Socialism is an economic system in which government controls economic activity. In Venezuela, the government took over large sections of the Venezuelan economy - including the nation's oil production industry. The nation went from being one of the world's primary oil producers to one of the most impoverished nations on the face of the earth. Even the money in Venezuelan has become so devalued that looters do not bother to pick up smaller bills. Many American media outlets used to praise the socialist economy in Venezuela; that was, until the socialists had enough time to run out of other people's money. There's nothing to praise about socialism once it ruins a nation's economy. That is the natural outcome of trying to dictate economic activity through artificial bureaucratic manipulation of prices, supply, etc., etc. Instead of letting the laws of supply and demand to freely operate thus setting prices naturally, socialists try to rig the system, but it has failed every single time, and in every single place, it has been tried in history.
"A friend recently sent me a photograph that tells a powerful story about the situation Venezuelans find themselves in now. It’s not a very good picture, really, just a blurry cellphone shot of trash: some wrapping material, an old CD — the detritus left behind after a store was looted last week in San Felix, a city in the country’s southeast.
And yet I can’t stop thinking about it, because strewn about in the trash are at least a dozen 20-bolivar bills, small-denomination currency now so worthless even looters didn’t think it was worth their time to stop and pick them up.
The photo stopped me dead in my tracks. In theory, according to the “official” exchange rate, which long ago lost even a hint of connection with reality, each of those bills is worth $2. In fact, as Venezuela sinks deeper and deeper into the first hyperinflation the Western Hemisphere has seen in a generation, bolivar banknotes have come to be worth basically nothing: Each bill is worth about $0.0001 at the current exchange rate, meaning you need to have 100 of them to equal one penny."