Quico says: As chavista radicalism escalates, and with no institutional checks left on the guy's power, the only brakes left on the damage this government might inflict are factual. Chief among them, of course, is the dicey issue of revenue: oil prices have been behaving in distinctly counter-revolutionary fashion lately, no doubt as the result of a CIA plot.
It's hard to tell at what point the slide becomes a real problem for Chávez. One upshot of the government's zero-transparency, zero-oversight management style is that we don't really know much about the state of the State's finances. Oversight of the official budget is weak enough, but the point is that more and more spending is carried out off-budget, through direct PDVSA spending, Fonden, and who knows how many other utterly opaque, slush-fundy vehicles for presidential discretion.
Since we don't really know how much the government has been spending, we can't really tell where its red line lies. Below what oil price does the government find itself forced to start cutting on sensitive spending programs? One well-informed guess I heard is $45/barrel. If so, things could get interesting, because Venezuela's export basket dropped to $44.50/barrel last week. That's still a lot, but then the government has been spending a lot as well.
So we may be getting uncomfortably close to some red lines. Seems like the government is advancing on two fronts to counter this one. On the one hand, they're working with Iran to press for yet more OPEC production cuts. If that doesn't work, they're getting ready to borrow the difference. The real Enabling Law, (as opposed to the one they published) includes a clause that would empower Fonden to borrow money without anyone's approval but Chávez's, and with the usual standard of financial oversight (zilch.)
But is Wall Street really going to pony up the cash for a guy who's off rambling about mass nationalizations and the Socialist New Man?
Stranger things have happened, I guess...
January 20, 2007
January 18, 2007
Lessons in XXIst Century Socialism
Katy says: Ever since his convincing victory at the polls last December, President Lt. Crnel. Chávez has been claiming a mandate for implementing "XXIst Century Socialism." The main problem with this claim is that nobody can define it. The President did not explain this in the campaign, and there is certainly not a government program nor a platform where the details of this little "adventure" are laid out.
Since our President is not the smartest guy in the room, we here at Caracas Chronicles thought that it would be a good idea to begin a series of posts explaining this vague concept, so crucial for our future. Think of it as our way of doing the mandatory, free public service now required of all Venezuelans.
Lesson #1: XXIst Century Socialism means that the PR needs of our Commander-in-Chief, Lieutenant Coronel Chávez, take precedence over the real needs of his people.
Example: Today, the Associated Press carries a story of how rural Alaskans are finally receiving the discounted heating oil from Citgo offered to them by the Venezuelan government. Alaskans were obviously thrilled to receive this gimme, as would be anyone braving it through the harsh rural Alaskan winter. At the same time, El Universal carries a story today about how only 2 of the 11 parishes in Vargas state, in the vicinity of Caracas, have enough doctors to provide reliable medical service. The source is none other than the regional Health director for that state.
Seeing that people in Vargas voted for Chávez overwhelmingly, one can only deduce that the people not being treated are either in the opposition, or simply prefer to sacrifice their health care so that Alaskans can keep warm during this winter. So for all you Alaskans out there, remember: while you are enjoying your hot cocoa and snuggling in your blankets while the thermometer outside hits 50 below, your comfort comes to you thanks to the sacrifice of a small child in rural Vargas who is probably bauling his eyes out because there is not a pediatrician in sight to treat his diarrhea.
There is no need to thank the boy in person. Just thank the Venezuelan Embassy and Chávez's minions at Citgo, proud banner-holders of this popular mandate.
Since our President is not the smartest guy in the room, we here at Caracas Chronicles thought that it would be a good idea to begin a series of posts explaining this vague concept, so crucial for our future. Think of it as our way of doing the mandatory, free public service now required of all Venezuelans.
Lesson #1: XXIst Century Socialism means that the PR needs of our Commander-in-Chief, Lieutenant Coronel Chávez, take precedence over the real needs of his people.
Example: Today, the Associated Press carries a story of how rural Alaskans are finally receiving the discounted heating oil from Citgo offered to them by the Venezuelan government. Alaskans were obviously thrilled to receive this gimme, as would be anyone braving it through the harsh rural Alaskan winter. At the same time, El Universal carries a story today about how only 2 of the 11 parishes in Vargas state, in the vicinity of Caracas, have enough doctors to provide reliable medical service. The source is none other than the regional Health director for that state.
Seeing that people in Vargas voted for Chávez overwhelmingly, one can only deduce that the people not being treated are either in the opposition, or simply prefer to sacrifice their health care so that Alaskans can keep warm during this winter. So for all you Alaskans out there, remember: while you are enjoying your hot cocoa and snuggling in your blankets while the thermometer outside hits 50 below, your comfort comes to you thanks to the sacrifice of a small child in rural Vargas who is probably bauling his eyes out because there is not a pediatrician in sight to treat his diarrhea.
There is no need to thank the boy in person. Just thank the Venezuelan Embassy and Chávez's minions at Citgo, proud banner-holders of this popular mandate.
January 17, 2007
Superfluous Authoritarianism
Quico says:
Rule by decree.
There's something irreducibly brutal about the phrase, something about it that makes the flavor of authoritarianism linger in your mouth.
Ruling by decree is what originally got Chávez in trouble back in 2001, when he first showed his disdain for pluralism by dictating 49 laws he'd discussed only with his pillow. That episode will likely seem mild, though, compared to the veritable orgy of rule by decree Venezuela is facing now that Chávez has asked the National Assembly to give him The Mother of All Enabling Laws.
An Enabling Laws is an authorization the National Assembly grants the president to legislate by decree for a fixed period of time. Time was when Enabling Laws could be used only as a last-resort, and only on financial matters. Under the old constitution, they allowed the president to move fast in situations where a long debate in congress risked deepening a financial crisis. Heading off a currency collapse, fighting a wave of bank failures, that sort of thing.
In came Chávez, and out went the safeguards. The 1999 Constitution removed the caveat that Enabling Laws could be used on financial matters only. Henceforth, the National Assembly could empower the president to go over its head on any matter, for any period of time. Sweet, sweet discretion.
Last week, Chávez asked the all-chavista National Assembly to give him the power, for 18 months, to dictate the following types of laws by decree:
If approved, this Enabling Law will make Chávez a dictator. I don't mean that in some fuzzy, propagandistic way, I mean it in the original Roman sense of the term: an official legally empowered to do anything he wants without being accountable to anyone. Hell, at least the Romans were frank enough to call their dictators dictators, and had the common sense to give them unlimited powers for 6 months only. Chávez? He wants three times that.
However unprecedented, however broad, what's chilling is realizing that these new powers won't really make a difference.
After all, legislating by decree is a way of circumventing debate in the National Assembly...as if there was any! In the era of the all-Chavista Assembly, when Chávez barks "jump", all he hears in return is 167 voices in perfect unison asking: "how high?" You'd think that would be enough power for him...but you'd be wrong. No amount of power is enough for this guy.
What's shocking is how superfluous enabling powers have become. With or without them, there is no imaginable circumstance where the Assembly is likely to encumber or delay - much less alter or (gasp) reject - a presidential bill. What these guys do is read out the bill twice and vote it in unanimously, Mao style. Even so, the assembly's desultory, entirely pro-forma kind of authority turned out to be too great a check on his power for Chávez to accept.
But the tragedy goes even deeper than that. The notion of legislating at all has become weirdly senseless in Venezuela given the current climate. With all oversight institutions, all courts, all prosecutions, in fact, the entire state system run by Chávez yes-men, the government long ago lost any incentive to pay attention to laws in the first place. And they don't...
So it just makes you want to take these guys aside and ask them, why bother writing new ones? The ink won't be dry on the Gaceta by the time you start breaking them, and we already know there will be no consequences. What's the point?
Why bother amending the constitution to legalize things you've been doing for years, like raiding the Central Bank Reserves? Even as you tacitly admit that what you've been doing was unconstitutional - otherwise, why change the constitution to allow it? - we can all see that you don't actually care. If you did, you'd sanction the people responsible for past violations. (But, of course, that would include el máximo, so you don't.)
If you're so determined to flaunt your power to break the law without consequences, just do it and be done with it. One thing's good and clear by now: we can't stop you. But why waste everybody's time decreeing new laws you'll flout just as shamelessly as you flouted the old ones? What kind of sick game are we playing here? What's the point of this dadaist charade?
Rule by decree.
There's something irreducibly brutal about the phrase, something about it that makes the flavor of authoritarianism linger in your mouth.
Ruling by decree is what originally got Chávez in trouble back in 2001, when he first showed his disdain for pluralism by dictating 49 laws he'd discussed only with his pillow. That episode will likely seem mild, though, compared to the veritable orgy of rule by decree Venezuela is facing now that Chávez has asked the National Assembly to give him The Mother of All Enabling Laws.
An Enabling Laws is an authorization the National Assembly grants the president to legislate by decree for a fixed period of time. Time was when Enabling Laws could be used only as a last-resort, and only on financial matters. Under the old constitution, they allowed the president to move fast in situations where a long debate in congress risked deepening a financial crisis. Heading off a currency collapse, fighting a wave of bank failures, that sort of thing.
In came Chávez, and out went the safeguards. The 1999 Constitution removed the caveat that Enabling Laws could be used on financial matters only. Henceforth, the National Assembly could empower the president to go over its head on any matter, for any period of time. Sweet, sweet discretion.
Last week, Chávez asked the all-chavista National Assembly to give him the power, for 18 months, to dictate the following types of laws by decree:
- Laws to accomplish the transformation of the institutions of the State.
- Laws to establish mechanisms of popular participation.
- Laws to establish the essential values that will guide public service.
- Laws dealing with social and economic issues.
- Laws dealing with financial and tax-related issues, including the Central Bank Law.
- Laws dealing with the personal and judicial security of Venezuelans.
- Laws dealing with science and technology issues.
- Laws dealing with the way the country's territory is organized.
- Laws dealing with the security and defense of the nation and the State.
- Laws dealing with infrastructure, transportation and services.
If approved, this Enabling Law will make Chávez a dictator. I don't mean that in some fuzzy, propagandistic way, I mean it in the original Roman sense of the term: an official legally empowered to do anything he wants without being accountable to anyone. Hell, at least the Romans were frank enough to call their dictators dictators, and had the common sense to give them unlimited powers for 6 months only. Chávez? He wants three times that.
However unprecedented, however broad, what's chilling is realizing that these new powers won't really make a difference.
After all, legislating by decree is a way of circumventing debate in the National Assembly...as if there was any! In the era of the all-Chavista Assembly, when Chávez barks "jump", all he hears in return is 167 voices in perfect unison asking: "how high?" You'd think that would be enough power for him...but you'd be wrong. No amount of power is enough for this guy.
What's shocking is how superfluous enabling powers have become. With or without them, there is no imaginable circumstance where the Assembly is likely to encumber or delay - much less alter or (gasp) reject - a presidential bill. What these guys do is read out the bill twice and vote it in unanimously, Mao style. Even so, the assembly's desultory, entirely pro-forma kind of authority turned out to be too great a check on his power for Chávez to accept.
But the tragedy goes even deeper than that. The notion of legislating at all has become weirdly senseless in Venezuela given the current climate. With all oversight institutions, all courts, all prosecutions, in fact, the entire state system run by Chávez yes-men, the government long ago lost any incentive to pay attention to laws in the first place. And they don't...
So it just makes you want to take these guys aside and ask them, why bother writing new ones? The ink won't be dry on the Gaceta by the time you start breaking them, and we already know there will be no consequences. What's the point?
Why bother amending the constitution to legalize things you've been doing for years, like raiding the Central Bank Reserves? Even as you tacitly admit that what you've been doing was unconstitutional - otherwise, why change the constitution to allow it? - we can all see that you don't actually care. If you did, you'd sanction the people responsible for past violations. (But, of course, that would include el máximo, so you don't.)
If you're so determined to flaunt your power to break the law without consequences, just do it and be done with it. One thing's good and clear by now: we can't stop you. But why waste everybody's time decreeing new laws you'll flout just as shamelessly as you flouted the old ones? What kind of sick game are we playing here? What's the point of this dadaist charade?
January 16, 2007
Rage against the machine
Katy says: One thing I learned during the past year is that writing regularly can be a chore. The best posts are the ones that combine insight, common sense and plain old human emotion. But it's not always easy to tap into that emotion, what with all those bills that need to be paid and diapers waiting to be to changed.
This is my first post of the new year. It's been a long time coming, but my problem during the last few days has not been lack of inspiration, but rather an inability to channel the state of mind that I equate with good writing: one leading to reasoning, patience, tolerance. I'm filled with rage, and usually I don't like coming across as angry.
The expression of rage is usually identified with animal behavior, but it is also deeply human. We're taught us to shun and repress rage, but a total lack of rage can be dehumanizing. At times, it's best to just let it rip, and there's certainly lots to be angry about lately.
The incompetents at the top have made a decided shift into stupidity, and we are all along for the ride. While the memories of CANTV's horrible service during the 70s and 80s are still fresh in my mind, the government ignores this and decides to purchase the telecoms industry from private investors that had, with caveats, done a fine job in bringing it into the XXIst Century. The argument? "Strategic" reasons, whatever that may mean in the "minds" of the failed soldiers that govern us.
I mean, think about it. Thirty years ago, you could've made a reasonable case that Telecoms was a strategic sector. Old style telecoms were a "natural monopoly" - there was no sense in laying out more than one expensive national network of wires connecting every home and office in the country. And if you wanted to communicate electronically, the phone was your first and your last option.
That was then. Today, we have four national mobile telephony operators, satellite phones, voice-over-IP, internet, internet-via-satellite, internet-via-cable-TV, Cable-TV-via-internet, Skype, etc. etc. etc. CANTV long ago ceased to be a monopolist, long ago ceased to be strategic. These days, it is just the biggest company in a crowded, fiercely competitive market. Head firmly planted in the sand, the government just ignores all that and waves its hands around shouting "strategic! strategic!" End of the argument.
There are even fewer reasons to privatize the electricity sector. While most of it is state-owned, the government has never really had a beef with allowing Electricidad de Caracas to operate as a private business. The only conceivable calculus behind these secret strategic reasons - which include the nationalization of all the extraction and refining activities in the Orinoco Tar Belt - has to do with the strategic interests the government's cronies have in lining their pockets.
Perhaps Jorge Rodríguez strategically wants more expensive cars, more houses in Margarita or yet another condo in Caracas' poshest neighborhood. Perhaps Oil Minister Ramírez and his family - including his brother-in-law, who is rumoured to have become somewhat of a "toll booth" in Venezuela's gas "business", an industry where millions of dollars are traded but not a single dollar of export revenue is produced - strategically need even more discretionary control over the oil and gas industry.
Meanwhile, Lieutenant Coronel Chávez insults our intelligence by claiming that nobody in the opposition is worth talking to because we don't reason, because we don't provide constructive criticism. If Chávez had enjoyed the benefits of formal university education, if he were anything more than a stupid "cadetico", this wouldn't ring so hollow. What "argument" can be made when Telecoms Minister Chacón (another "cadetico") says that the reason behind CANTV's nationalization is to make sure rural areas get more phone coverage?
This point is so dimwitted it's not even worth debating. Apparently, the Military "Academy" didn't teach "Tenientico" that there are any number of ways of regulating an industry to get it to do what you want. If it's rural services you need, there are plenty of incentives you can provide a company so that it does just that, if it doesn't, there are plenty of ways you can sanction it. However, there is some doubt about rural areas even needing fixed-line service, given how widespread wireless technology has become. Fixed-line telephony has been leap-frogged in rural Venezuela.
The CANTV nationalization scheme (where fat-cat corporate America will be paid handsomely for their shares while small Venezuelan shareholders are fleeced) is part of an ideological drive to turn us into another Cuba, something that is now looking more certain than ever. And while Tenientico Chávez would have certainly preferred to raid CANTV and tear-gas its executives, he decided to "buy them off" for fear of reprisals, lest a US Court confiscate Hugo's assets in the U.S. such as Citgo and the refineries on the Gulf Coast. The same story goes with AES, foreign owners of a big chunk of Electricidad de Caracas, who will probably be paid off handsomely while thousands of small Venezuelan investors lose their money as share prices plunge.
The RCTV case is even more pathetic. Chávez claims that he doesn't hear intelligent arguments from the other side of the aisle, but how can you provide an intelligent argument against a decision that has no logic? Whatever RCTV's sins may or may not have been, the proper place to vent those is a court of law. The RCTV case is pure censorship. Anybody supporting this move is supporting censorship and is therefore not a democrat - end of story, end of argument.
The opposition has also been showing signs of being comprised of stupid, short-sighted politicians. While Manuel Rosales went for a holiday in Miami (crikey!), the Primero Justicia gang is engaged in a fratricidal war that leaves nobody unscathed. While the country makes a decided turn towards radicalism, opposition leaders play into the hands of the government by taking their eyes off the ball. Instead of focusing on Venezuelans' many needs - housing, personal safety, jobs, economic stability - they're letting the government set the agenda...again!
So while Mr. Chávez bemoans the fact that nobody in the country is on par with his enormous intellect (the lieutenant-colonel has no clothes indeed), he proposes half-brained, stupid ideas such as setting up a common South American currency, building 200,000 homes in Nicaragua or giving Constitutional status to his regular raids on the Central Bank's vaults (Mobutu Sese Seko would have had trouble topping that last one). And while Venezuelans in the slums die by the thousands in a virtual civil war, the government does nothing and names its most cerebrally-challenged "cadetico" to the post of Minister of Interior.
In the meantime, The Guardian profile foreign sandalistas who visit Venezuela's barrios in propaganda tours and come back singing the praises of Chavez because in the slums, one hears Bach on the streets. Perhaps Bach is the best music to drown down the sounds of gunshots...
Arguing with the dim-witted can be exhausting, but I guess it should be done, and we will probably come back to our reasonable selves and try to make some sense of this mess in a purely logical, measured fashion. "El año viejo" didn't leave me an old jenny nor a white mare, but it did open my eyes to just how stupid Chávez is. Oh, don't get me wrong, I am not under-estimating him: he is shrewd, calculating, malicious and has a great tactical mind. He is also very popular and a great communicator. But he is dumb as a rock. He is basically an electoral machine with nothing in his head, and today, against that, I don't have reason, I have rage.
The "Godzilla" Chávez cartoon courtesy of www.coxandforkum.com.
This is my first post of the new year. It's been a long time coming, but my problem during the last few days has not been lack of inspiration, but rather an inability to channel the state of mind that I equate with good writing: one leading to reasoning, patience, tolerance. I'm filled with rage, and usually I don't like coming across as angry.
The expression of rage is usually identified with animal behavior, but it is also deeply human. We're taught us to shun and repress rage, but a total lack of rage can be dehumanizing. At times, it's best to just let it rip, and there's certainly lots to be angry about lately.
The incompetents at the top have made a decided shift into stupidity, and we are all along for the ride. While the memories of CANTV's horrible service during the 70s and 80s are still fresh in my mind, the government ignores this and decides to purchase the telecoms industry from private investors that had, with caveats, done a fine job in bringing it into the XXIst Century. The argument? "Strategic" reasons, whatever that may mean in the "minds" of the failed soldiers that govern us.
I mean, think about it. Thirty years ago, you could've made a reasonable case that Telecoms was a strategic sector. Old style telecoms were a "natural monopoly" - there was no sense in laying out more than one expensive national network of wires connecting every home and office in the country. And if you wanted to communicate electronically, the phone was your first and your last option.
That was then. Today, we have four national mobile telephony operators, satellite phones, voice-over-IP, internet, internet-via-satellite, internet-via-cable-TV, Cable-TV-via-internet, Skype, etc. etc. etc. CANTV long ago ceased to be a monopolist, long ago ceased to be strategic. These days, it is just the biggest company in a crowded, fiercely competitive market. Head firmly planted in the sand, the government just ignores all that and waves its hands around shouting "strategic! strategic!" End of the argument.
There are even fewer reasons to privatize the electricity sector. While most of it is state-owned, the government has never really had a beef with allowing Electricidad de Caracas to operate as a private business. The only conceivable calculus behind these secret strategic reasons - which include the nationalization of all the extraction and refining activities in the Orinoco Tar Belt - has to do with the strategic interests the government's cronies have in lining their pockets.
Perhaps Jorge Rodríguez strategically wants more expensive cars, more houses in Margarita or yet another condo in Caracas' poshest neighborhood. Perhaps Oil Minister Ramírez and his family - including his brother-in-law, who is rumoured to have become somewhat of a "toll booth" in Venezuela's gas "business", an industry where millions of dollars are traded but not a single dollar of export revenue is produced - strategically need even more discretionary control over the oil and gas industry.
Meanwhile, Lieutenant Coronel Chávez insults our intelligence by claiming that nobody in the opposition is worth talking to because we don't reason, because we don't provide constructive criticism. If Chávez had enjoyed the benefits of formal university education, if he were anything more than a stupid "cadetico", this wouldn't ring so hollow. What "argument" can be made when Telecoms Minister Chacón (another "cadetico") says that the reason behind CANTV's nationalization is to make sure rural areas get more phone coverage?
This point is so dimwitted it's not even worth debating. Apparently, the Military "Academy" didn't teach "Tenientico" that there are any number of ways of regulating an industry to get it to do what you want. If it's rural services you need, there are plenty of incentives you can provide a company so that it does just that, if it doesn't, there are plenty of ways you can sanction it. However, there is some doubt about rural areas even needing fixed-line service, given how widespread wireless technology has become. Fixed-line telephony has been leap-frogged in rural Venezuela.
The CANTV nationalization scheme (where fat-cat corporate America will be paid handsomely for their shares while small Venezuelan shareholders are fleeced) is part of an ideological drive to turn us into another Cuba, something that is now looking more certain than ever. And while Tenientico Chávez would have certainly preferred to raid CANTV and tear-gas its executives, he decided to "buy them off" for fear of reprisals, lest a US Court confiscate Hugo's assets in the U.S. such as Citgo and the refineries on the Gulf Coast. The same story goes with AES, foreign owners of a big chunk of Electricidad de Caracas, who will probably be paid off handsomely while thousands of small Venezuelan investors lose their money as share prices plunge.
The RCTV case is even more pathetic. Chávez claims that he doesn't hear intelligent arguments from the other side of the aisle, but how can you provide an intelligent argument against a decision that has no logic? Whatever RCTV's sins may or may not have been, the proper place to vent those is a court of law. The RCTV case is pure censorship. Anybody supporting this move is supporting censorship and is therefore not a democrat - end of story, end of argument.
The opposition has also been showing signs of being comprised of stupid, short-sighted politicians. While Manuel Rosales went for a holiday in Miami (crikey!), the Primero Justicia gang is engaged in a fratricidal war that leaves nobody unscathed. While the country makes a decided turn towards radicalism, opposition leaders play into the hands of the government by taking their eyes off the ball. Instead of focusing on Venezuelans' many needs - housing, personal safety, jobs, economic stability - they're letting the government set the agenda...again!
So while Mr. Chávez bemoans the fact that nobody in the country is on par with his enormous intellect (the lieutenant-colonel has no clothes indeed), he proposes half-brained, stupid ideas such as setting up a common South American currency, building 200,000 homes in Nicaragua or giving Constitutional status to his regular raids on the Central Bank's vaults (Mobutu Sese Seko would have had trouble topping that last one). And while Venezuelans in the slums die by the thousands in a virtual civil war, the government does nothing and names its most cerebrally-challenged "cadetico" to the post of Minister of Interior.
In the meantime, The Guardian profile foreign sandalistas who visit Venezuela's barrios in propaganda tours and come back singing the praises of Chavez because in the slums, one hears Bach on the streets. Perhaps Bach is the best music to drown down the sounds of gunshots...
Arguing with the dim-witted can be exhausting, but I guess it should be done, and we will probably come back to our reasonable selves and try to make some sense of this mess in a purely logical, measured fashion. "El año viejo" didn't leave me an old jenny nor a white mare, but it did open my eyes to just how stupid Chávez is. Oh, don't get me wrong, I am not under-estimating him: he is shrewd, calculating, malicious and has a great tactical mind. He is also very popular and a great communicator. But he is dumb as a rock. He is basically an electoral machine with nothing in his head, and today, against that, I don't have reason, I have rage.
The "Godzilla" Chávez cartoon courtesy of www.coxandforkum.com.
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