August 5, 2017

At least someone on the left is willing to find fault with Venezuela’s leadership

Filed under: Americas, Politics — Tags: , , — Nicholas @ 03:00

Of course, when I say “find fault”, I mean “criticize for not being even more horrible“:

Ken Livingstone, a former mayor of London, has blamed the turmoil in Venezuela on the unwillingness of the former president, Hugo Chávez, to execute “oligarchs” after he came to power.

Livingstone, who is suspended from the Labour party, also blamed the economic crisis in the country on the government’s failure to take his advice on investment in infrastructure, which he said would have reduced the Latin American state’s dependence on oil.

The former mayor, a longtime supporter of the late president Chávez and his successor Nicolás Maduro, said the socialist leader’s enemies wanted to restore their power.

“One of the things that Chávez did when he came to power, he didn’t kill all the oligarchs. There was about 200 families who controlled about 80% of the wealth in Venezuela,” Livingstone told Talk Radio.

“He allowed them to live, to carry on. I suspect a lot of them are using their power and control over imports and exports to make it difficult and to undermine Maduro.” When pressed, Livingstone said he was “not in favour of killing anyone”.

Livingstone visited Venezuela during his time in office as mayor of London, striking a cut-price oil deal with Maduro to supply Transport for London. The Labour leader, Jeremy Corbyn, has also regularly expressed his admiration for Chávez, saying in 2013 he was “an inspiration to all of us fighting back against austerity and neoliberal economics in Europe”.

August 4, 2017

Short memories and willing self-deception over Venezuela

Filed under: Americas, Economics, Media, Politics — Tags: , , , , , — Nicholas @ 03:00

In the Los Angeles Times, James Kirchick took the pundits to task for their adulation of Venezuela’s government as it plunged deliberately into a humanitarian disaster:

Shaded relief map of Venezuela, 1993 (via Wikimedia)

On Sunday, Venezuelan President Nicolas Maduro claimed victory in a referendum designed to rewrite the country’s constitution and confer on him dictatorial powers. The sham vote, boycotted by the opposition, was but the latest stage in the “Bolivarian Revolution” launched by Maduro’s predecessor, the late Hugo Chavez. First elected in 1998 on a wave of popular goodwill, Chavez’s legacy is one of utter devastation.

Thanks to Chavismo’s vast social welfare schemes (initially buoyed by high oil prices), cronyism and corruption, a country that once boasted massive budget surpluses is today the world’s most indebted. Contraction in per capita GDP is so severe that “Venezuela’s economic catastrophe dwarfs any in the history of the U.S., Western Europe or the rest of Latin America” according to Ricardo Hausmann, former chief economist of the Inter-American Development Bank. Transparency International lists Venezuela as the only country in the Americas among the world’s 10 most corrupt.

Socialist economic policies — price controls, factory nationalizations, government takeovers of food distribution and the like — have real human costs. Eighty percent of Venezuelan bakeries don’t have flour. Eleven percent of children under 5 are malnourished, infant mortality has increased by 30% and maternal mortality is up 66%. The Maduro regime has met protests against its misrule with violence. More than 100 people have died in anti-government demonstrations and thousands have been arrested. Loyal police officers are rewarded with rolls of toilet paper.

The list of Western leftists who once sang the Venezuelan government’s praises is long, and Naomi Klein figures near the top.

In 2004, she signed a petition headlined, “We would vote for Hugo Chavez.” Three years later, she lauded Venezuela as a place where “citizens had renewed their faith in the power of democracy to improve their lives.” In her 2007 book, The Shock Doctrine, she portrayed capitalism as a sort of global conspiracy that instigates financial crises and exploits poor countries in the wake of natural disasters. But Klein declared that Venezuela had been rendered immune to the “shocks” administered by free market fundamentalists thanks to Chavez’s “21st Century Socialism,” which had created “a zone of relative economic calm and predictability.”

Chavez’s untimely death from cancer in 2013 saw an outpouring of grief from the global left. The caudillo “demonstrated that it is possible to resist the neo-liberal dogma that holds sway over much of humanity,” wrote British journalist Owen Jones. “I mourn a great hero to the majority of his people,” said Oliver Stone, who would go on to replace Chavez with Vladimir Putin as the object of his twisted affection.

May 23, 2017

Venezuela’s American “useful idiots”

Filed under: Americas, Economics, Media — Tags: , , , — Nicholas @ 04:00

Marian L. Tupy on the American apologists for the ongoing economic and humanitarian disaster unfolding in Venezuela, thanks to that country’s embrace of socialism:

… all socialist countries eventually come to experience similar economic and political problems. And, just as surely, there will always be those in the West who will jump to socialism’s defense. Vladimir Lenin, the founder of the Soviet state, called such people “useful idiots”.

I was reminded of the immensely seductive nature of socialism this week, when Tucker Carlson, the host of the eponymous show on Fox News, hosted a young socialist from The Students and Youth for a New America. To give you a sense of the conversation between the two, I have transcribed some of Dakotah Lilly’s statements below:

    “We need to acknowledge that what Venezuela is facing right now is terrorism at the hands of the opposition. Opposition has bombed schools, they have bombed buses, [and] they have taken wiring and strung it across roads to behead cops on motorcycles. These are not choir boys. These are violent extremists, hell-bent on taking away the progress that Venezuela has made over the past few years.”

    “If you look at the casualties that have happened in the past few months in these protests, the majority of those that have been killed have been trade unionist leaders, have been dedicated Chavistas, have been people on the Left.”

    “In terms of economics, the sanctions that the United States has put on Venezuela and the hoarding done by multi-national corporations in Venezuela, certainly does not help the [economic] situation.”

Almost everything that Lilly says here is demonstrably false. Extensive reporting by the New York Times, hardly a promoter and defender of “unbridled capitalism”, shows that most of the victims of political violence in Venezuela have been anti-government protesters.

Prey for Socialism’s Siren Call

Moreover, the sanctions imposed by the United States on a few individuals connected to the Venezuelan government have nothing to do with that country’s economic meltdown.

Aside from oil exports, Venezuela does not have or make anything that anyone in the world wants to buy. Thus, when the oil price collapsed from $140 to less than $50 a barrel, the country lost most of the foreign exchange it needed to purchase food and consumer goods abroad. Shortages ensued.

Admittedly, it is not entirely fair to criticize American millennials for their almost unfathomable ignorance. The state-schools system is, by and large, broken. American pupils can go through years of primary and secondary “education” without learning about communist crimes and socialist economic failures. Solutions to these problems are not easily to find. History and economics are not the most popular of subjects, and more often than not, the faculties are Left-leaning.

To make matters worse, young people, such as Dakotah Lilly, are deeply idealistic and easy prey to the siren call of socialism. They see the imperfections of free-market democracy at home and assume that countries with the opposite economic and political arrangements, such socialist Venezuela, must offer a better life to their people.

As Steven Horwitz pointed out earlier this month, “you can’t deny that Venezuela is a socialist calamity“:

This humanitarian disaster has raised the question of who or what to blame. That question puts self-proclaimed socialists and their progressive sympathizers in a difficult spot. After all, one can easily find lots of examples (from Michael Moore to Bernie Sanders) of people on the left praising or endorsing Chavez’s economic policies. So what can people who took that position say in the face of this disaster? And what can the defenders of free enterprise say as well?

Many on the left will start by denying that socialism is at fault. Sometimes they’ll deny that the Chavez-Maduro policies were “real” socialism. In other cases, they’ll argue that while their intentions might have been good, corruption and poor implementation doomed good policies to failure.

Both of these arguments have real problems.

If those policies were not “real” socialism, then why did so many sympathetic to socialism express so much support for them and argue that they would be transformative in ways socialists value? Chavez himself made such claims.

Do all of them not understand what socialism is? The variety of attempts Chavez made to prevent markets and prices from working and to substitute some form of economic planning in the name of the people have been broadly consistent with socialism since Marx. If that’s not socialism, what exactly is meant by that word anymore?

February 7, 2017

Simón Bolívar – Lies – Extra History

Filed under: Americas, History — Tags: , , , — Nicholas @ 02:00

Published on Jan 21, 2017

James talks about our mistakes, and adds additional stories, for the Simón Bolívar series!

February 4, 2017

Simón Bolívar – VI: All Good Things – Extra History

Filed under: Americas — Tags: , , , , — Nicholas @ 04:00

Published on Dec 24, 2016

Simón Bolívar hoped to bring the nations of South America together in one great federation, but he feared that people would think he meant to make himself a king. He tried to step back, but revolution threatened from within his ranks and his body had grown weak with illness.

January 30, 2017

Simón Bolívar – V: Heavy is the Head – Extra History

Filed under: Americas, History — Tags: , , , — Nicholas @ 03:00

Published on Dec 17, 2016

After so many failures, Simón Bolívar finally began to find success: Gran Colombia, Peru, and Bolivia all stood free from Spanish rule. He raced to found new governments and consolidate the liberty he’d earned, but resources had been stretched too thin.

January 25, 2017

Simón Bolívar – IV: Defeat is Not Surrender – Extra History

Filed under: Americas, History — Tags: , , , , — Nicholas @ 04:00

Published on Dec 10, 2016

Failure had taught Simón Bolívar one important lesson: no single state in Spanish South America could win independence alone. To succeed, he needed to form one great state, united and able to stand up to the might of Spain.

January 22, 2017

Simón Bolívar – III: Leavings and Returns – Extra History

Filed under: Americas, History — Tags: , , , , — Nicholas @ 02:00

Published on Dec 3, 2016

The failure of his first attempted revolution in Venezuela only fanned the flames of Simón Bolívar’s determination to end Spanish reign over South America. Convinced that he needed to unite the entire continent in freedom, he gathered troops and set out with a new purpose. But his ferocity threatened to overwhelm his ideals.

January 19, 2017

Simón Bolívar – II: Francisco de Miranda – Extra History

Filed under: Americas, History — Tags: , , , — Nicholas @ 03:00

Published on Nov 26, 2016

When Napoleon conquered Spain, the Spanish colonies no longer had a clear leader to follow. Bolívar seized on this opportunity to promote his dreams of Venezuelan independence, but he stumbled from lack of experience. A man named Francisco de Miranda took control instead.

January 6, 2017

Venezuela’s journey from the “Bolivarian Revolution” to “Zimbabwean levels of hunger and inflationary poverty”

Filed under: Americas, Economics, Government — Tags: , , , , — Nicholas @ 02:00

Jack Staples-Butler on the moral accountability for outside supporters (particularly the British left) of what has turned into a huge humanitarian disaster in Venezuela:

DENIAL in the face of catastrophic failure of one’s ideas is a predictable reaction from a believer, as per Leon Festinger’s theory of cognitive dissonance reduction in response to the failure of one’s beliefs. Denial in the face of shame for one’s actions is an experience well-studied by psychologists and criminologists. One 2014 study summarises the role of ‘shame’ in creating both denial of responsibility and recidivism among offenders:

    “Feelings of shame… involve a painful feeling directed toward the self. For some people, feelings of shame lead to a defensive response, a denial of responsibility, and a need to blame others — a process that can lead to aggression.”

Combining both faces of the phenomenon of denial is the behaviour of the supporters, apologists and promoters of the ‘Bolivarian Revolution’, the late Hugo Chávez and the PSUV regime in Venezuela, and their response to the present state of the country. Humanitarian catastrophe of an apocalyptic scale is now unfolding in the most oil-rich state in the world. The magnitude of human suffering is indescribable. The scenes of bread queues and shortages familiar to Eurozone-crisis Greece are long since surpassed. Venezuela has become a ‘Starvation State’ which “today drowns in a humanitarian crisis”, with lawless cities and hunger for the majority. It extends beyond humans, as the country’s pets are left in skeletal starvation and the zoos of Venezuela become graveyards of wild and endangered animals. […]

The response of the Venezuelan government to a crisis entirely of its own making has been systemic and organised psychological denial of its own, and particularly to externalise blame through conspiracy theories. Fantasies of ‘economic warfare’ waged by ‘hoarders’ led by the United States are played out in government seizures of foodstuffs and crippling price controls. The most disturbing recent development is the prospect of Venezuelans becoming a population of forced labourers in government-run agricultural projects, a solution that would take Venezuela from Zimbabwean levels of hunger and inflationary poverty to Cambodian levels of state-led starvation.

H/T to Natalie Solent for the link.

January 2, 2017

Simón Bolívar – I: Reverberations – Extra History

Filed under: Americas, History — Tags: , , — Nicholas @ 03:00

Published on 19 Nov 2016

Born to one of the wealthiest families in Venezuela, Simón Bolívar imbibed the ideals of revolution from a tutor who inspired him to travel to Europe as a young man. What he saw and learned, he would one day bring back to foment revolution in the Spanish colonies of Latin America.

December 12, 2016

QotD: Don’t mess with the market

Filed under: Britain, Economics, Politics, Quotations — Tags: , , — Nicholas @ 01:00

Please note that this is nothing to do with a debate about capitalism or socialism: they are descriptions of who owns the productive assets in a society. It’s also nothing at all to do with whatever the correct level of taxation, state provision or anything about what redistribution should be in a society. It’s purely a point about how you try to achieve the goals that you’ve set yourself.

It’s entirely possible to alter or ameliorate the outcomes of market process. But the temptation to direct those market processes is where the problems come in. Take Venezuela: as I’ve repeatedly said there’s nothing immoral or necessarily undesirable about increasing the incomes of the poor or of reducing inequality. It’s just that the method that one uses to do this has to be taking money from richer people and then giving it to poorer people. Not, as they have done, attempting to do a whole series of price fixing. This was something that New Labour, under Blair and Brown, largely did get. Allow the economy to hum along and tax it to then pay for the results that you want.

Miliband was arguing the other way. That we should be doing that price fixing, that interference directly into the market, in order to achieve our goals. And that is the Venezuelan mistake.

We do in fact have in front of us an example of what most leftists consider to be a generally desirable outcome: the Nordics. They’re high tax, high redistribution states, oh yes they are. But they’re also, underneath that, markedly more classically liberal than either the UK or the US. That’s what makes the places tick. They don’t have minimum wages for example, let alone price fixing for energy. As Scott Sumner has pointed out Denmark might be the most classically liberal economy on the planet.

The real lesson I think the left needs to learn is that markets work. You can change the outcome through tax and redistribution if you wish: but don’t mess with the workings of the market itself.

Tim Worstall, “Under Miliband Britain Would Have Become Like Venezuela”, Forbes, 2015-05-09.

June 27, 2016

Media fans of Chavez

Filed under: Americas, Economics, Media — Tags: , , — Nicholas @ 03:00

Theodore Dalrymple on the unfailing ability of some political pundits to not only be wrong, but to be proven wrong so completely and so quickly (and yet to seem unable to learn from the experience):

In 2000 [former literary editor of The Guardian, Richard Gott] wrote a book about Chavez that I thought startling in its adulatory idiocy. The Bourbons may have learnt nothing and forgotten nothing, but Gott was far worse than any Bourbon. Despite it being obvious that Chavez’s crude and demagogic economic notions were capable of producing a sand shortage in the Sahara, Gott saw in them a rainbow with a pot of social justice at the end of it. As late as 2012, Gott wrote an article in The Guardian with the title “Chavez’s economic lesson for Europe.” Its subtitle was “Hugo Chavez’s rejection of the neoliberal policies dragging Europe down sets a hopeful example.”

Chavez’s policy was simply to use Venezuela’s large oil revenues, in effect its unearned income, to subsidize the standard of living of millions of people, while at the same time antagonizing foreign and even domestic capital. Oddly enough, it did not occur to the learned author of the article that Greece, for example, had no revenues from a resource comparable to oil to distribute, though for a time borrowed money played the role of those oil revenues; nor that an economy utterly dependent on the price of oil was extremely fragile, and that to distribute largesse on the assumption that the price would remain high forever was improvident, to say the least.

The article ends as follows:

    Greece has a wonderful chance to change the history of Europe and to throw their caps of Bolívar into the air, as once the Italian carbonari did in Paris all those years ago. Lord Byron, who planned to settle in Bolívar’s Venezuela before sailing off to help liberate Greece, named his yacht Bolívar; he would certainly have been pleased with contemporary developments.

What this omits, apart from the chaos into which Venezuela has only too predictably fallen, is Bolívar’s own miserable end as a fugitive from what he himself had brought about, and his deeply despairing though splendidly lapidary last pronouncement: He who serves the revolution ploughs the sea.

It was never very difficult, even for persons such as I ungifted with foresight, to predict that Chavez’s so-called Bolivarian Revolution would end in tears, with shortages of practically everything and corruption on a Brobdingnagian scale. For any person possessed of the most minimal common sense, Gott’s own book about the Venezuelan mountebank provided enough evidence that this would happen. Gott’s economic utopia is a place in which everything for everybody is subsidized, and nothing has a real price. A cynic, said Oscar Wilde, is a person who knows the price of everything; a Gott is a person who thinks there should be no prices, and everything should be distributed according to everyone’s wishes.

But perhaps we should not be too hard on poor old Chavez and his Guardian acolyte, praise-singer, and sycophant. Chavez’s Bolivarian Revolution was only European social democracy writ large and loud, a tropical parrot to Europe’s more soberly plumaged crows. After all, what is most of Western politics about other than the size and distribution of subsidies, the state, as the great French economist of the 19th century, Frédéric Bastiat, put it (he is the only economist in the history of the world who makes you laugh on practically every page), the means by which everyone seeks to live at everyone else’s expense?

June 19, 2015

QotD: There is a lot of ruin in a nation … but not an infinite amount

Filed under: Americas, Economics, Europe, Quotations — Tags: , — Nicholas @ 01:00

Over the years, I’ve had many arguments about economic policy with my statist friends. I put them into three categories.

  • The completely unreasonable statists blindly assert, notwithstanding all the evidence around the world, that bigger government and more intervention are actually good for growth.
  • The somewhat unreasonable statists acknowledge that bigger government and more intervention might have some minor “efficiency” costs, but those costs are acceptable and affordable in the pursuit of more “equity.”
  • The semi-reasonable statists admit that bigger government and more intervention hurt growth, but they argue that “libertarian types” must somehow be wrong because our predictions of economic chaos never materialize.

The folks in the last category have a point. For decades, advocates of limited government and free markets have warned about the economic cost of bad policy, yet where’s the collapse?

Why hasn’t Atlas shrugged, as libertarians have warned? Why have predictions of economic dystopia (examples here and here) been wrong?

I have two responses to these questions.

First, the economic damage caused by an expanding welfare state has been offset by improvements in other types of economic policy.

Second, maybe dour libertarians have been right, but got the timing wrong because it takes a long time and a lot of bad policy to destroy an economy.

And that’s today’s topic, because it certainly looks like both Greece and Venezuela have finally reached the end of the road. Let’s call it the Thatcher Inflection Point.

Dan Mitchell, “Atlas Is Shrugging in Greece and Venezuela: Two Case Studies of Statist Failure”, International Liberty, 2015-05-27.

May 28, 2015

QotD: The key strength of markets

Filed under: Americas, Economics, Government, Quotations — Tags: , , — Nicholas @ 01:00

This is a general and pernicious failing of the left in my view. They really, just really, don’t get what it is that markets do and do very well. What markets do do is they produce the information, through the price system, of who is willing to produce what at which price and who desires to consume what at which price. Thus we get an efficient allocation of scarce resources by our use of markets. And Hayek pretty much got his Nobel for proving that there is no other system to hand which can perform this function. The planner simply cannot gain enough information to be able to perform that function, nor process it real time (and no, computing can’t do it either, Allende and his computer to run the Chilean economy was wrong.)

It’s entirely possible to critique markets on the grounds of equity though. For example, too many people are too poor if we just leave it to the market. Perhaps we agree with that idea, perhaps we don’t: but that argues for changing peoples’ incomes through intervention, not for abolishing the market in the provision of goods. Or, as I’ve said before, if Chavez and Maduro want poor Venezuelans to be better off then send them more money. Don’t mess with the market: the result of that messing will inevitably be the sort of breakdown we see here.

As for the people of Venezuela, well, obviously, this isn’t going to work out well. Their rulers have pretty much bankrupted the country through their incompetence: and now they’re taking more economic power unto themselves?

Not going to work, is it? Even competent governments haven’t been able to make nationalised food distribution systems work…

Tim Worstall, “Amazingly, Maduro Is Going To Make The Venezuelan Economy Even Worse. Yes, Worse”, Forbes, 2015-05-03.

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