Saturday, 23 August 2014

Socialism in action...doing what it does best, making poor people poorer


Venezuela is fast becoming today's example of socialism and of how it starts with excitement about liberty, crushing the Yankee Devil, taming big business and eliminating poverty. And soon turns to control, suppression, rationing and shortage:

Venezuelan President Nicolas Maduro announced Wednesday that the country will introduce a mandatory fingerprinting system in supermarkets. He asserted that the plan will keep people from buying too much of any single item. 

But, you ask, why would anyone want to buy 'too much of any one item'? When I go to the supermarket, I buy to suit my immediate requirements. Since capitalism has given me a fridge freezer, I'm able to buy good for the whole week but that's it. The reason for buying 'too much of one item' is simple - the buyer anticipates shortage. We see this occasionally when some tabloid newspaper creates a scare over a consumer product's availability. But for government to seek to stop such buying behaviour, shortages have to be the norm.

And this is the case with Venezuela - the country where a smart phone app locating supplies of loo paper was developed. The government, having condemned the businesses making and distributing food and other consumer goods decided that it should intervene - controlling supply, setting prices and generally throwing its weight around in the marketplace. Such activity is justified, the government says, so as to allow the nation's poor to live more dignified lives.

The problem is actually pretty simple - by fixing prices artificially low (to help the poor) Venezuela's government created shortages. Now they've blamed variously the CIA, the political opposition and business in general for the problem using these perceived attacks on the socialist revolution in Venezuela to justify first the introduction of ID systems (described in the Guardian as "a grocery loyalty card with extra muscle") and now the use of fingerprinting to prevent 'hoarding'.

"We are creating a biometric system … to function in all distribution and retail systems, public and private," Maduro said in a televised address on Wednesday. "This will be – like the fingerprint scan we use in our electoral system – a perfect anti-fraud system."

So what's the problem here? Essentially the problem is socialism and its adherents' belief that you can abolish the market. For what Venezuelans are doing is variously: buying cheap stuff in Venezuelan shops and taking it across the border for resale at the price it should have been or else simply reselling it to other Venezuelans. Either that or else not having bread, oil, flour or loo paper because there's none to buy in the shops.

We can laugh a little as we are reminded again that fixing the price and supply of basic goods - especially while indulging in an inflationary splurge of oil money on public infrastructure - really isn't a great way to manage the economy. We can make jokes about the stupidity of socialism and make fun of Venezuela's fans like sweet little Owen Jones. But we should not forget that the current leader of the UK's opposition supports price fixing - for energy prices, for train fares and probably for anything else that gets him the votes of the ignorant.

Socialism is lovely. It's adherents are often caring, sharing folk who want the world to be a better place. But, put into action, socialism results in poverty, unemployment, authoritarian government and shortages of life's essentials. The losers in all this are those without the connections or the wherewithal to survive - the very people that socialism claims to support - the poor. As one Venezuelan put it:

 "The rich people have things all hoarded away, and they pull the strings," said Juan Rodriguez, who waited two hours to enter the government-run Abastos Bicentenario supermarket near downtown Caracas on Monday, then waited three hours more to check out.

The terrible thing is that this man, having spent five hours getting basics at a supermarket, still believes the socialists when they blame the rich. It's good politics but, like those who want to blame immigrants, simply isn't true and those setting out the policies know that it isn't true. The fault here - and every time with socialism - rests with the government.

Every time socialism is tried - and Argentina is now having another go at it - it fails. Yet another generation of people who care about the poor, who hate America and believe business is exploitative will come along, get power and prove again that socialism doesn't work. The saddest thing here is that, as that man in the Caracas supermarket queue points out, the rich seldom lose out under socialism - it's the poor that lose out.

Socialists may often be lovely caring people. But socialism is evil.


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