Archive for January 8th, 2008

Another lost decade for the daily problems of the average Venezuelan as Chavez claims to begin worrying about some of them

January 8, 2008

If it weren’t so tragic, I would write a parody of what the Chavez Government has become. But while the whole thing is so bizarre, it is difficult to find anything funny about what is going on in Venezuela with its Government.

First of all, last Sunday, in his Sunday variety shows, Hugo Chavez mentioned for the first time the crime problem. Yes, after exactly 86,452 homicides since Hugo Chavez took over, he mentioned a problem as important as that for the first time. Here is a guy that has found time to call Bush the devil, spent weeks and resources on rescuing Colombian hostages and has traveled all over the world “solving” the world’s problems, and he finally dared mentioned the problem that is the number one concern of all Venezuelans: Crime. I don’t want you to think that this is a problem that did not exist when Chavez took over. But, he is responsible for almost a 200% increase in homicides since he took over for two reasons: He did little about it and he put most police forces in the hands of his military buddies, who have no clue about fighting crime, other than with repression.

And while I am all for fighting crime, I can’t help but be concerned about the new man at the Ministry of Interior and Justice Rodriguez Chacin. This is a military officer that was involved in questionable military operations where innocent civilians died under suspicious circumstances. This is a man famous for being “tough”, thus I do hope his return to the Ministry is not because Chavez wants to him exhibit his toughness by repressing criminals. We shall see.

But things get even more tragic, when you hear the official TV station say today that Chavez will preside this week’s Cabinet at which “logically” his new Ministers will be there. Tragic, because while it may seem “logical” for that to be the case, what is illogical is that as far as everyone knows, this is actually the first Cabinet in over a year and a half at which Chavez will be present. That’s right, for at least the last year and a half, Hugo Chavez has been too busy with his international promotion to even go to the Cabinet, leaving it all in the hands of former Vice President Jorge Rodriguez, who may be a good political operator but certainly does not have the experience to run and coordinate a country.

And it showed, which is partially the reason why Chavez lost the referendum.

Except that nothing says that Chavez can do it either. In fact, he has shown in the past to be bored by the details and has left in the hands of others like Giordani, who had no clue as to what he was doing, and Rodriguez who had no managerial experience until he was put in charge of the CNE.

And the whole thing is so bizarre, that Chavez promotes the President of telecom company CANTV to Minister of Telecom, but ratifies her as President of CANTV. There are two problems with this, she had no experience to run a company as complex as CANTV, but all of a sudden she is put in charge of the largest telecom company in the country, as well as the telecom regulator, which hardly seems fair to the competition, no? The saddest part, is that telecom was the fastest growing sector of the economy last year, but I am sure this will not last long.

And to complete this tragedy in three acts, the new Minister of Finance decides to show either his ignorance or his stupidity, you choose, when he stated while being sworn in that the inflation target for 2008 will be 11% and the economy will grow by 6%. Well first of all he did not need to say either of them. Second, the two targets are incompatible, In order to achieve 6% growth, he will have to sustain high fiscal spending, which is certainly incompatible with that 11%. So, I will stick my neck out: Growth in 2008 will be 3%, there will be high Government spending once again and the CPI will be 28% for the year. Write it down, I assure you my error in both numbers will be less than those of the new Minister’s.

And that’s the tragedy, I am no expert. But when I hear former Minister Cabezas leave his post “satisfied” after screwing up inflation and allowing monetary liquidity to jump in 2007 and the parallel market to almost double, while imports were 44.6 billion US$ and I begin to think that while I have no clue, I have better clues than these illustrious incompetents.

Clearly, this tragedy in three acts is possible because Hugo Chavez is worried about his popularity numbers. But much like in earlier stages of his Government, expect him to get bored with these problems and frustrated, as things don’t work out in fixing them. By then, regional elections will be around the corner and politics will once again take precedence over solving the problems the average Venezuelan feels everyday.

And by then, Chavez will have been in power for ten years an we can talk again about another lost decade.

Some words from a true expert on poverty…

January 8, 2008

I have a lot of respect for Luis Pedro Espańa who I considered to be the country’s foremost expert on poverty. He is extremely knowledgeable, articulate and he combines knowledge of social sciences with economics, a rare thing in this era of specialization. He also looks at a lots of statistics of what people are saying or doing in Venezuela and understands them thoroughly. I have translated some of his articles before, but today he was interviewed in El Nacional and has some insights that I thought should be shared with you. The highlights:

—The poverty of income, no matter how you calculate it, has dropped…but that does not work as a reference in a country where we can double oil income, but maintain school desertion rates, or the patterns of mortality and the lack of infrastructure.

—People can consume more because PDVSA has higher income. When the oil market gets a cold, we could die of pneumonia.

—Barrio Adentro has not changed the rate of infant mortality. Mision Vuelvan Caras has not reduced informal employment. Mision Ribas has not ended with school desertion. All of these problems attack the consequences of the problems but not their causes.

—The most emblematic thing about misiones is their political management, not their real efficacy. Almost 80% of the population knows the misiones, but only 3% have benefited from it. The Misiones have a very high propaganda value. That credibility of the misiones is dropping.

—Fundamental social problems are still intact and the worst part is that an excellent opportunity to place social policy on the forefront has been wasted. And the people are realizing it.

—People have been with Chavez but they are not unconditional. Because they make demands, they want water and the homes they were promised. I do believe there is a lot of disenchantment.

—It is very clear that the problems of the people have not been solved. The only place where the opposite is believed is in the statistics office soft the Government, But you go out in the streets and people believe that their crime problem, their housing problem, their unemployment problem, their health and their education problem have not been solved, And when you ask them why, they blame corruption And after that inefficiency.

—It is possible for Chavez to become very unpopular. And he was that for a time, even if few people remember it. I am talking about the end of 2001, when an economic crisis began which forced him to make adjustments in 2002. He was forced on February 14th. 2002 to devalue by 50% and cut public expenditures. That had a very strong effect on all of us, including the poor. The economic situation was very bad. But then came the coup and the strike and paradoxically, that helped Chavez. Today the people remember that the economic crisis was generated by the opposition and not because of the wrong policies of the Government.

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