Chavez's Economy Spiraling Out of Control

Discussion in 'General Global Topics' started by Toro, Sep 3, 2007.

  1. Toro
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    Toro Diamond Member

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    The President of Venezuela, Hugo Chavez, is a proponent of Bolivaran socialism, a doctrine with roots that lie in the teachings of Karl Marx. Marx, despite his incorrect readings of history, probably would have made a good trader as he seems to understand the repetitiveness of human nature when he said that "history repeats itself, first as tragedy, second as farce."

    His erstwhile student and modern-day standard-bearer, Sr. Chavez, appears to have missed that class. It appears that Venezuela is heading down the path taken by Latin America in the 1970s and 1980s, when economic incompetence and quadruple-digit inflation ran rampant across the continent.

    http://www.bloomberg.com/apps/news?pid=20601109&sid=aTUqRT3KYeY0&refer=home
     
  2. Psychoblues
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    Psychoblues Senior Member

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    Seems to me that the opposite is happening in Venezuela.




    As the price of oil increases the standard of living for common folk in that country becomes better. The more fair distribution of wealth whether it be from national natural resourse or from collective and individual labor participation is generally good for the society, no?

    The concept of fair distribution of wealth was long ago abandoned by the American barons of political power.
     
  3. Bern80
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    Bern80 Gold Member

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    How do you define 'fair' distrubtion? If you are going by equal distrubtion of wealth then it is inherently unfair.
     
  4. Toro
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    Toro Diamond Member

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    The more participation the general population has in the wealth of a nation, the better. That's why I have no problem with increasing the distribution of oil profits around the country.

    The problem is that his government spending is too high. It is creating inflation, which has lead to price controls, which has lead to shortages. This week, overnight interest rates hit 90% in Venezuela because inflation is running out of control. Inflation hurts the poor more than anyone in society.

    He is also unilaterally changing contracts by nationalizing the oil fields, which is scaring capital out of the country.

    We have seen this all before in Latin America. Chavez understands neither economics nor his continent's own history.
     
  5. Ruby
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    Ruby Member

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    I cant say I quite buy that scenario.

    I do think that Venezuela will hit some serious rough patches, that is the nature of things when trying to fix somthing so large and so damaged over such a long period of time. It wont be a quick fix by a long shot, then you add in the forces that are trying their best to IMPEDE the recovery and you are bound to hit numerous rough spots.

    Spending is going to be high, so much of the infrastructure and economics of the average citizens have been neglected far too long and the imbalance that will occur naturally in trying to seek a fair balance is inevitable.
     
  6. Toro
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    Toro Diamond Member

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    Its "too high" because the budget deficit is 5% of the economy. And that's with oil prices near all-time highs.

    5% is far higher than anything Bush has run.
     
  7. trobinett
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    trobinett Senior Member

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    You know, it really wasn't a matter IF Chavez would be just another in a long line of despots ruining Venezuela's economy, it was only WHEN it would start to become public knowledge, well.............................:eusa_whistle:

    From the beginning, I could see the guy was a complete wing-nut, and was doomed to repeat what those that preceded him had done.

    The people of that country should hang the SOB.:eusa_naughty:
     

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