Bob Adelmann writes for The New American about price controls put in place by Venezuelan President Hugo Chavez.
Prices are going through the roof in the South American country and it’s all the fault of the hoarders according to Chavez. So while the dictator figures he’ll nip this in the bud with price controls, citizens are lined up to buy necessities that they can—hoard.
The fact that the government’s central bank has doubled the money supply over the past four years has nothing to do with prices going up, according to Chavez. With price inflation running at an annual rate approaching 30 percent, the President prefers to blame the consumer and ignore the natural consequences of the government’s actions. Karlin Granadillo, who heads up the price control agency, said, “The law of supply and demand is a lie. These are not arbitrary measures. They are necessary.”
Like all inflating governments, Chavez has put currency controls in place leaving Venezuelans no choice–spend the depreciating currency as fast as possible.
Adelmann cites Murray Rothbard who wrote, “In every age, in every culture, price controls have never worked. They have always been a disaster.”
Dictators never learn, they can’t overturn economic law.