6 ms·

Venezuela seizes toilet paper factory to avoid shortage

41 points by antr 13y ago

zebra 13y ago
Too much socialism is not a good thing. Same for the capitalism.
- fiatmoney 13y ago
  "Too much" makes it rather tautological.
  - jlgreco 13y ago
    Yeah, that comment is something of a Yogism.
- ihsw 13y ago
  We can play the word game and throw political ideologies around like frisbees, but the real issue is price controls. During the Hurricane Sandy disaster there were price caps on gas and the desired effect was to discourage panic buying, but the opposite occurred -- since suppliers had no interest in accommodating the authorities then supply dried up. It's not a matter of the suppliers being greedy assholes about it, but there were real and higher costs associated with supplying gas to NYC and the surrounding areas. They just didn't want to take the hit to their pocketbooks and I don't blame them. What also happened was the well-connected people were able to make arrangements for their own private supplies of gas, and those people included politicians, business leaders, and other wealthy people, but it was secretive and supply was restricted to them. The politicians were publicly attacking/shaming "scalpers" who were trying to sell gas at a fair price, meanwhile they were secretly making back-room deals for themselves. What's the lesson here? Depends on who you ask and what you goals are. Instituting price caps usually results in suppliers losing interest and disappearing, which is probably what happened in Venezuela. Oh, and a black market of gas emerged. There were iOS and Android apps for finding suppliers and becoming a supplier yourself. I'm usually the first to ridicule statements like "the market corrected itself" but it stands to reason that it applies here quite well.
  - dnautics 13y ago
    > What also happened was the well-connected people were able to make arrangements for their own private supplies of gas, and those people included politicians, business leaders, and other wealthy people, but it was secretive and supply was restricted to them. The politicians were publicly attacking/shaming "scalpers" who were trying to sell gas at a fair price, meanwhile they were secretly making back-room deals for themselves. This needs to be repeated. Time, and time again.
  - wjnc 13y ago
    There's a nice Econtalk on 'price gouging' [1] that talks at length on this subject. ihsw hits the highlights. [1] http://www.econtalk.org/archives/2007/01/munger_on_price_1.html http://www.econtalk.org/archives/2007/01/munger_on_price_1.h...
    - ihsw 13y ago
      It's interesting because my information source on this is mostly reddit.com comments across a wide variety of sections -- nyc, economics, conspiracy, libertarian, communism.
throwaway_yy2Di 13y ago
Apparent explanation here, in more depth than "price controls => shortage": "This Is Why There Is No Toilet Paper in Venezuela" http://transitions.foreignpolicy.com/posts/2013/06/17/this_is_why_there_is_no_toilet_paper_in_venezuela http://transitions.foreignpolicy.com/posts/2013/06/17/this_i... The problems of the local toilet paper industry are illustrative. Typical of the global supply chain, many inputs that manufacturers need to produce toilet paper are also imported. But since Venezuela has extensive currency exchange controls to regulate the flow of foreign currency (which can either be bought/sold or obtained through trade), the government must approve all imports -- and the red tape involved is legendary. In theory, the way the Venezuelan system should work is the following: The government authorizes imports by selling dollars that businesses buy to make international purchases at a heavily-subsidized price -- discounted at a much lower price than what the black market sells it for. After the imports have arrived and have cleared customs (lines at ill-equipped Venezuelan ports can last weeks), local manufacturers produce their goods, and then sell their products at tightly-controlled prices. [...] In reality, the government's ineffective regulation not only discourages investment, but creates incentives for people in the chain of production to take advantage of access to cheap dollars and sell them in the highly profitable black market. With "import dollars" reallocated to currency arbitrage, there is little money left to import the raw materials needed to make things that Venezuelans need.
- dnautics 13y ago
  >In reality, the government's ineffective regulation not only discourages investment, but creates incentives for people in the chain of production to take advantage of access to cheap dollars and sell them in the highly profitable black market. With "import dollars" reallocated to currency arbitrage, there is little money left to import the raw materials needed to make things that Venezuelans need. The irony is, substitute "wall street" for "black market" and this is exactly what the US is doing, albeit on a slower, less aggressive timescale, and with marginally less ineffective regulation.
  - _Adam 13y ago
    I don't quite understand. Can you explain in detail?
alexeisadeski3 13y ago
Socialists, I love you. Please don't ever change.
unsigner 13y ago
Toilet paper was a precious rarity in 1980s Bulgaria. Those ignoring the lessons of history are doomed to carefully collect yesterday's newspapers and stack them in the bathroom.
- Zuider 13y ago
  Pravda was printed on such rough paper. Ach, how The truth hurts!
- VladRussian2 13y ago
  obligatory http://www.imdb.com/title/tt0087747/ http://www.imdb.com/title/tt0087747/ - the "USSR toilet paper line" opening clip from it (sorry couldn't find it with original english soundtrek) https://www.youtube.com/watch?v=GR0I3DgWXX8 https://www.youtube.com/watch?v=GR0I3DgWXX8 What i'm genuiely wondering about is how Marx missed the "toilet paper effect" in Das Kapital while he was so true on the money with the rest of the theory.
toiletpaperwtf 13y ago
So I had to create a throwaway account since this is kind of a sensitive subject, but: Why do so many people in the Western hemisphere use toilet paper? If you had fecal matter on your hand, would you wash it, or just wipe it with some paper and call it good? I've never actually understood this, and it leads to questionable personal hygiene. (Let's just say I put a finger somewhere during..um..and it didn't exactly come out clean.) The ideal way to wash is with water, and maybe afterwards pat down with some TP to dry off. That's what a lot of South Asian countries and the Japanese do. I hope the American and European people learn to do this simple trick some day. Might help decrease the use of this ridiculous anachronism and save some trees.
- kmfrk 13y ago
  Maybe the water isn't clean enough in many Venezuelan households. You don't tend to see bidets in a lot of places, but you can basically spend $20 on a simple add-on to your toilet and go paper-free, if you want.
  - oleganza 13y ago
    So if you have not-clean-enough water in your tap, you'd wipe out shit from your hand with a paper instead of washing it off? The water then must be more dirty than whatever you got on your hand then.
- antr 13y ago
  I don't know why I know this, but I'm pretty certain most of the toilet paper is produced from tree farms, not impacting on deforestation. Have a read in the annual reports, CSR reports, of toilet papers manufacturers such as Kruger, P&G, Kimberly Clark, etc. Btw, I spotted a flaw in the "hand + water " argument... how do you make sure the tap is clean after washing your hands?
  - iopq 13y ago
    left hand for the butt, right hand for everything else
oleganza 13y ago
Apparently the fact that all other TP factories went bankrupt (or were prevented from being created by the loving government), so there is just one and it cannot produce enough of paper to satisfy demand, is not a hard proof of a total failure of government's policy. If the government was doing nothing wrong in the first place, why would there ever be a situation like this? I really doubt if this factory's owners somehow unfairly prevent competitors from jumping in and satisfying demand. And if they do, most probably they use government as a nice tool to regulate competition out of existence. In other words: whenever something globally shitty happens for no obvious reason, it's always a government and its monopoly of violence at fault.
bmmayer1 13y ago
A classic example of the so-called solution to shortages being the problem in the first place. Who's going to invest in a toilet paper factory in Venezuela now if it's just going to get stolen from you?

41 points by antr 13y ago

zebra 13y ago

Too much socialism is not a good thing. Same for the capitalism.

fiatmoney 13y ago
"Too much" makes it rather tautological.
- jlgreco 13y ago
  Yeah, that comment is something of a Yogism.
ihsw 13y ago
We can play the word game and throw political ideologies around like frisbees, but the real issue is price controls. During the Hurricane Sandy disaster there were price caps on gas and the desired effect was to discourage panic buying, but the opposite occurred -- since suppliers had no interest in accommodating the authorities then supply dried up. It's not a matter of the suppliers being greedy assholes about it, but there were real and higher costs associated with supplying gas to NYC and the surrounding areas. They just didn't want to take the hit to their pocketbooks and I don't blame them. What also happened was the well-connected people were able to make arrangements for their own private supplies of gas, and those people included politicians, business leaders, and other wealthy people, but it was secretive and supply was restricted to them. The politicians were publicly attacking/shaming "scalpers" who were trying to sell gas at a fair price, meanwhile they were secretly making back-room deals for themselves. What's the lesson here? Depends on who you ask and what you goals are. Instituting price caps usually results in suppliers losing interest and disappearing, which is probably what happened in Venezuela. Oh, and a black market of gas emerged. There were iOS and Android apps for finding suppliers and becoming a supplier yourself. I'm usually the first to ridicule statements like "the market corrected itself" but it stands to reason that it applies here quite well.
- dnautics 13y ago
  > What also happened was the well-connected people were able to make arrangements for their own private supplies of gas, and those people included politicians, business leaders, and other wealthy people, but it was secretive and supply was restricted to them. The politicians were publicly attacking/shaming "scalpers" who were trying to sell gas at a fair price, meanwhile they were secretly making back-room deals for themselves. This needs to be repeated. Time, and time again.
- wjnc 13y ago
  There's a nice Econtalk on 'price gouging' [1] that talks at length on this subject. ihsw hits the highlights. [1] http://www.econtalk.org/archives/2007/01/munger_on_price_1.html http://www.econtalk.org/archives/2007/01/munger_on_price_1.h...
  - ihsw 13y ago
    It's interesting because my information source on this is mostly reddit.com comments across a wide variety of sections -- nyc, economics, conspiracy, libertarian, communism.

throwaway_yy2Di 13y ago

Apparent explanation here, in more depth than "price controls => shortage": "This Is Why There Is No Toilet Paper in Venezuela" http://transitions.foreignpolicy.com/posts/2013/06/17/this_is_why_there_is_no_toilet_paper_in_venezuela http://transitions.foreignpolicy.com/posts/2013/06/17/this_i... The problems of the local toilet paper industry are illustrative. Typical of the global supply chain, many inputs that manufacturers need to produce toilet paper are also imported. But since Venezuela has extensive currency exchange controls to regulate the flow of foreign currency (which can either be bought/sold or obtained through trade), the government must approve all imports -- and the red tape involved is legendary. In theory, the way the Venezuelan system should work is the following: The government authorizes imports by selling dollars that businesses buy to make international purchases at a heavily-subsidized price -- discounted at a much lower price than what the black market sells it for. After the imports have arrived and have cleared customs (lines at ill-equipped Venezuelan ports can last weeks), local manufacturers produce their goods, and then sell their products at tightly-controlled prices. [...] In reality, the government's ineffective regulation not only discourages investment, but creates incentives for people in the chain of production to take advantage of access to cheap dollars and sell them in the highly profitable black market. With "import dollars" reallocated to currency arbitrage, there is little money left to import the raw materials needed to make things that Venezuelans need.

dnautics 13y ago
>In reality, the government's ineffective regulation not only discourages investment, but creates incentives for people in the chain of production to take advantage of access to cheap dollars and sell them in the highly profitable black market. With "import dollars" reallocated to currency arbitrage, there is little money left to import the raw materials needed to make things that Venezuelans need. The irony is, substitute "wall street" for "black market" and this is exactly what the US is doing, albeit on a slower, less aggressive timescale, and with marginally less ineffective regulation.
- _Adam 13y ago
  I don't quite understand. Can you explain in detail?

alexeisadeski3 13y ago

Socialists, I love you. Please don't ever change.

unsigner 13y ago

Toilet paper was a precious rarity in 1980s Bulgaria. Those ignoring the lessons of history are doomed to carefully collect yesterday's newspapers and stack them in the bathroom.

Zuider 13y ago
Pravda was printed on such rough paper. Ach, how The truth hurts!
VladRussian2 13y ago
obligatory http://www.imdb.com/title/tt0087747/ http://www.imdb.com/title/tt0087747/ - the "USSR toilet paper line" opening clip from it (sorry couldn't find it with original english soundtrek) https://www.youtube.com/watch?v=GR0I3DgWXX8 https://www.youtube.com/watch?v=GR0I3DgWXX8 What i'm genuiely wondering about is how Marx missed the "toilet paper effect" in Das Kapital while he was so true on the money with the rest of the theory.

toiletpaperwtf 13y ago

So I had to create a throwaway account since this is kind of a sensitive subject, but: Why do so many people in the Western hemisphere use toilet paper? If you had fecal matter on your hand, would you wash it, or just wipe it with some paper and call it good? I've never actually understood this, and it leads to questionable personal hygiene. (Let's just say I put a finger somewhere during..um..and it didn't exactly come out clean.) The ideal way to wash is with water, and maybe afterwards pat down with some TP to dry off. That's what a lot of South Asian countries and the Japanese do. I hope the American and European people learn to do this simple trick some day. Might help decrease the use of this ridiculous anachronism and save some trees.

kmfrk 13y ago
Maybe the water isn't clean enough in many Venezuelan households. You don't tend to see bidets in a lot of places, but you can basically spend $20 on a simple add-on to your toilet and go paper-free, if you want.
- oleganza 13y ago
  So if you have not-clean-enough water in your tap, you'd wipe out shit from your hand with a paper instead of washing it off? The water then must be more dirty than whatever you got on your hand then.
antr 13y ago
I don't know why I know this, but I'm pretty certain most of the toilet paper is produced from tree farms, not impacting on deforestation. Have a read in the annual reports, CSR reports, of toilet papers manufacturers such as Kruger, P&G, Kimberly Clark, etc. Btw, I spotted a flaw in the "hand + water " argument... how do you make sure the tap is clean after washing your hands?
- iopq 13y ago
  left hand for the butt, right hand for everything else

oleganza 13y ago

Apparently the fact that all other TP factories went bankrupt (or were prevented from being created by the loving government), so there is just one and it cannot produce enough of paper to satisfy demand, is not a hard proof of a total failure of government's policy. If the government was doing nothing wrong in the first place, why would there ever be a situation like this? I really doubt if this factory's owners somehow unfairly prevent competitors from jumping in and satisfying demand. And if they do, most probably they use government as a nice tool to regulate competition out of existence. In other words: whenever something globally shitty happens for no obvious reason, it's always a government and its monopoly of violence at fault.

bmmayer1 13y ago

A classic example of the so-called solution to shortages being the problem in the first place. Who's going to invest in a toilet paper factory in Venezuela now if it's just going to get stolen from you?