There Is Too Much Money To Be Made In The Bolivarian Revolution I: The Gasoline Racket.

August 28, 2014

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“You will never win this war when there is so much money to be made. Never”

Jhon Popeye Velasquez alias “Marino” in an interview before he was released.

To those that watched Escobar, El Patron del Mal, the character Marino is one of the worst guys in the book and series. It turns out that this week he was freed from jail after serving twenty eyars and has been in the press quite a bit. The sentence above hit me, because that is one of the things that I fear may happen in Venezuela: there is so much money to be made, that those trying to change the Government may never be able to. While “Marino” was referring to the drug war, I am referring to all of the corrupt businesses allowed and nurtured by the revolution. Everything in the rveolution has been turned into some form of business or arbitrage. From drugs, to Cadivi, to Fonden, to gas. Thus, do you really think those in control are going to give up these rackets so easily?

I don’t.

The basic question I want to answer is: How much money or profit are we talking about?

In this post I make a very rough estimate of one the biggest businesses (Billion dollar plus) where the boliburgoise and Government officials, civilians or not,  have gotten rich, filthy rich. I make many assumptions, attempting in the best case to be under the correct amount, rather than over. I will try to make a series out of this. Today, gasoline

1) The gasoline racket.

When did it become such a big business to take gasoline out of Venezuela? Since Chavez became President in 1998, the price has been frozen. When he got to power, a liter of gas was about Bs. 90 (0.09 of today’s Bolivars) and a dollar was about Bs. 600 (Bs. 0.6 of Bolivares Fuerte). Even at that level it was a good deal to send gas to Colombia. But it did not become such an organized activity until the difference was so large, that the cost of gas was irrelevant. Let’s say a factor of 50, that is, when the parallel market rate became Bs. 5. I am going to assume that this is when the racket began to become massive. We are talking around 2007. And I assume it reached the current massification when the factor became 100. This happened in 2012.

The first question is what is the current number for barrels of gasoline extracted per day. Ramirez says 100,000 barrels a day. Colombia says 55,000 alone to that country. I will assume, the latter and add 10,000 a day to Brazil and 10,000 a day each to Guyana and Caribbean islands. Total today 75,000 barrels a day. I will also assume that when it all began in 2007, about 10,000 barrels a day was being smuggled and from 2007-2011, take the slope between 10,000 and 75,000 reached in Jan. 2012 This is all very conservative.

Now, the next question is: When they say so many barrels a day, are they talking about barrels of crude? Because you only get about 19 gallons of gasoline from a barrel of crude which holds 44 gallons of crude. I am also assuming this interpretation is correct. it’s “only” a factor of almost 2.

So, here I am holding one barrel which was free, given the approximations I already made. The middleman in Colombia, Guyana, the Caribbean islands and Brazil have to make something. So, I will assume that each gallon is sold cheap for about $3, so that my barrel is worth US$ 57. Nice profit. Before we discuss who gets it, let’s calculate what this means in one year for 75,000 barrels.

It is US$ 1.56 billion per year.  Or from 2007 to 2013 US$ 8.426 billion in profit.

Now, I would bet the “bachaqueros” do a significant fraction of this business. But they have to pay the military. The question is how much is the more “formal” business. the one that takes full trucks of gasoline to Colombia. My guess is this is about half the business. Thus, assume the “bachaqueros” have to spend one third of their profits in bribes and that “you know who” takes about 80% of the profits from the other half and you are saying the ones that control the gasoline racket have pocketed about US$ 4.67 billion.

Double it if they are talking about barrels of gasoline…

Nice racket! But there are bigger ones! More, as I have time (but going on vacation)…Cadivi, Bonds, Drugs, Foreign Exchange

Government Paralysis Even At The Simplest Levels In Venezuela

August 26, 2014


That ideology screws up the implementation of the Venezuelan Government’s plans is obvious. What is incredible is how the belief that the anyone can do anything (Chávez was President, Maduro follows…) has led to the total destruction of the Government. There is no longer institutionality. As people have been put in charge of institutions they had no clue about, the decision making process has ground to a halt. We are not talking about rocket science here, we are talking about simple things like printing currency, for example. A function the Venezuelan Central Bank used to cover rather efficiently. As inflation increases and monetary liquidity goes up, you have to print bills in higher denominations. It’s sort of obvious and as long as there were some technical people left at the Venezuelan Central Bank, it was routinely done.

Then the revolution and with it some military officers, arrived…

And a friendly reader who has some some form of contact or works at the Central Bank, sent me some slides of a report that has been circulating at the Central Bank for apparently quite a while.

The report enunciates the problem rather simply: From 2008 to 2011 bills in circulation in Venezuela increased in value by 210%. The report, which apparently was done in 2012, predicted similar growth in 2011 to 2014 of 192%, coming up short, but that is in the end a minor detail.

In 2011, according to the report, there were 1.6 billion Bills in Venezuela, that is 55 bills per citizen. Of these, 40% were in Bs. 50 and Bs. 100 bills. But, these two denominations represented 82% of the Bills in Venezuela by value. Thus, the report predicted, without really expecting it, that these bills would become 95% of the bills by value by 2016 if nothing was done. (Nothing has…)

This was the prediction:

encircNow, Venezuela has the Casa de la Moneda in Maracay, run by the Central Bank. The problem is that it has a finite capacity on terms of how many bills it can print a year (800 million). As the Government has failed to create higher denomination bills, then the result is that more and more bills have to be imported (Another imported item in Venezuela), rather than be made in Venezuela. In fact, the source tells me that today the Maracay factory is running four shifts a day, but they are still not able to keep up and about 40% of all bills are now imported. And growing…

In fact, the report says that if a higher denomination bill is introduced in 2013 (which was not done), the number of new bills will increase to 1.1 billion by 2015, before it decreases.

But nothing was done, so the numbers are much higher.

In fact, the conclusions of the report are:

-A Bs. 200 bill (or even Bs. 500) is needed before 2014., as by 2014 the Bs. 100 bill would be 70% of all bills by value. (This was not done, of course)

-The Bs. 2 bill should be replaced by coins (This was not done)

-The 12.5 cent the “locha”, reintroduced by Chávez’ whim, should be withdrawn (No idea if this was done, it is worthless as a coin)

-The 1 cent coin should be eliminated. Ditto.

In fact, the report suggests that with the creation of the Bs. 200 bill, this would be the percentage of bills up to 2016:

ProjectedOf course, the Bs. 200 bill does not exist yet, M2 increased faster than projected in this report and the current authorities of the Venezuelan Central Bank have done little about something that should be pretty simple to decide and implement. Don’t even think about sophisticated things like how to invest and manage international reserves or sterilize liquidity to reduce inflation.

According to the anonymous reader, nothing has been decided, nothing has been considered, no one decides, it has all fallen in the Government aralysis even at the simplest levels in Venezuela.

Such are the ways of the incompetent and improvised Bolivarian revolution…

Is There A Government In Venezuela?

August 21, 2014


The question posed by the title of this post is not rhetorical. You have to wonder if there is a Government in a country where decisions appear to be random, if and when they are made and when incoherence seems to be the norm, rather than the exception.

Take, for example, Rafael Ramirez. This guy is supposed to be in charge of like half the Government. He is President of PDVSA, Minister of Energy and Oil and also holds a position with the over the top name of “Vice-President for Economic Affairs”.

Now, for months, Mr. Ramirez has been proposing a unified exchange rate to remove distortions and in his own words: “It is very difficult to manage three exchange rates”. Separately, Mr. Ramirez has been the main proponent of a gasoline price increase, calling the current level of subsidies “absurd”.

You would think that with all his titles Minister Ramirez has some pull in Venezuela’s Government. I mean, he made all of these proposals at the PSUV Congress (Where nothing was voted, in the best Stalinist tradition). The people even stood up and cheered for most things he said.

Despite this, not only has nothing been decided, but Ramirez has changed his tune. He now talks about “convergence” of the exchange rate, which should be read as “more than one”, maybe two or even three. But the timing is quite fuzzy too. He now says that additional measures have to be taken first, mostly monetary measures. Funny thing is, M2 not only keeps growing at the same unstoppable rate, but Treasury Bill auctions were recently declared null for the first time in years and the rates were really stupidly low.

Thus, it does not appear as this very powerful man has any power in Venezuela, as he has been preaching at least “reasonable” measures for months, but no decisions are made and his proposals change over time.

Of course, Ramirez has a boss, President Maduro. Thus, in the end it is your boss that decides things, no? But at the same time, you don’t go out publicly with anything without running it by your boss first, no? That is what organizations do, from the Girl Scouts, to companies, to Governments. They discuss, talk about it and run with the conclusions. Sure, sometimes in politics you float balloons to see how the public reacts, but these balloons don’t last six months.

But Maduro behaves much the same way. He says one thing one thing one day, only to promote the opposite later.

Take the whole issue of using fingerprint machines at supermarkets to control smuggling. The whole thing is absurd. Are you going to impose a system on the “people” you always cry you care about, given that it is hundreds of Tons of stuff that gets smuggled out of the country all the time? How much does this system cost? Who will run it? Who sells it? Who maintains it? Who profits from it? How do you implement it?

Even worse, just last week, one of Maduro’s powerful underlings, the Head of Sundde, declared the”war” on lines at supermarkets. Do you really think that implementing a fingerprint system with restrictions to boot, will help ease them.

Imagine the dialogue:

Cashier: “Sra. please move your finger. Ok, Ok, dry your finger before you place it on the scanner. Great, finally. Well, sorry you are limited to two bags of Harina Pan, two cans of powdered milk and one kilo of sugar, so we have to take it our of your cart.”

Sra: “But please, I have four kids, I need the milk. Even if I come tomorrow you will not give me any additional milk. Etc., etc., etc.”

Meanwhile the line backs up even more. People get upset, start complaining and who is going to come calm them down. The Sundee? Sure.  Most likely the National Guard.

But the worst part is that Maduro said a year ago that he was against this type of system. In fact, he ordered that Governor Arias Cardenas of Zulia State stop any form of rationing, arguing that producing stuff was the only way to go.

A year later, Maduro is the king of rationing and the surely corrupt biometric systems. As I tweeted, it would be much cheaper to put a voice transmitter on every military officer in the country, in order to stop them from charging commissions at every step, including all the flow through the borders.

Just watch this video from  this blog, and even if it is in German, you understand the guy is bribing the Guards to get thru and make a lot of money smuggling. So, are you going to check the cars or the Guards? Same idea applies to foodstuffs.

I mean, if as Ramirez says 100,000 barrels of gasoline get smuggled out of Venezuela, does Maduro believe it is one barrel per car? Or maybe it is like 500 barrels (80,000 liters) per truck and a few national Guardsmen helping out. And “colaborando”, wink, wink.

But going back to the title of the post, who then runs Venezuela?

I am starting to think nobody. This is a collection of individuals with no apparent command or direction, led by an indecisive man. I don’t think Maduro went to Cuba to receive orders. I believe he went to Cuba to ask Fidel which of the many proposals he should follow. And Fidel likely told him to just hold tight, try to sell Citgo, see how long they can last. And if they can’t sell Citgo, you can make very tough decisions, like hold payment on debt, borrow somewhere and try to ride it out. But Nicolas, Fidel likely told him: You are not Hugo.

And so the country drifts into som sort of economic black hole. Today it is fingerprint scanners, tomorrow it will be some different imaginary battle. But it will always be about attacking the consequences, not the causes. Those, they will not touch. Maybe a small adjustment in the price of gas. Maybe move the Bs. 6.3 per US$ rate to the Sicad 1 rate. But that’s it. In the absence of Government, there will be no decisions. No real policy changes until 2016

At the earliest.

What Government Control Of The Media Means In Venezuela

August 15, 2014


You would think from the headlines of El Universal, El Mundo and Agencia Bolivariana de Noticias shown above, that the Government had scored a big victory in signing a collective bargaining agreement with Sidor workers and managing to appease Venezuela’s steel conglomerate and its unions.

Except that the information is fake. False.

There is no agreement. This is just a staging of the signing of a contract.

There is no legally signed or approved contract. It has not been approved by the Assembly of workers, nor has it been signed by the Executive Committee of the union. This is simply a media operation by the Government taking advantage of its almost total control over all the print and broadcast media. For more than 15 million Venezuelans, the Government won in its fight against the “right” trying to destabilize it using Sidor. When and if there are more protests in the upcoming days, the Government will remind everyone that a contract was signed and the workers can’t go to work because a small group of “right wing” union workers (I would like to meet just one!) decided to boycott the agreement. You and I and others that read Tal Cual or Damian Prat will know it is not true. But it does not matter. The Government does not care about Sidor producing or union workers having rights. All it cares about is its image, which it can control via its control of the media.

Orwell would have been proud of them.

Some reader made a comment saying that what I posted is not from today’s El Mundo. I have no idea what he is talking about, but here is the front page of El Mundo today

mundoand here is page 14 with the story


Venezuela Should Increase Gasoline Prices Sharply

August 10, 2014


I am behind on writing about Venezuela. There are so many things to write about and I do have many opinions on them. And there is little time. But the subject of the gasoline price increase is at the top today. In this supposed “adjustment” that Chavismo has claimed it will do for the last eight months, the discussion began after the regional elections in December with precisely the price of gas. But then, much like the so called “unification” of the exchange rate (now called the “convergence”), there was a lot of internal opposition within Chavismo to the increase of gasoline prices.

Now things have been turned around, there is a lot of opposition to the convergence of exchange rates internally, so all of a sudden Minister Ramirez revives the subject of a gasoline price increase. It seems Ramirez only wants to find a way to have PDVSA improve its finances, rather than improve the country’s fiscal balance.

Let me state first, that I am absolutely and totally in favor of the gasoline price increase. I find it appalling that people oppose it, condition it, question it and dilute it it in an absurd discussion of what they want or don’t want the Government to have or do.

The gasoline subsidy in Venezuela is a disgrace, it is wasteful, it is absurd, it is bad for the environment, it generates contraband, it is regressive, it is unfair, it is unjust for future generations, it generates traffic, it distorts policy making and it is simply irresponsible.

In fact, I find it amazing not only that the opposition has so many reasons to object to it, but that the Government is thinking of a small adjustment like to Bs. 2 per liter, if not half of that.

Gas is so cheap (free really) in Venezuela, that it is difficult to talk about how much a liter costs. So, we go back to a picture I posted in May 2011:


I filled up my tank down in Caracas with 43 liters of gasoline and paid Bs. 4.2 for he whole thing. Bs. 4.2 for 11.43 gallons of gas, which at the Sicad 2 rate happens to be 0.082 dollars for a tank of gas. All of 8.2 cents of a US$.

I use the Sicad 2 rate, because it is the highest accepted by the Government and the only one “real” people have a small chance of having access to it.

So, currently in Venezuela, filling a tank of gas up costs 8.2 US$ cents, let’s round up to ten cents for the sake of the discussion.

Now, as you can see in the picture above on the right, I used gas that cost 0.097 Bs. per liter. The Government wants to increase it to either Bs. 1 or Bs. 2, depending on who you believe. This means that the Government wants to increase it to around one or two dollars a tank of gas.


To me, that is the same as leaving it is where it is today. It will have no impact on contraband, waste, PDVSA, fiscal accounts, etc, etc., etc…

Furthermore, with 70% inflation the effort of convincing the population that the increase is good, doing it and implementing would be wasted very fast.

Thus I think the Government should target an increase that is large. Say to US$ 20-40 per gas tank. (50 cents to one dollar a liter, still cheap. Or FOB export price, which is the most rational to do) and maybe do it over a year. Similarly, they should schedule further adjustments whenever they devalue, so as to maintain the price at the same relative level to international prices as the adjustment.

All of the other arguments are simply irrational and spurious. That you don’t trust the Government and what it will do with the money? Nobody trusts any Government and what they do with your money. It is the same arguments why people don’t like or want to pay taxes. But the bills have to be paid and in the end it is a vicious circle. The same with the argument that the public transportation is terrible. It is a chicken and egg problem.

Finally, there is the Cuba and Petrocaribe argument. They are valid, but you can’t tie one to the other. The opposition should raise a stink and point out that we give Cuba and those countries very cheap gasoline. In the case of Cuba, the Government of that island sells it at international prices and makes money. But that should not stop us from supporting the price increase. In fact, if anything, the oppsoition should attack the increase because it is not large enough.

Until policy is not discussed seriously, Venezuela will never advance. Chávez introduced the absurdity of an overly subsidized gasoline prices, if this Government wants to take a small step into some semblance of sanity in its policy making, it is absurd in my opinion to oppose it. Otherwise you are promoting the same type of irresponsible Government you object so much too.

I know this will not be a popular post, but I do believe that in politics, one should have certain essential beliefs and principles and that one should stand by them and not turn them around and debase the nature of the discussion just for politics sake.


Venezuela Drifting Further Away From The World

August 6, 2014


I was in Caracas last week. Almost did not go for the simple reason that it is quite difficult, besides expensive, to find an airline ticket out of Caracas. Venezuela is simply drifting away, further and further apart from the world.

In my case, my trip, more like a saga, began when I found a ticket Caracas-Aruba in Aserca to make a connection to a US airline in Aruba. Plenty of time between the two, Aserca was leaving at 11:30 AM, the other flight leaving at 3:35 PM. Given that the flight to Aruba is 35 to 40 minutes, there should be no problem. On top of that, I had only hand luggage.

Chop half an hour from the time between flights, thanks to now banned Chavista genius Navarro, as I did not take into account (my fault) the half an hour difference between the two countries. I did show up at the airport a three full hours before flight time. Seemed like a good precaution, as Aserca has no line for those without luggage.

Well, when I showed up, there was a huge line for the full flight and all but four passengers were in line in front of me. Fortunately (or maybe I should have worried about it) there was a sign that check-in would close at 9:30 a full two hours before the flight. That meant, that the line would only last one hour.

And it did. With about three minutes to spare.

In the line, I learned a number of things from the ladies ahead of me. For one, they bring their food to Aruba, you know, they told me, food is so much more expensive there. Thus, they bring their food, hiding it under the clothes, so that Aruba customs does not take it away. That happened to me, said a different lady. They also discussed how bringing lots of food is good, more space to bring back the stuff they buy in Aruba, which turns out to be paper products (toilet paper and diapers are favorites), food (not fancy ones, those you can get in Caracas. It’s all the stuff he government controls or imports that they bring back) and cosmetics. Cosmetics, like soap, shampoo and similar things, lest you think that they bring back expensive things like perfume. I also learned you have to stay a full week in Aruba in order to get the full US$ 700 from Cadivi. Better to go to Aruba than Miami, said a third lady, the ticket is cheaper and you get the same amount of money. Besides, I bring my kids, they don’t cost as much and I can ask for US$ 700 for each.

I trust I am not passing bad information, I haven’t checked it. But on how to squeeze the Chavista foreign exchange/travel system, these ladies seemed like true experts.

To my surprise, right before check-in there was a guy that would actually ask you if you were connecting to another flight. I thought I was the only one. How wrong I was. There were people connecting to my flight and to at least four other ones. In fact, looking over his writings on the reservation list (the only thing that was respected all day) about half the flight, including many kids, were making connections to the US and/or Europe. There were twelve connecting to my flight. I should have gotten worried when the agent told me that Aserca was not responsible for any of my expenses if I did not make the connection. I actually expressed confidence that there was plenty of time between flights, to which he answered: “Well, yesterday one passenger did not show up and it took an hour and a half for the National Guard to allow the removal of the baggage belonging to that passenger. The plane left with a three and a half hour delay.”

But I am a lucky devil, no pun intended, so I went to immigration confident that  there would be no problem.

Think again!

We were told to be at the gate at 10:30 AM, so I drifted towards Gate 22 at 10:15 AM not that I expected the flight to leave without me. Gate 22 must be the gate from hell. It is a combination of Venezuelan organizational planning, combined with Venezuelan military organizational planning (A true oxymoron).

You see, when you approach Gate 22, there are two signs: Gate 22 in the back and gate 17 in the front. If you are dumb enough to follow the Gate 22 sign, you reach a corridor, blocked by cardboard. Thus, you have to go back to gate 17. That is Gate 22. Obvious no?

There are no signs in gate 17 ( or 22). Just an escalator going down and stairs coming up. Given that there were four flights waiting to use Gate 22, the upstairs lounge was completely full, since it did not even have capacity for a  small commercial jet. Downstairs is different. It is empty, there are seats. But even though you have just passed security once, the chairs in the waiting lounge are blocked and you have to go through the National Guard security in order to get to the lounge and eventually on to the buses to the plane.

A not so pleasant looking Guardsman comes up to me and tells me to go back up until my flight is called. Up the stairs I go, not before he gives me the explanation: Your gate number could be changed (I should have paid more attention at this point), for example, and you would be down here.

Sounds perfectly logical, but I still don’t understand why flights that required a bus, need double security.

I go back up. During the time I was there, I saw some two dozen people go downstairs and then trek back up, including a pregnant lady with two kids.

Order (ha! ha!) was restored when the Aserca people showed up, roughly at the same time as the La Venezolana staff (different flight). This happened about ten minutes after the time we were supposed to be at the gate. Then began the placebo explanations of the Aserca staff. The plane is being filled with gasoline. Next customer up, the plane is in the national terminal. Next customer, if the plane is brought here we will leave from a different gate. (Told you I should have listened!)

As I am getting impatient, a passenger says: “We have to be very patient, this is Venezuela”. I feel like telling her why I don’t want to be patient, but I shut up. About an hour later, we are told the plane is full of gas (Cheers!), but it will be brought over now to the international terminal (Booo!). This means we have to go to Gate 28. (Which is actually Gate 28)

A real gate! No second National Guard check up of our hand luggage. Makes sense, no? Just kidding!

At the gate I meet a lot of fellow “conectees” worried about time. I meet a guy who is connecting to my flight. I tell him I only have hand luggage and have my boarding pass printed. I explain that the airline closes the flight 45 minutes ahead of time, thus, if we are further delayed, he will not make it. He does the check in in his phone. (He is the only other person that made the connection: “Thanks Devil” this guy should say. You are welcome!). There is a family going to San Francisco, a girl to meet her Spanish fiancee in Scotland. A guy who is moving to the US. Another getting his visa soon. Another bought a fish business. And finally, an Arubian/Venezuelan (Doctor, builder, grandfather and tool smuggler into Aruba) who clearly has done this many times and explains at the gate and on board exactly what obstacles you will have in Aruba to make the connection. (Thanks buddy!)

We finally board. A little disorganized, but hey, Germanic compared to everything what went  on before. We might yet make it.

As we are sitting on the plane, the Captain apologizes for the delay and says…we will have another delay, because the truck to start the engines is in the National terminal and has to be brought over. (Why did they move the plane then?)

It looks tough now. Very tough.

As we wait, the stewardess asks me to check if my seat has a life saver underneath. It does. Two mechanics come on board and start checking for life savers around my area. They are all there, but there is a report that one was missing. Finally it is determined, that it was the seat of the girl going to Scotland, sitting behind me, that did not have one, it was an empty bag under her seat. How would she know. She is given a life saver to put in the pocket ahead.

To my surprise the two mechanics that boarded the plane to check the life savers, stay on board. I don’t even want to ask why. They are seated in front of me, this must be the safe area of the plane, I tell myself…

We finally move at 1:45 PM Caracas time, which is 2:15 PM Aruba time, my flight is at 3:35 PM. Looks bad.

Flight goes well. I am seated close to the front. I leave the plane and start running. I get to Aruba immigration and the lines are huge, like 50 people deep. The not so considerate gentleman organizing the line tells me to get in any line, he can’t do anything for me. My new friend follows. We ask the people in the next line if we can go ahead of them. they say sure, they are vacationers going to Aruba, we look stressed. We bypass a bunch of people and when I am called, the immigration lady  I got is given a pack of eight passports to process ahead of me. “You can stay here, she says”

I smile.

And then I run. Remembering the instructions by the Aruban/Venezuelan guy on the plane, I exit the terminal, take a left. Then another left to departures. I keep running, O.J. Simpson style  (dated joke, last time I did this was in 1977, still recall the analogy). Then I do Aruba immigration and security. I keep running. Then I do US immigration and security. No lines, thanks God. Nice agent.

Then I run more, My plane is at the last gate at the airport. gate 8. I show my boarding pass. Lady says: “Mr. Octavio, I thought you were already on board”. I run, get in the plane, sweating by now, sit down and the stewardess offers me a glass of water and some paper towels (Thanks Veronica!) . She then turns around and closes the door to the plane.

I made it, but I realize that Venezuela is slowly drifting apart form the world. It is further and further away every day in all possible senses: Physically, intellectually and cronologically. And this increasing remoteness is true for both those abroad like me and for those who still live there.

What a tragedy!



Am I crazy?

August 4, 2014


No expert, just a little bit crazy. It has now been twelve years writing the Devil

The Collective Responsibility Of Venezuelans

August 3, 2014

I was amazed by how timeless this article is.  I do not necessarily agree with all it says, but most of it. The answer of when it was published is at the end, but there are hints in the text.

By Aníbal Romero

Some former parliamentary members of the official sector have announced that the upcoming Constituent Assembly shall initiate “popular trials” against the alleged perpetrators of our national misfortunes. Is is worth noting, once again, the lack of understanding that our novel rulers have about what it means to have the rule of law. It should also be noted that those who ask for such trials, are self-proclaimed ‘human rights defenders’. Undoubtedly, Venezuela today lives under the sign of Orwell: here the truth is a lie and the lies are he truth; white is black and black is white; demagoguery is government and government is demagoguery.

Now, who will judge who? I would not be balanced to deny the failures of the misnamed ‘elites’ of the puntofijismo as they have a fundamental responsibility for what happened, good and bad, over these past decades. But: what about the people, does the community generally lack any responsibility, any blame? Ask yourself, for example, if it is perhaps  that someone forced them to vote for Pérez in 1988, or Caldera in 1993? If I remember correctly, on both occasions many voices were raised to warn Venezuelans about what would surely mean the renewed choice of these characters as presidents. Many warnings were made, not that we lacked alternatives. However, the majority of people supported them. Does not this imply a degree of responsibility of the people in general of the national destiny? Do they not remember what we did? Or is it perhaps that we do not want to remember?

The idea that there is a collective responsibility for the fate of a community or country is not original. In our century, the reality of shared responsibility has been tested in specific cases, and the reason is simple, most especially if we are talking about a democracy: Citizens do not have the right to wash their hands of the sociopolitical processes that move history. At a minimum, life forces us to provide a balance of the outcome due to government we choose.

It is  especially absurd to not attribute part of the responsibility to a community like ours, which for more than forty years has lived with a massively overvalued currency, subsidized all over the place, undergoing massive investments in health and education (and which we were not able to take care of in both quality and efficiency). A community that, when the time to face the harsh reality of the end of the populist-rentist model arrived, chose to take to the streets (27-F 1989), behead a President who had been democratically elected, support two violent coups and bring to power in 1993 the person who sent them the pathetic ‘Letter of Intent for the people’. And to round it off, the same people ended up exalting to the leadership of our destiny, the main character in one of those military coups, the crucial negation of all democratic value. What can we expect, then?

Not understanding that collective responsibility is equivalent to conceive the ‘people’ as an entity composed of mentally, legally and morally disabled individuals. Because that is not my idea of ​​the Venezuelan people, I think that is composed of normal human beings, which is why I believe that we can not skirt the part that corresponds to us in the drama of the country. The sweet and complacent attitude towards the ‘people’ adopting an attitude which imagines them as pristine and the source of all virtue and wisdom, is nothing but a mask behind which they hide a deep contempt towards the people, which is seen as manipulable and even stupid, as people who you have to distribute cheat sheets to vote, which they aimed to deliver to electoral ballots decorated with berets, hats, caps and other playful symbols, so that they could  ‘get it right’, because they are too stupid, and may not vote for the currents saviours.

I insist: Who forced those who voted for Pérez and Caldera to do it? Who forced those who voted for Hugo Chavez to do it? Also in 98 many  warning voices rose, and nevertheless they again came back to take the easy road, that of the scapegoats, the messianic solutions, constituent illusions and other tricks of our incorrigible and systematic collective delusion. Now we claim to want to change everything, but really do not want to change anything. What we want is to go back, to that populism works, to that of a ‘strong man’ that makes decisions and leads us by the nose. Productivity? Competitiveness?? Long-term vision?? These are not the issues that beset us. Here are Danton and Robespierre emulating, retreating to the eighteenth century, minding if the Constituent Assembly will be ‘original’ or ‘derived’, happy to discharge our responsibility over any mirage that comes to mind. But it can not hide the truth forever: the Venezuelan people have given themselves the governments who they believed deserved. Nothing is left but to bear the consequences. Popular Trials? And who will judge the people?

This was Romero’s farewell article in El Universal on June 6th. 1999.


And One More Thing…On The Carvajal Affair

July 29, 2014

So, The Netherlands invoked an article nobody had referred to in the whole affair, to release Hugo Carvajal on Sunday evening. Basically what the Netherlands said was that Art. 13 of the Vienna Convention allows for a Consul named but not accepted to temporarily assume his or her duties. Thus, according to this, Carvajal’s arrest was valid and his release was valid.


It was somewhat sneaky of the Dutch to release Carvajal on a Sunday, without going to the Judge that originally said Carvajal did not have immunity. You would have thought that in a country with Law and Order, the proper procedure and place would have been to go to Court on Monday and request Carvajal’s release.

Most likely, the Dutch Government did not want the US to show up in Court on Monday with the extradition papers, creating a conflict. The Prosecutor in Aruba had said that the extradition was now just a formality and the US just had to provide the required documentation for it to take place.

Clearly, everyone applied pressure, but the weak link did not turn out to be Aruba as I suggested on my first post, but rather The Netherlands, as reportedly even Russia played a role, exchanging concessions on the Ucraine plane for helping release Carvajal. No matter what anyone says or how this is interpreted, it was a severe blow to the US, who would have loved to get Carvajal onshore. The indictments are a doozy, they are sealed indictments in Miami and New York, accusing Carvajal in Miami of helping drug dealers and in the Carvajal Indictment Southern District of NY of :

cavnyThis is not aiding or helping, this is coordinating the transportation of “only” 5.6 Tons of cocaine to the US, quite a strong accusation, charged by the Grand Jury, no?

Meanwhile, Carvajal is welcomed in Venezuela as a hero and there are few mentions of the fact that The Netherlands declared him persona non grata. What is true according to reports is that Carvajal had been going to Aruba for months and unlikely that he was going to act as a Consul. We will never know what he was doing there, but one can suspect.

The most likely threat by Maduro on the Dutch? That Venezuela would withdraw from the Isla refinery in Aruba. The Netherlands already spends more money that it wants on the ABC islands to have to spend even more.

This story likely ends here for now. Carvajal and his buddies will likely stay away from jurisdictions with a US extradition treaty for quite a long time.

And, of course, no more Disney for you, high ranking Chavistas!

Some Questions And Inconsistencies On The Carvajal Affair

July 27, 2014


There are too many  unanswered questions about the Carvajal affair. Too many inconsistencies. I have been wondering about them, some I have seen asked elsewhere, others not. So, here is my list of mysteries surrounding this affair:

-Knowing that General Carvajal was in the US Drug kingpin list since 2008, why did the Maduro Government name him as Consul to Aruba?

-Did the Venezuelan Government ever notify The Netherlands of Carvajal’s nomination as Consul to Aruba? El Universal says it never happened.

-Why did Carvajal, knowing about the extradition treaty between The Netherlands and the US travel to Aruba before he had been given the placet or approval by The Netherlands?

-Why did Maduro want to name Carvajal as Consul to Aruba specifically? Is it related to the island being an offshore financial center?

-Why would a legal resident of the US, lend or lease his US company’s jet to someone in the US drug kingpin list in the Patriot’s Act era?

-Why hasn’t Venezuelan Foreign Minister Jaua said a “pio” (beep) about the Carvajal detention, given that it was his underling that was jailed and a diplomatic immunity issue raised?

-People keep discussing the legalese of whether Carvajal had or not immunity, citing the Vienna Convention to argue both for and against. Doesn’t this article from that convention perfectly clear that he did not have immunity, since Carvajal could not take up his post until approved by The Netherlands?:

Article 39

  1. Every person entitled to privileges and immunities shall enjoy them from the moment he enters the territory of the receiving State on proceeding to take up his post

-Who ordered the ban on flights between Venezuela and Aruba? Who rescinded the order? Why on both?

-Was the cancellation of Rafael Ramirez’ trip to New York to meet with investors related to the Carvajal affair?

-Did Carvajal really try to cut a deal with the US in 2012, as reported,more here?

-Was it Chávez that stopped any investigation of Carvajal by the Prosecutor when drug dealer Makled made very explicit and specific accusations against the General?

-The US Government only requested Carvajal’s extradition on July 4th. 2014, 20 days before Carvajal’s detention.Was this coincidence, a change in US policy or they learned Carvajal was already going back and forth between Aruba and Venezuela?

-How does Carvajal explain the multiple passports, the $20K and the private jet he arrived in? Was one of the passports fake as suggested by a Miami newspaper?

-Is there really a connection between Carvajal’s removal as Head of Military intelligence and the fact that a number of Colombian drug dealers were captured in Venezuela following his retirement?

-Is it true that Carvajal was really disliked if not hated by the “ideological” wing of Chavismo?

-Can you be a serious General and be nicknamed ” El Pollo” at the same time?

There, if any of you have others, add them in the comments and if can clarify any, please do. Something does not make sense in this story.


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