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– The Rich, The Poor, & The Trouble With Socialism (ZeroHedge, Aug 9, 2015)
Submitted by Pater Tenebrarum of Acting-Man blog,
The Problem of Economic Ignorance
The fact that economic ignorance is widespread is really a big problem in our view. Unfortunately even what is broadly considered the economic mainstream thought is riddled with stuff that we think just doesn’t represent good economics. This is not meant to say that there is absolutely nothing worthwhile offered by the so-called mainstream. Often one comes across valuable insights and stimulating ideas. Still, there are a number of very fundamental issues on which various schools of economic thought don’t agree – beginning with basic questions of methodology.
Regarding the place economics should have in our lives, Ludwig von Mises once wrote:
– Inflation, Shortages, and Social Democracy in Venezuela (Ludwig von Mises Institute, Nov 29, 2013):
The economic turmoil in Venezuela has received increasing international media attention over the past few months. In September, the toilet paper shortage (which followed food shortages and electricity blackouts) resulted in the “temporary occupation” of the Paper Manufacturing Company, as armed troops were sent to ensure the “fair distribution” of available stocks. Similar action occurred a few days ago against electronics stores: President Nicolás Maduro accused electronics vendors of price-gouging, and jailed them with the warning that “this is just the start of what I’m going to do to protect the Venezuelan people.”
Earlier this month, in another attempt to ensure “happiness for all people,” Maduro began to hand out Christmas bonuses, in preparation for the coming elections in December. But political campaigning is not the only reason for the government’s open-handedness. The annual inflation rate in Venezuela has been rapidly rising in recent months, and has now reached a staggering 54 percent (not accounting for possible under-estimations). Although not yet officially in hyperinflation, monetary expansion is pushing Venezuela toward the brink.
In such an environment, paychecks need to be distributed quickly, before prices have time to rise; hence, early bonuses. This kind of policy is nothing new in economic history: Venezuela’s hyperinflationary episode is unfolding in much the same way Germany’s did nearly a century ago.
– Obama’s ‘Socialism’ Experiment Brought Home (ZeroHedge, Nov 8, 2013):
Submitted by Martin Armstrong via Armstrong Economics,
An economics professor at a local college made a statement that he had never failed a single student before, but had recently failed an entire class. That class had insisted that Obama’s socialism worked and that no one would be poor and no one would be rich, a great equalizer.
The professor then said, “OK, we will have an experiment in this class on Obama’s plan”.. All grades will be averaged and everyone will receive the same grade so no one will fail and no one will receive an A…. (substituting grades for dollars – something closer to home and more readily understood by all).
– To Boldly Go Where No Socialist Has Gone Before: Venezuela Creates Ministry Of Supreme Happiness (ZeroHedge, Oct 26, 2013):
If one (such as everyone at the Federal Reserve) thought that the world’s greatest artificial “wealth effect” would also generate the world’s happiest people, one would be dead wrong.
Take Venezuela – Hugo Chavez’ socialist paradise, which was recently inherited by Nicolas Maduro, when he proceeded to not only completely devalue the local currency but to engineer, through such exquisite central-planning that even the Politburo at the Marriner Eccles building is green with envy, the highest returning stock market on earth in 2013. Alas, either the locals are not quite as impressed with the Caracas’ “stock market” YTD return of over 300% (which doesn’t quite cover the loss in purchasing power for what things one can actually purchase in Venezuela)…
… or the chronic toilet paper shortages remind them that the phrase socialist utopia is the world’s greatest oxymoron.
As a result, president Maduro has decided to boldly go where no socialist has gone before and has unveiled a new Vice Ministry of Supreme Social Happiness, whose primary purposes will be to enforce “happiness.” In other words, something along the lines of the beatings will continue until happiness returns…
Americans may have the constitutional right to pursue happiness, but Venezuela now has a formal government agency in charge of enforcing it. President Nicolas Maduro says the new Vice Ministry of Supreme Social Happiness will coordinate all the “mission” programs created by the late President Hugo Chavez to alleviate poverty.
From the article:
“It is like a textbook case in government gone mad.
They have stolen the retirement accounts, devalued the currency, and put capital controls in place. There are trade controls so that people can’t import necessities into the country, but instead, have to manufacture them locally, with the government giving monopolies to their friends. They have price controls, which force the local supermarkets to not raise their prices. This will ultimately lead to shortages. And there are already shortages of certain items. They didn’t like an opposition newspaper, so they nationalized the newsprint manufacturing industry. In fact, just about every single thing that you could do to screw up a country, they have done. It is comical to see the extremes they have gone to. For example, in Argentina, if you publish an inflation statistic that differs from of the official government numbers, you could be hit with a $100,000 fine. I had never heard of this anywhere else – except maybe in communist Russia. They are really completely out of control and the country is spinning off into la-la-land.”
– Argentina’s Economic Collapse (Full Documentary)
– Lessons from Economic Crises in Argentina (Casey Research, June 5, 2013):
Nick Giambruno: Joining me now is David Galland, the managing director of Casey Research. His internationalization story, which involved moving his life and his family from the US to Argentina, was recently featured in Internationalize Your Assets, a free online video from Casey Research. He is perfectly suited to help us better understand some of the important lessons in internationalization that Argentina offers. Welcome, David.
David Galland: Nice to be here.
Nick: First, why don’t you give us a little background about the Argentine people and how they have learned to deal with their government and recurring financial crises?
– After Cyprus, Who Is Next? (Zerohedge, March 16, 2013)