Through the Venezuelan Looking Glass

Despite history’s many warnings about leaders’ erratic behavior ending up in catastrophe, similar stories are unfolding today. Venezuela, despite having the world’s largest oil reserves, is suffering from severe shortages of basic supplies, a crisis that’s the consequence of increasingly absurd government policies, suggests Ricardo Hausmann, economist, Harvard professor and former minister of planning in Venezuela. “In Venezuela’s case, these policies included expropriations, price and exchange controls, over-borrowing in good times, anti-business regulations, border closures, and more.” Humans rationalize and regard bizarre policies – whether stoning women for witchcraft in 17th century Massachusetts or engaging in mass slaughter of Jews in 20th century Germany – as common sense. “Politics is about the representation and evolution of alternative belief systems,” Hausmann explains. In the United States, the Republican presidential candidate argues that “the US is led by weaklings who are being exploited by savvy foreign powers, masquerading as allies.” In the United Kingdom, advocates for ending membership in the European Union targeted immigrants and EU regulations. Alternative belief systems that rely on a few targets and easy answers are experiments that are bound to fail. – YaleGlobal