How to Ruin an Economy 101

by Don Boudreaux on December 26, 2009

in Not from the Onion, Reality Is Not Optional, Seen and Unseen

As if following a script:

Venezuelan President Hugo Chávez, beset by a recession that is hurting his popularity, has turned his sights on international car companies, threatening them with nationalization and pledging to ramp up government intervention in their local businesses.

The populist leader has threatened to expropriate Toyota Motor Corp.’s local assembly plant if the Japanese car maker doesn’t produce more vehicles designed for rural areas and transfer new technologies and manufacturing methods to its local unit. He said other car companies were also guilty of not transferring enough technology, mentioning Fiat SpA of Italy, which controls Chrysler Group LLC, and General Motors Co.

The above two paragraphs open a report in today’s Wall Street Journal.

Wanna take bets on what will happen to rural Venezuelans’ access to automobiles and other automotive products?  Wanna take bets on what will happen to private foreign investment in Venezuela?

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