Economic disaster is ahead in Venezuela

December 23, 2006|By GEORGE MICHAEL

Venezuelan President Hugo Chavez won a big re-election victory recently. I didn't stay up to see the returns. I had a hunch he might make it.

And why not? Anyone who can attack the United States, belittle our president at the United Nations while providing subsidized food for the poor, free university educations and many cash benefits for ordinary folks back home, has a winning political platform these days.

Forgive me for not getting on the bandwagon.

Based on his recent history and his statements following his re-election, we can make one certain prediction. The people of Venezuela are facing a national disaster. Smart people there should leave the country now.

Shouting typical leftist slogans "Long Live the Revolution" and "Down with Imperialism," Chavez lambasted the devil (George Bush) and promised further social revolutions for his country.


Chavez's soul mates can be found in Iran and Syria. He sees Fidel Castro as his spiritual father and the Cuban revolution as his inspiration. Really? Has he visited Cuba lately? Is Socialism working there? Has it ever worked anywhere?

Socialism violates both human nature and the laws of economics. You can't go for very long by confiscating economic capital and passing it out to the poor. The rich will quit being productive and soon everyone is poor.

Suppose that I am a professor with a large class of students. After an exam, I bemoan the fact that even though the median grade was an 80, a number of students had failed the test. I then announce that for future tests, to make sure we have no failures and that the class average is 70 or above, I will take 15 to 20 points from the scores of the successful students and transfer these points to any student who failed so that everyone would be passing.

With a little liberal guilt manipulation, I might even be able to convince the "A" students that this is the right thing to do. The question then is: What would be the median score on the next test? Would it stay at 80? Or would it decline? What would be the impact of this decree on the more productive students? And on the lower achieving ones?

Socialism contradicts human nature. It destroys incentive. Citizens eventually feel that it is up to someone else to provide for their needs. Personal responsibility becomes a meaningless concept and private property rights are viewed as prerogatives of the state.

Socialism violates the basic economic law of supply and demand. It creates a huge amount of artificial demand by promising free food or easy money while discouraging productive citizens from producing anything extra. In other words, more demand and less supply. The state then dictates what the prices of goods and services will be, since an economic market is no longer functioning. Without exception, such controls lead to shortages. This is what is ahead in Venezuela.

Socialism sometimes looks and sounds good in the short run. But invariably, as night follows day, it destroys any nation and any people which succumb to its siren call of materialism.

Expect to see Chavez, if he has not already done so, erecting huge pictures of himself. Emperor worship is nothing new. Tyrants like Chavez need to invest "deity" in their persona so that people will be less inclined to notice their diminished standard of living. As happens in such cases, Chavez has already announced that he will need to suspend future elections in order to continue his enlightened rule. This is called dictatorship and it is not pretty.

Diane Sawyer on ABC's "20-20" recently did a great story on her tour of North Korea. It showed the more advanced stages of this kind of sickness in the cult-like domination of the people of North Korea in their adoration of Kim Jong Il.

One of the great images in her special report was a night satellite picture of the Korean peninsula. This night photo shows millions of brilliant lights coming from all over the land of South Korea. Immediately to the north across the DMZ is nothing but darkness. The contrast is stark. You can literally see an economic "black hole" from which nothing or no one can escape. The laws of economics have decreed this result. Who can comprehend the suffering of the enslaved people of such a gulag?

Through Citgo Petroleum Corp., Chavez is providing reduced heating oil prices to the poor people of the United States. What a hoot! Here is a poor country like Venezuela, providing subsidies to the people of the richest nation in the world. Strange. The average per-capita income of the United States is over seven times higher than Venezuela's. Our poorest people have more in terms of life's necessities than the average Venezuelan.

Chavez, of course, wants to make a political statement - anything to make a mockery of the U.S. and our president. Since he is willing to do this, maybe we should buy up all the oil he will give us at the discounted price and live off the squalor of the people of Venezuela.

One Venezuelan voter lamented after the election, "My country is being stolen. This (election) is the last chance we have. Communism is coming here." This person called the election a choice between freedom and increasing state control of people's lives. How true!

How sad that people fall for the lie of Socialism time after time. The one thing we learn from history is that people never learn from history.

George Michael is a Clear Spring resident who writes for The Herald-Mail.

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