Everything you ever wanted to know about price controls but were afraid to ask

Anabella Abadi and Carlos García-Soto wrote the book on Venezuela's price controls. Spanning nine decades of economic folly, it's a labour of love. Literally.

The best romances come naturally. Set dinner dates will never compare to finding that thing you don’t have to schedule to share and enjoy an intimate moment. That thing that binds you together effortlessly. Some of us find that while sharing a pizza and buffalo wings over Law and Order SVU. For Caracas Chronicles contributors Anabella Abadi and Carlos García-Soto, nerding out and writing is their thing.

“El Control de precios en Venezuela (1939-2015): De la Segunda Guerra Mundial a la Guerra Económica,” is their first book together. I say first because I’m sure (and hope) there’s so much more where that came from.

The book covers all you need to know about price controls, including their history, regulation within the Venezuelan legal system and, of course, their economic consequences. Some graphs ought to be included in high school history books, or simply tattooed (literally speaking) onto the foreheads of Venezuelan eighth graders so they can read them everyday while washing their teeth, and understand why they are not using toothpaste but a menjurje granny made instead:

The first years of price controls in Venezuela clearly revealed a pattern that would repeat itself once and again throughout history: all controls applied isolated will not keep inflation at bay, since prices will rise whenever bank bill issuing is higher to the increase of goods and services offered.

They start with Eleazar López Contreras in 1939, and with the framing of the first legal instrument to regulate a system of price controls in 1941, under Medina Angarita. It’s an interesting yet disturbing trip through (almost) 80 years of price controls which end, well, at the very End of Times, with 21st Century Socialism.

Anabella and Carlos’s work spares no detail, and the book is packed with joyful little nuggets of terror such as this paper clipping from Panorama in 1973:

Starting next Monday the housewives of Maracaibo will be appointed as ad-honorem deputies and will be empowered to apply fines to immoral merchant who speculate with food products. (Panorama, 1973)

As you can see, the madness started early on.

El control de precios en Venezuela is an important and useful document for lawyers, economists, and historians alike. It’s the kind of work we need from our academics in times such as these. It’s a reflection upon the mistakes we’ve been making (and consistently repeating) in the last eight decades as well as a guide to what’s wrong with current economic policy.

A guide to what not to do.

You can find the book at CEDICE (Edif. de la Cámara de Comercio), and soon at your local bookstore. Si los controles lo permiten.

On a lighter note: If writing is a passion that Anabella and Carlos share, it was the price control what actually brought them together. Last week was the second anniversary of the first time Carlos, a Lawyer, wrote Anabella to ask her economic insight on the subject. A question turned into a book. A book turned into a life together. One of many funny ways in which la Patria brings people together.

Unlike most Venezuelans, Carlos got more than what he bargained for.