Airline Loses Half a Billion Dollars Because of Socialism

Courtesy American Airlines

If you want a glimpse of what socialism does to a country, a good place to start is Venezuela. If you, for some reason, end up at a Venezuelan hotel and need to go to the bathroom, you better have brought your own toilet paper. That’s because hotels are asking tourists to do just that.
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In all actuality, getting to Venezuela these days is worth writing home about in and of itself. Most airlines have stopped going to the country because they can’t get their money out. American Airlines is in the middle of a nightmare scenario involving the socialist country themselves, which is why they basically just walked away from $592 million in cold hard cash.

“American Airlines Group Inc on Tuesday said it has written off more than half a billion dollars in revenue stuck in Venezuela because of currency controls.

American, the world's largest airline, said in a regulatory filing it will recognize a $592 million special charge in the just-ended fourth quarter "due to continued lack of repatriations and deterioration of economic conditions in Venezuela."

The South American country's socialist government had compelled carriers to sell tickets in bolivars but made reconverting the sales into U.S. dollars difficult. Globally, airlines have around $3.7 billion trapped in Venezuela as a result of its 12-year-old currency control system, the International Air Transport Association said in June.”

In other words, airlines can’t get money from tickets purchased in Venezuela out of the country. It’s stuck. Lost. Gone. Basically stolen by the Venezuelan government.

Airlines aren’t the only victims. A Hilton hotel was nationalized just ‘cause. If you’re playing along at home, the Venezuelan government is basically stealing billions from international airlines and they still can’t afford TP.


Bottom line

For as cheap as Venezuela is (to vacation in) no one is going. I’ve never been, but I’m sure the country can be a great place to visit. Unfortunately socialism has ruined it. And the people seem almost powerless to change the direction of the country, especially after when you consider what just happened: the people voted out their current president, Nicolas Maduro, only to have the results thrown out by Maduro’s Supreme Court.

Hopefully one day it'll all change. Until then, bring your own toilet paper if you visit.


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