Archive for March, 2008

On neonatal deaths, figures and a huge lack of responsibility

March 31, 2008

I wanted to write about the deaths at the Maternidad Concepcion Palacios, but every time I tried to I would get to irked at the Government´s reaction. For a Government that claims to care so much about people, all they seem to worry about the media and not the deaths and the facts. Just when I begin writing something,. Chavez himself came on and in a very insensitive and careless fashion accused the media, in the same way he does not want to hear about the almost 100,000 deaths during his tenure. To him, these are numbers, not the real people that suffer the consequences of the ineffectiveness and ineptitude of his Government. So, while he gives away millions of dollars to other countries and buys perfectly functioning companies so that he can be involved, kids die because of his idiotic view of the world. I thought inspiration would come at some point once the outrage subsided, but then I read Bruni´s article on the subject at cuentos intrancesdentes and figured there was little to add to what she so eloquently said. I suggested she translated and despite some initial reluctance at whether she had time or not, she sent it right away and here it is. I will not say for your enjoyment, because there is little to enjoy in this grotesque tale of incompetence and insensitivity by the Chavez Government

On
neonatal deaths, figures and a huge lack of responsibility
by Bruni

There
are many obscure points in the story of the six deaths at the Maternidad
Concepción Palacios on the night of 26 to March 27, 2008.

The
Maternidad is the only public hospital exclusively dedicated to prenatal and obstetric care in Caracas.

In
any serious country, the death of six patients on the same night in a single hospital would bring up
many questions. The public has indeed the right to know what happened and why
and to demand that public health facilities are reliable and competent.

The
role of a government, in such cases, is to immediately initiate an independent investigation,
help the families, calm public opinion and closely supervise the hospital
throughout the investigation.

In
Venezuela, instead of assuming its role, the government, in the person of
President Chavez and his Minister of Health, becomes a “guapetón de barrio”, insulting those who denounce what happened and calling them
“terrorists”.

The
minister’s statements are particularly revealing. They can be seen in this video.

The
minister began by explaining that it was not really six deaths of newborn
children, but three of the children were not born alive, as they were already
dead inside the womb of their mothers. The minister emphasized that, therefore,
the three children, or fetuses, cases were “stillborn” that do not
affect the statistics of neonatal deaths. Another child was born with a
congenital cardiology, one was not really born that night but died of
complications from an infection and another one was also a stillborn that was
produced due to a an obstetric complication….in other words ” everything
is fine Madame la Marquise “.

To
get a better understanding of the enormity of the lie that the media
“terrorists” is selling to us, the Minister brings us some figures on
the huge improvements in the statistics of neonatal deaths that Venezuela has
had in recent years.

According
to what the Minister says in the video, neonatal deaths in 1998 were 21.4 per
1000 live births, in 2006 there
were 14.4 and in 2007 the figure
has fallen to 13.

The
Minister, who a few minutes earlier had vehemently criticized those who take
advantage of human sufferings for political purposes, clearly explained that
such a decrease is due to the policy of Hugo Chavez, who has “saved 5274
children from death” in the nine years of his ruling. It is thanks to Hugo
Chavez, then, that these 5274 children have” filled with joy thousands of
homes over the years”.

The
Minister seems to overlook the fact that the normal trend should be a mortality
decline. In fact, in 1970,
Venezuela had 48 neonatal deaths per 1000 births (2007/2008
UNPD report)
. That means that, on average, the country had 0.95
deaths less per year until 1998 (if we take the Minister’s figure). On the
other hand, also using the Minister’s data, since Chavez is in power, the rate
had improved 0.93 deaths per year,
a slight decrease.

Now
let’s see how Venezuela compares with the best countries.

In
1970, the lowest rate was that of Sweden, with 11 deaths per 1000. Today, the
best country is Iceland (according
to statistics from 2005 that appears in the report of the 2007/2008 UNPD) with
a rate of 2. In 1970, Venezuela’s rate was 4.36 times higher than the country
with the best statistic. In 2005, Venezuela’s rate is 18, which is 9 times larger than the best
country.

In
other words, Venezuela has
significantly deteriorated its relative position since 1970.

But
the most surprisingly negative
figure, that was provided
by the minister himself as a positive point, is the number of neonatal
deaths in the Maternidad Concepcion Palacios itself.

Remember
that it is probably the most important maternal hospital in Venezuela.

The
Minister indicated that the Maternidad presented a rate of 40 deaths per 1000
in 2005 and has fallen to 21 per 1000 in 2007. He congratulated himself on such
a great progress.

How
on earth does the Minister welcome such a high figure? If the country’s
rate is 13 neonatal deaths
per 1000, how is it possible that the most important maternal hospital in
Venezuela presents almost twice the neonatal mortality of the country? Doesn’t the Minister realize that just such a
figure shows that there is a very
serious problem and that he should take action on it?

If
I were Minister of Health in Venezuela, I would immediately put under
guardianship the Maternidad to investigate why the neonatal mortality rate is
so high.

What
is it? Is it management problems? Medical? Social problems? What makes the
Maternidad’s neonatal death rate so high? Has anybody compared their statistics
with that of other hospitals in the same areas? And with other hospitals in
other areas of Caracas?

That,
Mr. Minister, is what a goverment
should be doing, not insulting the
media and calling them terrorists

Now,
let’s go back, again, to the opening words of the Minister that excused three
of the death cases because they were
“stillborns” as if, by the fact that they did not count in the
statistics for newborns, their cases were not as important for families and
public health policies. After all, of the six deaths, four were stillborns.

Let’s
see.

Those
women that arrive at the
Maternidad Concepcion Palacios are generally low-income and very often have had
no obstetric monitoring during their pregnancy. Precisely, one of the most
negative medical statistics of the government of Hugo Chavez has been the so-called
“maternal deaths” that occur from complications related to pregnancy.
Embarrassingly, despite Barrio Adentro and the phenomenal rise in the cost of oil, maternal deaths have
increased during the years of Hugo Chavez (see article in Ultimas Noticias here).

The
sad thing is that basic interventions like taken a blood pressure measure once
a month or a daily glass of milk,
can prevent or detect in time major complications.

I
do not know what were all the complications of the mothers who led to three of
the “stillborns” this March 26, but it is clear that in Venezuela
there is a problem with the monitoring of pregnant women.

One
thing is for sure, Mr. Minister, there is nothing to boast about, quite the
opposite.

Finally,
I conclude this post with an observation: La Maternidad Concepción Palacios is
the responsibility of the office of the Mayor of Caracas (Alcaldía Mayor)

So
since we are talking about responsibilities, I ask myself:

Where
is Mayor Juan Barreto?

Judge rules in favor of PVSA in freezing injunction case

March 30, 2008


I am a little behind in writing about some things and many will be not
covered as I am planning a long trip soon. But during the Easter week,
the Royal Court of Justice in London ruled in favour of PDVSA h.,
essentially cancelling the freezing order for US$ 12 billion on the
company’s assets. ExxonMobil had requested the freeze over the dispute
between the two companies over the takeover of Cerro Negro by PDVSA.
ExxonMobil refused to accept the change in ownership whereby PDVSA
would acquire a 60% control and simply walked away from the project
demanding compensation.

The judge in the case did not rule so much on the merits of PDVSA’s
actions, but more on the details of the freeze order and whether it is
the competence of the Court and whether the injunction is justified or
not. Thus, in a long and complicated decision, the Court ruled in the
context of UK laws whether to extend the injunction granted by a lower
judge.

The judge said in the decision that these type of freezing orders are
made to avoid companies from dissipating its assets and explicitly says
that for a freeze like the one requested by ExxonMobil to be justified,
there has to be compelling evidence of serious international fraud,
which is not the case for PDVSA.

However, the judge does refer to the takeover of Cerro Negro as an
expropriation and says that ExxonMobil does have an arguable case, but
it not only finds that the freeze can not be justified, but states that
ExxonMobil has other courses of action for its demands. The case is
found to be justified because the original agreements of the
association were breached and PDVSA acted in bad faith, but it is not
clear what the worth is and the judge made no attempt to resolve the
point as to whether the US$ 12 billion is justified or not.

The judge also ruled that in the absence of fraud, PDVSA would need to
have substantial assets located in the UK and Wales, which is not the
case. Moreover, the judge states, the fact that the seat of arbitration
is not UK-based, would make it inappropriate to grant the request. The
Judge also faults ExxonMobil for not seeking relief within the
Venezuelan Court system, which is clearly laughable given the current
state of the Venezuelan Justice system.

There are still injunctions in place in The Netherlands and the United
States that PDVSA will have to deal with in the near future. The ruling
does force PDVSA to abide and follow the arbitration steps as the judge
says the company has followed the steps even if with some delays. We
suspect that PDVSA and ExxonMobil will eventually settle a negotiated
agreement in which PDVSA will pay ExxonMobil with its stake in the
Chalmette refinery.

Prosecutor accusation against former General Prosecutor Isaias Rodriguez confirms gross miscarriage of justice under Chavez

March 28, 2008


While it
comes as no surprise, today we got confirmation as to how former General
Prosecutor Isaias Rodriguez carried out gross miscarriages of justice while
occupying the office which is suppose to defend and uphold the laws in Venezuela.

It is no
surprise, because Rodriguez used his office to persecute the Government’s
enemies and seldom took the time to go after the Government’s friends.
Moreover, he was always suggesting that cases would be closed soon, while
actually completing few of them.

No case
may be more emblematic than that of the murder of one of his main Prosecutors,
Danilo Anderson, who was assassinated using explosives in his car. Rodriguez
accused the opposition from day one and failed to follow leads suggesting that Anderson carried out a
lifestyle beyond his means. In fact, Anderson’s
friends charged that the assassinated prosecutor kept large amounts of money in
his apartment, money that was never found and were certainly beyond Anderson’s means. Other indications were never followed up in the investigation.

After
raiding the homes of opposition figures and suggesting the case was almost
ready to be prosecuted, Rodriguez found a “star” witness who he used to
prosecute a number of opposition figures, including reporter Patricia Poleo,
who still remains in exile. All of the charges against those accused have been
dropped, including businessman Nelson Mezerhane.

Well,
today a Prosecutor that worked for Rodriguez in the Anderson
case named Jose Contreras, presented a formal accusation to the new General
Prosecutor in which he charges that Rodriguez manipulated the penal
investigation into the Anderson
case.  While the accusation may be
politically motivated, I would like to think that there are people with ethics and
principles within the Government who may be at times pressured to shut up, but
rebel when those involved leave Government or their behavior exceeds certain
limits. It may be that the Prosecutor making the charges was sick at reading
yesterday
that his former boss was preparing the documentation necessary and
“working on” becoming  a member of the
Venezuelan Supreme Court, truly an insult to anyone with certain basic morals
and principles.

In any
case, the charges presented against Rodriguez are quite extensive and damaging
and I certainly hope they stop Rodriguez aspiration to become ea member of the
Supreme Court, although given the recent cases with other chavistas accusing
Government officials, maybe it will be Prosecutor Jose Contreras that gets
fired or accused of corruption.  

Contreras
says that Rodriguez himself switched and changed the files on the Danilo
Anderson case, who would argue that the content of the files had to be reviewed
by “High Government” since the investigation was a “State problem”. According
to Contreras, Rodriguez would later meet with them and would tell them to remove
a certain person’s name or include someone else’s, as well as describing that
person’s characteristics. Nothing in the investigations was done without the
precise instructions of the Prosecutor, says Contreras.

He also
said that Rodriguez said the star witness in the Anderson case had fooled him,
but Rodriguez never revealed who brought the star witness to him and why
Rodriguez never listened to the other prosecutors who told him the witness had
little or no credibility.

Contreras says he interviewed the star witness
exhaustively and was able to convince himself that the witness had interests
different from collaborating with Justice.

The prosecutor also charges that Rodriguez asked
people to be detained based on the star witness’s testimony, but most of them
have now been freed. He reminds the current General prosecutor that when she
was in charge of Processes he told her about the irregularities in the case and
as Isaias Rordriguez told him: “He needed to have a case..because the radical
currents of Chavismo were asking for results with the intellectual authors of
the crime in jail”. Contreras says Rodriguez’ egocentric personality and his
political involvement led him to deviate in his mandate as General Prosecutor.
(The full letter in Spanish is here)

The
case is just an example of what we have been saying about Justice under Chavez for years.
How Chavez has misused his power to neutralize enemies and how he has castrated
the independent institutions that are supposed to provide checks and balances
in a democratic society. The Prosecutor, the People’s Ombudsman and the
Comptroller have been puppets of Chavez for the last five years. They have been
used as tools of political pressure against the opposition and the fact that
their job was defined from above, implied these men ignored the mandates of
their position, allowing corruption, abuse of power and human rights violations
to flourish during the last nine years.  

Except
that by now, even Chavistas are totally fed up with it…

Looking at the forest and the trees in the Barinas soap opera

March 27, 2008

The last few days, there has been a soap opera going on in the National Assembly surrounding the accusations by a little known Chavista Deputy whose name is Wilmer Azuaje, who has been presenting evidence against what in Chavez’ own Barinas State is called the Chavez royal family. The whole thing is much like a soap opera, because one needs to look at the big picture and the littel details to try to understand, if at all possible, what is going on there.

Azuaje is not very well known nationally, up to now he has been loyal to the revolution, so loyal in fact, that he has been named to the Board of the Assembly a couple of times with the unanimous support of its members. He has no known track record in any field, other than sucking up to the boss and politicking in his own Barinas State. One of his few appearances in public was the injunction he asked against a reporter for defaming him, The reporter accused him of having no known education, job, training, being an ignorant and having no qualifications despite which he had accumulated substantial wealth in the years he had been a Deputy of the National Assembly. The injunction was granted.

The Chavez royal family is referred to that way as Chavez’ father is Governor of Barinas State, the brother is Secretary of the State (Argenis) and another brother (Anibal) is Mayor of Sabaneta, a city in that same State where Chavze was born. There are others, Adeliz is President of Sofitasa a financial institution used to pay all of Barinas’ public employees, Narciso, who used to be in the Canadian Embassy and, of course, Adan, the educated one, Minister of Education). Recall that Chavez has always claimed he was poor when growing up, which is why he joined the Army. This is not strictly true, both his parents were high school teachers in a country where all teachers have the same salary, independent of where they live or are, just how many years they have taught. Moreover, Chavez has never explained how come his older brother Adan managed to enter the University of Los Andes before he joined the Army if poverty was an issue. They were not poor, but they were not rich either, just lower to middle class.

Azuaje all of a sudden got ambitious and sensing the weakness of the Chavez name in Barinas, decided he could be Governor. Thus, despite the express prohibition by Chavez for people to announce candidacies, Azuaje announced he was running in November. However, he also decided to go for the jugular and denounced the Chavez family for corruption, saying they have accumulated large pieces of land, most of which they keep in somebody else’s name.

He brought the evidence to the Comptroller’s Commission of the National Assembly and the stuff is apparently quite thorough, so much that they had to admit it as evidence and open an investigation.

But nothing is straightforward in the revolution. Despite being the accuser, the commission decided at the same session to investigate him for enrichment and there were even proposals to remove him of his parliamentary immunity. Deputies in Venezuela receive immunity agaisnt prosecution so that they can speak openly without being threatened at every step. Only the National Assembly can remove him of his immunity, mostly in criminal cases and this Assembly in particular has never gone that far.

But this is the President’s family, so Azuaje certainly has his work cut out for him.

What Azuaje charges is that the Chavez family has been accumulating land around the only farm they owned when Chavez became President in 1998, a farm by the name of La Chavera. La Chavera is not huge, a mere 30-40 Hectareas, but according to Azuaje, it had no cattle in 1998 and now has over 5,000 heads of cattle. (Except he also charges they were removed last week after he presented his first accusations).

Azuaje charges that la Chavera is now huge, as the royal family has accumulated the surrounding properties under other people’s names. More specifically, he says that La Chavera now has a person managing it, who goes by the name of Nestor Izarra. Izarra an employee of the Chavez family, with barely US$ 2,000 in the only account he has in the banking system, happens to be the new owbner of the neighboring farm La Malagueńa, which happens to be almsost 600,000 Hectares in size, something like 20,000 bigger than La Chavera. Of course, everyone wonders and has wondered how the manager of the 30 Ha. farm could buy the 600,000 Ha one, a question that has been asked for a long time, but Azuaje is the first one to bring it up publicly.

Azuaje makes charges with as many as six farms surrounding La Chavera and even said Chavez daughter in law should be investigated, as she not only owns a farm but has about 5,000 heads of cattle to her name.

But let’s just focus on one aspect: The farm owned by the Manger of La Chavera, named La Malagueńa, has 600,000 hectares. Well, according to Chavez’ controversial Land Bill, any farm over 5,000 Hectares is consider a large farm state and should be expropriated in revolution that has taken over a British owned farm called El Charcote, which “only” had 13,000 Hectares, but somehow, right under the eyes of the Chavez family, a neighboring farm has 600,000 Hectares and nothing has been done about it?

In fact, this weekend Chavez announced taht he was taking over a 65,000 Hectares farm in Apure state, one of the largest in the Nation, which in reality is small, because it spends four months of the year under water and barely has 10,000 heads of cattle.

But while everyone worries about Azuaje’s charges, nobody asks these bigger questions as to why these huge properties still exists next door to the Chavez family while useless properties (the one in Apure is mostly a nature preserve)

The answer is nobody cares. Today the Chavez family asked once again that Azuaje’s parliamentary immunity be removed and even Nestor Izarra claims he will prove how he acquired La Malagueńa. I would bet Izarra does not even file income taxes, despite his apparent wealth.

In the end, this soap opera is about power (Chavez, his family and the Governorship) and not about fighting Latifundia (Large farm states) or social justice. It is in the end a Barinas family feud or Barinas Peyton Place. In fcat, I talked to a friend to find out who Chavez plans to run as his candidate for Governor in November and was not that surprised at the answer:

His mother Elena…

truly a Barinas family sopa opera

Colombian authorities recover depleted Uranium in the hands of the FARC as described in Reyes’ computer

March 26, 2008

Well, the most far fetched and explosive revelation of the Reyez computer was apparently confirmed today when it was revealed that the FARC did indeed have 30 Kilos of Uranium. While this will create a lot of scary headlines, the truth is that this was a commercial transaction, not an attempt by the FARC to build any type of nuclear device or dirty bomb.

You see, the Uranium found apparently is not enriched, i.e. it is mostly Uranium-238, rather than the enriched version Uranium-235 which would be required for a device. The Colombian authorities keep using the word “empobrecido” (impoverished) a term I had never heard, but which must mean depleted Uranium, what is left after Uranium is enriched and the enriched part is separated.

Thus, this may have actually have been a scam by the FARC to make someone naively believe that they could enrich this stuff. The possible buyer had to be fairly naive and/or stupid (Jeez, I can’t help having an obvious suspect, given this description!) given that depleted Uranium 238 is much less radioactive than even the Uranium found in nature.

One has to wonder where the FARC got this stuff, that should be a really interesting part of the never ending story of the stuff coming out of Reyes computer. I must say when I first read about it, I thought this was a far fetched plan by the FARC to obtain the stuff, but if confirmed, this proves the veracity of the material found in these computers.

Annoying details of the use of technology by the Exchange control office CADIVI

March 26, 2008

You have to wonder how the Government chooses technological suppliers. The case of CADIVI, the foreign exchange control office comes into mind, because from day one it has been a cumbersome system and it seems to get worse, rather than better with time.

First of all, while I commend the use of the Internet for all tasks, there is no way of having access to CADIVI dollars unless you have an email and Internet access. In a country like Venezuela, this is a discriminatory tool, because there is no alternative. While people who live in Caracas may find no problem finding a connection to the Internet, when 12% of the population is rural and only a fraction has direct Internet access, you may want to create more democratic paths to the whol thing. For example, you could have a paper mechanism whereby people supply forms to banks directly.

But I digress, the first point is that anyone requesting CADIVI dollars has to provide an email and register.

It used to be that you would try to enter the CADIVI page and you would have to wait a while, companies actually pay people to do it during the night and on weekend. But rather than spend some money in servers or hosting the CADIVI page in a hst with good bandwidth like banks do, the problems has never been resolved. A while back, CADIVI then decided to create days for access. Weekends are a free for all, but then depending on which number your ID card ends in, you can only try it on a certain day of the week. It still takes a long time to get in and I know people that have spent two or three weeks trying to get in to fill a form.

Ironically, this system is a lot like the “Pico y Pala” day that some Caracas municipalities tried to implement to reduce traffic, whereby if your license plate ended in a certain number you could not drive during the morning and afternoon rush hours. The Chavez Government opposed this strongly, as this was implemented in municipalities in the hands of opposition mayors. The Government opposed it on the grounds that it restricted the people’s right to move around and judges immediately and not surprisingly issued injunctions banning these days. Funny, that nobody has applied the same concept to ban CADIVI from limiting people’s rights to information, which is in the Constitution. But I digress again.

CADIVI has been abysmal about calling people to prove how they spent their CADIVI dollars. As business sprouted around requesting CADIVI dollars to take advantage of the arbitrage, it took a long time for CADIVI to wise up to it. Finally, they issued a list calling those in it to go to CADIVI and prove how they had spent their subsidy.

The first list was a violation of people’s privacy, it was public and it contained people’s names and ID number (Cedula). This is not only a violation of people’s privacy, but it provides information to crooks which now know your cedula number and could use it illegally.

In later lists, they removed the names to protect people’s privacy.

But what is truly annoying and absurd is the latest list of 60,000 people that have to provide receipts. Given that CADIVI has everyone’s email, you would think they would simply send everyone in the list an email telling them to provide the information. Instead, a 9 MB Adobe Acrobat file with 60,000 ID numbers and request number is placed on the already overloaded CADIVI website to make everyone’s life miserable. As hundred of thousands people attempt to download the list to see if they are in it, other trying to get in to request their money can’t do it and they lose their weekly chance to do it.

I don’t know who are the geniuses that run the CADIVI systems, but if after five years of exchange controls they are so bad, they should be fired. Unless of course, they got the contract because they had a buddy in CADIVI or they paid a bribe, God forbid!

Fortunately, this morning I got up to watch the Major League baseball game in Japan early and I managed to get the download going (It was still not done when I left for work almost wto hours later). I now have the list and can email it to all my friends who want to know whether they are in it. You see, the penalty if you don’t provide the receipts is one year in which you don’t get your quotas for Internet or travel and in a country where people are now obsessed from taking advantage of the Oligarco Burguesito arbitrage, that is much worse and uncool than having your rights violated by being in the Tascon Facist list.

Mision conuco, higher education version

March 25, 2008

I found the article below in today’s El Nacional which was also sent to me by a friend, probably concerned about its implications. But what never ceases to amaze me is how two relatively intelligent and educated people like the Minister of Higher Education and the Minister of Science and Technology can defend programs like those described below. These are people who spent their life financed by the Government to do research in esoteric topics of scientific validity, but who now seem to think they wasted their whole life because they did not work in conucos.  (Never heard them complain when they received funding to finance their fairly mediocre research projects and scientific careers). Moreover, all technical studies show how the conuco is an unsustainable as a self supporting structure, but since their big leader, the almighty Chavez defends it, then it must be good. Maybe they have forgotten how to read (or think!)

What’s next? Making them obligatory? It would be better for the same students and/or Venezuela to have them spend their time programming in Basic or Fortran, at least theyw ill learn how to think!!!

Let history judge their stupidity

Education and Society
 
Program
 
University Stsudnets will plant black beans, corn and mandioca
 
With the arrival of the rainy season, the beginning of the program All hands to sow will also arrive, a program which is being backed by the Ministries of Higher Education, Agriculture and Science and technology.
 
The project stipulates that students, Professors, employees and workers organize themselves in brigades to plant mandioca, corn and black beans in 100 hectareas that have been provided to 17 institutions.
 
The teams must have between five and seven members who, voluntarily, will sow sseds in May and will harvest the crops in September, backed by producers from agrarian developments. “We will plant not only the established items, but we will sow the conscience in all involved students about the need that their education point towards the development of the country”, explained Minister Luis Acuńa
 
Hector Navarro, Minister of Science and Technology, added that it means “adding efforts to substantially increase productive capacity, but not starting from the great units of production, but from the small and medium size producers”
 
The program implies the practical substitution of agrochemical practices by an agroecological and sustainable focus and will receive consulting from Cuban advisers.

A picture is worth 10,000 words #37: Oil GDP and production

March 24, 2008

Former PDVSA Economist Ramon Espinasa updated his graphs on oil GDP and oil production and they were publsihed in today’s El Nacional, they paint a grim picture:

In the top panel, he shows Oil GDP/Total GDP for the last few years, which dramatically magnifies what has been going on as oil GDP has been halved as investment and production has dropped.

The bottom panel shows total oil production in the black line, PDVSA production in the gray line. The bottom line shows internal consumption. A picture is indeed worth more than thousands of words. The question is whether the Ministers can even understand them…

Chavez’s lies and doublespeak rule the day in Venezuela

March 24, 2008

We got some more wisdom today from Chavez who is looking more like Jim Carey in Liar! Liar:

—He hailed the victory by the Government in the ExxonMobil case. Of course, he failed to say that the victory (where was the Empire when the decision was made?) was a ruling by the British Court that the expropriation by PDVSA of the Cerro Negro property was not within the jurisdictional boundaries of the Court. Thus, the Court implicitly said there was an illegal act, it just was not competent to rule on it. Moreover, the injunctions in Dutch and US Courts remain in effect.

—Chavez earlier had warned Uribe to reign in his “spokesmen for war” referring to the Minister of Defense of Colombia. Well, the only man that tried to pile up troops at a border and threatened military action was Chavez himself, but he was silently reigned in by his military Chiefs of Staff who took three days to do any mobilizations and what litel was moved was not too impressive, according to the Colombians. We know who the warmonger is and he is among us…

—Chavez was silent on two issues: The charges of corruption against his family members which will be brought up in front of the Prosecutor’s office tomorrow by a Chavista Deputies. This includes pictures, deeds and documents of the large state properties the Royal Chavez Family has accumulated in Barinas State over the last few years, making them the new bolilatifundistas. And then there is the coincidence between the “fake” letter from Marulanda found in Reyes’ computer and that read by Chavez on live National TV in December. I guess the CIA managed to slip that letter into Chavez reality show Alo Presidente. Those guys are good!

The hopeless destruction power of the Chavez revolution

March 24, 2008

The day before the Easter vacation/Semana Santa began, the Government owned telecom company CANTV reported it’s 2007 financial results. We had not seen much of a glimpse into these results as the company discontinued its quarterly reports under new revolutionary management, but the company is still publicly traded and the managers decided to comply with the law and present the yearly financials. Well after nine month under the revolution, the news is not good. The company reported that earnings were down 51% from a year ago.

Of course, Chavez has said repeatedly that the company will now have a social purpose, whatever that may mean and the profits will be used for social programs. The problem is that if in only nine moths profits are down 51%, how long will it be before they become negative and there are no profits to use in “social” programs. At that time, the ideological whim of the former autocrat, becomes a cost that will subtract money from social programs. Like so many other things the revolution has destroyed.

And it was an ideological whim, because when CANTV was privatized in 1991, it was not only sold for a huge price, but it was also mostly dysfunctional. IT was hard to make a local call, let alone an international one. At the time, however, it was a monopoly, which allowed it to be mismanaged, give terrible service and lose money year after year.

This time around, since Chavez decided to nationalize the company (which also cost money that could have gone to social programs) without consulting anyone, the problem is that CANTV is no longer a monopoly and private companies will take advantage of the new incompetent management to gain market share by providing better services. Just better, not necessarily good services.

And CANTV made less money for a simple reason, margins are down, the company is charging less and costs increased as the number of workers has increased. It is typical Government management, when the job is not being done, then throw more people and money at it in the hope it will.  But, it wouldn’t.

While I have yet to see the financials of Electricidad de Caracas, I have already seen the effects of the new revolutionary management: More blackouts, a note saying I have yet to pay my bill 21 days after I did and the senseless buyback of the company’s debt I talked about a few days ago.

But even more troubling is that an efficient and working company like Electricidad de Caracas will be taken apart by the decision to merge it into the new PDVSA owned and run, Compania Nacional de Electricidad, whose acronym CNE, simply gives us a glimpse into what we may see going forward.

Juts imagine, a company that runs well, will be split into pieces and merged into a new structure with no proven track record, which will be run and “managed” by an inefficient company like PDVSA. Anyone with the most rudimentary management training or ideas, would have suggested either keeping EDC’s structure or merging the non-working companies into EDC, the jewel of the bunch. Instead, eight or nine regional companies will be merged into a single entity all under the supervision of PDVSA managers, the same ones that have been unable to keep the company functional since the strike, losing production year after year and failing to invest for the future. What a joke!

But of course, this is the same revolution that in 2001 passed the infamous Land Bill and made sugar and cattle their focus for the future. It is not coincidence that he first shortages were in sugar, we have now become net importers of it, as acres of sugar cane plantations lay abandoned as none, yes not a single one, of the sugar processing plants is working at even half capacity under the advise, supervision and sometimes imported machinery of “expert” Cuban advisers. The same “experts” that made Cuba an irrelevant sugar producers long time ago. And the Chavez Government has spent billions; yes billion of dollars in sugar plants alone. Just the CAEEZ project, the jewel of the project in Chavez’ own Barinas State cost US$ 200 million. Obviously “cost” is a euphemism as US$ 200 million was spent in the initial stages of the project and only some land was cleared and some beams went up as the robolutionary National Assembly investigated corruption for US$ 3 million, but never asked where the other US$ 197 million were.

And there is cattle of course, all those large estates, the hated “latifundios” taken over by the revolution, none of the have even half the heads they did when taken over, as the beneficiaries sold off or killed the cattle when things started to not go well. Milk shortages by now have become chronic, not that Venezuela was ever self-sufficient in milk production, but whatever sufficiency there was has been reduced even further. More waste, more destruction, less money to where it is needed.

But rather than see and recognize the errors, the robolution goes after the next link in the chain, buying off dairy farms, producers and distributors, because they have now decided that is where the problem is. But all it means is more pain ahead as these enterprises from Parmalat to the ones bought off more recently become inefficient, wasteful under the inefficient Government eyes.

 It’s the same everywhere; a dysfunctional Government takes over working structures and rapidly thermalizes them with its own structure, for the worse, never for the better. 

It’s the same everywhere; a parallel health system was created to replace the existing one, today both lie almost useless, the old one decrepit due to the lack of maintenance, the new one mostly abandoned, as the focus on it seems a thing of the past. In education, not much ahs happened other than the change in name. Fewer than 200 new schools have been built in nine years, students graduate without receiving the obligatory math, physics and chemistry in high school. They get passing grades because there are no teachers. The lucky few that get into universities struggle with basic concepts they should have heard of three ears earlier.

The solution? As usual, destroy the existing structure, the functioning one: force universities to take on a fixed percentage from each public high school. It’s democracy they say. But it isn’t. In the end it will be simply frustration, as these students will become chronic repeaters unable to pass the most elementary courses. Universities will set up, like they already do, remedial courses to help them, and even that will not be enough. Most will fail and drop out, it is already happening without this destructive creation invented by the current Minister of Higher Education. Students from public high schools, the ones that have been able to pass the entrance exams are not doing well, too many gaps in their backgrounds, too much competition.

But the beat goes on, despite nine year of oil windfall and failure, the revolution looks for new targets to destroy, with its unique and hopeless power to destroy and undo however little works and functions in Venezuela.

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