The Elephant in the Pernil Room: Subsidizing Pork is Madness

Maslow? Give me a break. Pernilgate isn't about food. It's about the illusion of abundance amid dire scarcity, and about the scale of devastation a government can inflict when nobody who makes economic policy understands the concept of opportunity cost.

As Pernilgate unfolded, we all watched the protests caused by the government’s failure to deliver on its electoral promise of “one vote, one pernil” with a mixture of sadness and
schadenfreude.

Some even dwelled on the esoteric question of the righteous protest.

Most, however, failed to reflect on why the hell an almost-failed state is devoting desperately scarce resources to importing expensive cuts of pork.

Pernil has been a mainstay of the Venezuelan plato navideño since the 19th century. Today, it is painfully unaffordable for people on normal incomes. The price per kilo in some unsubsidized stores hovers around four times the minimum wage.

The real scandal isn’t that some people didn’t get a pernil. The real scandal is that each family that did get a pernil condemned its neighbours’ children to starvation. 

So forget Maslow, this isn’t about food. The Christmas pernil is a mirage of luxury amid the misery and starvation provoked by the epic chavista mismanagement. It’s about the self-harming fantasy that even today the petrostate should be extravagant. 

The failure to import expensive pork amidst our worst economic crisis in two centuries betrays something else: a catastrophic failure to grasp the concept of opportunity cost. Each pernil, good for three or four meals, meant months worth of more affordable food couldn’t be brought into the country. 

The same economic illiteracy that made them think they could subsidize everything made the government think it made sense to spend millions on expensive cuts of European luxury food while children literally starve to death.

The real scandal isn’t that some people didn’t get a pernil. The real scandal is that each family that did get a pernil condemned its neighbours’ children to starvation. 

Amid this catastrophe, believing that subsidizing perniles is an acceptable state policy is not just intellectually bankrupt, it’s morally bankrupt as well

The insanity of the way we talk about this whole issue came home to me as I listened to this wonderful interview with the Portuguese Foreign Trade Minister, Augusto Santos Silva. Dryly, Santos Silva explains that Portugal is a market economy where pork production and exports are carried out by private companies, far from the Portuguese government’s control.

This was in response to Maduro’s allegation that sabotage by the Portuguese government caused the whole mess, a claim made after blaming the U.S., Julio Borges and Colombia. Of course, the real cause is that the government stiffed a Portuguese company over payments for pork purchased starting in 2016. Of course.

It’s a lesson any future government would do well to take on.

Pernil will make its way back to most Venezuelans Christmas table only once we have a market economy with a robust private sector intelligently regulated by a competent government. The plain truth of the matter is that’s until we get that, we’ll continue to see people fighting to death for toys, or girls murdered by drunken national guards while running for food.