Earlier this month, 2,700 Venezuelans lost their jobs. The Venezuelan government seized General Motors’ manufacturing plant, and the company pulled out of the country for good. The socialist government’s actions left almost three thousand people unemployed in a country where one in four are jobless.
These former employees were already living in a country where their families face massive food and medicine shortages. Now they’re without an income in a country where rampant inflation means money is almost worthless.
GM’s employees aren’t the only Venezuelans who have lost their jobs because of the government’s overreaching policies. Exxon Mobil, Clorox, Conoco Phillips, Owens-Illinois, General Mills, and Kimberly-Clark have all been forced to leave the country, leaving thousands of Venezuelans unemployed.
First They Seized the Businesses, Then the Shortages Started
Doing business in Venezuela is almost impossible. Since Hugo Chavez took power in 1999, the government has taken more than 1,200 businesses by force.
Venezuela has seized farms, bakeries, family-owned businesses, and factories owned by foreign companies. Government officials say they are expropriating the companies “for the people,” but now the people of Venezuela are starving.
With severe price controls, no property rights, no rule of law, and no way for businesses to know if they might be the next company seized, productivity in the country has ground to a halt. The country is now unable to feed itself and has to rely on imported food.
But with a failing economy, Venezuela can’t afford to bring in enough food to feed his citizens. Three in four Venezuelans say they lost an average of 19 pounds last year.
It Doesn’t Have to be This Way.
Venezuela was once the wealthiest country in South America. It has more oil than any country on the planet and is rich in other natural resources. Venezuela’s farms and factories used to be production hubs, but no longer.
Erick Brimen, a Venezuelan immigrant, told Fox Business the Venezuelan government’s implementation of price controls and other redistributive policies has “literally destroyed the fabric of the country to be able to produce some of these basic goods.”
Venezuela went from producing nearly all the sugar the country needed to becoming almost completely dependent on imports in just a decade. “Beef, coffee, toothpaste, auto parts, toilet paper and various medicines are just some of the items that Venezuela once produced on a large scale and that now must be imported to meet domestic demand,” the LA Times says.
Change is Needed
The tragic situation in Venezuela is just the latest reminder of what socialist policies can do, and it’s only going to get worse. With GM’s departure, other companies could be considering leaving the country as well, taking more jobs and money with them. Unless the country implements free market reforms, Venezuelan families will continue to suffer.