• This is a political forum that is non-biased/non-partisan and treats every person's position on topics equally. This debate forum is not aligned to any political party. In today's politics, many ideas are split between and even within all the political parties. Often we find ourselves agreeing on one platform but some topics break our mold. We are here to discuss them in a civil political debate. If this is your first visit to our political forums, be sure to check out the RULES. Registering for debate politics is necessary before posting. Register today to participate - it's free!

Is Venezuela's economic problem due to inflation, or is it due to it not being productive?

??? did't mention or allude to MMT????????

The idea that a shrinking money supply can cause a contraction in the economy is very well supported by MMTers. And I have known quite a few far righties who totally reject that concept, they believe that if the money supply falls, it would be good for the economy because consumers would be able to purchase more). Of course you are correct, and they are wrong.

Ideally, we need a money supply that is expanding at about the rate that the GDP is expanding, or perhaps expanding just a slighter bit more (to push the economy and create jobs).
 
Venezuela inflation soars to 4,000% in 'death spiral' - Nov. 22, 2017

The article makes it sound like inflation is the issue, stating that people have to check the value of their money before heading to the grocery store to see if they have enough to purchase anything...
...then it says "if there is even anything on the shelves to buy".

Seems to me that lack of production is their real issue, inflation doesn't even matter if there is nothing to buy.

Returning to the OP of the thread: what is wrong with Venezuela? EVERYTHING.

However, in a nutshell, it suffers from the failed ideology of "social democracy", aka the populist "Bolivarian Revolution" - a revolution fueled by class hate, ignoramus voodoo left economics, and the various "bromides" of 3rd world socialism.

It has nothing to do with "outside influences" or "sabotage" (the all purpose stalinist excuse for totalitarian government blunders). It is an now unprecedented disaster.

A few weeks ago, this news from the NYT: https://www.nytimes.com/2017/12/27/...n=latest&contentPlacement=8&pgtype=collection

PUNTO FIJO, Venezuela — A general with no energy experience has been installed as the head of the state oil company. Arrests, firings and desperate emigration have gutted top talent. Oil facilities are crumbling, while production is plummeting.

As the rest of the oil-producing world recovers on the back of stronger energy prices, Venezuela is getting worse, the result of dysfunctional management, rampant corruption and the country’s crippling economic crisis. The deepening troubles at the state oil company, the country’s economic mainstay, threaten to further destabilize a nation and government facing a dire recession, soaring inflation and unbridled crime, as well as food and medicine shortages.

IF you want a better insight into the ideological roots of this kind of disaster, I suggest you start reading the recent writings of Clifton Ross. Ross (who I know through a friend) has been a life-long member of the left, one of the leftists that sojourned to the latest revolution to experience "transformative socialism". Fluent in Spanish, Clifton has traveled and lived in Central America and Venezuela for several decades, making short documentaries and writing books supportive of the poor's fight against social injustice. In Venezuela he thought he had found what he was looking for; a utopian path.

It took Cliff a life time to make his journey out of the left swamps. He has yet to complete his journey. But he now understands the nature of his delusion, and has written a book explaining his own delusions, ending in Venezuela:

"Home from the Dark Side of Utopia".

Clifton still lectures at book signings, he still loses American friends (most on the left), and he still disabuses gullible left audiences of their illusions of wreckers, sabotage and the role of the CIA. And naturally, the left publishers will no longer publish his articles, but he perseveres .

He finds solace, ironically, in the many Venezuelan ex-Chavistas that have joined him in opposition to the government (although they too don't understand why the American left does not get it).

Home - Clifton Ross
 
Last edited:
PUNTO FIJO, Venezuela — A general with no energy experience has been installed as the head of the state oil company.

Sounds to me that Trump must be president of Venezuela also. He's appointed all sorts of people who have no experience in the field that they were appointed to be in charge of.
 
mostly wrong, under the rules of the gold standard at the time the Fed was supposed to expand the money supply but failed to do so for a variety of personal reasons at the NY Fed mostly based around a lack of total confidence in the value of doing so. Today there is no such lack of confidence.
.
Under a gold standard your supply of money is based on your supply of gold. A federal reserve has very little power over the money supply unless it decides to completely change it exchange rate in relation to gold. Any changes to the exchange rate cause lots of issues.

I'm not sure what gold standard rules supposedly would push to the Fed to expand the money supply. One of the few ways to do that other than a straight devaluation of the dollar to gold exchange rate would be to RAISE interest rates in order to gain international investors and thereby gold from other countries. Raising the interest rates would of course be freaking disastrous as demand was already rock bottom low.

The Fed did slowly correct itself but by then you had 2 uber liberal presidents enacting socialist legislation that in effect caused a second depression to last 16 years and cause a world war that killed 60 million. Without the socialist legislation the Depression and World War 2 would never have happened
The Fed corrected itself because FDR suspended the gold standard in 1933 and the FED and US government had more control over it's money supply. Not nearly to the point that it does now...but it had that power.

The rest of your stuff is just babble and highly uninformed.
 
Sounds to me that Trump must be president of Venezuela also. He's appointed all sorts of people who have no experience in the field that they were appointed to be in charge of.

Fortunately Trump has not appointed Generals to head commercial enterprises expected to make wealth.
 
Under a gold standard your supply of money is based on your supply of gold. A federal reserve has very little power over the money supply unless it decides to completely change it exchange rate in relation to gold. Any changes to the exchange rate cause lots of issues.

I'm not sure what gold standard rules supposedly would push to the Fed to expand the money supply. One of the few ways to do that other than a straight devaluation of the dollar to gold exchange rate would be to RAISE interest rates in order to gain international investors and thereby gold from other countries. Raising the interest rates would of course be freaking disastrous as demand was already rock bottom low.


The Fed corrected itself because FDR suspended the gold standard in 1933 and the FED and US government had more control over it's money supply. Not nearly to the point that it does now...but it had that power.

The rest of your stuff is just babble and highly uninformed.

I suspect the way the fed expanded the money supply was that the fed traded dollars for gold. Part of the problem was that in such poor economic times, people tend to hord gold, so in 1932 the gov outlawed individuals hording/investing in gold. There were limits on how much gold that people could hold, and it wasn't very much. So people were basically forced to exchange their gold for US dollars, and for every dollars worth of gold the fed purchased, they issued another dollar.

Of course this whole gold standard thing was pretty much pointless because the government has no use for gold, and money doesn't have to be "backed" by gold to have value. We have proven this over the course of the almost 50 years since we went off of the gold standard.
 
The idea that a shrinking money supply can cause a contraction in the economy is very well supported by MMTers. And I have known quite a few far righties who totally reject that concept, they believe that if the money supply falls, it would be good for the economy because consumers would be able to purchase more). Of course you are correct, and they are wrong.

Ideally, we need a money supply that is expanding at about the rate that the GDP is expanding, or perhaps expanding just a slighter bit more (to push the economy and create jobs).

good for you you got one right! Keep it up
 
Of course this whole gold standard thing was pretty much pointless because the government has no use for gold, and money doesn't have to be "backed" by gold to have value. We have proven this over the course of the almost 50 years since we went off of the gold standard.

Not really pointless since it in theory keeps sound money supply decisions independent of politicians and the people . A strict no inflation or deflation Federal Reserve is just as good if not better but both depend on popular support to stay in place, and this support is always shaky.
 
Venezuela inflation soars to 4,000% in 'death spiral' - Nov. 22, 2017

The article makes it sound like inflation is the issue, stating that people have to check the value of their money before heading to the grocery store to see if they have enough to purchase anything...
...then it says "if there is even anything on the shelves to buy".

Seems to me that lack of production is their real issue, inflation doesn't even matter if there is nothing to buy.

Inflation isn't the cause of the country's problems but it is making them worse
 
"Is Venezuela's economic problem due to inflation, or is it due to it not being productive?"

Venezuela inflation soars to 4,000% in 'death spiral' - Nov. 22, 2017

The article makes it sound like inflation is the issue, stating that people have to check the value of their money before heading to the grocery store to see if they have enough to purchase anything...
...then it says "if there is even anything on the shelves to buy".

Seems to me that lack of production is their real issue, inflation doesn't even matter if there is nothing to buy.

Sorry for being late to this thread.

The answer is neither, Venezuela's economic problems are due to governmental fraud and mismanagement. That is not necessarily fixed easily with being more economically productive, especially when the nation's fiscal condition is based so much on oil.
 
Venezuela's economic problems are due to governmental fraud and mismanagement..


why do you say fraud and mismanagement when those things are characteristic of socialism and easily fixed by capitalism.
 
Back
Top Bottom