Essay Example on Focusing on creating an economy based around Agriculture

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On the surface it seems that focusing on creating an economy based around agriculture would be a stable and better option than anything but that approach may be deeply flawed and non executable as there is a heavy water shortage in Venezuela and the only water available is not hygienic therefore not safe for consumption The country of Venezuela can only get out of this economic stress if we implement our own version of Reaganomics with some adjustments according to the needs of our nation What is Reaganomics Reaganomics is a portmanteau for the economic policies that were implemented by Ronald Regan during his reign as the president of the United States of America during the 1980 The four major goals of Reaganomics are reducing federal taxes reducing government regulation reducing government spending and tighten the money supply in order to reduce inflation But the policies implemented in Venezuela will exclude reducing government spending for obvious reasons welfare for the people of Venezuela Reducing Federal Taxes By reducing federal taxes such as income tax corporate tax etc provides an incentive to develop the severely weak private sector With reducing federal taxes the government of Venezuela would also provide the private section a significant boost to establish a strong private sector which as time passes will help in reducing the inflation rate As exports would also increase by the promotion of the private sector the crime rate

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As there will be more sources of income people would have no need to turn to crime to get essential things such as food and the debt will also be significant reduced as the government will also get a new river of income from these policies Reducing Government Regulation Reducing government education also provides an incentive to businesses to come into function and make the private sector robust This will provide the same benefits we get by reducing federal taxes and at the same time it will also significantly increase the GDP of Venezuela provide employment and significantly decreasing poverty levels Tightening the Money Flow Venezuela will also tighten its money flow by increasing interest rates of banks etc which in the beginning will help in reducing inflation and slowly we would loosen the money flow to aid the Venezuelan businesses as the inflation rates would stabilize over time Total Removal of the Black Market Economy During the presidency of Hugo Chavez to pay for extravagantly large social programs he created CADIVI Comisión de Administración de Divisas Commission for the Administration of Currency Exchange a currency control board charged with handling foreign exchange procedures

This sets the official exchange rate which is 10 Bolivar to 1 USD while the black market sets the Bolivian exchange rate at 124 190 13 Bolivar for 1 USD This adversely affects the exporters of the country especially and rigorously reduces profits for a lot of businessmen and therefore removing this would provide the realistic image of the current situation and from that point the Venezuelan Bolivar can again be as strong as it was back in the glory days under Hugo Chavez Privatization of the Health Sector and Improving the Government Health Care By the funds that are received by the strengthened private sector the government can improve its health sector and when it is self sufficient we can privatize the health sector to further provide more revenue to the government for creating more policies benefiting the poor Problems Being Solved Through Reaganomics Hyperinflation By restricting cash flow promoting businesses that bring in more foreign currency and the total removal of the Black Market Economy the Venezuelan Bolivar s inflation can be significantly reduced Economic war The economic war mainly exits because of the huge economic disparity which will be reduced by the promotion of the private sector by reducing government regulations and reducing federal taxes and creating policies that support upcoming businessmen

Food shortages With the flow of income that will come through the private sector food can be imported but as the condition of the country improves the country can also focus on the agricultural side of our nation Refinancing its debt The capital that comes through the private sector in form of taxes will slowly help in reducing the debt of the country Health assistance The government will first providing a boost to the health sector and as things will stabilize the health sector would be privatized to be an enhancement to the already strong private sector Crime and poverty As living standards go up more people get employed and get more sources of income the poverty level and the crime rate will significantly decrease itself Conclusion The rebuilding of the Venezuelan economy will be a long and tedious task and can only be done with exceptional implementation of the policies mentioned above Even though this solution is not perfect it is at least a plan that can be followed by a country that is currently in shambles But this plan paves a way for the country to follow acts as a candle in a dark room that provides hope to millions of the citizens under my presidency

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