
Venezuela just defaulted, moving deeper into crisis - Shivetya
http://money.cnn.com/2017/11/14/news/economy/venezuela-debt-default-sp/index.html
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dgritsko
> Since Venezuela doesn't have the money to pay all its bondholders right now,
> investors would then be entitled to seize the country's assets -- primarily
> barrels of oil -- outside its borders.

Is there any historical precedent for a scenario like this?

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caiob
I'm no anarchist nor know about all the technicalities involved, but at what
point does Venezuela become vulnerable to invasions from countries which they
share a border with (E.g. Brazil, Colombia)? I'm assuming if you don't have
enough money to run a country, you certainly don't have enough to protect the
border and power the military.

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caio1982
Why would any other south american country invade Venezuela at all due to
defaults?

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donatj
Oil. Venezuela has an ocean of the stuff.

So much so they decided to base their _entire_ planned economy on it, which
didn’t exactly work out.

Almost like an economy that can adapt on its own might be a better idea, but I
digress.

~~~
TremendousJudge
>Almost like an economy that can adapt on its own might be a better idea, but
I digress.

Works just fine in the US. Not like people are dying on the streets due to
lack of healthcare or anything

~~~
donatj
Lived here my whole life, never seen anyone die in the street. Anyway a few
people needing healthcare vs everyone literally starving, I know what I would
take.

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thisisit
They have an alleged drug trafficker running negotiations, so this might not
end well: [https://www.bloomberg.com/news/articles/2017-11-06/drug-
king...](https://www.bloomberg.com/news/articles/2017-11-06/drug-kingpin-
leading-venezuelan-bond-talks-has-a-violent-streak)

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thriftwy
I wonder how you get here while exporting $20B of oil annually.

Where did all the money go?

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microcolonel
> _Where did all the money go?_

TL;DR: Socialism.

NTL;WR: Capital flight caused by the arbitrary seizure of private property.

Longer still: They allowed the state to control the oil revenues entirely, and
because they wanted to enrich themselves, they promised unsustainable
entitlements to the public which eventually fell through when the oil price
dropped slightly. Because they didn't give a damn, the private sector was not
involved to invest any portion of the revenues, and the government couldn't
possibly care less to invest them. Now lacking the revenue they took for
granted, the entitlements they promised the public have bankrupted the state,
and all good-natured attempts to liberalize the economy (which could save it
literally at any point, but with increasing transitional pain) have seemingly
been met with threats against life.

Added: Hey cowards, if you dislike this post so much, why don't you make a
reply and tell us all why it's wrong? There is probably a civil war on the
horizon and you can't help but QB the ideology of the establishment which has
turned Venezuela from a forward and developed country with a bright future
into a prison hellscape of rape, murder, and mugging.

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lawlessone
They do it so wrong and it seems like countries like Norway ,Sweden etc seem
to get the balance right.

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ameister14
Norway and Sweden are capitalist states with significant social programs. The
government does not own the means of production and doesn't completely manage
the economy - they just tax it; in fact they don't even tax corporations all
that heavily.

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jbooth
Norway's doing something very similar to Venezuela as far as nationalized oil
going to the public purse, and it's working out great for them.

When social-democratic countries screw up due to authoritarianism and
corruption, it's 'because socialism'. When capitalist countries screw up the
same way, and there have been a lot of them, it's because of the corruption.

~~~
ameister14
>Norway's doing something very similar to Venezuela as far as nationalized oil
going to the public purse, and it's working out great for them.

They did it in a completely different way, though, and the funds were managed
and executed differently. Norway helped establish a company and essentially
behave as shareholders, with their share revenues going into a fund that
reinvests it in stock internationally. They deliberately do not depend on it
to subsidize social programs entirely and only withdraw 3% per year.

Venezuela's leadership actively controlled the fund and used it to support
wide-reaching social policies that could only be sustained with new revenues,
pushing more oil production and making it a larger percentage of their economy
which ultimately caused massive failure when the oil prices went down, they
were producing at high capacity already and they couldn't get rid of the
social programs.

~~~
mcv
So the difference is that Norway uses it carefully, while Venezuela uses it
recklessly. It's not the idea that's the problem, it's the way it's applied.

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ameister14
Sure, the idea that the State can get revenues from investments in the economy
and put it in a sovereign fund is not the underlying problem.

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tibarun
Fake empire news. [https://www.telesurtv.net/english/news/-Venezuela-Holds-
Firs...](https://www.telesurtv.net/english/news/-Venezuela-Holds-First-
Meeting-With-Bondholders-20171113-0025.html)

