This could be our future

clearconscience · Apr 28, 2016

Angry Venezuelans take to streets, setting up barricades and raiding shops for food http://latino.foxnews.com/latino/ne...etting-barricades-and-raiding-shops-for-food/

Better have your prep started.

salmonriverjohn · Apr 28, 2016

Could happen anywhere, anytime.
I second the be prepaired suggestion.

Member 5605 · Apr 29, 2016

How's that socialism working for them now?

clearconscience · Apr 29, 2016

But, but, I thought the govt would take care of us.
They are the largest employer. And they are trying, I mean they are sending people home early.......and still paying them.

Joe13 · Apr 29, 2016

With the political atmosphere, it wouldn't take a whole lot of disaster to spark a civil war here IMO.

Best be on guard 24/7 says I.

PaulB47 · Apr 29, 2016

More than 100 people were arrested in the western city of Maracaibo for looting that damaged dozens of businesses, according to local governor Francisco Arias

Hmmm, seems like a good way to drive those folks out of business. Not a rational response to the situation.

Oh well, people will learn yet again that governments lead inevitably to ruin. Takes a while for the message to sink in.

Nick Burkhardt · Apr 29, 2016

No. Venezuela failed to maintain a diverse economy while undergoing its oil boom, so now that oil prices are low they do not have enough domestic agriculture to satisfy their needs and can no longer afford to import food.

RicInOR · Apr 29, 2016

Who might be next? .... Puerto Rico is on the verge of bankruptcy. Of course the ol' USA is the co-signer for their debt.

salmonriverjohn · Apr 29, 2016

RicInOR said:
Why might be next .... Puerto Rico is on the verge of bankruptcy. Of course the ol' USA is the co-signer for their debt.

Do you mean our 51st state?
Isn't that one of the 56 states old Barry Oblowma visited?

PaulB47 · May 3, 2016

No. Venezuela failed to maintain a diverse economy while undergoing its oil boom, so now that oil prices are low they do not have enough domestic agriculture to satisfy their needs and can no longer afford to import food.

What, all the farmers went to work on the oil rigs?

"Venezuela" did nothing, since "Venezuela" is not a sentient entity. It's better to avoid collective-speak if you can, since it hinders understanding.

A farmer farms because he knows how to do it and how to make money doing it. If he was given some freebie by government to eliminate his incentive to earn an honest living, well that is a problem with the government. Usually, when you find a ruined economy, you will find a government behind it - either taxing people so heavily it makes no sense to work, or providing freebies so it makes no sense to work. Free markets never lead to such dislocations.

salmonriverjohn · May 3, 2016

Great analogy Paul.

nammac · May 3, 2016

salmonriverjohn said:
Do you mean our 51st state?
Isn't that one of the 56 states old Barry Oblowma visited?

No, no, that was 57 states... Our educated, fearless leader...

PaulB47 · May 4, 2016

I ran into another explanation for the boom and bust:

Austrian economists have found the answer: something fishy must be going on in credit markets. All other explanations fall short, because only monetary expansion through credit markets can explain the widespread malinvestment and overconsumption.

Any other cause of supposed malinvestment would be confined to a few entrepreneurs at most, whose errors are quickly corrected by losses. These losses are not widespread, but focused on those who made the errors. Government interventions (besides monetary interventions), technological changes, preferences changing, and natural disasters would all fit into this category.

https://mises.org/blog/booms-busts-and-boundaries-economics

l'm not sure what he means by "monetary interventions", but it appears creation of a gigantic welfare state would not cause a boom and subsequent bust. I'm guessing it would however lead to an economy less productive than otherwise.