Venezuela about to go down the tubes...a lesson for Corbyn and the Labour Party perhaps?

I wonder how long it would take Corbyn to get the UK to the same levels of Marxist utopia as Venezuela ?
IIRC it took Jim "what crisis" Callaghan about two years to get the UK to the stage of food shortages, blackouts and contingency plans for "government feeding stations" due to fears of what Harold Wilson called "complete liquidation of the economy".

Jim wasn't a Marxist, but many of the union leaders that he let control the country were. I don't think Marxism is the cause of Venezuela's woes either. It's catastrophic economic incompetence, same as happened in Zimbabwe.

Since the Imperial Catastrophe in ancient Rome, through revolutionary France, much of Eastern Europe in the early 20th Century to modern day Venezuela, economic collapse follows a familiar path.

1 The government seeks to extend its control by seizing/nationalising/confiscating (delete according to your political views) the private sector. Private investment stops faster than Diane Abbott driving past a cake shop.

2 Productivity drops like a stone in newly nationalised industries (remember the stories about night shift workers bringing sleeping bags to British Leyland). Falling profits mean there's no cash to pay the millions of new employees the government has suddenly acquired.

3 Government prints money or otherwise devalues the currency to pay its bills (e.g. Roman emperors cheekily cutting bits off gold coins and hoping nobody would notice).

4 Hyperinflation.

5 Government attempts to control inflation by imposing price controls or wage restraint as in 1970s Britain leading to industrial strife or a parallel economy by way of a black market.

6 The economy is fu*ked, also as in 1970s Britain.

Remember that JC (not that one, the scruffy bugger with the beard, err) is already committed to the "Peoples' Quantitative Easing". This is a massive money printing exercise. Among other things, it will provide £800 billion to restart coal mining in the UK, apparently. John McDonnell is already telling us that renationalisation wont cost anything because shareholders will have their assets confiscated in return for some sort of vouchers that will no doubt come straight off the photocopier at the Treasury and be worth as much as a pack of Izal bog roll.

If Labour get in, we'll all be hanging around Dover trying to jump in the back of a lorry on its way to France.
 
I clipped a couple of paras from the original... Full article is here:

Venezuela’s Suicide


Your boy have a professional interest?
Somewhat, He is an analyst with a large stockbroker/investment banking company and spends a lot of time looking at world economy, trade.
Seeing the country with the worlds largest oil reserves going broke while actually importing crude from elsewhere is an odd thing.
 

Goatman

ADC
Book Reviewer
He will probably tell you all about Light crude vs Heavy Crude, cost implications thereof:

Source
Heavy crude oils provide an interesting situation for the economics of petroleum development. The resources of heavy oil in the world are more than twice those of conventional light crude oil. In October 2009, the United States Geological Survey updated the Orinoco deposits (Venezuela) recoverable value to 513 billion barrels (8.16×1010 m3),[16] making this area one of the world's largest recoverable oil deposits. However, recovery rates for heavy oil are often limited from 5-30% of oil in place. The chemical makeup is often the defining variable in recovery rates. New technology utilized for the recovery of heavy oil is constantly increasing recovery rates.[17]

On one hand, due to increased refining costs and high sulfur content for some sources, heavy crudes are often priced at a discount to lighter ones. The increased viscosity and density also makes production more difficult (see reservoir engineering). On the other hand, large quantities of heavy crudes have been discovered in the Americas, including Canada, Venezuela and California. The relatively shallow depth of heavy oil fields[18] (often less than 3000 feet) can contribute to lower production costs; however, these are offset by the difficulties of production and transport that render conventional production methods ineffective.[18] Specialized techniques are being developed for exploration and production of heavy oil.


Unlike them good ol' boys down in West Texas where the oilfields produce stuff that is classed as ' Light sweet crude' , Venezuela does indeed have large reserves - but none of it , so far , is light crude.

Ask him to source a copy of the Economist Intelligence Unit's Country Profile on Venezuela - it would prove interesting reading.
 
@Goatman - The only oil I deal with is the stuff in my SUV's crankcase and the stuff in the tank in the basement which feeds the furnace.
I did text my son to look at the Economist link, he said his firm subscribes to the Economist service and will take a look. He likes this sort of thing, got his MBA last year and has started studying for his CFA certification.
 
I havent attempted to read all of the clueless people posting on here about the crisis. Which seems to be the majority to experience a country as corrupt as venezuela for a short amount of time working In Guyana last year have a form of understanding by reading unbiased nonsense from sky and all the other mainstream media crap.
:?

I'm sure that means something to someone...
 
Interesting analysis here :

Venezuela’s Suicide

Consider two Latin American countries. The first is one of the region’s oldest and strongest democracies. It boasts a stronger social safety net than any of its neighbors and is making progress on its promise to deliver free health care and higher education to all its citizens. It is a model of social mobility and a magnet for immigrants from across Latin America and Europe. The press is free, and the political system is open; opposing parties compete fiercely in elections and regularly alternate power peacefully. It sidestepped the wave of military juntas that mired some Latin American countries in dictatorship. Thanks to a long political alliance and deep trade and investment ties with the United States, it serves as the Latin American headquarters for a slew of multinational corporations. It has the best infrastructure in South America. It is still unmistakably a developing country, with its share of corruption, injustice, and dysfunction, but it is well ahead of other poor countries by almost any measure.

The second country is one of Latin America’s most impoverished nations and its newest dictatorship. Its schools lie half deserted. The health system has been devastated by decades of underinvestment, corruption, and neglect; long-vanquished diseases, such as malaria and measles, have returned. Only a tiny elite can afford enough to eat. An epidemic of violence has made it one of the most murderous countries in the world. It is the source of Latin America’s largest refugee migration in a generation, with millions of citizens fleeing in the last few years alone. Hardly anyone (aside from other autocratic governments) recognizes its sham elections, and the small portion of the media not under direct state control still follows the official line for fear of reprisals. By the end of 2018, its economy will have shrunk by about half in the last five years. It is a major cocaine-trafficking hub, and key power brokers in its political elite have been indicted in the United States on drug charges. Prices double every 25 days. The main airport is largely deserted, used by just a handful of holdout airlines bringing few passengers to and from the outside world.

These two countries are in fact the same country, Venezuela, at two different times: the early 1970s and today.

The transformation Venezuela has undergone is so radical, so complete, and so total that it is hard to believe it took place without a war. What happened to Venezuela? How did things go so wrong?
The short answer is Chavismo. Under the leadership of Hugo Chávez and his successor, Nicolás Maduro, the country has experienced a toxic mix of wantonly destructive policy, escalating authoritarianism, and kleptocracy, all under a level of Cuban influence that often resembles an occupation. Any one of these features would have created huge problems on its own. All of them together hatched a catastrophe. Today, Venezuela is a poor country and a failed and criminalized state run by an autocrat beholden to a foreign power. The remaining options for reversing this situation are slim; the risk now is that hopelessness will push Venezuelans to consider supporting dangerous measures, such as a U.S.-led military invasion, that could make a bad situation worse.



Chávez had long looked to Cuba as a blueprint for revolution, and he turned to Cuban President Fidel Castro for advice at critical junctures. In return, Venezuela sent oil: energy aid to Cuba (in the form of 115,000 barrels a day sold at a deep discount) was worth nearly $1 billion a year to Havana. The relationship between Cuba and Venezuela became more than an alliance. It has been, as Chávez himself once put it, “a merger of two revolutions.” (Unusually, the senior partner in the alliance is poorer and smaller than the junior partner—but so much more competent that it dominates the relationship.) Cuba is careful to keep its footprint light: it conducts most of its consultations in Havana rather than Caracas.

ANATOMY OF A COLLAPSE
Nearly all oil-producing liberal democracies, such as Norway, the United Kingdom, and the United States, were democracies before they became oil producers. Autocracies that have found oil, such as Angola, Brunei, Iran, and Russia, have been unable to make the leap to liberal democracy. For four decades, Venezuela seemed to have miraculously beat these odds—it democratized and liberalized in 1958, decades after finding oil.
But the roots of Venezuelan liberal democracy turned out to be shallow. Two decades of bad economics decimated the popularity of the traditional political parties, and a charismatic demagogue, riding the wave of an oil boom, stepped into the breach. Under these unusual conditions, he was able to sweep away the whole structure of democratic checks and balances in just a few years.
When the decadelong oil price boom ended in 2014, Venezuela lost not just the oil revenue on which Chávez’s popularity and international influence had depended but also access to foreign credit markets. This left the country with a massive debt overhang: the loans taken out during the oil boom still had to be serviced, although from a much-reduced income stream. Venezuela ended up with politics that are typical of autocracies that discover oil: a predatory, extractive oligarchy that ignores regular people as long they stay quiet and that violently suppresses them when they protest.
The resulting crisis is morphing into the worst humanitarian disaster in memory in the Western Hemisphere. Exact figures for Venezuela’s GDP collapse are notoriously difficult to come by, but economists estimate that it is comparable to the 40 percent contraction of Syria’s GDP since 2012, following the outbreak of its devastating civil war. Hyperinflation has reached one million percent per year, pushing 61 percent of Venezuelans to live in extreme poverty, with 89 percent of those surveyed saying they do not have the money to buy enough food for their families and 64 percent reporting they have lost an average of 11 kilograms (about 24 pounds) in body weight due to hunger. About ten percent of the population—2.6 million Venezuelans—have fled to neighboring countries.



The Venezuelan state has mostly given up on providing public services such as health care, education, and even policing; heavy-handed, repressive violence is the final thing left that Venezuelans can rely on the public sector to consistently deliver. In the face of mass protests in 2014 and 2017, the government responded with thousands of arrests, brutal beatings and torture, and the killing of over 130 protesters.


Meanwhile, criminal business is increasingly conducted not in defiance of the state, or even simply in cahoots with the state, but directly through it. Drug trafficking has emerged alongside oil production and currency arbitrage as a key source of profits to those close to the ruling elite, with high-ranking officials and members of the president’s family facing narcotics charges in the United States. A small connected elite has also stolen national assets to a unprecedented degree. In August, a series of regime-connected businessmen were indicted in U.S. federal courts for attempting to launder over $1.2 billion in illegally obtained funds—just one of a dizzying array of illegal scams that are part of the looting of Venezuela.

The entire southeastern quadrant of the country has become an exploitative illegal mining camp, where desperate people displaced from cities by hunger try their luck in unsafe mines run by criminal gangs under military protection. All over the country, prison gangs, working in partnership with government security forces, run lucrative extortion rackets that make them the de facto civil -authority. The offices of the Treasury, the central bank, and the national oil company have become laboratories where complicated financial crimes are hatched. As Venezuela’s economy has collapsed, the lines separating the state from criminal enterprises have all but disappeared.

THE VENEZUELAN DILEMMA
Whenever U.S. President Donald Trump meets with a Latin American leader, he insists that the region do something about the Venezuelan crisis. Trump has prodded his own national security team for “strong” alternatives, at one point stating that there are “many options” for Venezuela and that he is “not going to rule out the military option.” Republican Senator Marco Rubio of Florida has similarly flirted with a military response.


Secretary of Defense James Mattis, however, has echoed a common sentiment of the U.S. security apparatus by publicly stating, “The Venezuelan crisis is not a military matter.” All of Venezuela’s neighboring countries have also voiced their opposition to an armed attack on Venezuela.


And rightly so. Trump’s fantasies of military invasion are deeply misguided and extremely dangerous. Although a U.S.-led military assault would likely have no problem overthrowing Maduro in short order, what comes next could be far worse, as the Iraqis and the Libyans know only too well: when outside powers overthrow autocrats sitting atop failing states, open-ended chaos is much more likely to follow than stability—let alone democracy.


The other Latin American countries are finally grasping that Venezuela’s instability will inevitably spill across their borders.
Some have suggested using harsh economic sanctions to pressure Maduro to step down. The United States has tried this. It passed several rounds of sanctions, under both the Obama and Trump administrations, to prevent the regime from issuing new debt and to hamper the financial operation of the state-owned oil company. Together with Canada and the EU, Washington has also put in place sanctions against specific regime officials, freezing their assets abroad and imposing travel restrictions. But such measures are redundant: if the task is to destroy the Venezuelan economy, no set of sanctions will be as effective as the regime itself. The same is true for an oil blockade: oil production is already in a free fall.


As the center-left “pink wave” of the early years of this century recedes, a new cohort of more conservative leaders in Argentina, Brazil, Chile, Colombia, and Peru has tipped the regional balance against Venezuela’s dictatorship, but the lack of actionable options bedevils them, as well.

Traditional diplomacy hasn’t worked and has even backfired. But so has pressure. For example, in 2017, Latin American countries threatened to suspend Venezuela’s membership in the Organization of American States. The regime responded by withdrawing from the organization unilaterally, displaying just how little it cares about traditional diplomatic pressure.


CARLOS GARCIA RAWLINS / REUTERS
Venezuelan refugees carry their belongings to Colombia through the Tachira river in Tachira State, Venezuela, August 2015


Venezuela’s exasperated neighbors are increasingly seeing the crisis through the prism of the refugee problem it has created; they are anxious to stem the flow of malnourished people fleeing Venezuela and placing new strains on their social programs. As a populist backlash builds against the influx of Venezuelan refugees, some Latin American countries appear tempted to slam the door shut—a temptation they must resist, as it would be a historic mistake that would only worsen the crisis. The reality is that Latin American countries have no idea what to do about Venezuela. There may be nothing they can do, save accepting refugees, which will at least help alleviate the suffering of the Venezuelan people.


A successor regime would need to reduce the enormous role the military plays in all areas of the public sector. It would have to start from scratch in restoring basic services in health care, education, and law enforcement.

It would have to rebuild the oil industry and stimulate growth in other economic sectors.

It would need to get rid of the drug dealers, prison racketeers, predatory miners, wealthy criminal financiers, and extortionists who have latched on to every part of the state.

And it would have to make all these changes in the context of a toxic, anarchic political environment and a grave economic crisis.

---------------- ends -----------------------------

The links with the International drug industry are here:

https://www.insightcrime.org/wp-con...enezuela-a-Mafia-State-InSight-Crime-2018.pdf
An excellent and informative article. Venezuela's neighbours are right to fear an influx of refugees. Look what's happening in this country.
 
1 The government seeks to extend its control by seizing/nationalising/confiscating (delete according to your political views) the private sector. Private investment stops faster than Diane Abbott driving past a cake shop.
I'd have given you a Like anyway, but that line did make me smile ;-)
 
IIRC it took Jim "what crisis" Callaghan about two years to get the UK to the stage of food shortages, blackouts and contingency plans for "government feeding stations" due to fears of what Harold Wilson called "complete liquidation of the economy".

Jim wasn't a Marxist, but many of the union leaders that he let control the country were. I don't think Marxism is the cause of Venezuela's woes either. It's catastrophic economic incompetence, same as happened in Zimbabwe.

Since the Imperial Catastrophe in ancient Rome, through revolutionary France, much of Eastern Europe in the early 20th Century to modern day Venezuela, economic collapse follows a familiar path.

1 The government seeks to extend its control by seizing/nationalising/confiscating (delete according to your political views) the private sector. Private investment stops faster than Diane Abbott driving past a cake shop.

2 Productivity drops like a stone in newly nationalised industries (remember the stories about night shift workers bringing sleeping bags to British Leyland). Falling profits mean there's no cash to pay the millions of new employees the government has suddenly acquired.

3 Government prints money or otherwise devalues the currency to pay its bills (e.g. Roman emperors cheekily cutting bits off gold coins and hoping nobody would notice).

4 Hyperinflation.

5 Government attempts to control inflation by imposing price controls or wage restraint as in 1970s Britain leading to industrial strife or a parallel economy by way of a black market.

6 The economy is fu*ked, also as in 1970s Britain.

Remember that JC (not that one, the scruffy bugger with the beard, err) is already committed to the "Peoples' Quantitative Easing". This is a massive money printing exercise. Among other things, it will provide £800 billion to restart coal mining in the UK, apparently. John McDonnell is already telling us that renationalisation wont cost anything because shareholders will have their assets confiscated in return for some sort of vouchers that will no doubt come straight off the photocopier at the Treasury and be worth as much as a pack of Izal bog roll.

If Labour get in, we'll all be hanging around Dover trying to jump in the back of a lorry on its way to France.
Good to hear a voice about that, some of us aren't old enough to remember it first hand

All I can remember from my childhood is Margaret Thatcher, and home everything got worse when she departed from politics

It's been downhill ever since
 
Good to hear a voice about that, some of us aren't old enough to remember it first hand

All I can remember from my childhood is Margaret Thatcher, and home everything got worse when she departed from politics

It's been downhill ever since
Like her, or loath her, we haven't had a politician like her... Well... Since she retired.
 

Latest Threads

Top