Believe it or not, in 1980, which wasn't that long ago, Venezuela was the richest country in Latin America. It had the highest wages. It had the best health care and education. It also had, by the standards of the region anyway, a famously stable democracy.
Then came an energy crisis, and Venezuela wound up with inflation. At times, it reached 100% a year. Inflation makes people poor. So, in a very short time, the poverty rate in Venezuela doubled.
By 1995, 66% of all Venezuelans were impoverished. Getting poorer tends to make voters radical. So inevitably, Venezuela got radical politics. You know what happened next. Venezuela is now rated one of the most miserable places on planet Earth. A few years ago, citizens in Caracas were reduced to eating zoo animals. There was no food and for that matter, there was no electricity. So, in just half a lifetime, an advanced society had reverted to the Stone Age.
The United States is not in danger of becoming Venezuela next week, but we are moving closer to it. Inflation is a big part of the reason. Of all the economic crises the country can face, inflation is the most dangerous. Inflation doesn't just make people poor. It totally destroys their confidence in their leaders, the authorities who issued the now worthless currency they're using for toilet paper. Inflation is not an act of God like a drought or hurricane. It's an act of negligence, like drunk driving. It is proof that the people in charge are reckless and stupid. That's why inflation tends to topple governments.
Once you get inflation, there's no pretending you've done a good job. You have not done a good job and everybody knows it.
So, you can see why the Biden administration is very worried about this. Joe Biden has historically low approval ratings. Voters say inflation is their top concern. Those two facts are directly related. Biden's most pressing task right now is reassuring Americans that he understands they're suffering under inflation and under a rapidly worsening economy, and he's got a plan to fix it. If he can't convince Americans of that, it may be a long time before we have another Democratic president.
Thankfully, Joe Biden has a plan, or at least a new publicist, a silver-tongued wordsmith/policy guru called Karine Jean-Pierre. It is Karine Jean-Pierre's job to take this message of economic hope to the American people and save the Biden administration. She started Monday. Here were her first words from the podium....
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