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How Venezuela's Crisis Developed and Drove Out Millions of People

08/22/2018

Summary

While optimism is quickly diminishing for Venezuelan citizens, inflation rates are skyrocketing at break-neck speeds. Venezuela has the largest proven oil reserve in the world. But because they have so much oil, they never bothered to industrialize in any other way. They would sell their oil to other countries and then import all the goods that they needed. It seemed there was no need to produce anything else. Then the oil prices plummeted in 2014, and Venezuelans found themselves with little foreign currency and an inability to import goods like they did before. All of a sudden there was a shortage of everything, including solutions. The government attempts to fix the economy only caused inflation to increase even more and many cities are now facing power-outs, water shortages and empty shelves. Thousands of people are now fleeing the country with no choice as health care, medicine and even education for their children are more and more impossible to come by everyday.

Main Points

  • Venzuelas economy crashed after oil prices dropped in 2014
  • Governments attempts to solve the hyperinflation problem have only made it worse
  • Thousands of people are fleeing as the quality of life rapidly declines in Venezuela

Discussion Questions

  1. Was it a good idea for the governemt to try and fix the inflation problem by increasing the minimum wage and printing more money?
  2. What benefits can an economy have by having multiple industries within its own country?
  3. What would you consider to be Venezuelas biggest mistake?

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