Thursday, February 08, 2007

A Quick Economic Lesson for Hugo Chavez

When you regulate prices, it affects supply. When you regulate prices to the point that suppliers can’t make a profit, you get shortages.

The news out of Venezuela today is that meat and sugar are now only available on the blackmarket at steeply inflated prices. So, while Chavez is busy trying to make Bush look bad by providing discounted oil to the poor in the US, his own people can’t even buy chicken breasts at the market.

The government is blaming ‘hoarders and speculators’ and seizing goods in warehouses, but this will only work until those goods are exhausted.

Maybe a US meat company should offer discounted meat to poor Venezuelans and find a no longer relevant Kennedy's to do the public interest commercial.

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