Venezuela’s Socioeconomic Solution – high minimum wage

The Venezuelan economy isn’t only a matter of 3 Trillion USD in oil reserves and the possibility of a market economy, but also of a reported/claimed large majority of low-skills and low-potential population which cannot compete against the Chinese in any foreseeable future.

Theory:

Usually poverty is mitigated for by means of an extensive welfare system, which is installed by a socialist regime, which is voted in by a majority of hapless people, further squeezing the middle-class, forcing it into bankruptcy and emigration. The Venezuelan population living mostly in villages scattered around the huge jungles is too conservative to give up massive reproduction, thus the problem of economic potential isn’t going to correct itself automatically.

Problems:

Communism has ruined Venezuela, dropping its agricultural produce levels due to central planning, which of course like always and anywhere is inherently inept and corrupt. The more state benefits are issued to lazy, ignorant people, who may gain benefits from having many simple-minded children and to migrants, the more such are incentivized to reproduce, thus aggravating the problem in a vicious circle. Germany has opted for low basic salaries, e.g. at supermarkets, in order to keep the overall fee-structure so low that its automotive workers could live off their modest salaries, while marginal cases are taken care of by the very expensive social network – which has been overloaded by open floodgate immigration of very cheap workers that hardly anybody needs.

In the meantime, this automotive industry has rotten down and  out of competition with Asia and Tesla, in particular since the energy prices have gone up since summer 2022, yet without a capability to generate new alternative branches of industry – perhaps due to very high taxation to fund all the above malarkey. Social integration of simpletons kills academic and R&D standars.

Solution:

The surprising, unconventional and non-intuitive solution is a high minimum wage, incentivizing the masses only towards work, while also pushing employers to vastly automate their production lines and to attempt at higher value (sophistication and quality) products. This is a competitive approach, thus brave and which factors-in all domains of concern: competence, demography, economy and culture. This has been working very well in Israel since summer 2006 (after I suggested it in order to make as many simple foreign workers redundant), against the expectations of many world leading economists, who neither understand social dynamics nor industrial technologies and methodologies. In the present world of humanoid robots costing $10K a piece, with an ever growing focus on smart software of various kinds, there’s no more room for hoarding simpletons and for cowardly hiding behind walls of cartels, socialism and complacent statism.

Conclusion:

The successful solution is which has in mind a dynamic world, of constant adaptation per changes in science, technology, industry, demand and supply around the world and across the economy.

A high minimum wage is the way by which the USA can bring prosperity and hope to all useful Venezuelans, i.e. the effectual members of the electorate, industry and regime, thus those who matter most in making decisions and pushing through policies for a better and useful future.