Food lines in Venezuela stretch long and far.
Venezuela has deteriorated to the point where a significant chunk of the population has to eat garbage to survive. A recent study found a stunning 15 percent of Venezuelans say they can feed themselves only with “food waste discarded by commercial establishments.”
What’s more, the study found three-fourths of all Venezuelans were unable to eat an optimal diet of breakfast, lunch and dinner every day. Just over half (54 percent) said they had gone to bed hungry, while 52 percent said they buy their food through the black market. Almost half (48 percent) said they had been forced to take time off work to search for food.
The severe food shortage can be pinned squarely on Venezuela’s socialist economy, according to William J. Murray, author of “Utopian Road to Hell: Enslaving America and the World with Central Planning.”
“The difficulty in Venezuela is the key element of central planning, and that’s price fixing,” Murray told WND. “Price fixing causes shortages, regardless of what price is fixed. In Venezuela, it’s food. In the United States, we have a shortage of certain medical care because the government sets prices on it.”
Murray, chairman of the Religious Freedom Coalition, noted that when prices are allowed to rise in accordance with market forces, as in a free enterprise system, demand is reduced to a manageable level. Also, when the cost of production increases in a free market system, producers raise their prices, which allows them to produce enough to meet demand.
But in a centrally planned economy like Venezuela’s, the government does not allow producers to raise prices on their goods to keep up with increases in the cost of production. Therefore, producers cannot afford to produce as much and shortages result.
Venezuelan President Nicolas Maduro implemented a rationing system in April 2014, prohibiting Venezuelans from buying more than their ration books allow. In fact, Maduro has ordered police and the military to crack down on anyone trying to buy more than their allotted ration, hoarding food or waiting outside a supermarket when the store is not open.
The president also created Socialist Party committees known as Local Committees for Supply and Production to determine who in each neighborhood receives food.
Murray said socialist rationing is simply a necessary outgrowth of price fixing. But he pointed out everything is rationed in America, too – it’s just rationed by the free market instead of the government.
“If the price is allowed to rise, as it is in a free marketplace, that is the rationing; the increasing price is the rationing,” Murray said. “We ration here; everything sold in the United States is rationed, but it’s rationed by price. We make it unaffordable through scarcity, and that causes more to be produced. In Venezuela, they don’t have that opportunity. The price can’t be raised, and as a result, greater amounts cannot be produced.”
When American leftists try to make their case for socialism, they point not to the dumpster fire of Venezuela, but to the Nordic countries of Sweden, Finland, Norway, Denmark and Iceland. Those peaceful nations up north have flourished under “democratic socialism,” they argue.
But Nima Sanandaji, an author and researcher who lives in Sweden, argues it is not socialism that is responsible for the success of the Nordics.
“Quite simply, the Nordic countries base their wealth on capitalism,” said Sanandaji, author of “Debunking Utopia: Exposing the Myth of Nordic Socialism.” “These countries have all for a long time, except a short period when Sweden made a failed experiment with socialism during the 1970s and 1980s, had strong respect for private property and business freedom. During the late 19th century and the first half of the 20th century, Nordic countries had low taxes and a free-market model. As I show in ‘Debunking Utopia,’ while the U.S. turned to the New Deal socialism following the Great Depression, the Nordics retained their faith in the free market – and thus the depression rapidly turned to job growth in the Nordics.
“After the second half of the 20th century, large welfare states have grown up in the Nordics. However, these nations have compensated for the detrimental effects of high taxes and large public sectors by introducing wide-ranging market reforms. This explains why Denmark, the country with the highest tax rate in the world, has the same economic freedom score as the U.S.
“Comparing the Nordics to Venezuela is comparing a free-market model to a socialist one. The differences are huge.”
Murray, for his part, sees no way Venezuela emerges from its food crisis while the socialists retain power over the country.
“Wheat crops cannot be the same year after year; corn crops cannot be the same year after year; the number of cattle produced cannot be the same year after year. And this is the problem with price fixing, which is a central element of centrally planned socialist governments. They have this idea: this is what the people should pay. And with no consequence, no conception of the idea of how much it cost to produce. As long as the socialists are in charge in Venezuela, this will continue to deteriorate.”
Murray pointed out in the years just before socialist Hugo Chavez took power, Venezuela was one of the most prosperous free enterprise nations in the world. A higher percentage of Venezuelans owned credit cards than in any other Latin American nation. The overwhelming majority of Venezuelans had enough to eat. But now times have changed.
“This was an overwhelmingly middle class nation that bordered on being a First World nation,” Murray declared.
“Socialism has brought the nation to its knees and is causing people to go through trash to survive. That would never have happened one year before Chavez took power; one year before Chavez took power, there was nobody eating out of the trash.”