« California Careens Toward "Financial Armageddon" | Main | Showtime Digs for New Lows »
December 11, 2008
Chavez's Revolution Follows Oil Prices Down
Just as the economic crisis was caused in part by fools who thought housing prices would keep going up indefinitely, Hugo Chavez's nascent socialist dictatorship is based on perpetually rising oil prices. As oil prices fall, so does Chavez — flat on his face:
Premising his government spending on perpetual rises in oil prices, he's now facing an economy with 40% inflation and not enough foreign reserves to cover exports. It's a classic recipe for trouble. …
After posting a surplus of 12.5% of GDP this year, and spending at least 4.5% of GDP on a stimulus package of soup kitchen offerings, Chavez is now down to his last $87 billion in reserves, having created nothing of permanent value. Next year, S&P estimates a wild swing into deficit by Venezuela, forcing devaluation.
Oil prices habitually fluctuate wildly. Energy companies stay in business by investing in infrastructure when the price is up, allowing them to survive when it's down.
Authoritarian socialists aren't so forward-looking. The good news is this could mean the demise of Chavez. The bad news is that the same sort of thugs have been taking over our government. Looting "windfall profits" from oil companies could put them in the same boat as Venezuela.
On a tip from Charles O.
Posted by Van Helsing at December 11, 2008 9:14 AM
Comments
As Nilson would say : Ha! Ha! Your government is going down because you only focused on one type of export!
Posted by: Bid_Daddy at December 11, 2008 9:28 AM
Surely our leaders aren't as dumb as this clown — are they?
In a word - yes.
Remember, it's all about the numbered bank account in some out of the way place. When a kleptocrat like this guy and Nazi Pelosi and company get done, so is the country. However, miraculously they 'suddenly' appear to have millions of dollars a few years later. Hmmmmmm.
Posted by: chuck in st paul at December 11, 2008 11:31 AM
If the oil prices stay down, you're viewing the next Mugabe.
Posted by: apostle53 at December 11, 2008 11:32 AM
Couldn't happen to a nicer dictator. Too bad that a lot of people will suffer, but then again you get the government you asked for.
We have what we have because the PEOPLE desired it to happen. When a country (including ours) forgets that and says "please Mr. Government, fix our lives" then you get the Hugos of the world.
Live free or die, baby!
Posted by: Matt at December 11, 2008 11:50 AM
He didn't anticipate this possibility? Chavez must be a moron. Oil prices fluctuate. To assume they'll stay high, or even more ludicrously, continue to rise, is laughable.
He's in very deep sewage right now. Time to gin up a war with Colombia or something to lay off blame for the impending hardship in Venezuela. He can't even blame Bush anymore. Tough times indeed.
Posted by: Jay Guevara at December 11, 2008 12:08 PM
Oh look he is wearing commie blood red and the clencht fist logo on dirty commies
Posted by: Spurwing Plover at December 11, 2008 12:12 PM
Looks like someone in Venezuala has enough food.
Posted by: baslimthecripple at December 11, 2008 12:28 PM
another asshat socialist dictator whos gonna destroy his country. like zimbabwe
but have any of the older posters noticed how much he looks like chet in the cult 80's movie wierd science after he was turned into a steaming pile of sh*t?
Posted by: rumcrook at December 11, 2008 8:27 PM
The blood of the inocent on the hands of commies STALIN WAS A MASS MURDERER AND THE new york slimes AND ITS COMMIE BOOTLICKER REPORTER WALTER DURANTY no wonder their losing readers
Posted by: Spurwing Plover at December 11, 2008 10:26 PM
Looking at Chavez and remembering Castro as well as Hitler and others, it makes one wonder how long it will be before Obama will not be able to give a speech without showing his armpits even more than he does now when he gives a speech.
I suspect it might have some physiologic purpose for these guys connected with oxygenating the brain or maybe pumping endorphens out of some special gland in their armpits.
Posted by: SnowSnake at December 11, 2008 11:09 PM
