Many are aware there is a situation in Venezuela, and what is being reported as the cause is only half the story.
There is a missing element that many media channels have not mentioned.
Rewind to the early years of the Chavez administration, 1999 and the next few years.
Oil was near $19 a barrel when he took office in Venezuela.
The oil in Venezuela is called heavy oil and is among the heaviest in the world — which also means it needs a LOT of refining to make it marketable.
Refineries are expensive to build, refining somewhat expensive — and Chavez knew he could have other countries refine his oil, thereby keeping more money in the country.
Oil was also the ONLY expert Venezuela has and it is losing whatever market share it had fast.
Hugo, in keeping favor with the people, sold their oil but never built any refineries.
However, Hugo’s lack of wisdom never took into account that oil would not remain cheap, it is a very volatile market. as seen in the years before he took office.
As the price per barrel increased, it started becoming too expensive for their customer countries to refine it as well as buy it – they could get it cheaper and refined elsewhere.
To save Venezuela from future catastrophes, Chavez had to find a way to refine it — and Hugo didn’t.
And their customers went elsewhere.
Hugo never learned Economics 101.
The collapse of the Venezuelan economy and the country started when their oil couldn’t be sold — and that was long before it hit $100 per barrel.
If Chavez were still alive today, he would be witnessing the same collapse though not as magnified as Maduro has made it.
Maduro has only compounded the problem with his failure to manage the economy – a move that is typical of any tyrant that wants to form a dictatorship.
In less than 2 months time, Maduro has permitted the inflation rate to enter into hyperinflation stage, with the June inflation rate being 200% and the July inflation rate at 1500% — and it’s still climbing.
So what did Chavez do with all that wealth Venezuela once had?
If you could not afford a house, the government provided one for you…
Now stop and think — these are simple people for the most part, what are they going to do with their current house? next house? They are going to make sure they qualify for a free house…
Gasoline was dirt cheap – pennies to the dollar, no Venezuelan was going to be without gasoline…
Yet foreign companies could not make a profit in Venezuela due to government regulations and demands.
Earlier this year (2017), Venezuela seized a General Motors plant, shifting ownership from GM to the Venezuelan government – a move under Maduro, however, something Chavez had started nationalizing foreign investments by seizing them long before his death in 2013.
Venezuela faces around 20 arbitration cases over nationalizations under late leader Hugo Chavez, with Maduro that number is unknown right now.
This 2-1/2 minute video from Reason Magazine picks up from there…
Socialism only works on paper — once you implement Socialism, everyone has lost their liberties and once liberties are lost, so are your freedoms.
Every country that enforces a government on its people loses.