Caracas Chronicles

Thanks to Katy for pointing to this typically flabbergasting bit of Chavez non-sense. In the context of a long-winded attack against evil, greedy, neoliberal roasters who obdurately refuse to sell coffee for less than it costs them to buy the beans and roast them, Chavez threatened to nationalize the coffee-roasting industry. Putting his most reasonable face forward, Chavez blamed hoarding by the roasters for recent coffee shortages, saying the government is willing to “pay them what the coffee is really worth” and stressing he would approve only “just” price rises.

It’s all more than this poor economics grad student can bear. The whole line of reasoning is medieval…and I mean that not as some esoteric slur, but as a straightforward description. The last time this kind of argument enjoyed intellectual standing was roughly 750 years ago, when Thomas Aquinas was on the cutting edge of economics and his theory of just price held sway. Put another way, Chavista economics has been discredited for half a millenium, give or take.

Call it Socialismo del Siglo XIII.

Of course, as a pretext to nationalize random industries it will do just fine: pinch manufacturer’s margins away through absurd price controls, and when they refuse to play along, slam them for greed and take over their industries. Can’t fail.