It’s been two decades since Hugo Chavez ushered in a socialist revolution in Venezuela, and already, everyone in the country is now a millionaire.
Unfortunately, that doesn’t count for much in Venezuela nowadays.
At the end of June, it was widely reported that due to hyperinflation in the country, the price of a small cup of coffee had surged to 1 million Bolivars. (RELATED: Socialism! Venezuela’s 500,000% Inflation). It’s been only a month since then, and that same cup now costs 2 million Bolivars. For context, 2 million Bolivars is $17 US dollars, and equivalent to two weeks pay in Venezuela. Three months ago, the cup cost 190,000 Bolivars.
The economy is in a downward spiral and is the most devastating and quick downfall of a socialist country in recent history. And as the spiral continues, President Nicolas Maduro continues heaping coal into the fire, with his “solutions” becoming increasingly ridiculous.
According to the Daily Caller, “Venezuela will remove five zeros from its currency as it attempts to stabilize its failing economy and skyrocketing inflation rates. Maduro’s government originally planned to remove three zeros from the bolivar, but as the inflation rate is set to reach 1 million percent by the end of the year, the government is scrambling to uphold its socialist economy that’s been in decline since 2014.”
This change will take effect in August, right as Venezuela launches their own cryptocurrency, the Petro. After taking three zeros off their currency, Venezuela’s government wants to peg the value of their revised currency to that cryptocurrency. The government claims that the value will be pegged to the value of Venezuela’s oil and mineral reserves, but fraud is a guarantee there. There’s no explanation for how those reserves will be valued.
Even more suspicious, Venezuelan citizens are prohibited from purchasing the Petro. And there’s no use of this cryptocurrency to anyone outside of Venezuela since it isn’t pegged to the resources it’s claimed to be. In other words, the only people that can purchase the Petro can’t use it, and the only people that can use it can’t purchase it. The government claims they raised over $5 billion from selling this currency but hasn’t provided any evidence.
Economists predict that Venezuela’s economy will contract by a fifth in 2018, which marks the third straight year of double-digit declines.
When Venezuela went socialist in the late 90s, liberals praised the nation for all its efforts. (RELATED: Why Are Liberals Silent About Venezuela’s Socialist Nightmare?).
It’s only now that they’ve either gone silent – or lectured on how it’s not “real socialism.” It’s interesting how nobody argued the country didn’t have “real socialism” prior to the collapse.
