Minister of Planning Felipe Perez who was appointed less than a year ago was removed today by President Chavez. Perez, who has a PhD. in Economics from the University of Chicago, did little but make failed predictions as to the path of the economy while invoking the need for divine intervention and positive thinking to have things work out well.
He will be replaced by Jorge Giordani who happens to be the man that led the Ministry during the first three years of Chavez’ administration. Giordani, who is not an economist, set the country in a path that was simply unsustainable. He purposely pushed for the overvaluation of the currency while increasing internal debt by a factor of six in three years at levels above 30%, destroying much of local industry. This contradictory policy was doomed from the beginning and eventually led to the sharp devaluation in February of 2002 and the continued devaluation since then which in turn led to exchange controls in January.
Some people believe that he comes back because Chavez can’t find anyone else. I disagree, he comes back because Chavez has extraordinary rapport with Giordani and believes in him. Giordani is a true leftist fundamentalist on economic matters who as recent as 1995 was praising the success of the North Korean economy in his academic writings on scientific planning. I see his return as a sign that Chavez wants to exert even more control on the economy. What is not clear to me is what will be the role of Minister of Finance Nobrega. Nobrega is an economist with a sound background, which Giordani does not have. Can’t see how they will get along, given that Giordani was the controlling force on the economy when he was Minister, a role assumed by Nobrega a year ago. Very bad sign for the country.
The Devil's Excrement 
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