The left-wing sociologist running the Venezuelan economy doesn’t believe in inflation. Last year he wrote a pamphlet in which he insisted that “Inflation does not exist in real life.”
Inflation certainly exists in Venezuela which has seen 500% inflation. The Socialist regime responded with price controls. When stores and farmers wouldn’t sell at set prices, soldiers were sent in to take them over. Crowds initially cheered all the subsidized products. But they wouldn’t be cheering for long.
The Socialist government tried to solve its money problem by printing more money. But it wasn’t able to pay for the money it wanted to print because of the inflation which officially did not exist.
Venezuela needs 10 billion bank notes in its new inflationary economy, more than America, and it can’t pay for them. Or pay for anything else. It can’t afford to import food and it refuses to pay fair prices at home. Meanwhile eggs, at the official exchange rate, run to $150, McDonald’s fries for $126 and a pound of coffee for $85. Socialists may not believe in inflation, but inflation believes in them.
No wonder the people are starving.
Teachers sell passing grades to students in exchange for milk and flour. Lines at government stores are endless and an entire economy has been built on buying and trades spots on food lines. Fingerprint scanners are used to enforce milk rations. And a heavy military police and military presence is required to stop mobs of starving people from grabbing the food as soon as it arrives.
The government met protests by its starving population with a 40% minimum wage hike. That’s the usual socialist solution to what leftists call ‘income inequality’. The problem is that 40% of nothing is still zero.
The “Strong Bolivar” introduced by former dictator Hugo Chavez, who died of an overdose of Cuba’s socialist medicine, leads the world in one economic category: a 3,000% inflation rate. Currently a dollar will buy you 111,413.23 bolivars. Wait a while and there will be a better bargain in bolivars because economists are forecasting a 30,000% inflation rate.
Now. The inflation rate hit 40.000%.
Venezuela’s inflation rate has hit a new high, according to university research, with consumer prices in the crisis-ridden country rising by more than 40,000% annually for the first time on record.
Steve H. Hanke, an applied economics professor at Johns Hopkins University, told Business Insider on Friday that annual inflation in the country has risen as high as 41,838%. Hanke, who calculated the inflation figure, has tracked prices in the country for more than two decades.
Venezuela’s government has largely stopped reporting economic data, including internal measures of inflation. The Central Bank of Venezuela, which did not immediately respond to request for comment, has not independently released inflation figures in at least a year.
Socialism. It really works. As long as you turn your brain off, believe and stop eating.