quote:

Venezuela annual inflation rate hits 30 percent


CARACAS, Venezuela (AP) - Venezuela's annual inflation rate has surpassed 30 percent after consumer prices surged in April.

<snip>

Venezuela's economy shrank by 3.3 percent last year amid a downturn in its all-important oil industry. It's the nation's first recession since 2003.

The country imports most of its food, and Chavez on Friday announced the government will create an import-export corporation aiming to break with the private sector's "hegemony." It wasn't immediately clear how the new state entity would operate.

Chavez said wealthy Venezuelans involved in the import business "buy abroad, come here and ask for more than it really costs."


http://apnews.myway.com/article/20100508/D9FIDGM01.html

quote:

ORIGINAL: auditguy

Technically he is right.  They do ask for more than it is worth, it is called a profit..

No...Profit is cost + markup
What something is worth is what ever the coustomer will pay for it.

This state corporation will function by buying at market outside and then selling to the citizenry at a loss. 


Do you know this or is this your opinion?
Is it possible that the state corp. would simply turn the food and recover costs?

The loss will be absorbed by the oil and energy industry, which will lead to no investment in the infrastructure of said industries.

It is a nationalized industry why would the state fail to maintain it's infrastructure?

  This will bring about even worse power shortages then already happen there and exacerbate the situation by destroying the few industries left,

How so?...By what machanism?


and in a few years the whole economy will collapse.  Chavez will use the military to stay in power of a new third world country.

Just for clarity would you please define "third world country"?


What is sad is that Venezuela was once as close to a developed nation as there was;

You are speaking of the previous dictatorship right?



with unbelievably good looking women (they still have good looking women at least, unless Chavez creates a state company to redistribute good looks). 

quote:

And finally, what incentives will possibly ensure that the things Venezuela's government imports on the behalf of the people of Venezuela will be of suitable quality.

quote:

ORIGINAL: FatDomDaddy

It's Bush's fault

quote:

ORIGINAL: auditguy

As I remember the last government before Chavez was Rafael Caldera (democratically elected). 
His was the first time in Venezuela's 139 years of independence that an incumbent government peacefully surrendered power to an elected member of the opposition.
He also was the one who let Chavez out of the joint and made it legal for him to run for public office.

By third world I mean countries that have not "developed" to the same levels as OECD countries or are in the process of regressing from that level (like Venezuela is).

Here is the list of OECD countries and their dates of entry into that group. Chili is the only South American country on the list.
AUSTRALIA: 7 June 1971
AUSTRIA: 29 September 1961
BELGIUM: 13 September 1961
CANADA: 10 April 1961
CHILE: 7 May 2010
CZECH REPUBLIC: 21 December 1995
DENMARK: 30 May 1961
FINLAND: 28 January 1969
FRANCE: 7 August 1961
GERMANY: 27 September 1961
GREECE: 27 September 1961
HUNGARY: 7 May 1996
ICELAND: 5 June 1961
IRELAND: 17 August 1961
ITALY: 29 March 1962
JAPAN: 28 April 1964
KOREA: 12 December 1996
LUXEMBOURG: 7 December 1961
MEXICO: 18 May 1994
NETHERLANDS: 13 November 1961
NEW ZEALAND: 29 May 1973
NORWAY: 4 July 1961
POLAND: 22 November 1996
PORTUGAL: 4 August 1961
SLOVAK REPUBLIC: 14 December 2000
SPAIN: 3 August 1961
SWEDEN: 28 September 1961
SWITZERLAND: 28 September 1961
TURKEY: 2 August 1961
UNITED KINGDOM: 2 May 1961
UNITED STATES: 12 April 1961

I fail to see Venezuela


I have personal experience with government run corporations in the Socialist/Communist world.  

As for maintaining infrastructure: graft and corruption ruin nationalize companies, which is why they always fail in the end.

The police,fire and utilities in the U.S. are mostly government monopolies (nationalized)and they seem to work ....is it only communist monopolies that do not work?

  Other industries would be ruined by the lack of reliable services like electricity, which would make providing customers with reliable service impossible and destroy whatever marketshare they had.

This does not happen here where we have government monopolies on utilities like electricity?
This is a link from NPR in 2006, it has gotten much worse since then:
http://www.npr.org/templates/story/story.php?storyId=5162934 

The NPR link states that Hugo Chavez is hugely popular with Venezuelans and that the infrastructure problem is more than 20 years old and that is documented in the corps of engineers report.

quote:

ORIGINAL: auditguy

I did say near first world, not actually first world.  They were starting to improve until Chavez took over.

Well according to your list only about thirty nations in the whold world fit your catagory.
I notice that Greece is on the list of the "good guys".
Did you know that there were other definitions of "third world"

As for firefighting those are public works (which are natural monopolies), which are a lot different than nationalized private companies.

I can't wait for you to fully explane the difference for me.
"Natural monopolies"????
If you want to broadcast on the airwaves with more than five watts you need permission from the government....isn't that another monopoly?

  Public utilities usually provide services that the market will not provide and when the market becomes capable of providing it then it gets privatized (like all the Baby Bells got privatized into all the different phone companies).

The baby bells got privatized????????They were part of ATT is ATT not a private corp. How many competing sewer,electric and fire departments are there?


  Also, in the US you do have indirect competition between these services in the form of cities.  Unlike in many countries, the US does not have a national police or firefighter force, it is all local. 

Who are they compeating against?

This means if the city’s police force is horrible, then the people will move out to another city,

So you really think it is realistic to imagine that all the inhabitants of philladelphia might move if they were unhappy with the cops...????

which is not always possible in more restrictive countries (like in the Soviet Union, where if you did not have a visa in the city you could not live there). 

So here the visa has a pic of benny on it

This intercity competition has led to cities with less efficient and costly services uniting their police and emergency services with the more efficient ones, and the city losing its service paying the provider city a predetermined payment for those services and capitalizing on the economies of scale.

The list of cities that have done this would fill what???? the back of a napkin?

I don’t worry about Chavez too much though, cause he is following the Zimbabwean blueprint almost to a tee.  The only ones that will suffer from his plans will be the Venezuelan citizens, and as they say, the people get the government they deserve.

quote:


DarkSteven:

Venezuela IS doing something about inflation - intimidating private sector retailers and trying to force them to sell at cost or at a loss: http://finance.yahoo.com/news/Butchers-beware-Venezuela-apf-2701351594.html?x=0&.v=4

quote:

ORIGINAL: servantforuse

The CIA should take out Chaves. This time do it right and don't screw it up like 50 years ago in Cuba. Problem solved.