El Estímulo has a specially important and, to my mind, terrifying piece yesterday. It turns out Guárico State Governor Ramón Rodríguez Chacín has decided that, in order to sustain Guariqueños’ access to the product, rice may not be physically transported outside of Guárico state.

It’s a mad decision, the kind of microprotectionist restriction that, in other contexts, has set the stage for outright famine. In Ukraine in 1932-33 and in Bengal ten years later, bureaucratic decisions to stop food from moving from food-surplus to famine areas played a major role in precipitating catastrophe.

But one other thing tipped those places: the absence of democracy, and of information. As Amartya Sen famously argued, famine is very seldom a function of absolute lack of food: much more often famine takes place where there’s plenty of food around, but the people who need it most can’t get to it. And that happens where government’s are undemocratic and, crucially, where information about the famine can’t flow.

Which brings us to VP Deputy Manuela Bolívar. It was Manuela who took Rodríguez Chacín’s alarming memo to El Estímulo, blowing the whistle on a blunder that could have incalculable consequences.

documento-arroz-guaricoIt may not seem like that much, but Bolívar’s gesture, and El Estímulo’s bravery in publishing it, constitutes Venezuela’s best line of defense at this point against an even greater tragedy. We have serious theoretical reasons to believe that keeping information flowing actually can prevent a famine. It’s…no joking matter.

19 COMMENTS

  1. Thanks for writing about this. I was about to. Allow me to put some background for foreigners about who Rodríguez Chacín is:

    Military Chacín was a military who took part in actions against the lefty guerrillas before Chávez came to power. He was even going to take part in the Amparo Massacre so often quoted by Chavismo as example of the previous governments’ track on HR, but had a helicopter accident shortly before that (look for Provea, Chacin Amparo)

    Chacín apparently had over 1000 hectares of land, which later passed to be property of his daughters..he got them some time between 1998 and 2006. He is also known for his connections to the FARC, which met in one of his haciendas.

    Chacín as minister of Interior also had a peculiar way of talking about crime: for him, most people dying by violent means were suicides, a certain murder was something that happened among “indigentes” (homeless) fighting each other, etc.

    http://www.eltiempo.com/archivo/documento/CMS-3811454

    This piece of news shows what I have always said: Venezuela, in spite of the social mobility possible during oil booms, is still a profoundly feudal country.

  2. The governors decision involves a deeper issue , because what it proposes is the idea that each part of the country see itself as separate from the rest in the pursuit of its own best interests , which means that Venezuela no longer exists as an unified state but rather as a collection of independent regions each protective of its own parochial interests , taking the notion a step farther it would allow the argument that if more export oil is produced by certain states then they should have the lions share of the taxes produced by such oil exports, in which case Guarico should be returning a big chunk of the public money its recieved throughout the years……. and which it had no role in producing …..!! This is plainly absurd and speaks of a country on the verge of feudal like fragmentation, a country in danger of ceasing to be a modern nation state in the ordinary sense of the word…..the regional tribalization of Venezuela after two hundred years of its existence as a unified country….!!

  3. How would you like to be the guy staring over the shoulders of the bureaucrat who is in charge of measuring the actual quantities of food being imported into the country (few people know the real numbers), adding to that the dwindling home-grown food production, vs. the actual daily food consumption rate of the average Venezuelan? Those figures may be the scariest numbers in all of South America.

  4. I’m not exactly sure how many times famine has been due to not moving food from where it is produced to where there is need and how many times it has been because army thugs come to where it is produced and get 100% of everything leaving farmers to eat nothing, but when you are getting to the point to actually think about this, then you are about to find out, I think…

  5. This actually fits disgustingly well with the induced famine strategy of chavismo, which is this year’s “AZO”, another sequel of those “giveaway” events that begun with the “dakazo”, then it come the “huevazo” and now it is the “comida-regulada-azo”, where chavismo “miraclously gives away for cheap” a certain stuff to buy votes, often destroying the country’s economy even more with each one.

    With the dakazo, it was cheap appliances at the illusory 1$=6,3 Bs price, which was possible because Daka is owned by Tarek Alsaimer aka the “Aragua taliban”, the huevazo came on the back of a pathetic decree to lower the egg prices to 420Bs courtesy of imbécilus in extremis Jorge Arreaza aka “perchero married to a daughter of the corpse”, the decree was promptly reversed and eggs are in their market price today.

    Now the planified famine comes in the frame of the dictatorship decree with the so-called production comitees (claps), which are simply groups of highly partisan crazed chavistas which will handle the people’s money to buy the regulated products (Products that experienced absurd raises in their prices past week, in most cases above 70 and 200%) and will handle later the famous food bags, which will only result in a more blatant thievery to divert all those products straight to bachaquero mafias to keep stealing from people.

    • Are prices being freed or raised by decree?
      If they are being freed shortages should abate. Seems like a step in the right direction.

      If they are raised by decree then shortages will become cyclic as products will appear and disappear in waves. Still it must be an improvement over the current situation.

    • Are prices being freed or simply raised by decree but still controlled?
      If it is the former then it is a step in the right direction. Scarcity should abate shortly.
      If it is the latter then the scarcity will be a cyclic phenomenon with products appearing in waves when prices are adjusted. Still, it should be an improvement over the current situation.

      • Sorry for the double post. The first time it did not seem to show up.

        Anyway I just found out that they are by decree:
        http://elestimulo.com/elinteres/nuevos-precios-panales-papel-toilet-higiene/
        Interestingly enough (but not surprising), most of the comments are condemning the raise in prices and berating the bachaqueros.
        Only a few are like this:
        “Que los pongan al precio que mejor les parezca pero que aparezcan nojodaaaaaa”
        “Price them whatever they want but make them appear, f….k!”

        Which shows that only very few people realize that the cause of the bachaqueros, high prices and scarcity are the low regulated prices, and that the solution is to deregulate the prices.

        • And stopping the communist madness where the government deliberately destroys the private sector, PYMES first, to favor monopolies for political reasons (Example, Cisneros has been making a killing with chavismo, first he’s got the monopoly on television when RCTV got shut, and now he has the monopoly over beer now that Polar is out of that game too)

          And, government-controlled monopolies are the basic tool for political domination that communism uses.

  6. Food-hoarding in one province directly negates the idea that Venezuelans are a single unit.

    Guariquenyos can now say: “La cosa va mal, pero al menos no tenemos patria.”

  7. Blunder after blunder after blunder. The stupidity is just non-stop. Not so different than keeping electricity going in Caracas but screwing the rest of the country. The mentality of these people is really frightening.

  8. Reading about the Bengal Famine it is interesting to note how the government reacted during the crisis:
    – Denial.
    – Blaming producers.
    – Price controls.

    First and foremost was denial. They seem to be truly convinced that there was enough food and that the scarcity was because some people (producers among them) were hoarding the product. Sounds familiar?Even Amrtya Sen argues that this was the case, but others refute him with good arguments.

    Rice prices were very high due to the scarcity but they argue that producers would not sell because they did not need to sell as much rice to make the same amount of money. Which seems a totally crazy argument that goes contrary of the logic of any business. They mean producers were hoarding rice BECAUSE prices were high? That they preferred to hold on to a perishable product instead of making a killing and getting the cash? It seems absurd. Their version of “Economic war” I guess. (BTW, it was 1943, the world was at war at the time, a real one).

    The other similarity is the policy implemented: price controls. It is a knee-jerk reaction of politicians with little understanding of economics. To me that explains very well the famine. Regulate the price down therefore stimulating: consumption, hoarding and outflow of the products and scarcity becomes famine. Those with money can eat while others starve.

    The correct measure would be let prices rise (as it happens naturally during scarcity) and provide government subsidized food and aid for those in need (yes, like Mercales).

  9. The Guarico rice will find its way to the highest bidders/bachaqueros/corrupt govt./military officials, with higher prices to the general Venezuelan public than if distributed through govt. price-controlled distribution centers..

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