Chronic shortages of consumer goods are a trademark of socialist and communist regimes, so this comes as no surprise:
Venezuela to import 50M rolls of toilet paper after government claims it’s wiped out
Economists say Venezuela’s shortages stem from price controls meant to make basic goods available to the poorest parts of society and the government’s controls on foreign currency.
“State-controlled prices — prices that are set below market-clearing price — always result in shortages. The shortage problem will only get worse, as it did over the years in the Soviet Union,” said Steve Hanke, professor of economics at Johns Hopkins University.
Then the government raised prices by 20%, which will eat up the 20% raise in minimum salary that went in effect on May 1st.
Carlos Eire posts on the Cubanization of Venezuela,
According to the Spanish newspaper ABC, the Maduro dictatorship is blaming its opponents for Caracastan’s toilet paper shortage.
“The Revolution will import around 50 million rolls of hygienic tissue… so our people can calm down and realize that they should not allow themselves to be manipulated by media campaigns that speak of shortages,” said Minister of Commerce Alejandro Fleming, through the state-run Venezuelan News Agency.
Minister Fleming cited facts and figures to prove that the production and importation of toilet paper was more than adequate in Caracastan, and then claimed that a “sobredemanda” — a sudden spike in demand — fiendishly orchestrated by the government’s opponents had caused the product to disappear from store shelves throughout the country.
Considering the disastrous state of what’s left of the Venezuelan economy, it’s no wonder people may have the runs,
Finance Minister Nelson Merentes said the government was also addressing the lack of foreign currency, which has resulted in the suspension of foreign supplies of raw materials, equipment and spare parts to Venezuelan companies, disrupting their production.
“We are making progress … we have to work very hard,” Merentes told reporters Wednesday.
Many factories operate at half capacity because the currency controls make it hard for them to pay for imported parts and materials. Business leaders say some companies verge on bankruptcy because they cannot extend lines of credit with foreign suppliers.
Speaking of runs, consumers who had spent hours waiting in line were stampeding in Caracas when they heard chicken parts and flour were finally available,
Nicolás Maduro tried to intimidate Empresas Polar president Lorenzo Mendoza,
accusing him of hoarding products as part of an “economic war” on the state by private business.
Mendoza, whose company is Venezuela’s biggest beer- and flour-maker, denied that and pointedly challenged the government to sell production plants nationalized under Chavez back to the private sector to boost efficiency.
Mendoza would not be intimidated, and at least for now, Maduro backed off.
Toilet paper buyers continue to wait in line,
Fleming, the commerce minister, said monthly consumption of toilet paper was normally 125 million rolls, but that current demand “leads us to think that 40 million more are required.”
“We will bring in 50 million to show those groups that they won’t make us bow down,” he said.
Hmmm… 125 + 40 – 50 still leaves you 115 million rolls short, Minister Flemimg.