I believe Derpy stated prior that whilst the houses get made and bought, after those V-bucks get printed the currency deflates rapidly so the people are starving and living poorly despite not technically having smelter.
Venezuela is failing because maduro concentrated the economy around oil exports and in turn had to raise the price the arrangement worked fine for a while because the price was still competitive but then Venezuela began asking too much and Saudi oil was starting to look like a better alternative so the countries who were purchasing oil from them embargoed them for artificially driving up the price and switched to alternative sources and since the economy was centered around that export Venezuela collapsed
