ECONOMYNEXT – The United State will get into a ‘big mess’ if attempts are made to ‘run’ Venezuela which is an unstable country with unknown levels of inflation, a top US economist who has tracked the country closely and advised its opposition, has warned.
“We are going to run the country,” President Trump told reporters after abducting Venezuelan President Nicolás Maduro and First Lady Cilia Flores in a special operation.
“Uncle Sam’s going to have a big mess in his hands,” Steve Hanke, Professor of Applied Economics at John Hopkins University said in a twitter.com post.
“Venezuela hasn’t even reported its official inflation figures since October 2024. Lots of luck.”
BREAKING: Pres. Trump on the future of Venezuela:
“We [the US] are going to run the country [of Venezuela].”
Uncle Sam’s going to have a big mess in his hands.
Venezuela hasn’t even reported its official inflation figures since October 2024. Lots of luck. pic.twitter.com/A7lV21gk0w
— Steve Hanke (@steve_hanke) January 3, 2026
Venezuela has a severe monetary instability and outmigration.
It is notoriously difficult to govern countries with bad central banks as economic liberalization is easily discredited when inflation picks up and the currency falls, and liberal governments are ousted quickly.
Only authoritarian regime that rig elections, more often than not, can rule in countries with bad central banks and high inflation.
Trump himself was elected amid inflation and instability in the US and is now facing debt problems.
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Hanke has estimated that annual inflation is Venezuela was around 549 percent by November, behind North Korea at 201 percent and Iran at 60 percent.
The official exchange announced by Venezuela’s central bank was 304 to the US dollars this in the first week of 2026, which is an increase of about 480 percent from the 52 to the US dollar recorded in early 2025.
In the kerb market Venezuelan Bolivars are trading at around 560 to the US dollar, media reports say.
Trump openly admitted that Venezuela’s vast oil reserves played a part in the attack the led to the capture of the Maduro.
“Well, we’re going to be running it with a group and we’re going to make sure it’s run properly,” he said.
“We’re going to rebuild the oil infrastructure, which will cost billions of dollars. It’ll be paid for by the oil companies directly.
“They will be reimbursed for what they’re doing, but that’s going to be paid. And we’re going to get the oil flowing the way it should be.”
Some discussion had been held with the Vice President of Venezuela, Trump said, but did not elaborate.
“You know, they stole our oil,” Trump claimed. “We built that whole industry there and they just took it over like we were nothing.
“And we had a president that decided not to do anything about it. So we did something about it. We’re late, but we did something about it.”
Trump’s reference to ‘stolen’ oil is perhaps are reference to expropriated US and other Western oil companies which discovered the original oil and also kept extracting the heavy crudes even after the state oil firm, the PDVSA was set up in the 1970s.
A second wave of expropriations under Hugo Chaveze has crippled the PDVSA, which is unable to make the investments required to make the heavy oil from, amid monetary instability.
There are disputed claims over expropriation of US and other firms which went into international arbitration and won awards. Venezuela’s 3 million barrels per day production has now declined to a third or less. China is a purchaser of Venezuelan oil.
The US has also imposed sanctions on the Venezuela.
Hanke has previously criticized sanctions, saying they create a ‘rally around the flag’ effect helping authoritarian rulers to remain office and also lead to deaths and economic difficulties for people living in inflating countries with authoritarian leaders. (Colombo/Jan04/2025)
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