* Jokes proliferate about shortages and food queues
* Comedian says socialist government becoming thin-skinned
* Surreal reality often hard to distinguish from satire
By Peter Murphy
CARACAS, July 30 (Reuters) - A genie appears from a lamp in the hands of an astonished Venezuelan boy to declare: "You can ask for anything - except toilet paper!"
The world's highest inflation and shortages of basics from milk to toilet roll are really no laughing matter for Venezuelans, but they find solace in a thriving comedy scene lampooning the governance behind the economic strife.
Through cartoons like the genie, stand-up comedy, and online satire, humor has become a prominent and poignant form of criticism as mainstream media exercise more self-censorship.
"Despite oil at $100 a barrel, Venezuela is living through the worst economic crisis of its history ... It's the Midas touch in reverse," stand-up comic Laureano Marquez told Reuters before entertaining a 600-strong audience at a Caracas theater.
His 90-minute routine delivered a witty critique of problems from food queues and medicine shortages, to government corruption and skewed courts. The stand-up branded his show a "sit down" because of the serious themes at which it pokes fun.
"Humor may be mankind's most serious attitude because we use it to say some very painful things," said Marquez, 50, who warmed up his audience with jokes about the trials of the weekly grocery shop, and the queues and squabbles caused by shortages.
One audience member afterwards called it "therapy."
The 1998 election of ex-army commander Hugo Chavez swept in a socialist "revolution" that won plaudits for dedicating more of Venezuela's oil wealth to helping its poor. But 15 years on and a year after his death, price increases and crime are plaguing Venezuelans while under-investment is constricting oil output.
HARD TIMES SPAWN MORE HUMOR
The economic crisis has been bad for business - but a boon for humor. "Ironically, the worse the country gets, the better the humor gets," said press cartoonist Eduardo Sanabria or Edo, who has sketched for El Mundo daily for the last seven years.
One cartoon in July showed Chavez dancing with six plump cows representing the oil sector bonanza, then successor Nicolas Maduro later gazing in horror at a list of bills to be paid as the now-emaciated cows loll around drunk or crying in despair.
Edo feared he would be left struggling for ideas after Chavez's death in March 2013 from cancer, but he says material has abounded under successor Maduro who has so far held steadfast to most Chavez-era polices.
One close-to-the-bone cartoon strip by satirical website "The Bipolar Chiguire" showed Maduro, who in real life said Chavez was "inoculated" with cancer by his foes, seeking ideas from advisers about how to explain Chavez's illness.
"It was Israel," says one. "It was the CIA", pipes up another. "Tell the truth," suggests a third aide, who is promptly thrown out of the window.
Edo depicted the government's much-vaunted war on corruption as a net reaching into the sea, picking out small fish while huge ones nearby grin and clutch suitcases bulging with dollars.
Though most prominent comedians appear pro-opposition, the anti-government parties do not escape the derision.
Divisions within the Democratic Unity coalition, for example, were mocked in one cartoon as a jumble of signs with their various objectives all pointed in different directions.
SATIRE OR REALITY?
The imposing skyscrapers of Caracas are a testament to decades of oil wealth, adding to the sense of bewilderment now at barren shelves and near-worthless bundles of cash.
On the street, Venezuelans constantly josh with each other about the situation. "Careful you don't get robbed! Hide it!" people shout at shoppers seen with flour, oil or sugar.
"Welcome to Havana!" passersby sometimes taunt the queues.
The increasing surrealism means genuine news stories sometimes rival satire for absurdity, say Juan Andres Ravell and Oswaldo Graziani Lemoine, creators of El Chiguire Bipolar.
Their stories often fool readers who stumble upon outlandish stories on social media without realizing they are fake.
"The government has done so many crazy things in the past you can believe anything," said Graziani.
Maduro's recent assertion that airlines' cutting of flights to Venezuela was due to reassignments for the World Cup, and not a $4 billion debt, might not have looked amiss as a satire.
Ditto a genuine announcement that passengers at Caracas' international airport would have to pay a new ozone tax.
Headlines from El Chiguire this week included a dig at the ruling Socialist Party's deification of Chavez - "Party congress debates whether Chavez was galactic or celestial."
The site comically sidestepped the latest national controversy over a former intelligence head jailed in Aruba due to U.S. drug-trafficking charges: "We're not going to write an article about the detained general because we want to live!"
Shortages of ferry tickets were lampooned with a spoof new "dolphin" service, while the Byzantine three-tier currency system spawned this headline: "New currency scheme contemplates the exchange of tears for dollars."
Comedians say controls over free speech have tightened under Maduro, especially since anti-government protests this year sparked violence killing more than 40 people.
"You can feel that this government is more sensitive to criticism," said cartoonist Edo. "Chavez could live with humorous criticism because he had his charisma."
The Chiguire Bipolar's website has been hacked and content substituted with pro-government messages, and stand-ups say they can no longer book government-controlled theaters as venues.
Comedian Luis Chataing's TV show was ended in June by private broadcaster Televen after his mockery of the government's display of emails as evidence of coup allegations.
In the skit, Chataing showed viewers how to falsify evidence using paper, scissors and glue - an apparent jab at the amateur appearance of the e-mails shown on TV with annotations and arrows pointing to the allegedly incriminating sections.
"All you need is paper, photos of those incriminated, red arrows that you can find anywhere left over from a prior production of false evidence ... an email you've written yourself ... and of course a lot of bad faith." (Additional reporting by Andrew Cawthorne; Editing by Andrew Cawthorne and Lisa Shumaker)