Businesses quietly switch to dollar in socialist Venezuela

[Bacchus4.0]

http://news.yahoo.com/businesses-quietly-switch-dollar-socialist-venezuela-040219420.htm

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As the South American nation spirals into economic chaos, an increasing number of products are not only figuratively out of the reach of average consumers, but literally cannot be purchased in Venezuelan bolivars, which fell into a tailspin on the black market last week.

Businesses and individuals are turning to dollars even as the anti-American rhetoric of the socialist administration grows more strident. It's a shift that's allowing parts of the economy to limp along despite a cash crunch and the world's highest inflation. But it could put some goods further out of reach of the working class, whose well-being has been the focal point of the country's 16-year-old socialist revolution.

The latest sign of an emerging dual-currency system came earlier this month when Ford Motor Co. union officials said the company had reached a deal with officials to sell trucks and sports utility vehicles in dollars only.

A few weeks earlier, American Airlines announced that it had stopped accepting bolivars for any of its 19 weekly flights out of Venezuela. Customers must now use a foreign credit card to buy the tickets online. Virtually all other foreign carriers have made the same switch with the government's consent, according to the Venezuela Airlines Association.

[stevenleser]

1. People would do well to remember this is happening in an oil rich country

Even a country literally awash in petroleum resources is having a hard time making it as it becomes more and more Socialist.

Whatever blend of capitalism and socialism is ideal, Venezuela is considerably over that on the socialism side.

[Bacchus4.0]

2. They've never invested in other industries so are completely dependent on oil

Its not a new problem in Venezuela that the economy is not diversified. However, the situation has exacerbated under hugo and Maduro. Another in one of their long list of failures.

Mexico, Ecuador, and Colombia are petroleum producers but are not as dependent on the energy sector.