News Summary: "Venezuela crippled by 56% inflation and social unrest, but filling a car with gas is still 'cheaper than a bus ticket'"
Article by: Tom Blackwell
Article Link: 
http://news.nationalpost.com/2014/04/04/venezuela-crippled-by-56-inflation-but-filling-a-car-with-gas-still-cheaper-than-a-bus-ticket/


Venezuela is currently in a state of unrest.  The country has daily struggles with protests, riots and other acts of citizen rebellion.  In his article, Blackwell describes the country as going through sky-high inflation, having an abnormally high murder-rate, and a lack of basic items.  He claims that a large reason for the protests and upheaval is because citizens are unhappy with the government and their leader, they don't want to wait for the next election to make government changes.  He also makes it clear that analysts also see the unrest as due to the country's messy economy.  Venezuela has the largest oil reserves in the world, their economy should be booming.  However the country is misusing their precious natural resource.  In the article, it explains that domestic subsidies result in making it cheaper for citizens to fill their tank than buying a bus ticket.  Because of this, billions of dollars are being kept from Venezuelan oil companies.  At the same time, Venezuela is underwriting oil costs sales to Caribbean countries.

In class we have been discussing markets.  As we have seen, government involvement in markets can sometimes be a good thing and sometimes be a bad thing.  The Venezuelan government is costing Venezuelan oil companies lots of money because of their subsidizing requirements.  I'm wondering what would happen if there would be less government involvement in this market.  Would it help Venezuela's struggling economy? Or would it create more unrest with rising gas prices?

Venezuela's situation is a difficult one.  The country is a mess right now with political unrest and economic instability.  It is hard to suggest a resolution because their is so much going on in the country. It is also tough to fully understand the situation because the government has put regulations on the media, not allowing any opposition to the government get any television airing time.  To me, it seems like obtaining new government officials is inevitable in order to restablish order in the country.