Venezuelan Coffee Growers vs. the Frente Starbuckista de Liberación Nacional

Coffee, tea or me?

There’s a certain guilty amusement to seeing chavistas tangle themselves up in knots having to relearn, through trial and error (and error, and error, and error, and error…) all the lessons of the Economic calculation problem.

On any day of the week you can find the detritus of this process strewn through Venezuela’s newspapers. Administratively set prices are like a machine for generating economic chaos and absurdity, reliably pissing people off and destroying their livelihoods for no apparent reason. The government’s approach to the problem is very much like a fly’s approach to the problem posed by a pane-glass window.

Today El Nacional – still capable of doing some good journalism, presumably when its editor calls in sick – has this story telling the sad plight of Venezuelan coffee growers forced to choose between criminality and insolvency by the government’s chronically misgauged administrative price on farm-gate coffee.

So how come you can still find coffee at your local abasto? Simple: because the government imports it, from Nicaragua, for more than twice the price it offers local growers.