Pirates of the Caribbean II: Welcome to Venezuela

Lawlessness abounds in socialist nations.  I don’t think bringing back piracy to the Caribbean was what they had in mind.  The Washington Post actually does a pretty good exposé on this.

There have been reports of piracy over the past 18 months near Honduras, Nicaragua, Haiti and St. Lucia. But nowhere has the surge been more notable, analysts say, than off the coast of Venezuela.

An economic crisis in the South American country has sent inflation soaring toward 1 million percent, making food and medicine scarce. Malnutrition is spreading; disease is rampant; water and power grids are failing from a lack of trained staff and spare parts. Police and military are abandoning their posts as their paychecks become nearly worthless. Under the socialist government of President Nicolás Maduro, repression and corruption have increased.

The conditions are compelling some Venezuelans to take desperate action.

One Venezuelan port official, who spoke on the condition of anonymity to address official corruption, said that Venezuelan coast guard officers have been boarding anchored vessels and demanding money and food. He said commercial ships, in response, are increasingly anchoring farther off the coast, and turning off their motors and lights to avoid being seen at night.

It’s important to remember that this could happen to us.  Socialism is often times a slow creep.  It’s part of the reason there was such a huge outcry to Obamacare.  In the United States, health care is about 20% of the gross domestic product.  Thankfully, we’ve elected a President who recognizes this disaster and has tried to dismember it, or encourage Congress to do so.

Venezuela turned to socialism in 1998 with the election of Hugo Chavez.  He redistributed land to the poor and in 2007 took over many of the major oil projects.  Oil is half of the country’s GDP and accounts for nearly 100% of its exports.  Price control, a heavily government controlled economy, and plummeting oil prices have wrecked what should be a prosperous nation.  Venezuela has the largest oil reserves in the world.  There is no reason they should be floundering this badly, or having to cross into Colombia to buy simple necessities such as toilet paper and milk.

Forbes.com has a nice little slideshow here which highlights many other countries that have tried socialism and failed.  The dumbing down of the populace is one of the greatest injustices we have ever seen.  There should be absolutely no reason socialism and communism are as popular as they are, especially among millennials.  Via The Washington Times:

The majority of millennials would prefer to live in a socialist, communist or fascist nation rather than a capitalistic one, according to a new poll.

In the Victims of Communism Memorial Foundation’s “Annual Report on U.S. Attitudes Toward Socialism,” 58 percent of the up-and-coming generation opted for one of the three systems, compared to 42 percent who said they were in favor of capitalism.

The most popular socioeconomic order was socialism, with 44 percent support. Communism and fascism received 7 percent support each.

Let that sink in.  This falls directly on us and our educational system.  This isn’t altogether surprising as the vast majority of academia consists of far left professors and administrators.  While immigration is our most glaring problem right now, reforming the education system is just as important though a much longer process.

Let us not forget the horrors of socialism.  Nationalizing major industries and redistributing wealth always leads to disaster.  The faster we can leave industry to the free markets and disband welfare and other government programs that force redistribution of wealth the safer and better off we will be.

Venezuela’s prez admits socialism failure

Even Venezuela’s president now admits that socialism has been a complete failure.  Via Yahoo:

Under-fire Venezuela President Nicolas Maduro admitted his economic model has “failed” in the wake of food and medicine shortages and public service paralysis, such as Tuesday’s power failure that affected 80 percent of Caracas.

“The production models we’ve tried so far have failed and the responsibility is ours, mine and yours,” Maduro told his ruling PSUV party congress, as Venezuela looks to tackle chronic inflation the International Monetary Fund predicted would reach one million percent this year.

The apologists will come out of the woodwork as per usual to defend socialism at every turn and lecture us about how Venezuela’s model wasn’t real socialism.  (They hope you’ll forget the fact they were praising Venezuela just a few years ago.)

Venezuela has centralized hundreds of industries.  It’s difficult to name even one industry that has ever been better off being run by the government rather than private enterprise.  This, perhaps more than any other reasoning, should be the approach when trying to explain to those championing socialism the inherent dangers therein.  It’s easy to get frustrated (as I often do) at these people, but we also must remember they’ve been under government programming for 12+ years of the educational system.  Sometimes trying to explain things from a financial basis can be too much for some people to understand.

Financial advice in a socialist country

One of the greatest problems of any civilization is forgetting about the past.  We can’t learn from history’s mistakes if we don’t read up on it, or as is more often the case with our education system these days, if we’re not taught about it in the first place (or taught an alternate version).  Enter socialism, a system that no matter how many times it proves to be a total trainwreck, rears its ugly head over and over again.  And we’re promised that “last time it didn’t work, but this time it totally will”.  This article from The Economist explains some of the pains many in Venezuela have to go through because of socialism.

ASK the chief investment officer of a fund-management firm how to spread your investments and you will be told to put so much in stocks, so much in bonds and something in hedge funds or private equity. Chances are that white-elephant buildings, eggs and long-life milk will not feature. But in Venezuela, where the inflation rate is in the tens of thousands, things that people elsewhere would shun for fear they will lose value have become stores of real wealth.

That is why you can see scaffolding and other signs of a building boom dotted around Caracas, the capital of a country that has endured an economic collapse. Businesses need to park their earnings where they will not be wiped out by inflation. A smaller-scale response to galloping prices is the emerging “egg economy”. Eggs hold their value better than cash, for a while at least. They make for a convenient currency, too. It is easier to carry around a half-dozen eggs than a trunkful of banknotes. And many tradespeople would be happier to receive the eggs.

Is that the kind of place we want to live?  Where eggs are the currency and hold more value?  Or where a car is a better investment vehicle (har har) than a mutual fund?  The nation that has the largest oil reserves by country in the world should never in any circumstances be in the kind of financial trouble that they are in.  Socialism has the ability to destroy even the richest of natural resources.

Let this serve as a reminder to us.  Socialism, not now, not ever.

socialism