Venezuela has the world's largest estimated oil reserves. Yet its world-low retail gasoline prices — about 6 cents per gallon — wouldn't exist without government subsidies. Now, President Nicolas Maduro is calling for a formerly unthinkable price hike. In effect, he's admitting that his supposed socialist paradise is unsustainable.
Venezuela suffers from shortages of basic goods, 56-percent inflation, poor roads, schools and hospitals and rampant crime, reports The New York Times. Yet it annually gives away gasoline and other fuels worth $30 billion, its state oil company is having to borrow millions of dollars from its central bank and it is even resorting to paying market prices for imported U.S. gasoline because of problems with its own refineries.
Mr. Maduro's being coy about when and how much he'll raise gasoline prices. That's likely because the last increase, 15 years ago, sparked riots in which hundreds of Venezuelans died. But financial imperatives force him to take political risk, which he'll probably try to lessen by earmarking the resulting revenue for housing, education or other social programs.
Maduro's dilemma is a symptom of the economic disease he has perpetuated as successor to the late Hugo Chavez. And so long as socialist policy heavy on government meddling afflicts Venezuela, yet more state intervention necessitated by prior state intervention — such as these gas price hikes — will afflict its economy.
Socialism got Maduro elected but he's finding out that it's no way to run an economy.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.