CARACAS, Venezuela (AP) — Venezuelan President Nicolas Maduro is extending price controls and will place limits on profits as he extends attempts to curb the galloping inflation that is eroding support for his rule.
Maduro made the announcement in a late-night television address Sunday in which he also vowed to step up inspections of businesses selling shoes, clothing, automobiles and other goods to make sure they aren't gouging consumers.
"We can't just close the businesses; the owners have to go to jail," Maduro said in an impassioned speech in which he cited Jewish, Muslim and Christian texts to harangue businessmen he accuses of usury. "We can't allow our hard currency to be used to rob people through the sale of these goods."
Huge crowds of government loyalists and opponents formed outside appliance stores over the weekend after Maduro ordered the military to occupy the Daka chain of electronic stores and slash by more than half prices for washing machines, televisions and other white goods.
While soldiers with assault rifles were deployed to keep bargain hunters in check, at least one Daka store, in the country's third largest city of Valencia, was looted by unruly crowds, according to photos and videos posted online.
Maduro Sunday night urged Venezuelans to remain calm, saying that he won't allow the "parasitic bourgeoisie" to overcharge consumers ever again.
Read more: Venezuela to toughen price controls, set profits - New York News
A simple question for our family here at DP....
With progressive liberals often taking this kind of hyperbolic line against Corporations, and business in general, are we to see this type of open attack against business? I think that some in America believe in this sort of thing, and would love to see this....
Your thoughts?
A regime is approaching its end, when it needs to resort to price controls. That means that its business model does not work. Problem is that it can still take quite some time to fall. That means the period of pain to the population can be extended.
A simple question for our family here at DP....
With progressive liberals often taking this kind of hyperbolic line against Corporations, and business in general, are we to see this type of open attack against business? I think that some in America believe in this sort of thing, and would love to see this....
Your thoughts?
When I was in Vietnam in the 1960s, the rice merchants had cornered the market on rice and the price of this staple food was going out of sight in Saigon and perhaps all of South Vietnam, but I can only speak for Saigon. Nguyen Cao Ky warned the rice merchants to relent on the price or he would execute them. They did not relent and he executed four of them on poles in downtown Saigon. The price of rice dropped precipitously the same day. No more problem. Sometimes extreme action is the only thing that works.
When I was in Vietnam in the 1960s, the rice merchants had cornered the market on rice and the price of this staple food was going out of sight in Saigon and perhaps all of South Vietnam, but I can only speak for Saigon. Nguyen Cao Ky warned the rice merchants to relent on the price or he would execute them. They did not relent and he executed four of them on poles in downtown Saigon. The price of rice dropped precipitously the same day. No more problem. Sometimes extreme action is the only thing that works.
How's gas at $.2/gallon, $.05/liter workin' out? That doesn't even cover basic environmental costs, let alone labor and infrastructure. Free gas for votes.
And what corporate CEO's heads would you like to see on pikes? :shock:
Seriously though....You really think that government control over business is the answer?
Sometimes. That's why I posted the information. That worked and at the time was probably the best solution. Authority was exerted and problem resolved. Circumstances vary. Think about how you are going to address Global Warming for your children's and grandchildren's sake. Paradoxical, don't you think?
Oh yeah, no doubt...How do you think the anti corporatism folks in here think about this...I mean there is a strong support for this type of thing right here in America...Everything from anti Walmart, oil companies, banks, to health insurance....This is what some of our progressive posting family right here think is the solution.
A simple question for our family here at DP....
With progressive liberals often taking this kind of hyperbolic line against Corporations, and business in general, are we to see this type of open attack against business? I think that some in America believe in this sort of thing, and would love to see this....
Your thoughts?
Oh yeah, no doubt...How do you think the anti corporatism folks in here think about this...I mean there is a strong support for this type of thing right here in America...Everything from anti Walmart, oil companies, banks, to health insurance....This is what some of our progressive posting family right here think is the solution.
The problem is simple. Venezuela was ruled for decades by the right wing corporations and elitists and left 90+% of the population in uttter poverty and despair. Chavez was the reaction and the policies, miss-guided as they are, are also a reaction.
Now the regime is grasping at straws no doubt about that, since it is their currency policy especially, that is the problem, but the real question is what is the alternative... back to the old right wing regimes that pissed on most of the population? Doubt that...
Corporations weren't the problem, dictators, and socialist political elite classes that siphoned profit from the oil boom off the top, and kept the middle class, and poor to benefit from the economic boom that could generate through out the economy is the problem
That they refuse to address their currency supply problem, and think that governmental micro management of private industry through nationalization, and Socialistic top down control is the way forward, but instead it is a failure!
Venezuela could be a shining jewel of the region with free markets, and capitalism, instead they choose to be a ****hole ruled by failed socialistic policies. What a shame.
A simple question for our family here at DP....
With progressive liberals often taking this kind of hyperbolic line against Corporations, and business in general, are we to see this type of open attack against business? I think that some in America believe in this sort of thing, and would love to see this....
Your thoughts?
Yes, but that was before Chavez and it was not "socialist" political classes. It was pro American right wing corporations and rich people who kept defacto dictators in power for decades by fixing election after election and hitting down hard on left wing parties and politicians. The country was driven on typical right wing economic policies with massive corruption at the top, and leaving the masses in the dirt. When the cold war ended, and there was no need for the US to maintain its strangle hold on central and south American countries to ward off the big bad USSR, then suddenly the times changed.. and the elections had to become more transparent and that meant a man like Chavez could come into power. When that happened, the US and its right wing allies in Venezuela even tried to topple him and have him assassinated, but that did not work and only drove him and his people even further away from the centre.
Because they tried the alternative and it did not help the middle class and lower classes at all. That is my point. This policy might be a failure, but the alternative was also a massive failure for the very people who elected first Chavez and now the new guy into office. Like it or not, life has improved massively under Chavez compared to the decades before.. that is now collapsing in part due to external factors and internal stupidity and manipulation, but it takes a hell of a lot to change the mind of the masses to get rid of the sitting government when many can remember what life was like before.
It was a **** hole before the "socialist policies", owned by mostly the top 1% who took billions out of the country every year. There was no competition before Chavez (or after for that matter), which meant a handful of very wealthy people owned pretty much everything and they did absolutely nothing to help the average man/woman. Chavez improved life for the majority.. at least for a decade or two..and that is why he has so many followers even to this day.
Even this case, the supermarkets involved are owned by former regime backers from the pre-Chavez era. Now it might not be their fault exclusively for the problems.. it is mostly the government policies, but it is very easy to point the fingers at them and do this because of the history.
There's more at stake than any one person's ability to purchase a television. If everyone woke up tomorrow to find that the American Dream was a sham and there was a corporate conspiracy to price people out of the middle class and deny them the luxuries generally available to them then there would be civil unrest, as there was in Venezuela. Its mostly about perception and corporate marketing induced expectation.
If you're making the same amount of money but couldn't afford today what you could easily purchase yesterday; you would probably be at least a little put off if the only thing that changed was the price of the product. If you recall, there was national outrage and there were runs on gas stations several years ago when gasoline prices went through the roof. Why? Because what people could easily afford in the days, weeks, months, and years before suddenly became much more expensive. In that case, the oil companies didn't necessarily do anything wrong, but people were still angry because a product they could and expected to continue to afford became much less affordable. Owning a car with a tank full of gasoline isn't a necessity, its a luxury that clever marketing and social pressure have made people believe to be a necessity.
How high do you think gasoline prices would have to rise before riots break out all over the country? Medicines? Education? What do you think would happen if everyone woke up tomorrow to find basic luxuries priced at over 1000% of the cost to produce and/or procure them? A lot people seem to be operating under the delusion that people would just accept that they can no longer afford the things which they think their income and/or social status entitles them to buy and companies would just lower prices as a result. What they either don't realize or want to admit is that corporations created a global consumer monster with their marketing and consumers tend to get cranky when they cant afford the things they could yesterday. Sometimes, price controls are necessary to maintain civil order.
Price controls don't work in the long run...Never have.
Price controls sometimes work far better than the "free market." Diamonds are a prime example of why the "free market" doesn't work in the absence of government intervention. They are one of the most common gemstones in the world with huge supply and high industrial industrial and commercial demand yet they are sold at many times the cost of the most rare gemstones on earth. Why? A combination of market manipulation and clever marketing by DeBeers.
There are three main reasons diamonds are so expensive:
1. Diamonds are historical
Diamonds have been used by many people worldwide to store and transport wealth across geographies and generations, especially people who have been persecuted throughout history and forced to migrate against their will. For instance, there are many stories in pre-WWII Nazi Germany of Jewish families trading family assets through diamonds because they were easy to conceal. (There’s actually a scene in Schindler’s List that shows some family members hiding diamonds in a loaf of bread.)
2. Diamonds are emotional, and closely tied to marketing
The popularity of diamonds is the result of one of the most successful marketing campaigns in history. This was largely orchestrated by De Beers and included product placement as well as celebrity and royal associations. The modern symbolism of diamonds along with the idea of the diamond ring as a perfect gift of love are largely creations of the marketing departments.
The DeBeers company has basically controlled the supply of rough diamonds for years. Many believe this set up to be a cartel, like OPEC.
Diamonds have been branded as the default signal for wealth, interpersonal commitment, purity, rarity, scarcity, brilliance, and all the emotions which mark each of these moments. By artificially controlling the scarcity of the product (which is not really scarce), it drives up the cost. Consumers don’t usually deviate from the norm for these special occasions. We all want the best of the best, don’t we?!
3. Diamonds are an accumulation of marginal costs (Basically, everyone wants a piece of the pie!)
If you peel back the layers of the diamond trade and think about just how a diamond gets on the finger of a young woman (or man) ready to marry, consider this chain of events:
A diamond is mined by an employee of a company and sent to a warehouse where rough diamonds are packaged together and sold to traders.
Those traders transport the diamonds to cities in the world where the best diamond-cutting talent exists, such as Antwerp, Tel Aviv, Mumbai, and places in Southeast Asia. These cutting centers buy the rough diamonds and use a mix of handmade skill and technology to cut the diamonds in the right shape and in the right way to maximize each stone’s brilliance.
The stones are put into parcels and then sold to wholesalers, who look through boxes of stones from similar lots, but are so dense that they are not able to investigate each small stone individually. Instead, they have to apply crude statistical tests on looking at small samples. The wholesalers buy up parcels and then sell the best stones to individuals, sell the majority of stones to jewelry makers, and in some cases, make standard jewelry to sell directly to retail players.
Lastly, many hands touch the diamond in making the jewelry as well, such as those who make settings, who polish the stones, and the runners who deliver pieces back and forth.
Whew, that is a lot of people in the diamond production process! By the time a wedding ring reaches someone’s finger, it has literally touched so many hands and each person in the chain needs to profit a bit from the transaction.
3 Reasons Why Diamonds Are So Expensive » Host Home Party
What would you think would make life better for the poor in Venezuela, and what policies, government, and private fixes could be put into place to make things work better for the average person there?
Do you understand why diamonds are the price they are? This may help...Although DeBeers has a part to play, the sheer amount of hands the finished product has to go through to get to your local Zales store, is amazing that they don't cost more.
I'm not talking about the Hope Diamond or the French Blue. I am actually talking about what you'd find at your local Zales store. There is only one reason why those diamonds are many times the cost of some of the rarest gemstones in the world and that reason is DeBeers. The so-called "law" of supply and demand that is the "free market" is much looser than a lot of people think. What makes the price of a television increase after Black Friday? What made it decrease in the first place? We also have things such as patents which block entry to cheaper and competing products into the marketplace. We live in a market primarily controlled by corporate manipulation of both supply and demand. Consumers don't really decide anything anymore and the "free market" is all smoke and mirrors.
Easy, an open free economy not dominated by individuals and a society where everyone has a chance. Now getting there is not easy when you have a history of the total opposite.
And if corporations are so bad, can you tell me what would happen say in the diamond industry, if corporations suddenly disappeared from the landscape?
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