When oil prices slumped, Venezuela completely shut down while Norway seemed fine.
Why is this?
And can anyone redpill me on the Norwegian economy, are they as socialist as everyone says they are?
Why did Venezuela collapse, but Norway didn't?
Blake Lee
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Nicholas Campbell
norway is NOT fine
a lot of people lost their jobs
the city of stavanger went from a blossoming metropolis to a slum
the norwegian crown lost it's value
the price of chocolate and candy skyrocketed
life is hell now
Anthony Foster
Not all oil is the same, Venezuelan oil is much more thick and has much more particulate meaning it has to be processed more for it to be used. The oil in Norweigan territory is a more clean and finer grade oil allowing it to be used with less processing and if it is processed it gets used primarily in the aeronautics industry. Since it requires less processing it allows them to get to their markets at a lower price point meaning the oil slump doesn't affect them as harshly.
Caleb Price
>the price of chocolate and candy skyrocketed
I'm so sorry
Lincoln Gray
That the Scandinavian countries are socialist is a common misconception, promoted by the American left, and in particular Bernie Sanders.
These countries are market economies with social policies. Capitalism-light, with high government interventionism in the economic sphere.
Private property and agreements, the fundamentals of a functioning capitalistic economic system, are well guarded and protected by Norwegian laws. The opposite, clearly, is true of the Venezuela socialist experience.
The Norwegian economy is not fully dependent on oil. We were indeed hit by a light recession because of the oil price fall(reflective in higher unemployment and severe problems in the area of the country most dependent on oil production), but nowhere near very destructive for the entire society.
Venezuela, on the other hand, has continued down the road of glorious social redistribution. Hugo Chavez, gaining access to the glory of oil money, used this to drastically increase the living standards of the Venezuelan people through basically 'giving them free stuff'. This failure to economically modernize is where much of the current economic problems of Venezuela lies. Money used to buy votes through social programs. Money runs out, people riot. Then the socialist machine tightens the ropes to stay in control.
Norwegian oil policy, on the other hand, has been aware of the negative effects that oil money can have on the stability of the economy. Thus, the Norwegian oil fund, has invested the profits of the oil enterprise overseas. This has lead to a more stabilizing effect, by not pumping money and raising inflation in Norway.
Jackson Lewis
would it have been better with lower taxes instead of putting (literally) a trillion dollars into the oil fund?
Asher Long
When are you going to break Anders out of prison? Europe needs him more than ever now
Carter Reyes
Because Norway own a thriving sovreign wealth fund with very diversified interests, and Venezuelan nepotists raided the state for all its worth until the oil prices slumped and the magnitude of their crimes meant they couldn't prop up the basic services that the government had been funding with petrodollars.
And obviously Venezuela is a second world shithole that has never developed properly and can't live without selling unoxidised carbon atoms.
Daniel Nelson
That makes sense, I was in Stavanger over spring and wondered why the city looked so empty. Very few people walking about on a weekend, but to be fair I was exploring it early in the morning, so it mat be more related to when you guys decide to leave the home.
Isaiah Gonzalez
so would overseas investment be better than lowering the taxes?
and shouldn't overseas investment be done privately, instead by the state?
because if an investment goes wrong, for example fannie mac in 2008, then the people feel the costs, instead of a private investor.