. They just know "socialism bad" and "capitalism good". It's tiresome because the same structural deficiencies at play in their economy today was there decades ago, when they weren't "socialist".
It should be noted what happens to countries whose economies collapse because their place in the world economy no longer exists and then seek to renormalize via the accepted capitalist channels (like the IMF and the like). The entire country gets sold off to foreign interests and they spend the rest of their decades financing a debt they can never pay off.
As for the repressiveness of the Venezuelan state, it's not surprising. The violence of a state is directly proportional to how threatened it feels. When a state is failing, it is going to be violent. Cf. Spain and Catalonia at the moment.
Re: How Venezuela went from a rich democracy to a collapsing dictatorship
#10Earlier quoted context omitted.
If their economy wasn’t centrally planned and controlled by the government, it would be more resilient
This same thing happened under a more liberal capitalist government before. That's literally how Chavez got into power. The biggest difference between then and now is the severity of the oil price drop. An exacerbating factor is that the same forces that tried to coup Chavez in 2002 are of course still politically active and, rationally given their interests, using their economic connections to exacerbate the economi…
A quick refresher for my liberal friends,
Oil Prices in 2012: https://www.eia.gov/todayinenergy/detail.php?id=9530
Food Shortages in Venezuela in 2012 Source from NYT:
http://www.nytimes.com/2012/04/21/world/americas/venezuela-f...