Two countries made the economic news recently. The first was Venezuela, which began food rationing. You need a biometric measurement, your fingerprint, to buy food, making it the first but perhaps not the last, country in the world to require more ID to purchase beans than is required to vote in the US.
Caracas has announced “it had taken over warehouses around Venezuela crammed with medical goods and food that ‘bourgeois criminals’ were hoarding for speculation and contraband.” Things are only going to get worse, as oil prices plummet, sending Caracas (as well as Tehran and Riyadh) into a blue funk. “The slump in oil prices comes as Harvard University economists Carmen Reinhart and Kenneth Rogoff warned this week that Venezuela is almost certain to default on its foreign-currency bonds. Deepening concern the South American country will renege on its debt payments triggered a selloff in its $4 billion benchmark bonds due 2027.”
The second country in the economic headlines was Britain. The UK has been told by the EU to pay an extra 1.7 billion pounds into the superstate’s coffers because ‘the economy has performed better than expected in recent years’. France on the other hand, will be awarded 790 million pounds because its economy is struggling. What message does this send to those who succeed? EU president Jose Manuel Barroso put it succinctly: the UK still has friends in EU. But ‘please keep them’”.
Welcome to the world of ‘shared prosperity’. Recently Labor Secretary Thomas Perez explained what that means. “Labor Secretary Thomas Perez said President Barack Obama will take ‘aggressive executive action’ on immigration, which Perez said will bring about more ‘shared prosperity.’”
Contrary to what you may think, shared prosperity doesn’t mean ‘pass around the joint’, but apparently conveys the sense that if you spread around money, more money will come to you. “The pie is getting bigger. American workers helped bake it, but they’re not getting a bigger slice … in private-sector job growth,” Perez said. “Shared prosperity is not a fringe concept. … and it’s a lynchpin of a thriving middle class.”