Published by Front Page Mag
By Daniel Greenfield
The future of socialism is trading sugar for beans on social media.
Daniel Greenfield, a Shillman Journalism Fellow at the Freedom Center, is an investigative journalist and writer focusing on the radical left and Islamic terrorism.
Prime Minister Thatcher once famously observed that socialists “always run out of other people’s money.” But what actually happens when socialism runs out of money?
Venezuela, a once wealthy nation with black gold coming out of the ground, is a test case.
The socialist regime ran out of other people’s money, and then out of money, years ago. The government met protests by its starving population with a 40% minimum wage hike. That’s the usual socialist solution to what leftists call ‘income inequality’. The problem is that 40% of nothing is still zero.
The “Strong Bolivar” introduced by former dictator Hugo Chavez, who died of an overdose of Cuba’s socialist medicine, leads the world in one economic category: a 3,000% inflation rate. Currently a dollar will buy you 111,413.23 bolivars. Wait a while and there will be a better bargain in bolivars because economists are forecasting a 30,000% inflation rate. In Venezuela, even the poorest American can become a millionaire in bolivars. The only question is why would anyone actually want bolivars?
The socialist currency of the revolution isn’t counted, it’s weighed on scales. The only thing “strong” about the bolivar is the exercise you get from carrying bags of them everywhere. You could forge bolivars, but the fake money would cost you more than the real money. If you can actually print bolivars, go ahead and get in touch with the Venezuelan government which can’t afford to print its own money.
Venezuela’s central bank (under socialism, everything is centralized) can’t pay for the paper to print all the worthless money. And none of the companies that might sell the socialists the paper will take its worthless paper money in exchange for their paper. There’s no point in printing anything less than 50 bolivar notes because they’re worth less than the cost of the paper. But putting Obamanomics in action, Venezuela ordered billions more bills: more than the United States and Europe have combined.
Paying for minimum wage hikes by printing money doesn’t actually work. That 40% minimum wage hike comes as the buying power of Venezuelans can drop by 50% in one month. The socialist regime keeps printing money and inflation keeps skyrocketing. A 30,000% inflation rate by the end of 2018 is a conservative estimate. More liberal estimates peg it at 200,000%. And then the sky’s the limit.
Is Venezuela’s finance minister out of his mind? No, he’s a leftist. So he believes inflation doesn’t exist.
Luis Salas is the perfect man to head up the economies of Venezuela or California. He’s a sociologist who claims that, “Inflation does not exist in real life.”
Venezuela’s economy also doesn’t exist in real life.
See the full story here.
January 9, 2018
Link: https://www.frontpagemag.com/fpm/268930/what-happens-when-socialists-run-out-money-daniel-greenfield
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