Not communism: The real cause of hyperinflation in Venezuela

[7788bitcoin]

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Norway and Saudi Arabia also depend on the oil exports but they didn't collapse.
I think the situation of Venezuela has nothing to do with the oil prices.
The country is just corrupt.
Some people just cannot differ right from wrong and they cannot think for the long term.

Even i think that the situation in Venezuela happened because of corrupt officials and the leaders who comes up with bad economic policies will ruin any economy and i believe that the constant bad economic policies is the core reason why their economy went into hyperinflation.

Look at Afghanistan... The US gave them guns and training so they can fight Taliban, built their infrastructure, educated them, spend trillions of Dollars. In the end when the US left, all surrendered to Taliban. ¯\_(ツ)_/¯

One of the strangest decisions i have seen,  no idea what kind of policies Biden will come up. spend trillions in the war sacrificed life and then soldiers who lost their limbs and is handicap fighting the war and now leaving everything behind after 20 years and dragging them back to where they  started  .

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[hatshepsut93]

How it has nothing to do with communism if Venezuela's government is heavily influenced by marxism which causes them to make all those irrational decisions that led to their downfall. If they weren't socialist, they would have adopted better policies. Of course capitalist governments can do stupid things too, but they rarely screw up so extremely that their currency enters a hyperinflation.

[johnyj]

TLDR,

The only reason for hyperinflation is increased money supply by many magnitudes. Those newly printed money are distributed to a few government officers that owns the oil supply, lots of people in the country does not get more reward for produce anything, thus the supply of tangible products and services are still very limited, then the price of everything just go up

The strange thing is that once price go up, there is usually a higher motive to drive more production, but if it goes up too fast, there is no motive of production, hoarding assets instead become the first choice

[Darker45]

It's a combination of socialism and corruption of their government and over reliance to oil that has caused this hyperinflation that they have been experiencing now and if the leaders of this country invested on infrastructures like hospitals, schools and other public infrastructure then we would've seen something different, they got too complacent that they didn't expect oil to go down in prices.

I doubt the particular form of government in Venezuela is the one primarily causing the economy and the entire country, so to speak, to crumble down. Venezuela is not even truly a socialist country. The problem, of course, is a lot more complicated than it may seem, but I guess it is mainly the government's mismanagement that led to the country's failure. Of course, too much reliance on oil is just one big failure representing mismanagement. That's basically a lack of foresight on the part of the government's experts.

[Wind_FURY]

Communism, Socialism, Capitalism, and other “ISMs” will lose control of the financial system as long as the leaders behind the “ISMs” are INCOMPETENT. I believe one of the next countries to experience a Hyperinflation Event will be that of CapitalISM. The unsustainability of BRRR money printing economics.

[Hydrogen]

Venezuela's government waged war against capitalism and the private sector in the country. That's what caused the demise of their economy. They harassed and threatened to nationalize factories in the country run by toyota, kelloggs and other big name brands. Then after toyota, kelloggs and other corporations fled the country, state officials went in and looted everything like common thieves.

State regulators overprinted the native currency, the bolivar, in an effort to compensate for the destruction of jobs and business their heavy handed authoritarian approach had caused.

Socialism? Communism? Whatever you call them, they floated the idea they could give people free things (free healthcare, free education). And promoted the idea that attacking and destroying capitalism would improve qualify of life. If you attack your local economy and kill off most of big business people rely upon to support themselves, your economy dies. Who would have guessed.

[herurist]

Norway and Saudi Arabia also depend on the oil exports but they didn't collapse.

I think the situation of Venezuela has nothing to do with the oil prices.

The country is just corrupt.

Some people just cannot differ right from wrong and they cannot think for the long term.

indeed the complex problem here is when rich countries are not accompanied by competent human resources and this is a real example and the difference is very clear.
Norway is a country that even though the country is small but they can manage and make the excess of fuel and oil a profit for the country and even its people and if you look at things that are in Venezuela, this actually feels inversely proportional when government policies depend on only one sector in this case. state revenues and accompanied by very high levels of subsidies, resulting in nepotism everywhere and indeed hyperimplation is certain and can no longer be maintained because indeed the policies that the government is carrying out are indirectly destroyed from within by some corrupt governments themselves.

[Kittygalore]

The real cause of hyperinflation in Venezuela is a combination of continuous printing of fiat, corruption of the government officials and zero to no investment in public service. It's not communism there, I think they have socialism which aims to satisfy the needs of the people first before anything else which is a bad move for them.

[DooMAD]

The country is just corrupt.

This.  Whether your country is capitalist, socialist, authoritarian, libertarian, or whatever else, if people in the government are lining their own pockets and the pockets of their supporters, it can and likely will fail at some point.  You can't have people siphoning off large sums of money without consequence. 

[Poker Player]

Well, in reality communism is fully to blame for the catastrophe that Venezuela is now going through, is it a fallacy to say that this absurd policy did not end the country? OP is Venezuelan? the only way to speak like this is because he is obviously a supporter of the government, the elimination of small and medium industry, the total of the whole disaster began when unsustainable economic decisions were made and full of impulses.

It does not make any sense to say that the disaster did not come after being in a communist system, now the only solution that can be seen is for that whole system to be destroyed, or for them to adopt BTC for everything, so that hyperinflation ends, and that is what I say properly since every economic study points it out. The source was obviously made by an economist who has no idea about the situation in Venezuela nor did he experience it.

Actually, I would say he is Chinese. I was familiar with his nickname and when I saw his post history, I saw that he created this thread:

Is there discrimination in the forum?

In any case, I don't care where he is from, he seems to think communist regimes are wonderful, and that only happens if you are very close to those who are in charge. As a fellow forum member told him:

Dear CCP representative, Welcome to Democracy 101.

[The Ghoul]

In any case, I don't care where he is from, he seems to think communist regimes are wonderful, and that only happens if you are very close to those who are in charge. As a fellow forum member told him:

Dear CCP representative, Welcome to Democracy 101.

Please do not quote other irrelevant posts.

I elaborated on the hyperinflation in Venezuela. topic quoted from an economics article.

I did have a fierce quarrel with amishmanish, but it did not hinder this topic.

I gave you another post with a merit.And I will continue to update my not communism series.

[mindrust]

The real cause of hyperinflation in Venezuela is a combination of continuous printing of fiat, corruption of the government officials and zero to no investment in public service. It's not communism there, I think they have socialism which aims to satisfy the needs of the people first before anything else which is a bad move for them.

Not only the officials are corrupt. The whole country is. These government guys did't come from a different country. They are Venezuelan people. The other stuff like printing FIAT and socialism are not even significant compared to the fact that these people are corrupt. Cuba is socialism too but we don't hear them bitching or dying of hunger.

[The Ghoul]

The real cause of hyperinflation in Venezuela is a combination of continuous printing of fiat, corruption of the government officials and zero to no investment in public service. It's not communism there, I think they have socialism which aims to satisfy the needs of the people first before anything else which is a bad move for them.

Not only the officials are corrupt. The whole country is. These government guys did't come from a different country. They are Venezuelan people. The other stuff like printing FIAT and socialism are not even significant compared to the fact that these people are corrupt. Cuba is socialism too but we don't hear them bitching or dying of hunger.

So in the end, whether people in a country starve to death has nothing to do with communism, socialism, or capitalism.

What determines their living conditions is the level of national development and production efficiency. It can even be said that the welfare and health care system is built on high production efficiency.

[Baihaki Khaizan]

It is undeniable that the economy is one of the important foundations in the life of the nation and state. A growing and stable economy will be able to create prosperity. On the other hand, a slumped and chaotic economy will cause misery for every citizen.

Venezuela as a rich country that was initially able to provide welfare to its people turned out to have a strong and stable economic foundation. The economic turmoil that began with the decline in world oil prices became a real nightmare.

A prolonged economic recession, a weakening currency value, a food crisis, as well as a decline in the country's foreign exchange are the causes of hyperinflation that improve economic conditions in the country.

[jaysabi]

It's a combination of socialism and corruption of their government and over reliance to oil that has caused this hyperinflation that they have been experiencing now and if the leaders of this country invested on infrastructures like hospitals, schools and other public infrastructure then we would've seen something different, they got too complacent that they didn't expect oil to go down in prices.

I doubt the particular form of government in Venezuela is the one primarily causing the economy and the entire country, so to speak, to crumble down. Venezuela is not even truly a socialist country. The problem, of course, is a lot more complicated than it may seem, but I guess it is mainly the government's mismanagement that led to the country's failure. Of course, too much reliance on oil is just one big failure representing mismanagement. That's basically a lack of foresight on the part of the government's experts.

Venezuela is definitely a socialist country.  It is run by the United Socialist Party of Venezuela, governs the economy with socialist objectives, and has nationalized private businesses in the name of socialism (and then proceeded to run those industries into the ground through cronyism and general incompetence, particularly the oil industry).  Prices are set by the government in Venezuela, another classic hallmark of socialism.  There is no way you can look at the government and conclude it's not socialist. 

[zanezane]

This.  Whether your country is capitalist, socialist, authoritarian, libertarian, or whatever else, if people in the government are lining their own pockets and the pockets of their supporters, it can and likely will fail at some point.  You can't have people siphoning off large sums of money without consequence. 

Those who line their pockets won't be affected by the downfall of the country because they're already safe since they have a lot of money and they've already covered their bases. One thing to end this corruption in the government is if the people smell that there's a hint of corruption, a revolution should happen where the people systematically assassinate those officials or have them kidnapped and brutally murdered, that's the only way to solve that, they will be scared to commit any form of corruption because they know that anyone in the public will be able to kill them, don't jail them, don't let them enjoy the money that they've stolen.

[jaysabi]

This.  Whether your country is capitalist, socialist, authoritarian, libertarian, or whatever else, if people in the government are lining their own pockets and the pockets of their supporters, it can and likely will fail at some point.  You can't have people siphoning off large sums of money without consequence.  

Those who line their pockets won't be affected by the downfall of the country because they're already safe since they have a lot of money and they've already covered their bases. One thing to end this corruption in the government is if the people smell that there's a hint of corruption, a revolution should happen where the people systematically assassinate those officials or have them kidnapped and brutally murdered, that's the only way to solve that, they will be scared to commit any form of corruption because they know that anyone in the public will be able to kill them, don't jail them, don't let them enjoy the money that they've stolen.

People know the government is corrupt, but having an ability to do anything about it is an entirely different matter.  Revolutions aren't easy because there's no centralization.  Once any momentum gets large enough to pose a threat to the government, they know about it and violently crack down.  

On another matter, your comment that people should be brutally murdered or assassinated as a means of controlling the government is just as disturbing as when a government employs those tactics to control a civilian population, and has no place in the modern world or a civilized society.

[DrBeer]

And no one says that the problem of Venezuela is communism and Maduro's stupid head! The problem is much older than Maduro. The problem is the huge dependence of the economy on the commodity vector. Earlier, budget revenues were 75% dependent on oil and its price. This is a problem for all resource-based economies. This is a problem both for Venezuela and for Russia - the price of oil has dropped, and that's it, there is nothing to fill the budget with, inflation begins, degradation of entire sectors of the economy, and all this is developing in a circle. Salvation - only a sharp rise in price above the previous "nice prices" in order to FAST get huge sums of money to save the economy. From world history - the "great USSR" collapsed like a house of cards in a matter of years, after oil prices fell ...

[DooMAD]

<snip>

The more likely outcome is that some agency just put you on some sort of watchlist just for writing that, heh.  Corrupt governments are generally quite fond of locking up radicals before they can stir up any great deal of dissent.  If they think your message is getting through to a sufficiently wide audience and that it's gaining traction, that's when you mysteriously disappear.

[Darker45]

It's a combination of socialism and corruption of their government and over reliance to oil that has caused this hyperinflation that they have been experiencing now and if the leaders of this country invested on infrastructures like hospitals, schools and other public infrastructure then we would've seen something different, they got too complacent that they didn't expect oil to go down in prices.

I doubt the particular form of government in Venezuela is the one primarily causing the economy and the entire country, so to speak, to crumble down. Venezuela is not even truly a socialist country. The problem, of course, is a lot more complicated than it may seem, but I guess it is mainly the government's mismanagement that led to the country's failure. Of course, too much reliance on oil is just one big failure representing mismanagement. That's basically a lack of foresight on the part of the government's experts.

Venezuela is definitely a socialist country.  It is run by the United Socialist Party of Venezuela, governs the economy with socialist objectives, and has nationalized private businesses in the name of socialism (and then proceeded to run those industries into the ground through cronyism and general incompetence, particularly the oil industry).  Prices are set by the government in Venezuela, another classic hallmark of socialism.  There is no way you can look at the government and conclude it's not socialist. 

Well, Venezuela is as socialist as China is a communist, which means it is only as they claim. One of the most basic tenet of socialism is that all members of the society are to fairly benefit from the proceeds of the economy. That is definitely not the case with Venezuela.

Socialism was an attractive system which served as an alternative to the growing monopoly and exclusivity of a few privileged members of society during the Industrial Revolution.

In essence, Venezuela is not a socialist country. It is what a failed socialism looks like.