Imaginary Dialogues: Reporting From Venezuela by Paul Esqueda

April 16, 2014

Caricatura-de-maduro-y-el-circo

While I am at the beach, my good friend Paul Esqueda sends me this imaginary dialogue in Bogota…Enjoy!

Imaginary Dialogues: reporting from Venezuela

Paul Esqueda[1]

Maria Angela returns to Bogota after a few hectic days, in the Presidential Palace, in Caracas serving as a facilitator of the Dialogue between Maduro’s Government and the Roundtable for Democratic Unity (MUD) that represents the opposition groups in Venezuela. She is about to meet with the President to give her verbal report.

Maria Angela: I am supremely anguished by what I witnessed in Caracas. I was appalled at how unprepared Maduro’s team was for such a high stakes meeting that was aired in national TV for everyone to see. Worst of all, Juan Manuel, it was also witnessed by Luiz Alberto Figueiredo, Brazil’s Foreign Minister; Ricardo Patiño, Ecuador’s Foreign Minister; and Aldo Giordano, Vatican’s Apostolic Nuncio to Venezuela. If this is the way Maduro handles matters publicly, I wonder about the depth and breadth of the conversations when they discuss matters informally as a team internally. I am really mortified that this dialogue is going to lead nowhere. Juan Manuel my prestige is on the line here.

President Santos: What about the MUD? Were they equally unprepared?

Maria Angela: Absolutely not, they were very prepared and scripted. They pointed out serious violations of the Venezuelan Constitution. They questioned the trustworthiness of the last two elections. Using data released by Maduro’s own people in the Venezuelan Central Bank, the MUD seriously questioned the precarious state of the economy particularly the notion of heavy dependence on the oil revenue alone. They revealed horrific data about the violent crime rate in Venezuela that Maduro’s Government has encouraged rather than control.

President Santos: Did Maduro’s team respond assertively to any of the allegations made? For example what did they say about the economy?

Maria Angela: The fellow in charge of the economy and finances could not articulate a strong message, he was simply pathetic. It was all vague without data. All they kept saying is that they blame the forty years of the bipartisan governments of AD and COPEI. My God, Chavez and Maduro have been in power for more than 15 years now. That argument is not a good one. Maduro and his team do not want to take responsibility and be accountable. All they want is to stay in power.

President Santos: The impression I get from you is that you have taken sides already and you, as a mediator are supposed to be impartial.

Maria Angeles; I swear on my mother’s tomb that I am being objective. You should see the body language of Maduros’s team. Their gestures and demeanor were of disdain and contempt. They show no respect for the MUD. One of Maduro’s closest collaborator told a union leader and congressmen “I do not like you, I have never liked you, and however, I am willing to work with you.” This is no way to treat the other party in a nationally televised dialogue. On the contrary the MUD people were very respectful and always made statements based on data or provided examples of real life situations to illustrate their points.

President Santos: These type of conversations always have similar beginnings and as the dialogue progresses, things tend to get better. I think you are being impatient. Remember we have gone through this with our own revolutionaries here in Colombia.

Maria Angeles: Do you realize how tough we have been with our own revolutionaries to get them to the negotiating table? How can you be tough with Maduro if he controls all the power centers like Congress, the Supreme Court, the Military, and the National Elections Board? His weak spot is the state of Venezuelan economy, which is about to collapse due to anachronistic policies.

President Santos: Now you are passing judgment on the Venezuelan economy and that is not your job. You need to help Maduro and the MUD to find common ground so that Venezuela does not gradually become a failed state. That would hurt us big time

Maria Angeles: Forgive me Juan Manuel but you seem to be biased too. You are not being objective either because you are vested on Colombia’s best interest.

President Santos: Let us not go there for now. Tell me Maria Angeles how do you see the dialogue moving forward?

Maria Angeles: That is a tough question. I think Maduro is going to have to bring more brains to the table and diminish the ideological piece. He needs to be pragmatic and focused because Venezuela is in a lot of trouble. Maduro’s team needs training in negotiations, diplomacy, a coherent approach to this dialogue, and a clear sense of direction. At some instances I got the impression from Maduro’s people that this would go away just like an unfaithful husband would do when caught red handed. They are doing all the wrong things. Similarly Maduro needs strong evidence that his 21st Century Socialism is working and that the quality of life of all Venezuelan’s is improving not just that of the poor. Otherwise they need to abandon that model quick and cut their losses. The MUD needs to keep the pressure on if they are to get anything out of this dialogue. I think the democratic solution is along the lines of what Lula had suggested: a coalition to ensure a minimum of governability. As it is the Venezuelan economy is paralyzing in slow motion and it may past the point of no return. Frankly, Juan Manuel I fear anarchy and civil war. I sincerely hope it does not happen and I will do everything under my power of influence to avoid that outcome.

 

[1]This is a hypothetical dialogue. The content is the absolute responsibility of the author. These events never happened in reality.


Venezuelan Dialogue Irrelevant Short Term, But Helps Opposition Medium Term

April 11, 2014

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I did not watch the ¨dialogue¨live, it was too long for my taste, but I watched parts and later watched the videos of some that I had missed. And here is my take:

Short term, this is largely irrelevant, clearly Chavismo is stuck in its own imaginary world, trapped in its slogans and has no intention of yielding on anything, despite the scheduling of another session on the 15th., right in the middle of a nationwide vacation.

But the fact that this was shown on nationwide TV and the opposition had some very good interventions, is very important long term. Close your eyes, ignore the names and last night the opposition was Hugo Chavez circa 1994 and the Government was Caldera or ¨La Cuarta¨, out of touch and mired in their ideology of what they believed in.

The only difference was than in the 94-97 era, Chavez was the only leader and here you had good interventions that range from Henry Falcon to Henry Ramos. And when Falcón asked Ramirez to get rid of his bodyguards and go to the streets, it sounded just like Chávez in the late 90′s, talking to out of touch politicians.

And Falcon was probably the best speaker, simply because I don´t like the other Henry, On nationwide TV, Falcón told his former buddies you really screwed up the Venezuelan economy, while a dreamy Ramirez tried to claim that shortages and 57% inflation were the signs of the success of the revolution’s economy.

And yes, it is all irrelevant short term, but I think the opposition looked good and in touch with the country, while Chavismo/Madurismo could only appeal to slogans that seem very empty today.

And if you watched both sides, it was the Government that showed no respect, while Capriles “carajeaba” a Nicolas and Ramos told Diosdado he was not his boss and he had a lot to say after 15 years of “cadenas”

And while it is clear the Government will not yield, with Maduro claiming this was a time for “Justice”, what the various opposition leaders talked about, even the boring Barboza (He was great, but was talking to the wrong audience) was exactly in line with what the average Venezuelan is worrying about.

For now, Maduro and his cronies have to be worried about, they may have gained a few points internationally by holding their dialogue, but asking for justice n denying the paramilitary groups or torture hurt their credibility, On the other side the opposition was not strident, logical and very in tune with not finding corn flour or paying for regulated items six times the price.

And that is something the average Venezuelan understands, while anyone claiming that the economy is successful or peachy sounds almost extra-terrestial.

Thus, while I was not that favorable to the dialogue without some amnesty gesture first, I think the meeting allowed the opposition to score points and shine, while showing that the revolution has become the IVth. Republic, out of touch and living in the world of bodyguards and jet planes that Chávez promised to get rid of.

Funny (not ja ja), Chavismo becomes the Cuarta Republica with fascism and the opposition shows who is in synch with the people in a single night.

This can only be a positive for the opposition, united or not, in the medium and long term.


Casto Ocando’s Book “Chavistas En El Imperio”

April 6, 2014

Ocando

That a book like Casto Ocando’s “Chavistas en el Imperio” (Chavistas in the Empire) can be published and have very little impact in the daily Venezuelan media, is evidence of how low Venezuela has fallen as a society. Anywhere else, Ocando’s detailed account and information would have become the subject of daily accusations of corruption, which would have forced the Venezuelan Prosecutor’s office to open a myriad of investigations.

But not in the corrupt Venezuela that Chavez and Chavismo have helped create.

Perhaps nothing summarizes better the book, as Ocando’s revelation in the introduction, that Chavez spent US$ 300 million in propaganda in the US during his first ten years in power. Thus, while Chávez was accusing Washington of trying to destabilize Venezuela, he was outspending Bush and Obama in promoting his revolution. And his buddies in Government, were always (or are?) trying to make friends in the US, to defend their money, their properties and even guarantee protection sometime in the future.

In fact, the promotion was not only of the revolution, but even paying companies in the US to regularly show that Venezuela’s economic numbers were doing well. ironically, while Chávez formed the Venezuelan Information Office and Eva Golinger was hired to show the US was conspiring in Venezuela, there was proof of all the money being spent very directly by the Venezuelan Government to promote itself in the US and very little proof was ever shown that the US was doing the same thing in Venezuela or elsewhere.

And while I know most of the stories, given what I have done with this blog for too many years, there is something very pleasing about seeing it all in one place, publicly, from electoral shenaghinans, to the purchase of properties in the “Imperio” by the same people who were pledging their allegiance to the XXIst. Century Socialist revolution. How, when faced between the choice of “Imperio” or Chavismo, so many of them have chosen the Imperio, so as to guarantee the use of their ill gotten money.

And Casto’s book is not a “fun” book. I think to plow through it and enjoy all the details you have to be interested in the subject, like I am. And in the middle of it, there are many pointers to many stories that remain untold today, as Ocando provides, not only the names of those involved in enriching themselves, but the names of the companies they used, their “partners”, links to property registers and connections that, in my case, help me understand better some of the things that went on in Venezuela.

And some anecdotes are priceless, like that of Maduro trying to buy three first class tickets in American Airlines at Kennedy Airport with cash. I think I remember that story vaguely, but to think that Chavez’ dumb son, now President of Venezuela tried that, is truly priceless.

And it is all in there, how Illaramendi was caught, the Bandes people, Ramos de La Rosa. Remarkably, some, like Arne Chacón were busted first in Venezuela, but their destruction had wide ranging effects in the luxurious properties they had set up in the US.

In the end, the book just tells us how Chavismo went from corruption to drugs, joining forces with the FARC, the Iranians and drug cartels, showing that Chávez was willing to allow anything to his buddies in order for the revolution to survive.

But while we see why Chavismo liked the “Imperio” and enjoyed it, it was their capitalist, corrupt side, I wish Ocando had devoted sometime to why the US Government has not made use more public use of the information brought by those Chavistas, like Andrade and Aponte Aponte have given the US Government. Is that information being used? Because in the end, we have seen a lot of Chavistas being protected on the US side of the world, but we have seen little of the use of that information to subvert the regime and the revolution.

What is the strategy? Is there a strategy?

I don’t see one, I do hope there is one. If you are into this subject, buy the book. Even if you know a lot about it like me, you will be surprised, but more importantly, most of the info is right there.


Maduro Dictatorship Ignores Constitution To Get Rid Of Opposition Deputy

April 1, 2014

mariaCorinaMachado gassed by National Guard at peaceful demonstration in her support today

It may be easy to try to dismiss the removal of Maria Corina Machado as a duly elected Deputy of the Venezuelan National Assembly as another step in the imposition of the Maduro Dictatorship. But it is much more than that. If Leopoldo Lopez’ jailing was a sign that Maduro was not willing to walk the fine line between Democracy and Dictatorship that Chávez walked for years, Maria Corina’s absurd impeachment by the Venezuelan Supreme Court represents a break with any sort Constitutional order. This is not a fuzzy charge, there is no basis for the decision. There is nothing gray about what the lowest Court of the land has decided. There was no due process, no right for Ms. Machado to defend herself and a complete ignorance about the Constitution says.

The Government simply wanted to get rid of Machado as part of its confrontational plan. Whatever that may be.

The charge against Machado was begun by the man who would like to be the Dictator, the President of the Venezuelan National Assembly Diosdado Cabello. All that Cabello is missing today seems to be a little Hitler-like mustache to play the part to perfection. Cabello stated that Machado had violated Art. 197 of the Constitution, by accepting to speak for the Government of Panama at the Organization of American States. That article says that the Deputies will hold the job as full time jobs and devote all their time exclusively  to the position.

First of all, Ms. Machado did not occupy another position by speaking in front of the OAS as a representative of the country of Panama, which graciously gave her the time that the majority of OAS members did not want to give her to present the case for that half (or more?) of Venezuela that is being ignored by the Maduro Government. You could say and I would say, that she was actually doing her job. In fact, none other than Jose Miguel Insulza, the Head of the OAS, has publicly stated that Ms. Machado was not speaking as a representative of Panama, but in her role as an elected Deputy of the Venezuelan National Assembly.

But even worse, the Venezuelan lowest Court actually justifies what Machado did at the OAS when it says:

Deputies can not exercise or accept other positions…except for educational activities, academic activities, accidental or of assistance….

What Machado did was certainly accidental and in no way was she representing another country, getting paid for it or not doing what the people who voted for her wanted her to do, whether Maduro or Diosdado like it or not.

And clearly for the Court, their words are a command.

But think about it. Machado was removed or impeached by the Court, without being allowed to defend herself. In fact, Insulza’s declaration that she acted as a Deputy of the Venezuelan National Assembly should have been enough to have the Court ignore the accusation against her.

But beyond this, Maduro, who was questionably elected President, with a promised audit of the vote shuffled under the rug, gets rid of an opposition Deputy who was elected with over 80% of the total vote. Ms. Machado could have been removed by the procedures that the Constitution establishes for it, just like Maduro can also be impeached. Instead, the Dictators chose the short cut, getting rid of her, just because…

What happens now to the only argument to defend Maduro that some people have: He was elected democratically.

Was he? Really? So was Machado, she really was elected, and the law and the Constitution were bypassed by the Dictator and his understudy to serve their purposes.

And that alone is enough to call for the removal of Maduro. Because democracy is not only about elections. It is about the daily exercise of democratic principles. The “people” may even support a Dictatorship, but Venezuela has a Constitution, a Democratic one at that and its precepts and tenets have to be respected, whether you would like Maduro (or Diosdado!) to be a Dictator.

In fact, they are so cynical, that a Chavista Deputy of the same National Assembly Adel El Zabayar, joined the forces defending Assad in that country for a while, as you can see in this picture. Not one Chavista, let alone the Venezuelan lowest Court said a beep about it. Talk about double standard and discrimination!

Thus, the rest is just wishful thinking by those that want Maduro’s Dictatorship to stay in power to satisfy their own personal ideological, monetary or personal reasons. But they have nothing to do with democracy, human rights and the Venezuelan Constitution.


Students Set Up Long Term Protest Camp In Front Of UN’s Office in Caracas

March 31, 2014

IMG_2991Aerial picture of student tent camp in front of the UN office in Caracas (Thanks MD!)

One goes to Caracas and picks up so many stories, that when you return you don’t know where to start. But I thought I would lead up with the story of the students in front of the United Nations office in Caracas. In some sense it encompasses a number of stories of what is going on in Caracas in the protest movement an its relationship with the Maduro Government.

Essentially, a bunch of students (or not) have set up camp in front of the United Nations office which is in Avenida Francisco de Miranda in Los Palos Grandes. I may not like the #SOSVenezuela hashtag, but, as you can see in the picture above, they have focused on what the hell is the UN doing, or not, in Venezuela. But their reality, their plan is a bit more complicated than that.

The first day, the students set up maybe a couple of rows of tents. But, as you can see in the picture above, taken by a buddy from the building in front (Thanks MD!), by now they are up to four rows and growing.

It is very colorful as the picture below shows, but this is more than just a spur of the moment plan. I talked to the students last week, and their plan is much more complex than just sitting there.

IMG_4060Another great picture by MD (or is it TD ot TT?)

When you first talk to them,there are a number of surprises. First, they are not all from Caracas. Second, they are not middle class. Finally, they are not all students, as many of them are part of radical, left wing groups 8yes!, real left wing not imitation Chavistas!) which oppose the Government. So, for fools that claim that these protests are somehow motivated by the US, driven my middle class students, please come down and talk to them. You will be surprised, really surprised.

The second interesting aspect, is that the UN is just a way of focusing on something. They know that the UN will do not much more than make a statement or two. But they also know, that where they are, they should be safe, they are close to Altamira where they can go protest  every night and in a location where the protests can grow, as they have grown in the last week.

But more importantly, they think that Maduro is playing  a game of patience. They believe Maduro wants the students to get tired, wear out the opposition with repression and nightly fights, which, much like in 2002 in Plaza Altamira, will lead to the students or the opposition getting tired and giving up.

But they have no plans of giving up.

Their plan is to grow the camp, as long as it is livable. To make their presence a nuisance, but one that gets the approval of the neighbors. But it has to be livable and sustainable. They have received donations, they have  a couple of Porta Toilets, they cook for everyone, they organize protests. But more importantly, they rotate. The tents may have someone’s name on it, or State, but the truth is that they alternate. Each person has someone to occupy their place. The idea is to outlast the Government, to out-tire the National Guard or the Bolivarian Police. After all, nobody can say they are violent (even if they go help in Altamira) but if the Government were to decide to move them out, repress them, it would be the Government that would look bad.

For them, the UN territory, IS their territory for the time being.

And just to make a point, they have set up a sort of “museum” of the weapons of repression. The left overs from the National Guard attacks. This shows who is the violent one. Maduro asks for dialogue, but responds with violence and repression. While the students are just sitting there.

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The students are more than just anti-Government. They are doing this, because the revolution has simply blocked their progress. They see most students finish their studies and either stay unemployed, start a business for which their studies are useless or simply, leave the country. Emigrate. And they think the revolution is to blame for this. Many of them come form poor families, but somehow they managed to get into the regional universities. And what they see is that their future is blocked by a Government that wants to dominate everything, including their families. So, they don’t want to put up with it. Better protest like this looking for change than waiting for a degree that will do nothing for their future.

And it is fun too. They organize activities, talk to friend meet friends. Hell, if you have nothing to do, why not go visit them? You will be around people your age, talking about like, the future and why they are doing it. I did that and it was lots of fun. Imagine being their age!

And they have activities all of the time. Last weekend they had a vigil with candles.It was  away to feel together, to have people join them. And who could not be moved by their sacrifice? After all, they are out there most of the time. Fighting in their own way for what they believe in.

vigilIf I was Maduro, I would not want to fight against the conviction and dedication these students show…

Note added in the morning the next day: Last night the students were attacked. I have heard different versions, the correct one seems to be they were attacked by someone in a truck an dnot by the National Guard with tear gas.

I am not sure if this was in response to that, or the students had planned to expand anyway. In fact, they seem to suggest they were going to expand when I talked to them Saturday. Maybe the idea is to peacefully challenge the Government right in front the UN’s nose. Stay tuned..

The camp this morning as it expanded to the street:

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(Thanks DA)


A Premature Look At The Nascent Sicad-2 Venezuelan Foreign Exchange System

March 26, 2014

Sicad2

It is premature to judge the Sicad-2 system yet, but I think it will be premature to give judgement on it for quite a while, so it is worth talking about what has (finally!) happened with this nascent foreign exchange system.

First of all, I clarify what I tell everyone that wants to listen: this is not a trading system for fx, as has been reported in the international press. This is a system by which the Government allocates foreign currency to those that request it, with the Government exercising a significant discretionary judgement in the amounts and levels at which people are allocated the foreign currency.

The Government took quite a while in implementing the system and it is still not fully functional, but I guess it was getting to be somewhat embarrassing to announce that it would begin operating so many times and having it postponed for almost a month.

So, the first good thing to say about Sicad-2 ,is that it is here! Finally!

The bond part of the system is not functional, but should be up and running soon. Basically, right now you are just given cash. At some point in the future you will be told that you were given the equivalent of the amount allocated to you, but in the form of a bond at the price of that particular instrument in the international markets. There will be uncertainty in the final price as the bond will be sold in two or three days.

So far, only banks are part of the system. The regulations for brokers are not out yet and they have not been authorized to work in the system. Many banks have yet to begin operating with Sicad-2, essentially because they have not given the system an urgent priority and are taking their time starting operations. Other banks, you can even place orders via their webpages.

The second good news is that the Government wisely decided to operate a a price higher than apparently many people expected. This is good for reducing the distortions, it will improve the fiscal balance, create incentives for foreign oil companies to invest in the Heavy crude projects and help with PDVSA’s cash flow. According to the President of the Venezuelan Central bank, foreign currency has been allocated between Bs. 50 and 61 with the average price each day at Bs. 51.84 and Bs. 51.58. Apparently, no order above Bs. 61 has been filled.

The parallel market went down to Bs. 55 before Sicad-2 began operating, but is being indicated at Bs. 75 today already. Either people sold a lot of dollars ahead of the start of Sicad-2 or they were expecting much lower levels for it.

Reportedly, individuals are being assigned, so far, small amounts, even if they requested large ones. Similarly, many company orders are allocated a large fraction of their order, but not all. The Government is not reporting total amounts.

Demand has been slow. On the one side, those requesting dollars may not have an account in dollars in Venezuela or in the case of companies, they are still looking at the legal issues surrounding Sicad-2. On the financial institution side, not all are ready for it.

In the end, the big question remains how much is the Government planning to sell via Sicad-2. This is what will determine its success. We believe that it will only work if part of the foreign currency allocated to Cencocex at Bs. 6.3 per US$ or the Sicad I at Bs. 10.8 per US$ is moved up. Perhaps the fact that Sicad 1 was lowered to Bs. 10.8 per US$ implies that the Cencoex  dollar will be moved to the Sicad 1 rate. There are indications that this is what the Government has told some industries in private, but it will require increasing regulated prices significantly.

Thus, the conclusion is that it finally started, foreign currency is being sold at a good level to make the system successful but we don’t know yet about whether the Government will sell daily average amounts that are ample to satisfy demand and make the system a total success.

Despite the cartoon above, it is looking well, but we reserve final judgment until wee see the dynamics for a coupe of weeks.


Venezuela: The Shameful Spectacle Today At The OAS

March 21, 2014

OEA

Cartoon by Rayma

Today’s spectacle at the Organization of American States was truly shameful for anyone that believes in free speech and the basic rights of people. The Government of Panama had graciously given up its representation to have opposition’s Maria Corina Machado to speak at the OAS in representation of the opposition, to present the case of the repression and the lack of democratic rights that Venezuelans face today.

And instead of accepting that fact, this club that seems to represent the so called “leaders” of Latin American and the Caribbean, proceeded to vote on whether Machado’s speech should be made in a public or in a private forum.  In the end, 22 countries voted against the public forum and only 11 voted in favor.

Ironic and depressing that in order to listen to charges of censorship and repression, the representatives of these so called “democracies” had to start by protecting the repressor, Dictator Nicolas Maduro, violating not only the Charter of the OAS, but Ms. Machado’s rights and that of the opposition to be heard in a forum which is supposed to be there to defend the basic rights of people across the Americas.

And while I can understand the strong dependency of the weak Caribbean economies on the stupid (or is it?) largesse of the even more stupid revolution, I was most disappointed at how so many of these Latin American countries were ready to prostitute themselves in order to protect their mercantile interests. It is remarkable how low these mostly leftists Governments have fallen. Despite being democratically elected, they were not willing to give a voice to the over 50% of Venezuelans that find themselves discriminated against and repressed by the Maduro Dictatorship.

And in doing so, they are trying to defend the most repressive Government, save for Cuba, to have risen in the region in the last two decades. How these representatives and their Governments can sleep at night is beyond me, more so when some of them were victims of similar repression in the past.

But somehow they are short sighted enough in thinking that this will not happen again in their countries and that their commercial interests are being protected by their unethical actions. Both premises are actually wrong. As the world turns, their countries may swing back to repression and they may need the same type of solidarity Venezuela’ opposition deserves today. But more importantly, their belief that their actions in support of the Maduro Dictatorship will somehow lead to payment of Venezuela’s debts with their countries or companies is simply wrong. As stated by Minister Ramirez or the President of the Central Bank, Nelson Merentes, there is no money to pay anything but the foreign currency budget they have established for the year 2014.

So, forget it! You will not collect under Dictator Maduro. In fact, you would probably have a better chance under a change in Government that would put order in the economy and reduce some of the absurd subsidies present in the Venezuelan economy. Only in this case, could Venezuela receive loans and cut subsidies which would, with very strict management, allow it to pay its debts with these countries, that so easily supported what can not be supported under any moral framework.

But in the end, these mediocre diplomats really blew it. For one thing, Machado’s visit captured even more attention by the refusal to receive her publicly. CNN would not have interviewed her as prominently as they did today. And via that press conference and the distribution of the video she meant to show at the OAS, Machado has made her point and is likely to make it even stronger in the upcoming days.

Here is the video she meant to show to these diplomats who think the world is static:

And it was pitiful to see Brasil’s representative justifying the ¡e private session because of Machado’s “circus”. A circus composed of herself, an elected Deputy of the Venezuelan National Assembly who is likely to have her immunity lifted and jailed upon her return, a student representing the more than 1,600 students jailed so far in one month of protests and a mother. A mother whose daughter was killed by the repressive forces of the Maduro Dictatorship. A mother who is still grieving but thought and believed she would find compassion and understanding in a forum that under normal circumstances is supposed to defend the rights of the people of the Americas.

Instead, she was laughed at and labeled a “circus”. Brasil’s leaders are not as close to God as they may erroneously think.

And this grieving mother was not even allowed to speak and was forcibly removed from the press room of the OAS.

Does it get more shameful and depressing than that?

And while Brasil has proven that it does not have the moral stature to call itself a leader of the region, others have shown to have more dignity, morals and leadership. Starting with Panama, who gave Machado the chance to speak, even if she was silenced by the OAS, using the same censorship techniques that the Maduro Government has so effectively used. And following with these countries:

Canada
Chile
Colombia
Costa Rica
USA
Guatemala
Honduras
México
Paraguay
Perú

who seem to understand that one day, they may face the same situation and they would like the same support they gave today to the Venezuelan opposition. I want to thank all of them for their respect of human rights and for their transparent behavior, even if they face the same commercial problems in their interactions with the Venezuelan Government.

Most of the Mercosur countries showed that the letter of their charter is worthless as democracy is simply irrelevant, as had been shown previously in their eagerness and perverted acceptance of Venezuelan into their club of undesirables. But they ratify it today. They could care less. So do we.

To us, they simply show how corrupt, unprincipled  and unethical they are.

Let them be punished and judged by history and by their people!


Poll Numbers Suggest Venezuelan Government Is In Big Trouble

March 17, 2014

datos

A lot of people argue that these protests are too early. That the barrios are not participating. That the people still support the Government widely and many other such arguments. While there is evidence to counteract each of these claims, I think they try to oversimplify the problem. In the end, the “barrios” are not where the opposition is weak, it is in the very rural states, where the people have a very high dependence on the Government. These are the true Chavista strongholds, where the media is fully dominated by the Government and the opposition gets less than 40% of the vote in any given election. In the barrios of the big cities, the 2013 Presidential elections tended to be closer, with the opposition scoring wins in many.

At the same time, anyone that has talked to the students in these protests, can see that they come from all over the place. In fact, in my conversations in Plaza Altamira when I was there three weeks ago, I found a very large fraction (I would say one out of every two) of the students came from poor neighborhoods.

But the argument continues from the Cassandras that see Chavismo as impossible to dislodge, too popular and too ingrained in the Venezuelan population.

This, of course, goes against logic: Maduro barely squeaked by a year ago (if he did, which I am still not sure happened) and since he took over, inflation has doubled and scarcity has gone up by almost a factor of three (Datanalisis says it is at 47.7%). I just don’t think people are that insensitive to their problems.

And yes, Maduro did recover for the regional elections thanks to the Cadakazo, but conditions have worsened significantly since.

But we (and the Government!) all should take notice of the latest poll by Datos, a well respected polling firm, a copy of which someone sent me and which shows that the Government’s approval, popularity and acceptance has deteriorated dramatically. In fact, I would even say it has deteriorated more than I expected and in some aspects, the result surprise me.

Let’s start with the basics. According to the poll, 43.7% consider themselves to be opposition, while only 27.1% consider themselves to be pro-Government. In the lowest strata of the population, Class E, 36.4% of the people see themselves as pro-opposition, while it is only 32.5% who consider themselves to be pro-Government. (The same number is 62.4% and 18.2% in classes A,B and C). So much for the opposition not resonating or penetrating in the poorer strata of the population.

When people are asked if they things as being fine or not, basically the hard core pro-Government 27.2% of those asked, say things are fine (Define as being well, or more or less well), while 72% think hings are going bad or not very well.

Enough to make any Government nervous…

But where things really get surprising in my opinion, is on questions that should make Maduro and his cronies truly nervous. Like 46.4% of the people think Venezuela is a Dictatorship, while only 42.5% think it is a democracy, for example.

Or that 50.4% think Maduro is doing a negative job, 23.6% think it is positive and 21.3% think it is neither positive nor negative.

And if this were not enough to make any Government official very nervous, 66.1% of the people think dollar scarcity is the Government’s fault, while only 3.1% of those polled think it is the private sectors fault. And 53% of the people think scarcity is Maduro’s fault, while only 14.4% think it is the private sector’s fault. And 51% blame the Government for inflation, while only 8.6% thinking it is the private sector’s fault. Amazingly, despite these numbers, 46.5% still think the Government can solve the country’s problems, while 47.1%, don’t think so.

Finally, 61% of those polled think that the Government’s reactions to the protests has been disproportionate and a mistake, while only 29.5%think it has been correct or adequate. Moreover, when it comes to how many people think the Government has to rectify its policies, 87% of those polled think they have to.

To me, these numbers say the Government is in real trouble. They show that Chavismo sin Chávez is a flimsy proposition. If these were the numbers up to March 2nd. , I suspect they are much worse now and what the Government has been doing goes counter to what those polled suggest. Polls are inaccurate, but I saw Datos’ polls before the Cadakazo and afterwards and I can assure you they gauged well what happened.

If I were the Maduro Government, this poll would make me very nervous indeed!


To Those That Think Maduro Is Not A Dictator: ¿Qué Pasa en Venezuela? by Foro Penal Venezolano

March 14, 2014

I am still amazed by the number of people that are still saying we should wait for elections, bla, bla bla. The video above proves beyond any doubt that Nicolas Maduro has become the Dictator of Venezuela. He has to go. Period.

And if you still have doubts, read Gustavo Coronel’s article “Approaching the Unthinkable” about Venezuela importing oil and you will realize that indeed, under Chavismo, all that oil underground will always stay there.


Si-Cad Or So-So-Cad in Venezuela’s new fx system?

March 11, 2014

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Almost eleven months ago, Nicolas Maduro was elected President and since then, the Government’s economic team has been telling us about the new foreign exchange system (fx for short) in the works, which was almost ready. Today, everyone wants me to write about the “new” and “improved”  fx system, called Sicad 2, but there is not that much really that I can say about it. The Devil is in the details and we still don’t know most of them.

Meanwhile, Maduro keeps thinking that talking and not working, is the way to survive as President. He now has a new program (above), While that may have been something good to do for his former boss, he just does not foot the Bill. I mean who wants to listen to Nicolas give us his usual BS that half of Venezuelans are right wing fascists oligarchs, and the other half pure PSUV socialists? If that were true, there would be hope for Venezuela, not because we need more oligarchs, we have enough with Chavistas, but because there would be more market ideas, which does not seem to be what the opposition is proposing either. But Nico sounded nostalgic tonight, maybe he has been reading too much Dieterich these days. Eight weeks left of this nightmare? First time I am rooting for a Chavista prediction!

But going back to the new fx system, the so called Sicad-2, which is what people want to know about, all I can sayis , so far it looks like So-So-Cad, more than Si-Cad in my opinion. And I do hope they change my mind in the upcoming days. I would love to be proven wrong.

But let me be clear: Sicad-2 is a huge and positive step for Chavismo. First, it is a significant break with their ideological straight jacket, which has tied them for so long, and it it is very positive step for PDVSA, which will improve its cash flow by selling dollars at a much higher rate than the official Bs. 6.3 per US$ or the Sicad-1 rate of Bs. 11.8 per US$.

End of positives.

Because in Sicad-2, the Government has not created a foreign exchange market, but as usual, a complicated auction-like system, in which it is not clear who will win and how much you win. This is typical Chavista thinking: They spend eleven months thinking of what to do and come up with a Goldberesque system for fx trading.

To begin with, what is the fixation with bonds? Why can’t people trade Bolivars for US Dollars, Euros, or Yuans?  (or vice-versa). Remember that bonds were introduced in the fx system as a pantomime to mask the true fx rate at which things were being done. The Government made it a criminal activity to buy or sell Bolivars for dollars or vice-versa, unless you used securities. You could not even say at what equivalent price transactions were being made.

But now, neither how you do it, nor saying the price is illegal. You can even say the price of even the black market, it is no longer a crime. Remember all those brokers jailed in 2010? The case against them has been dropped, as the new Foreign Exchange Illicit Bill, decriminalized everything they were accused of doing.

So, why not forget about bonds? The Venezuelan Central Bank will actually state at which rate each batch of dollars will be sold on average.

Anyway. The new and improved Sicad-2 will begin operating…soon. We still need the rules and regulation. But if we are to believe the authorities, it will work something like his:

You go to your friendly bank, where you will say you want to buy x dollars and you given them a range of prices at which you want to buy (or sell if you are deranged enough). (You need an account in Venezuela and in dollars first)

Your bank, will create a spreadsheet with all its postures, which it will send two or three times daily to the Central Bank. You can only place a single posture per day. Unlimited, in amount or price.

The Venezuelan Central Bank will come back to you and say Si-Sicad for you, or No-Sicad for you, without explanation, after “matching” buying (bids) prices and sell (offer) prices. At the end of the day, the Central Bank will publish only the average price of all dollars sold.

So, this is not a market, it is a pseudo-auction system, where only the Central Bank will know bids and asks and what it does with them.

Fairly opaque in the details.

The system has no upper bands, limits and is flexible, but nothing says there will be unlimited offer to all the bids. In fact, I am sure there will be limited offer only. Nothing says that if you want to buy 1 million dollars at Bs. 100, they will give it to you. In fact, they may give it to you cheaper, as the Government has the right to intervene to keep the price down.

So, it is still is unclear. My opinion is that the Government has very limited resources for this market. Thus, initially there may be some optimism, which will fade fast. No matter what you may have heard, the parallel market (it is no longer black) has barely budged, suggesting some level of skepticism with the new Sicad-2 system.

At the same time, there will be little demand at the beginning. The large buyers (multinationals) will have to review the foreign exchange agreement, the regulations and the Foreign Exchange illicit Bill before they can even begin to operate in this new Sicad-2 market. The small buyers (you!) will have to open a dollar account in Venezuela, which is apparently one of the requirements to participate.

So, it may be on Maduro’s first year anniversary as President in mid-April (which falls in the middle of Dieterich’s prediction) before Sicad-2 shows its true dynamics and whether it is a real positive or not. In my humble opinion,there will be too many exchange rates, not enough transparency and too many limitations. The Government in trying to solve economic distortions, simply creates more and more, without understanding the true implications. To begin with, a new price for the dollar, which represents a huge devaluation, implies allowing prices to rise in the middle of 56% inflation per year. The Government has yet to understand that a foreign exchange market is not economic policy, but a transactional part of the economy. If it does not create other rules and regulations, it will all be a waste of time.

But if Sicad-2 is all they could come up with in eleven months, there is little hope for the rest of the policies. Thus, maybe Dieterich is right.

I just find it hard to be that optimistic.


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