World View: Venezuela Economy Close to Collapse as Maduro Orders Jailing of Factory Owners

Venezuelan President Nicolas Maduro(L) greets supporters during a rally at the Miraflores presidential palace in Caracas

This morning’s key headlines from

  • Venezuela’s socialist economy close to a crash
  • Maduro orders jailing of owners of closed factories
  • Maduro recalls Brazil ambassador over Dilma Rousseff ‘coup’

Venezuela’s socialist economy close to a crash

An injured man lies next to national guard members during a demonstration in Caracas, Venezuela on Wednesday (AFP)
An injured man lies next to national guard members during a demonstration in Caracas, Venezuela on Wednesday (AFP)

Pity the poor Venezuelan citizen who enjoyed years of free Socialist giveaways under president Hugo Chávez and more recently president Nicolás Maduro, and now has to pay for it all, as Chávez’s Socialist paradise faces financial disaster.

The inflation rate in 2015 was 275%, the highest in the world, and it has continued to surge. The International Monetary Fund (IMF) estimates that it will reach 720% in 2016, and over 2200% in 2017.

Maduro’s government is drenched in corruption, with officials not giving a s–t about anyone but themselves. Common staples are in scarce supply, and citizens have to stand in line to get milk, rice, flour, ketchup, diapers, and toilet paper. Crime and violence are becoming rampant. And the fall into hell has been rapid: 75% of Venezuelan homes now live in poverty, compared to 27% just two years ago.

New indignities keep getting piled on, one after the other:

  • Beer has become unavailable because the country’s largest brewery shut down for lack of malted barley.
  • Get this: Despite the highest inflation rate in the world, Venezuela cannot print any more money because they cannot pay the printing bill. Oh, the irony.
  • In order to save power, Maduro ordered that all clocks be moved ahead one-half hour.
  • Also to save energy, Maduro ordered that state employees work only two days per week.

Oh, wait. Maduro has found a solution. He has ordered a 30% increase in the minimum wage. Increasing the minimum wage 30% is sure to cause even greater super-inflation and even deeper shortages, but logic never stops a Socialist loon.

Maduro’s opposition have collected two million signatures on a petition to force a recall vote that would remove Maduro from power, but Maduro has control of the courts and all national agencies. One of those agencies that Maduro controls is the National Electoral Board (CNE) which supposed to have certified the signatures a week ago, but under Maduro’s orders they’re stalling.

Opposition leader and former presidential candidate Henrique Capriles said on Saturday that if Maduro blocks the recall referendum, then the country “can explode at any given moment.”

Maduro has announced that’s calling out the army for military drills starting on Saturday, to protect the country from “foreign aggression,” meaning the United States. Since the United States has no plans to invade Venezuela, it’s more likely that Maduro will use the military to attack protestors violently, which is what Socialists always do to stay in power. Miami Herald and Reuters (11-Apr) and VOA (2-May) and Bloomberg (27-Apr) and VOA (1-May)

Maduro orders jailing of owners of closed factories

As we mentioned above, the country’s largest producer of beer has closed down the last of its four domestic breweries, for lack of the imported malted barley needed as the principal ingredient. Cerveceria Polar, the manufacturer, is blaming the problem on Venezuela’s government for not giving the company the dollars it needs to import supplies.

Venezuelan citizens are only allowed to have inflation-bloated and increasing worthless currency, the Bolivar. Dollars are tightly controlled by the government, and have been in particularly short supply since the price of oil crashed over the last two years. Cerveceria Polar and other manufacturing firms have been forced to close their doors because they could import the goods they needed.

Like all good Socialists, president Maduro has a ready solution.

On Friday, Maduro declared a full-scale state of emergency. If a factory has closed because they were unable to import what they need to make their products, then Maduro will have the factory seized and the factory owner jailed.

According to Maduro, the country is facing an “economic war,” led by the United States. BBC and Fox News and USA Today (8-May)

Maduro recalls Brazil ambassador over Dilma Rousseff ‘coup’

Venezuela’s president Nicolás Maduro recalled his ambassador to Brazil, Alberto Castelar, following a vote by Brazil’s parliament to suspend president Dilma Rousseff from office and subject her to an impeachment trial on charges of corruption. The debate in Brazil that preceded the vote lasted for days, and resulted in wild protests and fury from both opponents and supporters of Rousseff. Rousseff claims that the corruption charges are bogus, and many people agree, saying that Rousseff’s real problem is that her left-wing policies have brought the country to near ruin, though not yet as bad off as Venezuela.

Maduro claims that the impeachment vote was actually a palace coup against a democratically elected left-wing government. With Maduro himself facing a recall petition in Venezuela, he has become an ally of Rousseff.

There have been a string of coups and attempted coups against mostly left-wing Latin American leaders in the last decade.

In 2004, there was a coup against Haiti’s president Jean-Bertrand Aristide; in 2008, widespread violence left dozens dead as opposition groups sought to oust President Evo Morales; in the early hours of June 28, 2009, the Honduran military kidnapped President Manuel Zelaya and flew him to Costa Rica; on September 30, 2010, the police and military kidnapped Ecuador’s president Rafael Correa, who eventually escaped; in June 2012, Peru’s left-wing president Fernando Lugo was impeached and removed from office.

Rousseff is just the latest in this string of “coups.” Next in line is Maduro, unless he completely destroys the democratic process by ordering the army to use violence against his political enemies. Reuters and TeleSur TV (Caracas)

KEYS: Generational Dynamics, Venezuela, Nicolás Maduro, Hugo Chávez, Cerveceria Polar, Alberto Castelar, Brazil, Dilma Rousseff
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