Some quotes with comments on things Hugo Chavez said this weekend during his vacation in Porto Alegre, Brazil:
-What is happening in Venezuela is only an advance of the great battles that we will have this century which are beginning, between neoliberalism and alternative currents which are surging, because the venezuelan is an alternative to neoliberalism.
Well, Venezuela was never or ever much of a “neoliberal” country to begin with. The State controls everything and owns most of the wealth. As an example, Venezuela has very few gas stations because the number is decided by the PDVSA. The exchange rate has always been determined by the Government, which seldom has allowed the rate to float. Finally, what is the economic alternative that is being developed? Economic Amateurism?
-Exchange Controls are indefinite
There is an honest one! However, he should have told his Minister of Finance who said they would be on for only six months or the Central Bank Director who said they would be on only for as long as oil production was down. (Maybe that is indefinite!)
-He is considering applying a tax to “speculative capital”, explicitly mentioning the so called “Tobin tax”.
Well, there is very little speculative capital in Venezuela. The Stock Market has been dead since Chavez has been in power and there is a debit tax for each financial transaction of any size of 1%, which makes speculation quite difficult, if not impossible. Second the Tobin tax proposal was to establish a worldwide cross-currency transaction tax to reduce speculation in markets that trade billions with trades that last seconds. Reportedly Chavez is considering the tax to be 10% versus 0.1%-1% of the Tobin tax proposal. If such a tax is established, the black and gray markets will be the real winners. You can buy stocks or bonds in local currency that trade in NY in dollars, thus this becomes a synthetic exchange mechanism. (It has been on since last Wenesday, only hours after the exchange market was suspended). Then there are the tehories that speculators reduce volatility, but I will not get into that.
-We will establish price controls
Don’t need to comment on that one.
On politics (page A-2, El Nacional):
-The only alternative to get me out is a recall referendum. The solution to the crisis is not elections now..this violates the Constitution
Not quite. As a matter of fact it is legal for him to resign and one of the two Carter porposals is an amendment which is very expedient if 15% of the voters petition it, there could be elections in June via this mechanism and defuse the crisis.
-I put away my rifle…but I keep it and if the oligarchas do not accept changes in peace, like Che Guevara said, noises of combat and machine gun fire will thunder.
Nice guy, what a democrat!
-I may close some TV stations