Alifa Dian R, 2018 ESSAY Economy

1. Bismillahirrahmanirrahim’
ALIFA DIAN RAMADHANI
ESSAY
ENGLISH CLASS
Three reasons behind human action
in an economic perspective
about Venezuela's economic crisis
1. Suffering, hunger, and low-average health levels make the venezuala's people
live in pressure. Some of them try to survive, even by committing a crime. And
others surrender, despair then commit suicide.
Case :
Venezuela has the largest proven oil reserves in the world. But in the last three years its
economy has collapsed. Hunger has gripped the nation for years. Now, it’s killing children.
Hunger has stalked Venezuela for years. Now, it is killing the nation’s children at an
alarming rate. For five months, The New York Times tracked 21 public hospitals in
Venezuela. Doctors are seeing record numbers of children with severe malnutrition.
Hundreds have died.
Venezuela has been shuddering sinceits economy began to collapse in 2014. Riots and
protests over the lack of affordable food, excruciating long lines for basic provisions. For
many low-income families, the crisis has completely redrawn the social landscape. Parents
go days without eating, shriveling to the weight of children themselves. Women line up at
sterilization clinics to avoid having children they can’t feed. Young boys leave home and
join street gangs to scavenge for scraps, their bodies bearing the scars of knife fights with
competitors. Babies die because it is hard to find or afford infant formula, even in
emergency rooms.
2. The wealth and abundance of Venezuela's resources make people forget their
responsibilities. The power is used by dictatorial leaders to corrupt. A weak legal
systems, morals and responsibilities, and non-transparent political and financial

2. systems make corruption to be a common problem. Almost every period, the
president of Venezuela proved to be corrupt.
Case :
Venezuela is locked in an intense struggle between the defenders of democracy and
a president intent on becoming a dictator for life. The nation has been characterized by the
persistent presence of political and financial corruption in public administration. In the early
20th century, the long dictatorship of Juan Vicente Gomez was plagued by high corruption
in the management of public wealth.
In the mid 1970s, the management of national assets deteriorated significantly, as the
country experienced a sudden oil windfall that tripled fiscal income. From 1980 onwards,
Soaring corruption resulted from several factors, including weak political institutions, lack
of administrative controls, too much money circulating in the financial system of the
government, and, above all, populist leaders promoting a welfare state in which hard work
and social discipline were not encouraged. In the 20th century,the highest levels of
government corruption ever experienced in Venezuela. Three major areas of corruption
have emerged: grand corruption, derived from major policy decisions made by President ;
bureaucratic corruption, at the level of the government bureaucracy; and systemic
corruption, taking place at the interface between the government and the private sector.
3. The increasingly severe economic crisis in Venezuela has to be fixed soon. But
the government's role in responding to economic problems is still very slow.
Venezuelan economists suggest that the Government should try to take steps to
reduce inflation, and make policies that can contribute to economic growth and
development.
Case :
There are steps for Venezuela fix the economic crisis. First, the economy has to be
stabilized, to put an end to balance of payments crises and chronic shortages, as well as
the recession of the past two years.
Venezuela this week announced it would significantly raise fuel prices and devalue its
currency as part of a series of measures to help shore up its flailing economy. The economy
has large imbalances that will have to be adjusted. Therefore, the first thing to ensure is
that poor and working Venezuelans do not suffer from the adjustment. This means setting
up a system to make sure that food, medicine, and other essentials are available at
affordable prices.

3. Next, Venezuela has to stabilize the currency, let the currency in circulation, then there will
be devaluation. after the devaluation, the government should be able to manage the
exchange rate for the next six years at a realistic level, and the economy grew very fast.
When the economic situation has started to improve, the government can begin to lift some
of the dysfunctional price controls. price controls on food and household items need to be
relaxed in order to eliminate shortages. This will save billions of dollars of foreign exchange
lost to smuggling, although consumers would have to be protected from price increases.
The last, Venezuela has Adjusting to lower oil prices over the intermediate and longer run
will mean diversifying the economy away from oil. In 2011, Venezuela imported food, and
the country could become nearly self-sufficient in food production and pursue other import-
substitution and diversification strategies. So, Venezuela should adjust the price of oil with
a lower-valued currency.
REFERENCES :
https://www.nytimes.com/interactive/2017/12/17/world/americas/venezuela-children-
starving.html
https://www.cato.org/publications/commentary/corruption-democracy-venezuela
https://qz.com/715230/these-are-the-brutal-emergency-measures-it-would-take-to-pull-
venezuela-back-from-total-collapse-right-now/
http://fortune.com/2016/02/20/venezuela-oil-bolivar/