Venezuela’s Tyranny of Bad Ideas Socialism was a proven failure, but Hugo Chávez got his countrymen to try it. Daniel Pipes
https://www.wsj.com/articles/venezuelas-tyranny-of-bad-ideas-1535311573
Ideas run the world. Good ones create freedom and wealth; bad ones, oppression and poverty. You are not what you eat, but what you think.
Politicians in particular fall under the sway of ideas. As John Maynard Keynes put it, “Practical men, who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back. . . . It is ideas, not vested interests, which are dangerous for good or evil.”
The story of Venezuela makes this point with singular clarity. In 1914 the discovery of oil brought the country vast revenues and produced a relatively free economy. By 1950 Venezuela enjoyed the fourth-highest per capita income in the world, behind only the U.S., Switzerland and New Zealand. As late as 1980, it boasted the world’s fastest-growing economy in the 20th century. In 2001 Venezuela still ranked as Latin America’s wealthiest country.
Venezuela’s troubles, however, had begun long before. Starting around 1958, government interference in the economy, including price and exchange controls, higher taxes, and restrictions on property rights, led to decades of stagnation, with per capita real income declining 0.13% from 1960-97. Still, it remained a normal, functioning country.
Today the country with the world’s largest oil reserves suffers from a severely contracting economy, runaway inflation, despotism, mass emigration, criminality, disease, hunger and starvation, with circumstances deteriorating daily. Venezuela’s economy contracted by 16% in 2016, 14% last year and a predicted 15% in 2018. Inflation was at 112% in 2015 and 2,800% at the end of last year. Economist Steve Hanke finds an annualized rate of around 65,000% for 2018, making Venezuela’s one of the most severe hyperinflations ever. Food shortages led to an average weight loss among Venezuelans of 18 pounds in 2016 and 24 pounds in 2017.
What caused this crisis? Foreign invasion, civil war, natural disaster, substitutes for oil, or agricultural plagues? No, bad ideas, pure and simple. CONTINUE AT SITE
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