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  HOME | Opinion (Click here for more)

TalCual: Venezuela Goes from Bad to Worse
The Government is getting into more trouble every time. Annual inflation now nears 50% (until October of this year stood at 45.8%) and shortages level was at 22.4% during the same month; this means supermarkets and grocery stores are doing without at least 20 out of 100 products, but aggravated by the situation that most products demanded by Venezuelan consumers are the ones gone missing.

By TalCual

The Government is getting into more trouble every time. Annual inflation now nears 50% (until October of this year stood at 45.8%) and shortages level was at 22.4% during the same month; this means supermarkets and grocery stores are doing without at least 20 out of 100 products, but aggravated by the situation that most products demanded by Venezuelan consumers are the ones gone missing.

We have the worst of both worlds: Expensive and scarce. No wonder President Nicolás Maduro is desperate.

Every single time Venezuela has gone through a situation like this, a mishmash of famine and shortages, a smothering “double play,” our governments, and this one is no exception, have turned to the “speculation” wildcard. This does exist, no doubt, but as the natural and forced daughter of inflation.

If it didn’t exist, speculation would be something impossible to achieve. But inflation allows “hiding” speculation behind a very heavy curtain.

This is the real problem here. Of course, a wrong diagnosis of the problem leads to wrong therapies. Since the Government is the one handling the burden of “speculation,” the measures it takes against it are of police nature, as inefficient as these can be by the way.

What is new here is that our Armed Forces have been added in this fight against the high cost of living, with poor results as a matter of fact, if not counterproductive, such as the lootings that took place in Valencia, Carabobo state.

If the Government focused on inflation, it would take fiscal and foreign exchange measures to face it; but this is not the case and therefore it has made a wrong move, because no police or military force on this planet has been conceived for the purpose of fighting the high cost of living.

The experience of previous administrations is worthless to the one we have now. Maduro has already announced he will tighten and extend controls throughout the economy.

The people from the Government are acting like firemen trying to put out a fire with gasoline. One could say they have never lived in this country and never knew about the failures with the same kind of measures by previous administrations.

It is always the same: Controls, fair “price-fixing,” and, on top of that, threat of imprisonment for the “speculators.” Because, once again, this government is nothing else but an extension of others back in pre-chavismo republics.

How many times we have heard about the same concepts from the mouths of previous rulers already! The Government, which is brimming with petrodollars, changes them into bolivars and, with them, invades the economy so it can cover excessive expenditures.

The outcome: An increase in demand faced with a supply of products and services that does not grow at the same pace and therefore makes prices go sky-high.

All this, naturally, has a political and social counterweight. The population has been accumulating a silent rage inside them as the little leadership Maduro could have possibly have until he came into power has died out.

Allow ourselves to recommend a return to the basics of economics, which implies a revision of current fiscal, foreign exchange and monetary policies in order to keep inflationary pressures at bay, as advised by the common sense.

But if they persist on believing they are doing things right, our rulers will end up throwing the entire country down an economic ravine.

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