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Hornberger’s Blog Index

Going the Way of Zimbabwe and Venezuela?
by Jacob G. Hornberger

The next time some conservative or neo-conservative tells you that inflation is a good thing for Americans because it makes “our” exports less expensive for foreigners, ask him why the citizens of Zimbabwe are having a difficult time making ends meet. In that country, inflation is estimated at more than 26,000 percent. If a little inflation is beneficial to the people of a country, wouldn’t you think that a lot of inflation would be even better?

According to an article in the Washington Post, families in Zimbabwe are struggling just to survive. Growing numbers of people are becoming foot commuters, given that a short trip to work can cost commuters an entire week’s salary.

Yet, only a decade ago Zimbabwe was one of Africa’s most prosperous nations. What happened? Socialism and interventionism happened, along with the printing of the money to pay for the government’s ever-increasing expenditures.

The government confiscated land owned by white-owned commercial enterprises to give it to the poor, which destroyed the businesses and left many poor blacks out of jobs. It also engaged in urban-renewal projects, which threw the poor out of their homes, leaving them further away from their places of work. It engaged in massive spending projects, printing the money to pay for them.

The situation is not much different in Venezuela, where President Hugo Chavez has foisted socialism and interventionism onto that nation. Despite the fact that the government owns the nation’s oil and gas, the nation is being plunged into greater depths of poverty.

Inflation in Venezuela is soaring, given the fact that the government is simply printing the money to pay for its socialist projects. It’s even against the law for anyone to publish the true exchange rate (i.e., the black-market rate) of the national currency.

Venezuelans are growing increasingly disenchanted with Chavez’s domestic policies. Staple foods are difficult to find, no doubt because of government price controls. Chavez is even threatening to nationalize food distributors that are caught hoarding food.

Not surprisingly, Chavez is drumming up foreign policy crises to distract people’s attention and to cause them to rally ’round the flag, much as U.S. officials do here in the United States when the citizenry begin to stir.

Any U.S. conservative or neo-conservative would quickly recognize the root of the problems facing both Zimbabwe and Venezuela, which is why neo-cons spend much of their time writing about the problems facing foreign countries. The blind spot that neo-cons have is that they cannot bring themselves to recognize is that just like the situations in Zimbabwe and Venezuela, the U.S. government is the root cause of the economic problems facing Americans.

That’s why the dollar is crashing in international markets. The Federal Reserve is working the printing presses overtime to pay for the ever-mounting federal debt and expenses, just like the Zimbabwe and Venezuelan governments are doing. Given that the American people are beginning to stir, the federal government is sending American taxpayers some “free money” that is intended not to stimulate them, as the government claims, but rather to calm and pacify them, which is no different from what the Zimbabwean and Venezuelan governments do to calm and pacify their people.

Of course, there is also the constant drumbeat of fear from “the terrorists” that serves to remind Americans that their only real friend and protector is the federal government. Never mind that it’s the federal government’s own policies (e.g., killing people in Iraq) that is the source of the terrorist threat. It’s not a new trick. As Madison pointed out, “Among the Romans it was a standing maxim to excite a war, whenever a revolt [among the citizenry] was apprehended.”

Unfortunately, most Americans still don’t want to confront the truth — that their federal government and its socialist, interventionist, and imperial policies are the problem, not the solution. That’s why most Americans continue to look to the federal government as their savior, even as many Zimbabweans and Venezuelans are beginning to recognize the truth about the economic problems in their countries.

Jacob Hornberger is founder and president of The Future of Freedom Foundation. Send him email.

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