Caracas Daily Journal (Vincent Bevins): Most Venezuelans have experienced something quite shocking recently. They have gone to their local supermarkets, and there has been milk there. Lots of milk. And maybe even different kinds of it.
The months-long crisis which consisted of serious hassles in the attempt to find powdered milk, long-duration, or otherwise, seems to be coming to an end.
Scarcity is still a problem and there are sporadic difficulties in finding certain kinds of products, but it seems the problem is wrapping up, and polls say the people agree.
In last month's IVAD poll, scarcity was still listed as a principal problem in the country, but at a much lower rate than had previously been recorded. And by this Tuesday, the Food Minister, Félix Osorio, said that the distribution of powdered milk is almost completely back to normal. He contributed the success to coordination between the public and private sectors.
The scarcity had a mysterious and diverse set of causes, including a rapid rise in wealth and therefore demand in the population which was not met by corresponding increases in production, strict price controls which made private distributors unwilling or unable to sell basic food products, and at times, outright attempts to sabotage the economy by hoarding food supplies.
Recognizing that scarcity was a major problem early this year, the government attacked the problem with a pursuit of contraband, a massive influx of costly imports, and oil-subsidized food through the Mission Mercal. According to the same minister, 55 percent of the products currently distributed by Mercal are nationally produced. Though this is still a relatively low number compared to a normal Latin American country, it is an increase for Venezuela itself, which has a tendency to produce very little other than oil.
The so-called "Dutch Disease" which affects oil economies in a boom increase the purchasing power of a local economy while leaving local production unchanged. Therefore, the new demand is spent on imports, actually harming local development outside of the oil sector. This has contributed to Venezuela's current dependence on imports and to the scarcity phenomenon.
This phenomenon has been near-unavoidable historically, as long as market forces have remained dominant. The government has fought the tendency by avoiding the market and investing in costly national projects.
Economists also report that demand dropped in the first quarter of 2008, compared to December of 2007. While December is usually a festival of consumption, demand increases have tended to continue in January the past few years.
The developments, which include a prioritization of spending towards basic needs and away from consumer items such as new cell phones, is likely the result of inflation and efforts to decrease liquidity through interest rate increases and selling bonds. The final effect of the decrease in consumption is likely to slow down inflation.
This piece is much too kind to the economic saboteurs: who must all be nationalized -- and without compensation, AFAIC. The main reason by far why the capitalist boycott of the socialist economy was broken was because the bolivarian republic kept its cool and its resolve, and spent the milk monopoly out from under them by buying/building new socialist infrastructure for the production of milk. And so knocked the prop out from under the monopolist boycotters (and not just the milk distributors and producers, eh?). And so these scumbags who play with people's lives really should pay dearly for this perfidy now. Don't let them off the hook -- they'll just try it again some other CIA-defined way.
ReplyDeleteAs well: the true superiority of the socialist system will indeed cure such capitalist anarky as the "Dutch Disease" -- and much more besides -- when given half the chance (has it ever been?). And there's nothing like a world-wide Finance Capital-induced depression to make that fact more and more obvious to everyone, eh..?
I forgot to add the important point that the present developments above are proof positive that this was indeed economic sabotage -- and that all those involved who denied this are indeed liars and/or saboteurs and should be dealt with as such.
ReplyDelete