Venezuela: Shuffling the deck chairs on the Titanic UPDATED
The president also said the central foreign-exchange board, Cadivi, would be incorporated into a separate government body overseeing external commerce.
Some Venezuelans misinterpreted that to mean that
Cadivi will be eliminated, which many interpreted as the elimination of Cadivi for the private sector, and the Government keeping the Bs. 6.3 per US$ rate to itself.
$5 says that Maduro’s regime will only increase whatever control it exerts over the private sector, Cadivi or whatever you call it. While he was at it, Maduro just created
111 new Vice-Ministers to accompany the thirty Ministers that accompany in his Cabinet. The hilarious thing is that the decree creating these new positions (Decree 730) actually says that this “optimizes” the structure of Government, not once, but twice.
I wonder how many of these new ministers are former military, a la Cuba.
The 2014 Index of Economic Freedom rates 178 countries on four broad categories, or pillars, of economic freedom:
- Rule of Law (property rights, freedom from corruption);
- Limited Government (fiscal freedom, government spending);
- Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and
- Open Markets (trade freedom, investment freedom, financial freedom).
Venezuela is 175th, or 4th from the bottom. Only Zimbabwe, Cuba and North Korea rated worse – all countries whose leaders Hugo Chavez admired.
At long last socialism
What happened yesterday is that the government doubled down on the insane economic policies that, in case you have not heard, have brought growth to a standstill, fueled inflation, generated unprecedented scarcity, and has sent the black market into overdrive.