The late, inordinately great man and economist Milton Friedman once rightly observed “If you put the federal government in charge of the Sahara Desert, in five years there’d be a shortage of sand.”
Where governments run things – shortages abound. Places with unbelievable amounts of natural resources – end up importing those very things when government controls their production.
Communist Venezuela has the world’s largest oil reserves – and it imports oil. (From, amongst other places, the United States.) Why? “The nation’s late president Hugo Chávez often boasted the South American country regained control of its oil industry after he seized joint ventures controlled by such companies as ExxonMobil and Conoco. But nineteen months after Chávez’s death, the country can’t pump enough commercially viable oil out of the ground to meet domestic needs — a result of the former leader’s policies.”
Communist China used to be a huge rice exporter. Now they are the world’s largest rice importer – despite the population’s declining rice consumption. Why? “China’s agricultural sector is declining in competitiveness. Like some other Asian countries, China has implemented state-funded strategies that encourage rice cultivation by guaranteeing minimum purchase prices. After almost a decade of government increases to these prices, they are now well over international market levels.”
Asian countries aren’t the only ones stupidly engaging in price-skyrocketing, shortage-inducing price fixing. And government ownership of production. And many, many other stupid policies. We do a lot of it – and have for decades. Most agriculture-producing countries around the world do it. More