Daily Archives: August 18, 2015

The decline of socialism in the XXI Century… with Bolivia as NO exception!

Carlos Mejia writes in El Diario:

The decline of socialism in the XXI Century

When the Cold War and the dichotomy between two antagonistic economic systems capitalism and communism, ended with the disintegration of the Soviet Union and its European satellites were released, caused by internal inconsistencies, capitalism was installed as the global hegemonic system, including Francis Fukuyama to be motivated and to write “The End of History”.

Screen Shot 2015-08-13 at 12.36.10 PMHowever, Asia and Latin America reserved surprises. Indeed, when in our region, some countries, tired of supporting corrupt governments, decided to exercise the “punishment vote” to bring about change, the left was given a chance to coming to power, as it happened, among others in Venezuela, Brazil, Argentina, Ecuador and Bolivia. [from the web, I selected the photo on the left, of the “distinguished” presidents…, it says: think like Marx; govern like Stalin; and live like Rockefeller. Socialist hypocrisy]

These governments that emerged as champions of transparency and social justice, met and soon became excited with the privileges granted by the exercise of power, ignoring their origins, they abandoned their ideological and ethical principles, and set up schemes to ensure reproduction power, using the technique of personality cult around leaders created by a harsh and expensive propaganda campaign, typical of fascism.

Following the populist script, steeped in demagoguery, they dismantled the institutions, changed the constitution according to their own interests, such as immediate reelection, and when they could, indefinite. They violated the independence and balance of powers.

Taking advantage of the revenue from the super cycle of raw materials, they created a blind scheme of subsidies, which, although it had an inclusive and redistributive character, was designed to capture the vote of the poorest masses.

Despite the bad experience with public companies, they gave a new impetus and, in many cases, production companies were expropriated, in some cases with unusual enthusiasm, as in Venezuela. In the inhibition of national and international private investment, there was a significant boost to public spending, not always with much luck.

However, when the international situation changed, it darkened the outlook for the respective governments, who posed and attributed the windfall to good management.

In response, Venezuela and Ecuador got loans from China against future oil sales as an alternative source to compensate for lower revenues, and Argentina managed to make swaps to oxygenate the critical management of its scarce reserves.

Others, like Bolivia, using the services of capitalist managers, such as Merrill Lynch, launched sovereign bonds increasing external debt.

In Brazil, like it was not enough, the economic crisis confronting the corruption scandal uncovered in Petrobras, it has been an impact on the waterline of the government of Dilma Rousseff, that practically is an unburied corpse.

Venezuela, despite awash in oil, faces an impressive economic and social crisis, which already induces looting typical of terminal governments, due to the bad economic management and waste generated by Chavez in his eagerness to become a regional leader.

In Ecuador the economy is winning the politics, as the upset population has begun to rebel and confront the government of Correa, who warns that a soft coup is brewing.

In Argentina, the holy former soybeans, and the significant reduction in its export retention, which financed the policy of massive subsidies to the captive militants, has lost its capacity to generate exchange, necessary for a normal economy, which is in recession.

Given this regional panorama, bettings are expected to see which will be the first chip to fall from the populist domino.

The author is an economist.


Need say more?  NOT!

Need do more? YES, lets vote them out!!!! anytime there is an election, lets get rid of those despicable, greedy individuals!