In world news, Venezuela is in the spotlight as a riches-to-rags story. The country has spiraled into an insurmountable humanitarian crisis. Its economy is imploding as inflation skyrockets and hunger and disease plague its citizens. The morbidity rate among newborn children rivals that of Syria. 90% of the country lives in poverty. This is a regional crisis, and neighboring Latin American countries struggle with absorbing refugees in search of a better life. Millions have escaped to Columbia, Peru, North America and Europe.
How did this unravel? Venezuelan president Hugo Chavez came to power in the late 90s and aimed to fight poverty, but ended up milking the oil cash cow to gain at the expense of Venezuelan economic security. The administration adopted social programs where the state owned the oil companies and production, and used its soaring oil as collateral to borrow from foreign countries. But it had no reserves, instead spending their money without considering the future. Chavez mismanaged the cash cow, and ran oil to the ground.
When countries stopped lending to Venezuela, its capital markets dried up, and the Venezuelan economy plummeted along with oil prices.
Venezuela could no longer buy food and medicine imports, and could not repay its 150B in debt. Venezuela is playing a blame game with the US, which has imposed sanctions against the country for its mistreatment of its citizens.
In Esti news, word games are my thing….