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Venezuela Isn’t Just a Failed State. It’s a Failure of the Left. Conservatives are not wrong when they say socialism deserves some blame for the nation’s collapse.
From Tyler Cowen. Excerpts:
"…rates of change are important. The Venezuelan figure of about 40 percent [govt. spending/gdp] is up from about 28 percent
in 2000, a very rapid increase. By boosting government spending so
quickly, the Venezuelan government was sending a message that the key to
future riches is courting government favor, not starting new
businesses.
Or consider exports, which for most developing economies play an
especially critical role. They bring in foreign exchange, provide
contacts to foreign markets, and force parts of the economy to learn how
to compete with the very best foreign companies. Yet over 90 percent
of Venezuela’s exports are oil, and those resources are owned
and controlled by the government. For this all-important growth driver,
Venezuela comes pretty close to full socialism — to its detriment.
…nationalizations under Chavez were numerous
— encompassing much of the oil sector plus parts of the agriculture,
transport, power, steel, telecommunications and finance industries. Even
though many of those nationalizations were small in scale, the threat
of further encroachments on private property rights discouraged
investment and sent the wrong signal about where the nation was headed."
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