Venezuela & America : Progressive Ideologies Fail

Know this - what is happening to Venezuela is what is going to happen to America with the trend to spend more revenue then we take in. As it stands now with the debt rising every year, at some point if we continue down this path, the payments to just pay the interest on the debt will cause chaos to our domestic economy.

Given what chaos that has occurred already over the last 6 years of the Obama administration spending $trillions of dollars we don't have, little wonder many among us are beginning to understand the ideology of communist Venezuela, that is controlling that country economy, is not that much different from the progressive socialist liberal democrats that are controlling our country and driving it into a similar economic disaster.

Venezuela's Oil Troubles Will Not Be Over Soon
Source: Alvaro Vargas Llosa, "Chavez's Legacy: Venezuela in Shambles," The Independent Institute, March 4, 2015.

March 12, 2015

Venezuela's reserves, nearly 300 billion barrels according to the "Oil and Gas Journal," surpass even those of Saudi Arabia. Nevertheless, two conditions must be met in order to turn a profit. One is the ability to produce millions of barrels of crude per year; the other is the opportunity to sell the oil at a high price.

Venezuela has recently struggled to meet the first condition due to the sheer incompetence of the socialist government. Despite the price of oil multiplying by a factor of twelve since Chávez rose to power in 1999, Venezuela has been producing a million barrels less per day than before Chavez took power.

Making matters worse, 50 percent of the country's oil production going to China and Cuba to pay off debt. Consider:

• Oil prices have fallen by 45 percent, reducing revenues to less than $150 million.
• Social programs supported by fossil fuel revenue focused on handouts for food, clothing and community development conservatively report spending cuts as deep as 80 percent.
• Venezuelan debt, much of it owed to other socialist or quasi-socialist countries is expected to cost the country $11 billion for 2015 alone.
• Sector fundamentals show no indication oil will fall much lower than $55 per barrel or rise much higher than $60 in the near future.