Venezuela’s Dictatorship No Longer Cares About Appearances

May 13, 2014

camp3

For two and a half months, the Venezuelan Government had been extremely careful with the students and their protests. While it was aggressive and repressive at attacking those protesting in the streets, it had been respectful of the student camps set up in various parts of Caracas and other cities. The strategy by the students had been clever, they could not be accused of being violent, while camping near where many of the protests were taking place, allowing them to “feed” into the protests and retreat back to the camps when required. Moreover, the camps were in front of the United Nations in one case and near the OAS in the other. It seemed improbable that a Government involved in an internationally mediated dialogue would attack the camps. It would simply damage the image of the Government and tell the world what an outlaw Government Maduro’s has become.

Except it did not work out that way. Instead, the Government or someone decided to attack and raid the student’s camps. And the raids had many surprises:

-It was a military operation led by the Minister of the Interior Rodriguez Torres.

-It was an illegal raid, as the Prosecutors office was not only not informed, but had no representatives present at the raid, as required by law.

-The military raid arrested everyone in the camps, those sleeping on the streets and/or the sidewalks, with no legal justification for those that were simply protesting, without blocking the way, as guaranteed by the Constitution.

-Students were held incommunicado for longer than twenty four hours, without the Government releasing their names, allowing them calls or legal representation while they were mostly accused as a group, without being individually charged.

-The students were all subjected to drug tests, without any legal reason for it. In fact, only a small number were found to have traces of drugs.

-Minister Rodriguez Torres, who acted as prosecutor, policeman, investigator and judge in the operation, accused the students of being armed, despite them not using weapons once, including the night of the raid. Contrast this with the paramilitary groups who support the Government are usually seen publicly with their weapons.

-Most students were eventually released, those that were kept in prison were simply accused of “leading” the protests via intelligence evidence gathered prior to the raid. There is nothing illegal about being a leader of a protest.

While all of this is going on, Maduro keeps trying to talk dialogue, while Diosdado Cabello makes wild accusations against opposition figures, many of which are members of human rights ONG’s or are involved in the dialogue process.

So, can anyone understand what is going on here?

Well, I am not sure I can and that is why I have been silent on the whole process for so long, because the change in strategy not only took me by surprise, but I truly did not believe the Government would go and frontally attack the students like it did.

The question is whether the Government changed its thinking and decided on a new strategy, or whether this was an individual act by Rodriguez Torres. Or whether there is agreement on which strategy to follow.

My interpretation is that this was not a unified strategy, but that Rodriguez Torres acted on his own, after many discussions not leading to anything within the Government.

The camps had actually been quite successful. Within the Government there were, and are, large divergences on to how to handle them. Not doing anything was to many simply a sign of weakness. Doing something was an act of future intimidation to others, which was badly needed. While Maduro favors the dialogue that he agreed to internationally, he also believes that intimidating the opposition is the way to go, while Diosdado does not believe in the dialogue at all.

Thus, Rodriguez Torres acted on his own or tried not to involve Maduro in the whole operation as a way of having the President save face, and his image, while at the same time acting in the intimidating fashion that he had always favored. As the leading enforcer of the Dictatorship, Rodriguez Torres cares little about appearances, as his raid clearly demonstrated, while defending the empty revolution is all he cares about.

Meanwhile Maduro can welcome the Foreign Ministers arriving on Thursday and argue that he was unaware of the plan as there had been no agreement on strategy, but the protests had created an untenable position for him.

Of course,the raid and the way in which it was carried out completely (and finally!) destroys the image that Chavismo has tried to build and defend over the years of a democratic Government, respectful of the rights of others, while twisting and perverting the laws and its interpretations to have its way. To the UN, it was an unexpected slap in the face. And now Maduro will try to blame the break in the dialogue to the intolerant opposition, something that the Unasur mediators are unlikely to buy, but Chavismo believes that it can sell anything to what they think are the naive Foreign Ministers of Unasur. (After all, they have so far)

Unfortunately, this bodes badly for the Venezuelan opposition, whether students, MUD, anti-MUD, pro-Salida or whatever. Rodriguez Torres stepped over the line and got away with it. Next time he will push further. And the one after that even further.

Dictatorships are like that. They push the line and then they push it again, until they find themselves at a point where human rights abuses and appearances are simply irrelevant. Where the important thing is, as Rodriguez Torres said, the survival of the Bolivarian revolution, however failed it may be. And if next time it requires jailing dozens of opposition politicians, so be it. Or killing a few dozen protesters. Oh well! they were being too violent. An explanation will be found and we don’t care if you don’t believe us, we are a sovereign country.

There are too many games being played at once within Chavismo, that of appearing as a Democratic Government respectful of others, is simply no longer a priority. Human rights are simply not a priority for the revolution. Not even the appearance of respect for them. Neither are the students, the universities or the young.

You have been warned!


Venezuela: Where Is The Money? (¿Donde están los reales?)

May 7, 2014

As foreign analysts talk up the “pragmatism” of the current Venezuelan Government and Venezuela and PDVSA bonds soar, one has to wonder where the money is. After all, with shortages and inflation at an all time high, you would think this “pragmatic” Government would make a huge effort to reduce shortages by giving our foreign currency to importers to guarantee supply.

In my mind, the moment is now, not 2015. With the Government’s popularity at 21%, this is the time to adjust an really  be pragmatic. Instead, the only “pragmatism” has been that the Sicad 2 rate was higher than anyone expected. The rest, is so far wishful thinking, from currency unification, to any increase in the price of gas.

It is a case of “Show me the money”. So far, I have seen very little.

Thus, bonds go up on three acts of faith:

-The Government is “pragmatic”

-Oil will not go down in price.

-The parallel funds have the money the Government says

(And there is a corollary: The political cost of defaulting is too high. Ummm, I have heard that before: The political cost of firing 20,000 PDVSA workers is too high. The political cost of jailing Leopoldo Lopez is too high and so on and so forth, you get the idea)

Meanwhile, let’s look back at Cadivi approvals  for imports in 2012 (no data for 2013):

2012The important numbers here is that in 2012, the Government gave importers in twelve months US$ 18.18 billion  or US$ 77.7 million per day.

Well, today, Cencoex released the number for the first four months of the year, and this is the same data for imports:

CencoexWell, this 2.827 billion in four months for imports, which is equivalent to US$ 8.481 per year, substantially below the US$ 18.2 billion of 2012. And if you think Sicad 1 or 2 explains this, let me remind you Sitme was around in 2012 at daily average levels near or above Sicad 1 and Sicad 2 combined so far this year.

That is a factor of over two difference. So, if you have felt the shortages this year, the quantitative explanation is right there: A third of the money, a third of the goods.  And shortages, of course, create inflation, as there is too much money chasing too few goods.

So, if the Government has so much money in the parallel funds and if oil is high and you have become ¨pragmatic¨, why not use it? What are you waiting for?

For the Government to reach 10% in popularity? Really?

Which only leads to the question Luis Herrera used to ask: ¿Donde están los reales? (Where is the money?)

I have absolutely no idea, it may not even exist…


Tales Of Bolivarian Inefficiency IV: Puerto Cabello’s Bermuda-like Triangle

May 3, 2014

One of the nice things about having faithful readers, is that I sort of get copies of videos, documents and papers (like this one) making sure that I seldom miss important stuff. Sure I get stuff twice or even more times, but it is an incredible source of information, so thank you all. Once in a while, readers write to tell me stories, many of which I would not know about in detail if it were not for them. Sometimes, these become a post. This is one of them.

Chavismo thinks that it can hide incompetence and inefficiency. But modern tools are pretty incredible. Chavismo also seems to believe that it can do anything, run any enterprise. Their infinite belief in the power of the State and their own ability is simply scary. Take imports. In its war against the private sector Chávez began importing stuff from all over, just to bypass the local private sector. In his mind, if there is no toilet paper, or corn, or wheat, it is just a matter of importing the stuff and magically, it will show up in the shelves of local stores.

Except in reality, the path is an extreme adventure in inefficiency. It starts with how much is paid for the stuff, as there are bribes and commissions at each step. Then, there is the problem of what to bring. Some bureaucrat in Caracas decides to import paper towels and corn and, in a few weeks, people are using the towels in lieu of toilet paper and making corn bread because there is no wheat.

Except that it is not even that easy, because to get stuff from say, Brazil, to the Venezuelan consumer, the stuff has to go through the Puerto Cabello Bermuda-like triangle, where ships don’t disappera, but they do get lost for a while:

Bolipuertos

You see the port responds to the whims of Chavismo, as it is run by Bolipuertos, which is 49% owned by Asport, the Cuban port authority. This is not an easy fact to dig out, as they try to hide it deep in the webpages, but go to slide 22 of this page, and it is clearly spelled out.

This means that if it is May Day, like yesterday, many of the dock workers are bussed to Caracas to participate in the Maduro march. That means tough traffic to get in and out of the port, little unloading and almost no cargo going in or out.

But Puerto Cabello is like a Bermuda triangle, where ships get lost in time, as they arrive, spend weeks and months waiting and then too much time unloading. And time, my friends, means cost and money for everyone involved.

What my friend and reader taught  me (let’s call him DD) is that in the maritime world you can’t hide. Each ship carries  an AIS (Automatic Identification System) which is sort like the black box that airplanes have, allowing all ships to be tracked. There are websites like this one or this one, where you can follow each step of what is going on. I actually subscribed to the first one for a while ,so I could go back 60 days and follow the ships. In fact, you can even add alerts to keep track of ships.

This, for example, is an overview of the part of the Caribbean where Puerto Cabello is from the first site I linked to:

marinetraffic1

The first thing you note is how much movement and density of ships there is near Aruba and Curacao (Ships moving look like little arrows, rather than diamonds, which are vessels that are not moving), while around Venezuela everything is so static. (If you go to the webpage, you can even tell how fast the ship is moving by putting your mouse on it). Obviously, comparing the size of the three economies, you would expect much more movement and density around Puerto Cabello. But such are the ways of the revolution…

In fact, you can zoom in and see how little movement there is inside the port itself  (Colors are what type of ship it is, tanker, (red), cargo (green), passenger (blue), etc.):

marinetraffic2

You can dig even deeper, blowing up the port to the level of street detail, if you know the port, then you know where the grain elevators are, for example. Thus, if you know your stuff, you can tell what type of ship is at each spot, even if the system tells you most of the time.

Here is a detailed picture of  what was going on in Puerto Cabello, yesterday May 2nd. 2015:

Maritime3

In fact, you can click on any of the ships and you can get all sorts of information on each ship. For example, if you click on the second green ship below the point in the middle, you get this window:

ship

Note that you can check out the vessel’s track, history, itinerary. And in vessel details you can get even more pictures and find out this ship came from Norfolk Virginia, for example. If you are subscribed, then you can see when it arrived in Puerto Cabello, when it went to port and the like.

And here is where you find that Puerto Cabello has become almost like the Bermuda triangle: Companies send ships in, but they never know when they will come back. First, they arrive at port and have to wait for weeks, sometimes months, to get into the port to unload the cargo. As an example, last November, the 27th. to be exact, the M/V UBC Toronto left New Orleans loaded with corn. The trip takes about 8 days. Thus, it should have arrived in Puerto Cabello  around December 8th., the 9th., at most.

Well, on February 24th. this ship was still sitting in the same spot outside Puerto Cabello, waiting to be unloaded. We are talking more than seventy days later! It finally left Venezuela at the end of March (I did not follow its course and my subscription expired!), arriving back in the States on April 9th. that is a four month trip, for something that should only take three weeks, two traveling and one unloading.

This not only costs money, days inside the port cost on average US$ 15,000 per day, but think about it, this ship was loaded with corn at a time that Venezuelans are experiences shortages in Harina Pan to make their arepas!

Chavista management is clearly an oxymoron…

There was another ship, which arrived right before last Christmas, which was unable to go into port to unload until after two weeks anchored at sea. Well, this ship was still in Puerto Cabello unloading at the end of February, more than 8 weeks later. And it did not leave until the first week in March, which means that at $16,000 per day for roughly 60 days, the trip cost an additional US$ 960,000 for the trip.

Guess who pays for this?

So add it all up. In most of the world, workers unload, on average, about 5,000 Tons per day, from a vessel with peak rates of about 10,000 Tons in very efficient operations. In Venezuela, with luck, you may get to 1,000 Tons per day, but rates can be about half that much. This adds costs from US$ 10,000 per day, all the way up to US$ 20,000 per day, for up to two or three months. Given that a shipment may be worth US$ 10 to 12 million, this becomes a very expensive proposition. (Not to mention graft, overprice, commissions and the like)

Add it all up. This is the cost of the ports being under the inefficient Chavista management, under the advise of Cuban consultants, which not only charge for it, but turn out to own 49% of the company running the ports (They probably paid nothing for it). And, of course, being in charge of the port is juicy business, with Generals or whatever their rank may be, fighting for the top spot regularly (Last year, the port had four different Heads, with each new one requiring to learn the job from scratch, They probably never did, except to learn at which step you could charge something)

There are many other stories surrounding this. DD told me how a ship used in the oil business, costs about US$ 400,000 per day rental, US$ 230,000 if not in use. Just bringing it to Venezuela, if it is in Europe, for example, costs about US$ 2 million. Well, one such ship was brought to Venezuela last year from Europe. By the end of March it was still there, sitting around, doing nothing.

Chavista inefficiency at its best!

Meanwhile, maritime operators tremble at the thought of having to send a vessel to Puerto Cabello. It is the Bermuda triangle backwards. Your ship always disappears when it goes into the area, you just don’t know when it will reappear!

And these guys think hey can keep doing this!

(Thanks to DD for the tip and the info)

 


Tales Of Bolivarian Inefficiency III: Chávez’ Frozen Cuban Dream

April 30, 2014

Despite all of the problems at Ultimas Noticias, the reporters there keep turning out some of the best investigative pieces in Venezuela. This time, it was the turn of Lisseth Boon in her excellent piece about Helados Coppelia, which can also be entitled Chávez frozen Cuban dream.

To put it in perspective, Chávez was such a Cubanologist that despite the long tradition of ice cream in Venezuela (Tio Rico, Efe, Castellino, Crema Paraiso, 4D, Versalles), rather than promote local brands, Chávez did the opposite, trying to promote and bring to Venezuela the Coppelia brand, his hero’s Fidel Castro’s creation. Castro created Coppelia in 1966, much like Chávez, it was his idea, nothing was done in Cuba that was not Fidel’s idea. Well, Efe and Tio Rico and Castellino (which made killer frozen lemonade) were around in Venezuela well before then. I can prove that Efe was here before 1966, in the only picture you will ever see of The Devil in this blog, here is the Devil eating Efe ice cream circa 1951 or 1952 (Vanilla, of course!):

efe(Saintly, no?)

Yes! I am proud of my ice cream heritage and taste!

Chavez was not…

Instead, Hugo went to Cuba and brought the Copellia brand to Venezuela. In 2012 Chávez inaugurated the Copellia plant and called them “the best in the world”, which clearly showed he was not much of an ice cream eater.

And because every project in Venezuela since 1999, was Chávez’ project, despite his  keen interest in it, Coppelia, much like the rest of the projects, did not work out well. In fact, barely three weeks after the inauguration, the plant was closed. Somebody told Chávez something was wrong, he even suggests that Fidel called to complain. Then, on nationwide TV Chávez complained to everyone:

and the then Minister of “Efficiency” (today Minister of Defense, clearly a justified promotion) Carmen Melendez, told Chávez then, that the plant was closed because a machine broke down, there were not enough supplies and they did not have a sufficient number of containers to put the ice cream in.

Chavista planning at its best! We are talking only three weeks.

Long term in their attention span.

Well, as Ms. Boon reports in Ultimas Noticias (kudos to her!), things have not really improved much. There is only one Coppelia ice cream parlor (Gradillas a San Jacinto) in Caracas and some 72 spots where you can supposedly buy the stuff.

Except sometimes you can’t

Compare that with thousands of places you can buy Efe or Tio Rico or Crema Paraiso and I know at least five 4D ice cream parlors, with even one in Miami Beach.

But much like anything else, Chávez preferred to promoted foreign ideological stuff, even if it was ice cream, than successful Venezuelan ones and enterprises.

Chávez initially promised that Coppelia ice cream would be made with Venezuelan products and supplies. Milk products from Lacteos Los Andes (now practically bankrupt), sugar from CVA Azucar (now shut down, see first post) and orange, guava, mango, peach and coconut.

Well, 18 months later and now Chávez is dead, Coppelia produces ice cream, mostly creamy flavors, in irregular and limited fashion. Raw materials and supplies are all imported. Forget about all those fruit flavors, but its manager says raw materials come from Lacteos Los Andes, which is practically shut down.

Go figure!

But, a different raw material, money, is not in short supply for Coppelia. In March the plant received an additional Bs. 12.1 million in Venezuela. This adds to the funding in 2012 and to the US$ 4 million given to the Cuban Coppelia in 2013 to “increase its production”

But, in 2013, the milk came from Nicaragua, while powdered milk was imported in 2013 to the tune of 187 thousand Tons. But ask the manager, and it is all Venezuelan. As for the fruit juices, the same manager of the plant said almost a year ago that “in a few weeks fruit flavors will be on the street”

But we are still waiting.

So, much like the Bolivarian revolution, Chávez’ frozen Cuban dream is just that, an ill-conceived dream, a Presidential and Bolivarian whim, with little to show for it.

I wonder who the Minister for Efficiency is today? Just asking…

Next:  Tales Of Bolivarian Inefficiency IV: Puerto Cabello’s Bermuda-like Triangle


Tales Of Bolivarian Inefficiency II: The “New” Venezuelan Steel Industry

April 28, 2014

conchinajdcii20140416_0079

Continuing on this short (or long, maybe) series of Tales of Bolivarian Inefficiency, this time we look at something that you may have missed during Easter or Holy week, as the Chinese Vice-Premier came to Caracas and signed a bunch of contracts with various Government institutions. As usual, the details are scant, but the steel and aluminum agreements are certainly intriguing and appear to be a waste of money.

The “New” Venezuelan Steel Industry

While many people were on vacation or resting over the Holy Week holiday, China’s Foreign Minister Wang Yi was in Venezuela and is usually the case in these visits he was accompanied by a number of representatives of Chinese firms and institutions to sign cooperation agreements.

Two of the agreements are loans, which are part of the Joint Chinese Venezuela Fund, which were signed by none other than Diosdado Cabello’s brother Jose David Cabello, who mostly announced them via Twitter. But there was a press release and as is customary in topics relating to Guayana, Damian Prat was on top of it.

The steel project is perhaps the strangest one. This contract with China Minmetals Engineering Co. Ltd, Chalieco, involves according to what little has been informed, to purchase and install a continuous smelter for round products in order to continue diversifying the steel products that Sidor produces. Supposedly, this will allow for the production of an additional 700,000 Tons of steel products. This steel will in turn allow for the production of pipes in a new plant.

Now, as Prat points out, this makes little sense. The Chavista Government nationalized in 2008 the Tavsa pipe plant and immediately proceeded to shut it down, in order to start importing the same pipes from China. the question is then, where is this new plant and why instead of starting a new project, doesn’t the Government revive Tavsa, which has received no funding and sits there languishing after six years.

But more importantly, where is the steel going to come from? When Chávez nationalized the Sidor plant, it was producing 4 million Tins a year of steel. Today, six years later, it is expected to produce less than 1.5 million Tons, the amount produced in 2013. This is insufficient to satisfy the demands of the Venezuelan market, let alone to supply any new plant. Why are they building something new, instead of using the money to restart Sidor and Tavsa and invest in parts and supplies to get them going?

What is most ridiculous is that, much like in the case of the sugar processing plants, Cabello, who is new in the Ministry for Industries said: “Recovering companies that were abandoned has been a characteristic of the Bolivarian Government. We will work as a team to fulfill this …”

Well, we don’t know what other companies he is referring to that have been recovered by the fake revolution, but in this particular case, it was his idol Hugo Chávez that nationalized these companies, which then began receiving no backing, no funding, no financing and were mismanaged. This is why they are  in the deplorable state they are in.

But the mystery remains about the new pipeline plant that Cabello referred too, as nobody knows of such plans. So, even if ture, if the new plant does not exist, what is the point anyway.

Separately, Cabello also announced a contract with Challieco for US$ 500 million (how easy they throw these figures around!) to recover production in Venalum. The same company was hired in 2011 to build parts in China for Venalum, which for forty years had been built in Venezuela. The debt was incurred, but as far as anyone can determine, nothing was ever installed and it is unclear what happened with the U$ 403 million.

In the meantime, this financing has to be paid someday by future generations and the revolution is deaf to the questioning about the projects. Where is the money? What was it used for? Did someone pocket it? Who made money when Tavsa was shut down and its production replaced by Chinese imports? Who is responsible for this disaster?

You can’t ask these questions because largely, the same actors that were in charge then are in charge now.

I wrote earlier about the book by Prat Guayana: The Upside Miracle, the destruction of Tavsa and Sidor is all documented there. But the decimation of the country continues in the name on the revolution. And nobody in Governemnt does or says anything. In fact, they continue the destruction and the mindless indebtedness of the country.

Next: Part III: Chávez’ Frozen Cuba Dream

 

 


Tales Of Bolivarian Inefficiency I: Sugar Processing Plants

April 26, 2014

cva

Coming to Caracas, one is bombarded with stories. Just watching Maduro in his now almost daily tirades on how he will restart the economy and save it from economic war, would give enough material for what has become a truly bizarre dictatorship, presided by someone who has no ability to diagnose neither the problems, nor the solutions to the mess created by the revolution.

But one area that has caught my attention is the ability by the Bolivarian revolutionaries to disregard or dismiss the many failures of the revolution and describe how they will certainly fix things going forward. Sometimes they don’t even bother to acknowledge that the mess created is their own, talking as if some other Government or group of people was responsible.

Maduro is the first one to talk like this. This week, he has talked about a “new economic model” and the launching of a new age of powering local production, as if it was some Martians that replaced local production with cheap imports subsidized by cheap foreign currency, while the private sector was obliterated, persecuted and nationalized by the Bolivarian revolution.

But there were some announcements this week or during Holy week, or stories, which simply need to be told as they perfectly exemplify and describe the inefficiency and improvisations of the Chavista revolution.

Part I: Sugar Production and Processing

Sugar and sugar cane processing was one of the first areas in which the Chavista revolution decided to intervene some thirteen or fourteen years ago. The Government did two things: It nationalized existing sugar processing plants and imported others from Cuba and under Cuban “expertise”. The argument was not only that the Government could do a better job, producing more and cheaper sugar, but that it would eliminate monopolies and stop the exploitation workers.

Move forward thirteen years and Government plants barely produce 26.7% of the sugar in Venezuela and the companies were losing so much money that the Government last year decide to “restructure” CVA Azucar, the holding of the processing plants in order to make it more efficient. Except that was simply an excuse. By eliminating CVA Azucar and replacing it with the “new” and improved Corporación Venezolana del Azucar (Coincidentally also CVA) what the Government is doing is bypassing its own decrees, which do not allow you to fire anyone. Unless, of course, the company is being shut down.

Thus, the Government that wanted to eliminate the “exploitation” of the workers, is using this legal subterfuge to fire workers and eliminate unions, as both the unions and their leaders were part of the now extinct company.

Nice trick, no? You fire workers and get rid of unions all in a single and somewhat fictional stroke!

Oh! The pretty revolution!

And this is all happening because these companies, which were emblematic of the Chavista revolution, became bloated by cronyism, inefficiency and disregard for productivity and profit.

In fact, General Wilfredo Silva, the President of the recently created new and improved CVA, defended the practice and described how inefficient these companies were. All said, as if the original companies had been bloated and created by a different Government.

The General gave the example of how in Brazil, a sugar processing plant which processes 9.6 million Tons a year, does it with only 390 workers. In contrast the Central Portuguesa plant, which processes 3.6 million Tons, does it with almost twice the number of workers with 700. Or the Sucre Central, which processes 288,000 Tons also has 700 workers.

But there is no remorse. According to the General, the Socialist system under the revolution is the correct one and under his new management, which may last just a few months if experience is any indication, what has not happened in 14 years will magically happen now. There is no reason to return the expropriated plants to its rightful owners to continue “exploiting” the workers.

Sure General, because we can think of so many successful examples under the revolution of successful enterprises, except we can’t really recall the name of a single one…

Next: part II: New Steel Projects…The “New” Venezuelan Steel Industry


Venezuelan Supreme Court Limits And Legislates Right To Protest

April 25, 2014

prot

In a remarkable decision, the Venezuelan Supreme Court in interpreting the 2000 Chavista Constitution, proceeded to not only remove rights given by the Venezuelan Constitution, but in one swift interpretation, legislated new limitations to the right to protest, as well as appearing to promote repression of protests.

It was just another chapter in the bizarre history of a Supreme Court that only responds to the desires of the Maduro Government.

The Constitutional Hall of the Supreme Court essentially says that any concentration, protest or public meeting which is made without prior authorization of the authorities can give rise to the police or public force to remove the gathering in order to guarantee the right to freely move around of others.

However, Art. 53 of the Venezuelan Constitution clearly says that  any person has the right to meet publicly or privately, without permission, for legal ends and without weapons. It also state that such meetings will be regulated by the Law.

And the Law clearly says that you don’t need permission for such meeting, just participating it to the relevant authority.

The decision also violates international human rights standards which explicitly say that the right to free transit should not be above that of meeting freely in public. In fact, the same human rights standards specify that the lack of approval or notification should not be an excuse to allow the gathering to be broken up by the police. Venezuela has signed all United Nations human rights agreements.

To close the absurdity and perversity of the decision, the Supreme Court says that municipalities have the responsibility of controlling public order, while municipalities in Venezuela are barred from buying equipment of any kind for such purposes.

Thus, in one blow the Court reduces rights provided by the Constitution, legislates on what is required or not to protest, making it essential to be approved first and exhorts the police to remove any such protest.

Of course, all of this will be applied only to whatever the Government considers opposition.

Someone is clearly worried somewhere with these protests, no?

 


Maduro First 365 Days As President Of Venezuela

April 19, 2014

Madurosilla

A year after supposedly being elected President of Venezuela, Nicolas Maduro is still trying to figure out how to do his job. Growing up under the shadow of Chávez, Maduro had or has little idea about how to manage the Venezuelan economy. He thinks that he can follow the path of his Master, but the Master left the economy in bad shape and there are few places where the regime can find the funds required to stabilize the über-distortioned Venezuelan economy. Add to this the internal bickering between the various factions in Government and it took Maduro almost a year to make changes to the foreign exchange markets of Venezuela, which Chavismo thinks is the most important piece of any economic policy.

In fact, it thinks it is economic policy.

But other than the Maduro administration admitting a much higher rate of exchange, the new Sicad-2 foreign exchange system has become a Sitme-like repeat monster, which shows little of the supposedly “free” and “transparent” aspects that the Government promised. But what can you expect from the brainiacs that surround Maduro?

And as the world expects that the Maduro administration will become pragmatic, we have seen little of the sort. But somehow, good “sources” tell analysts stories of a future unification of all exchange rates at the Sicad-2 level, a noble goal, but one as vaporous as Chavismo’s pragmatism or Chavista “ideas” for that matter. The time for Maduro to make an adjustment was then and maybe still is now, but not next year, when the economy will be in worse shape, the Government’s popularity will be at its lowest ever and a Parliamentary election will be looming in the horizon.

Call us skeptical, but we just got over this new “free” and “transparent” fx system being promised.

Meanwhile, while Maduro blamed everyone for the economic problems, he doubled inflation to 57% per year, shortages increased dramatically to levels such that the scarcity index is no longer published by the Venezuelan Central Bank and monetary liquidity increased by a whopping 75.3% during his first year, mostly due to the Central Bank lending to PDVSA.

Economic “stupidity”, more than economic “war”

And rather than seek expert help, Maduro relied on the same clueless advisers that led Chávez and him to where we are, promoting the man who has destroyed PDVSA, Rafael Ramirez, to Economic Vice-President, as if Ramirez had any training on the subject. And it shows.

And rather than recognize the failures of the policies of controls and intervention, Maduro, who has even less of an idea on economic issues than Ramirez, went for more controls, more intervention and more imports (overcharges and “guisos”) by the Government. Price and profit controls on everything were imposed and right before the regional elections, Maduro declared war on prices, forcing merchants to sell below cost, increasing his popularity, but accelerating scarcity and the overall deterioration of the private sector.

Way to go Nico!

And just to make things a little worse, the Government did not include its debt with importers from 2013 in the foreign currency budget, slowing down both local production, manufacturing and imports, something that is still going on today.

Not exactly what needs to be done. But rather than try to change direction, now Maduro wants to declare another war on the economy. This time around, he wants to increase taxes, introduce an asset tax, since taxes from profits have gone down, given the lower profits, if any.

Talk about clueless. With deeply negative interest rates, those that have assets will soon learn the wonders of borrowing to the hilt to buy things that can be hidden, like dollars, or acquire others, all under the subsidy of the Government. Some economic model!

Meanwhile, Venezuela not only finances Cuba under incredibly generous (or is it stupid?) terms, but even the meek Comptroller takes offense on the Cubans ripping Venezuela off, overpricing up to 9,000% (no error there!), importing unnecessary products, the Cubans not sending even 1% of certain orders, storage costs, delays and mismanagement.

It is an extension of the Cuban economic model, applied to rob Venezuelans.

Stupid Solidarity Forever! (SSF!)

Meanwhile, Maduro seems to be trying to juggle the military, the corrupt, the radicals, the so called “pragmatists”, his family (or Cilia’s) and Chávez’, as well as combinations of all of these, including Diosdado.

Houdini would be proud!

And as if this was not enough, Maduro decides to repress protests, jail the leaders of the same and have a dialogue with anyone but those protesting. Remarkably, the opposition shines on national TV, but you have to wonder, who does Ramos Allup represent in the end? Could he get elected to anything? How many people like him, including his wife?

But the beat goes on, Maduro is a clueless President, the country is rudderless, with nobody really proposing an alternative model, beyond applying more order and knowledge to the current one. Everyone fishing to see what morsel they can grab. Even the opposition supporters have by now drank the Kool Aid that the real manufacturing sector has made heaps of money off the Government and that the airlines, car companies, pharmaceutical companies and the like deserve not to get paid.

They should ask themselves: Am I better off than in 2000 and their answer will be the same as that of those companies.

But Maduro is really happy, he believed what Rafael said about the economic model being right and successful. He still wonders why there are meetings all the time and nothing ever gets done. And Cilia prods him to keep on repressing, who cares about human rights and the like?

At least she is safe!

And crime is rampant, but the pretty revolution does not even care for its own supporters. Have you noticed? Even the deaths of Government supporters are not investigated and punished. Maduro is worried because that is the number one concern of the “people”, but he think he can’t control crime if the opposition leaders do not help.

And like in Catch-22, so it goes…

Maduro’s Government is 365 days old, how many more will the country have to endure?


Imaginary Dialogues: Reporting From Venezuela by Paul Esqueda

April 16, 2014

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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.


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