Like the mythical King Midas, who starved in the midst of plenty, oil-rich Venezuela is finding it can do just about anything with its money except eat it.

Caracas bank accounts are overflowing, and worldwide oil price increases have tripled the national income over the last three years, but Venezuela is suffering a food shortage so severe that President Carlos Andres Perez has labeled it his government's number one priority.

Grocery shelves here are often bare of such basic commodities as milk and eggs. Many shoppers wait hours in line for a chicken.

On the frequent days when food supplies in wealthy, luxury-filled Caracas are scarce, it is easier to buy a Cadillac than a pound of coffee.

Once a food exporter, Venezuela imported more than $700 million worth of food in 1975. More than half the total consumption of many staples is purchased abroad, including 500,000 tons of U.S. white corn imported last year to keep the country stocked with "arepas," the tortilla-like national bread.

In a heady blend of spending and desperation, the government has resorted to such measures as a twice-daily air shuttle to fly 25,000 live cattle -- 175 head on each plane -- from Costa Rica: the removal of import duties from many food products: and the loaning of enormous quantities of money, at rock-bottom terms, to any Venezuelan it can get interested in agriculture.

Since prices of most commodities are frozen by the government, food, when it is available, is fairly cheap. The lack of availability of food at any price however, has become an infinitely more dangerous political problem for the Perez administration.

How this previously rural country got itself into such curious straits is a story unique to the 1970s, when oil suddenly made many poor nations with an abundance of it rich beyond their wildest dreams.

For Venezuela, the oil-price boom meant that the country could afford a major industrial expansion. Small farmers who formerly grew enough food for both themselves and city dwellers flocked in record numbers to better-paying urban jobs.

In Caracas alone, the population is now more than twice what it was 20 years ago, and the current 22 million figure is expected to double again by the turn of the century. Venezuela's birth rate, one of the highest in the world, increases the population by 3.4 per cent each year.

At the same time, as the oil money has filtered down. Venezuelans of all economic strata can afford to eat more, and better. The country's per capital income of $2,000 a year is the highest in Latin America, and protein consumption -- meat, eggs and vegetables -- has skyrocketed.

The fact is, President Perez said in a recent interview, that we are adding a lot of people, and we are consuming a lot of food. It's not the rich people who are eating more.

Perez said that total milk consumption in Venezuela has risen by more than 35 per cent since 1973.

In contrast, local milk production has increased by only 11 per cent during the same period. The difference has been made up in imports -- more than 40,000 tons of powdered milk, primarily from the United States, was brought in last year.

Annual beef consumption has risen by more than a third in the last five years, and U.S. agriculture officials say they expect Venezuelan beef imports to double this year. Loads of eggs, cheese, vegetables and grain are brought in almost daily from outside the country, many by plane to avoid long unloading waits at Caracas' clogged Caribbean port.

Food production, in relation to population growth, is now down to early 1960s levels. While in absolute terms the 1976 harvest was 1.8 per cent lower than in 1975, in per capita terms it was down by 8 per cent. Less than 20 per cent of all Venezuelan land is used for food production, and all but a tenth of that is uncultivated pasture.

While the high level of imports could conceivably go on until the oil wells run dry, many financial and agricultural experts here view that scenario as increasingly frightening. Instead, they argue, Venezuela needs to return to the near agricultural self-sufficiency it enjoyed 20 years ago.

Although last year's production problems were exacerbated by bad weather conditions that left farmland alternately parched and flooded, government officials and large-scale farmers agree that in general the problem is the result of bad planning, an import mentality and simple greed.

"Ninety-five per cent of the trouble," said one of Perez' agricultural advisers, "is that people here can make so much more money investing in things other than agriculture." The profit margin in real estate speculation, a thriving business in jampacked Caracas where a simple condominium apartment goes for $100,000 and up, is estimated to average more than 100 per cent.

Just putting money in the bank earns an easy 8 per cent interest.

Big private money does not go into agriculture because, as one local cattleman from the steaming central plains said, "There are dozens of ways to make a quick back here that are faster, cleaner and cooler."

While farmers complain that the government's freeze on retail food prices does not offer them a decent return and discourages investments, the Perez administration has tried every stimulation short of a free market to boost production, beginning with a pledge that agriculture would replace industry as the most important sector of the economy.

One of the first things Perez did after the election in 1973 was to release small farmers from government agriculture loans and to eliminate taxes from earned farm income.

In 1974 the government set up an agriculture credit fund with an initial deposit of $140 million to loan cheap money to farmers. Farm price supports were increased, and agro-industry was promoted in the countryside so that farmers could process their crops without middlemen. Under a more recent presidential decree, private Venezuelan banks must set aside 20 per cent of their money for loans to farmers.

Rural highways have been built, massive irrigation projects undertaken, and social service facilities have blossomed in the countryside.

The government programs have their critics and their supporters.

"There has been a lot of sloppy planning," said the cattleman. "Handing out a lot of money to farmers was a fairly good idea, but money without a lot of close coordination by good agriculture agents -- people who know what they're doing -- that was a failure."

At first, the easy money program brought a lot of city boys to the country. "They waded right in," the cattleman said. "They were going to make a fortune before Christmas. There was no methodology," and production rates did not come close to reflecting the investment.

"Agriculture is a good deal if you really know what you're doing. They (the government) should have set production goals. The only goal a lot of these new guys have is to figure out what to do in five years when they have to start paying the money back."

Many of the poorly supervised agrispent on family shopping, trips to Miami and luxury goods. Because the paperwork is complicated, and there is a moral prejudice against borrowing among largely uneducated small farmers, few of them have taken advantage of the lending programs.

"I've got enough now to feed my family," said one farmer in the mountain state of Merida, several hundred miles southwest of Caracas. "Besides, if you borrow money, the day always comes when you have to pay for it."

Still, harvests are expected to reach record highs this year, barring weather complications, and the government does have its success stories.

Oriel Nunez, who came from the city and bought his 5,000-acre farm in west central Portuguesa state seven years ago, has prospered with government money. He expects a big increase in his rice and tobacco crop this year, although he caustions that "it's not a bonanza -- it takes years to build, and we're hoping for better."

Nunez has gotten several government loans, and has no problem with money. His problem is finding enough laborers to work on his farm. Since the oil price boom, he says, they've all moved to the city.