Jon Miltimore on Venezuelan "privatization"

It seems that after much pain and suffering, even socialist leaders in Venezuela have conceded that they cannot run an economy with enough efficiency to avoid economic ruin. But while returning enterprises to private owners is a step in the right direction, it’s hardly accurate to call Maduro's strategy “capitalism.” 

The Maduro government is still using everything from price controls on food to minimum wage hikes to currency manipulation to manage its economy, not to mention selecting which businesses get to participate in its privatization efforts (and who gets to invest). In terms of overall economic freedom, Venezuela ranked 179 out of 180 countries in 2020—one place ahead of North Korea and one behind Cuba. 

At best, Venezuela’s current economic system is a form of fascism, which Sheldon Richman once described as “socialism with a capitalist veneer.” 

So while applauding Venezuela’s small but important step, we should not lose sight of an observation from Nobel Laureate economist Vernon Smith, who in 2018 noted that prosperity would return almost at once to Venezuela if politicians repealed their harmful policies and unleashed the power of markets.

~ Jon Miltimore, "Bloomberg: Venezuela Turns to Privatization After Being Bankrupted by Socialism," FEE.org, February 16, 2021