Socialism Doesn't Fail

It just runs out of other people's money to give away.

In the case of Venezuela, the plan was simple, use it's vast hoard of petroleum to fund socialism and give away those dollars. Of course, a few would be kept for distribution to the ruling junta, but shush no one will tell. It looked good a few months back, oil was $145 a barrel and life was good for the ruling class. Not so good for the peasants, but who cares about them. Now with oil at $50 a barrel, the lessons are coming hard and fast.

The thug oil populist in charge of Venezuela said as recent as May 2008 that he was expecting oil to go to $200 a barrel, before finally stabilizing. So much for the predictive power of Hugo Chavez and his socialsim. The pie pantry is now empty, the and the bakers of the free "oil" pies are failing to perform as ordered.

How much of the scare run up in oil prices were designed by the cartel to try and forestall an American attack on Iran's nuclear weapons production, we will never know. But the back breaking effect of high oil prices on the world's economies is now well understood. We are all in it together.

Hugo Chavez has reduced Venezuela's support to foreign allies and is poised to make deeper cuts at home and abroad as plunging oil revenues hit his self-styled socialist revolution.

The government has warned of austerity measures after years of breakneck spending on social programmes, nationalisations, arms and diplomacy, an exhilarating splurge when there seemed no end to petro-dollars.

South America's energy giant relies on oil for half of its exports and 95% of government revenue, leaving Chavez's ideological and political ambitions vulnerable to a crunch. A much worse problem, since socialism has destroyed the economy of Venezuela, the future is not bright for the people.