May 21, 2009

Oligarcas Temblad!

Quico says: So, there's an earthquake. It wakes you up. You turn on the TV and see a report about it. What do you think is more likely to leave you feeling alarmed, fearful, anxious or panicky? The earthquake, or the news story about it?'s like fish in a barrel, this story...except we're the fish.

As I think about it, I can't shake the feeling that the very ridiculousness of the charge tells its own story. There's a message in it; a conscious decision to go after Globo on the most self-evidently ridiculous grounds possible, precisely as a way of flaunting the government's arbitrary power.

After all, if you go after Globovision on grounds that someone could imaginably mistake as being rooted in the law, you might not quite get your message across. But go after them on grounds as transparently nonsensical as "you talked in public about something literally everyone in Caracas had felt minutes earlier", and you make it perfectly that, no matter how vanilla the channel's reporting gets, you're still going to go after them...just cuz you can.

May 20, 2009

Crafting a Chavista Court

Quico says: Five years ago today, the court-packing Organic Statute of the Supreme Tribunal of Justice came into effect. As I've recently discussed, I think that event should be recognized as the moment when Venezuela ceased to be a constitutional democracy in any recognizable sense.

To continue our commemoration of the event that made our justice Simply Red and our democracy Simply Dead, I've asked a Venezuelan legal scholar - who comments here as Capablanca - to contribute his thoughts on the state of Venezuela's legal system.
Capablanca says: On January 26, 2006, in the opening act of the Judicial Branch’s activities for that year, Venezuelan Chief Justice Omar Mora Diaz, speaking in front of Chávez and other prominent political figures, proudly stated that the Venezuelan judiciary was, at last, free from external political interference. The AD & COPEI era of judicial submissiveness was gone, and a new time of true judicial power had arrived. Shortly afterwards, several judges started spontaneously singing “Uh, ah! Chávez no se va!” showing everybody what judicial independence meant in Chavista jargon.

We know our judiciary –especially the Supreme Court – has always been weak compared with other political actors, especially the cogollos of the AD & COPEI era and their acolytes in the Judicial Council (Consejo de la Judicatura). But we have reached new lows in the current regime: the old tribes at least had the minimum sense not to chant political slogans in their robes. How did it come to this?

It would be too easy to just blame Chávez. In public, he has never showed too much deference to Dos Pilitas. From the (in)famous letter sent to the Supreme Court justices back in 1999, to his public use of expletives to refer to decisions that didn’t go his way, Chávez frequently showed contempt for the idea of leaving justices alone to do their job and interpret the law as they see fit (or to freely express their policy preferences, as judges arguably do in established democracies). These open interventions can only psych-out judges, usually threatening and constraining them from reaching any decision that would not match the regime’s (a.k.a. Chávez’s) preferred outcome.

However, Chávez’s public Court bashing probably is not all – or even most – of what this is about. Chavismo uses other tools to manipulate the courts. Like everywhere else, the most important mechanism is the appointment of sympathetic judges. In a democracy, this takes place following institutional rules that allow for the meaningful participation of a variety of actors, and respecting the rules of judicial tenure, probably the most important guarantee of judicial independence. Conversely, in non-democracies or dysfunctional democratic regimes, these rules are changed or completely bypassed: Judges are dismissed, forced to resign, or the court’s size and composition is changed to reflect the rulers’ wishes (a.k.a. court-packing).

Under Chávez, the Supreme Court has been reshuffled three times - late-1999, late-2000 and 2004 - and all three episodes have aimed to create Chavista majorities. But some majorities have been more Chavista than others. After the first two tries, the Chavista majority crumbled as soon as the ruling coalition responsible for its appointment broke apart.

Take, for example, the late-2000 appointees. Many of those justices people used to call "Chavista!" were really Miquilenista judges who understood that they owed their appointment not to Chávez but to their political boss, former Interior Minister and Chávez-mentor turned opposition Luis Miquilena. As a result, as soon as Miquilena flipped on Chávez, the justices did the same and, coupled with the very few judges who had connections with other parties, formed a solid 10-judge group strongly committed to the opposition cause. This group went far as stating, in a majority decision of the Court's entire roster, that the events of April 11-14, 2002 were not a coup. The feeble Chavista majority in the Constitutional Chamber was barely able to overcome this deadlock through their controversial use of that chamber’s alleged pre-eminence over other Chambers in the Court and over the Court in its entirety, reliably voting 3 against 2 in favor of the government in every major decision, including those that paved the way to the 2004 recall referendum.

To (re)create a majority, the 2004 Chavista majority in the National Assembly decided to expand and pack the Court, using the excuse of needing to pass the pending Organic Statute of the Venezuelan Supreme Court (LOTSJ). At the time, this proposal gained even more steam, since there was some fear among Chavistas about the prospects of losing the recall referendum against Chávez or achieving a narrow victory. Basically, they needed the Court as insurance in case of trouble.

The main culprit in this second packing-plan is clear: Luis Velásquez Alvaray. Velásquez had an agenda of his own - to reach the Supreme Court and, specifically, the Comisión Judicial, a body in charge of appointing Venezuela’s judges, to create a new judicial network or tribe that responded to his will.

We remember well how far Velásquez Alvaray and his buddies were willing to go to get the new Statute passed - they ended up modifying the National Assembly’s Rules of Order to get the Statute approved, steamrolling all opposition, even if that involved turning the statute into the messiest, most inarticulate piece of legislation in Venezuela’s contemporary history. Possibly even more than the crude political hatchet job it represents, it’s the amazing amateurishness of the LOTSJ’s drafting that makes serious lawyers cringe.

The Law passed and the new justices were appointed, Velásquez Alvaray among them. Ironically, Velásquez would last just a short time in the Court. Picking a fight with the wrong people and being blatantly corrupt at the same time was probably too much a stretch for someone with such little juridical credentials!

Now, what did they achieve with the last wave of court-packing? This time, the court apparently turned more Chavista than ever before, right?

That’s one plausible interpretation - especially since every magistrate is now absolutely clear that the only boss around is Chávez. Only a handful of justices with ties to the opposition dare to vote against the government line - among them, former Miquilenistas like Rondon Haaz at the Constitutional Chamber. Moreover, since the new justices arrived in the Court, the judiciary as a whole has been more willing than ever to stretch or trespass the boundaries of acceptable legal interpretation to favor the regime, tearing down a minimal image of legitimacy that is necessary to perform its role. Just think about the Supreme Court’s endorsement of the closing of RCTV last year, the use of criminal prosecution against political opponents, and a very long “etc.”

On the other hand, some things have not changed. Beyond the evident commitment that most Supreme Court justices have to Chávez’s cause lies an ever-divided court. Justices still compete, sometimes bitterly, for business, favors and to secure judicial appointments for allies in the lower courts. More importantly, since the 2004 law, many of them became tokens of prominent legislators in the National Assembly. Additionally, despite a decline in the court’s willingness to protect plaintiffs’ rights against the government – a phenomenon that several Venezuelan legal scholars have already highlighted – the opposition still goes to the courts.

This might sound puzzling, but it is also reasonable: the courts, especially the Supreme Court, are a highly visible venue for opposition politicians to keep showing that they are fighting for their constituency – in our case, that they are challenging the tyrant and his servants by all possible means, even if this is otherwise absolutely useless, even when their claims are constitutionally plausible.

So, on the one hand, the Court fails to control both the President and the Legislature, ceasing to do what is most important in a liberal democracy. That is probably fine with Chavismo, since they are already clear that their regime is not liberal-democratic. But many things have not changed. As in the past, networks of justices, judges, politicians and lawyers work to exploit the court for rent-seeking and personal benefit. In the legal world in Venezuela, everybody knows that several judges (not all of them) are willing to sell decisions to the highest bidder, and even guarantee that the decision will not be overturned on appeal by sharing the profits with their superiors. Everyone knows that many attorneys work as ruling-brokers, and not as legal practitioners; this used to be the case before Chavez and it essentially remains the same. And everyone knows that justices of the Court and politicians struggle to get judges appointed who then pledge loyalty to them – just like they once did with their old-regime designators.

In fact, the judiciary changed for the worse without addressing any of the underlying problems. Judges without tenure or a sense of it are less secure than ever that they will be in the bench tomorrow. Every time you see a discussion about ‘improving the courts’ and whatnot in the National Assembly, bear in mind that what we are really witnessing is a fight between different factions to control the judicial goldmine. So, in addition to being politically dependent, and sing songs to praise Chávez their noble leader, many of them know that even this is not enough, because the day somebody else is powerful in the legislature or the court, their post is at greater risk than ever. Making money while you are in the court all of the sudden starts making a lot of sense..

That is Chavista justice in a nutshell - a judiciary that remains politically dependent, not only on Chávez, but on rapacious politicians inside and outside the Venezuelan court system. But not everything is bleak. As in the past, there are a few real heroes that work as justices, judges, lawyers and public defenders with the goal of building the rule of law in Venezuela. Quietly, they believe that wearing red T-shirts, going to demonstrations or singing Chavista songs in the court is inappropriate for honorable public servants. And they are worthy of our utmost respect, and at least a bit of hope.

May 19, 2009

Así, así, así es que se gobierna...

Quico says: So you want to know how a minimally responsible petrostate elite might manage the oil industry's boom-and-bust cycle?

Go ask the Norwegians.

Facing a worldwide slump that has seen energy prices tumble dramatically, the government has just announced a big boost in public spending. And how will they pay for it, you ask? Are they going zillions of kroners into debt to finance it all? Not a chance. They're spending just a fraction of the billions upon billions they saved up during the oil boom.

If it's macroeconomic coordination you want, they got that too. Their Central Bank is aggressively cutting interest rates to boost aggregate demand and head off a slump. And, guess what? They can do that without worrying too much because they face an inflation rate under 3%. Why? Because they were careful not to overheat the economy by overspending when oil prices were high. And how did they manage that? By saving up a bunch of the excedent . . . you know, the part they're spending now, when they actually need it.

Which, to be fair, doesn't mean Norway will manage to avoid a recession altogether...just that the recession they're having will be incomparably shorter, shallower and less traumatic for Norwegian families than the one they would've had if they hadn't taken all those precautions.

None of this is rocket science, people. It really isn't.

May 18, 2009

Government eats itself

Juan Cristobal says: - The Chávez administration has been gobbling up everything in sight at such a pace, it's actually nationalizing itself now!

The Banco Industrial de Venezuela (BIV) was Venezuela's original state-owned bank: one of the few holdovers of the puntofijista Import Substitution Industrialization strategies of the 1960s and 70s to remain in state hands through the 90s. The BIV has a long, dysfunctional track record. It hasn't made a profit since the Welsers were around.

So in the latest display of chavista coprophagia, the government has decided to "intervene" it, which basically means taking control of the BIV.

What's not really clear is why the government has to go through this whole convoluted rigamarole to intervene a bank it already owns.

In fact, whatever ails the bank is the government's own fault. So it's not clear what this "intervention" is really after, other than the latest round of chavista musical chairs, quítate tú pa’ ponerme yo.

It can't be the BIV's losses and its severe under-capitalization that prompted this. If making a loss was the kind of thing to trigger an "intervention", every state owned company in the coiuntry would be "intervened." Besides, this profit-and-loss stuff is so unrevolutionary to begin with

There has to be something else at play here. Perhaps the government is setting the stage to merge the BIV with the Banco de Venezuela, once Chávez gets his fat, dirty paws on it. Perhaps this is the first step to justify a massive nationalization of the banking sector. Or perhaps somebody in the BIV wasn't giving loans to the right people and this is a way to send a strong signal.

Whatever it is, it makes no sense in the real world. But this is the Chávez government we're talking about, so it makes perfect sense.