Dollars and Jens
Tuesday, February 13, 2007
Venezuela
Speaking of fecklessly trying to teach economics to politicians, how incompetent do you have to be run the economy of an oil exporter into the ground?
Meat cuts vanished from Venezuelan supermarkets this week, leaving only unsavory bits like chicken feet, while costly artificial sweeteners have increasingly replaced sugar, and many staples sell far above government-fixed prices.Here's what you do: eliminate the price controls, and replace the central banker with a monkey. As long as it's not a trained monkey — or at least not one that's trained to print money — you ought to see a dramatic improvement.
President Hugo Chávez's administration blames the food supply problems on speculators, but industry officials say government price controls that strangle profits are responsible.
Such shortages have sporadically appeared with items from milk to coffee since early 2003, when Chávez began regulating prices for 400 basic products as a way to counter inflation and protect the poor.
Yet inflation has soared to an accumulated 78 percent in the last four years in an economy awash in petrodollars, and food prices have increased particularly swiftly, creating a widening discrepancy between official prices and the true cost of getting goods to market in Venezuela.
