Archive for January 7th, 2006

And when it falls…

January 7, 2006

I am dressing in black and trying it, just need to borrow a car…

A show of intolerance and bad manners by the Mayor of Caracas

January 7, 2006

In this video
from Noticiero Digital there is tape of the Mayor of the Metropolitan area of Caracas, Juan Barreto,
showing his intolerance, disrespect and poor manners by simply losing his
temper and insulting and reacting against a reporter that is trying to ask him
a question. The question is really never

Basically the
Mayor is announcing the expropriation of some 32 buildings in the Caracas area. The Mayor
begins saying that they will publish the pictures of the buildings so it is
clear which ones they are, because people are concerned and it is not true that
buildings are being taken over. The reporter points out that people have
started invading buildings since the expropriations began, she then asks what
will be done to the people that violate the law and he snaps back at her saying
you are cornering me and that is not how reporting is done and tells her she
should go back to the University, as his supporters join him, jeering at her. He
then makes some preposterous charges against Juan Fernandez giving oil away to foreign
countries and tries to draw a parallel to this situation. Fernandez, one of the
union leaders of the oil workers never had the level within PDVDA to even participate
in those decisions and it was not even his area of expertise.

reporter then repeats the question and he says he will apply the law. While he
is the one being aggressive, he tells her that she is being too aggressive. At
this point he leaves, loses his temper and a starts screaming at her telling
her she is no reporter that all she is an opposition leader, as his supporters
jeer and scream at her.

Another sad
show of the intolerance and aggressiveness by a leader of the pretty

(Note Added: El Nacional today reports (page B-20, by subscription) that a total of 20 buildings have been invaded since Friday morning. This is what the reporter was asking the Mayor which he never answered, in fact he says in the video it is not happening)

Memo to Mrs. Maripli

January 7, 2006

MariPili Hernandez is a former TV announcer, Chavez supporter/adulator and was a Vice-Minister of Foreign Relations. She writes a weekly column in El Nacional where she sucks up to Chavez and treis to tell us how wonderful everything is under the revolution. Her latest was too much for Gustavo Coronel , who wrote this memo to her. It speaks for itself.

to Mrs. Maripili

Gustavo Coronel.


You just
wrote the following: “I certainly am one of those who think that there is no
Venezuelan with a clearer vision of what a strategic national plan should be
than our current president”. This statement provoked such indignation in me
that I have decided to send you this brief memo. What you wrote would have
merely been one more example of the abject adulation that you, the paid hands
of the regime, lavish on Chavez. But you said this at a very unfortunate time,
when the colorless Minister of Infrastructure is saying that the main bridge
that connects Caracas
with the world (Port and airport) is falling down and that the highway will
have to be closed indefinitely.

What this
means, in brutally simple terms, is that Venezuela
is abruptly being thrown back to the early XX century, when the only way to get
from Caracas to
the sea was a narrow and winding road built by Dictator Juan Vicente Gomez.
This trip was an adventure, taking long hours. Today, the adventure will be
magnified by the fact that the road is in poor conditions and is now part of a
huge marginal village, full of criminals who assault travelers who have the
misfortune of having a flat tire or falling behind a slow truck. The police as
defender of the people, as you well know, Mrs. Maripili, has ceased to exist in

What a
poor timing you showed in writing your stupid statement. What f… vision can
Chavez have? Forgive me for the f.. Word, but I am sure that is often used
among your friends. What f… strategic vision can this man have? Tell me if a
person who does the following things can have “a national strategic vision”:
(1), gives away $1.2 billion per year of Venezuelan money to Fidel Castro; (2),
buys $1 billion in Argentinean bonds at a price above the market; (3), promises
a subsidy of $700 million per year to the Caribbean countries; (4), Promises
Paraguay to build them a $700 million refinery; (5), Donates $30 million to Evo
Morales on his recent visit to Venezuela, to be used at his discretion; (6),
gives $40 million in petroleum subsidies to the “poor” of New York City, Boston
and Chicago whose average income is ten times greater than our Venezuelan poor
who lack all essentials; (7), buys for his use a $70 million airbus without
proper budgetary appropriations, when Venezuelan roads are rotting away; (8),
acquires $6 billion in arms from Russia and Spain when the country is falling
to pieces; (9), promises Jamaica $300 million for a road when ours are a pile
of shit; (10), builds houses for Cubans when thousands of Venezuelan families
lack a roof over their heads; (11), tolerates the existence of 200,000
abandoned children in our cities and thousands of Indian mothers begging in the
streets; 12) finances those so-called Youth Festivals and Popular Congresses,
simple excuses for drug consumption and ideological incest, with money that
should be used to alleviate hunger and ignorance in our country.

vision of a national strategic plan can possess someone who surrounds himself
with such mediocre collaborators? How can a strategic national plan be
developed with people like Pedro Carreno, Lina Ron, Luis Acosta Carlez, Nicolas
Maduro, Isaías Rodríguez, Jorge Rodríguez, Jose Vicente Ramgel, Dario Vivas,
Cilia Flores, William Farinas, William Izarra, etc etc…? A national strategic
plan has to be put together as the result of an intense civic dialogue, has to
be made known by the citizens of the country, has to be executed by competent
and honest people, must be subject to accountability. Tell me, what are the
similarities between such a plan and the disaster you have installed in our

I would
challenge any reasonably coherent member of the regime to a public debate on
Chavez’s “strategic national plan”, if such a coherent person could be found. I
discard challenging Chavez because he is incapable of civilized debate. He is
already an autocrat who will not dialog nor accept dissidence. His mind is full
of dreams of grandeur, of aspirations to become a new Tupac Àmaru, helped along
with our money, which is badly needed for tasks of real national development.
He does not have the time or the inclination to dialog on a democratic basis.

Your boss,
Mrs. Maripili, does not have the foggiest idea of what a national strategic
plan is or should be. When he is ousted, he should be condemned to work, with
pick and shovel, in the construction of the new highway from Caracas to the international airport and
port. Maybe he will be able to do that job although, every day that goes by, I
have more doubts.

When people lose their property rights to their crops and buildings

January 7, 2006

has many problems, old ones and
new ones. Anyone that believes that Government alone can solve all of them,
ignores both history and economics. In order to improve the lot of all
Venezuelans to acceptable levels there has to be a huge increase of at least
300-400% in the size of the country’s economy. Simple math shows that in the
last seven years, oil income has increased by a factor of four and nevertheless
that has not translated into an increase in the general well being of all Venezuelans
or in the size of the economy. Government alone just can’t do it; you need the
multiplier effect of the private sector in all areas of economic activity.

Two areas
where results in the last seven years, despite the hoopla, have not been good
are housing and agriculture. You can see a graph of the number of housing units
which is a
year old here
. As you can see there, the number of new housing units built
by this administration each year is much less than those built during Caldera
and CAP II and those were terrible Governments, which are looking better
everyday! In fact, the Chavez administration in the last five years has built fewer
units than in the worst of the last four of Caldera’s years. 2005 was no
different. Despite Chavez lashing at his collaborators (and firing them!), his
unrealistic goal
of building 120,000 units was not even close. The last numbers are not yet in, but
in September the totals had reached less than 20,000 units in 2005, according
to the Government.

But the
Government continues its stubborn path to failure. The last seven years have
seen little construction of new housing units due to the uncertainty about private
property rights, as well as the fact that the Government decided to go at it
alone in building housing projects. Thus, the shortage of 1.7 million housing
units estimated by the Government a year ago continues to grow everyday. It
sometimes even gets funny as municipal officials have begun using the term “houses
from the secondary market” when referring to housing purchased from th private
sector by municipalities to solve emergencies when landslides occur.  

If you
want the cooperation of the private sector you need to send the right signals.
But the opposite is happening. Only yesterday, the Mayor of the Metropolitan
area of Caracas
expropriated two buildings, a brand new one and an old one, to give it to those
affected by the rains both in the vicinity of the viaduct, as well as near the
Cotiza brook in the West of Caracas. (By the way, that brook overflowed in the
1999 floods and the people went back to it, five people died two days ago when
a dam in Avila mountain gave in)

I watched
on TV when the Mayor arrived at the private new building to announce its
expropriation and take it over. The owner was there and asked the Mayor if he
had a representative from the Attorney Generals’ office, as required by law.
The Mayor said no, but went on to say that it did not matter because the
procedure was perfectly legal. Of course, no price has been set and this man,
who claims he put all of his money into this project of building an eight story
apartment building, says he now has no money and will have none until he gets
compensated, if it ever happens. So much for the Constitutional guarantee of
private property rights.

things are happening in agriculture, another area that Chavez has given a high
priority to. There has been an upturn in production in the last two years, as
interest on loans have dropped, but little of it comes from the takeover of
latifundia, most of which remain in the hands of the Government or have not
been exploited. Moreover, Mercal, rather than becoming a motor for local agricultural
production has become a huge importer that meets with local producers and
threatens them with imports rather than trying to work with them to produce
more locally.  Some of Venezuela’s
crops like coffee and cocoa have a lot of potential to become important export industries.
But this has been the case for decades and nothing ever happens.

The last
few months has seen a fight over wholesale prices for coffee that remain well
below international ones even after the recent adjustments. But coffee prices
at the retail level remain controlled at Bs. 7,400 per kilogram (US$ 3.44 per
kilo or US$ 1.56 per pound at the official exchange rate, way below world
market prices). The last few weeks there have been shortages of coffee and this
week a Government official suggested an increase in the controlled price was imminent,
which led to even more scarcity. Then on Wednesday the consumer protection
agency (Indecu) impounded
300 Tons of coffee at the distributor’s warehouses and two additional raids have
taken place. The coffee will be forcefully purchased at the official controlled

Clearly, this
is no way to run an industry, if you are forced to sell your coffee at the
lowest price, can not even export it, even at the official exchange rate, there
are few incentives to invest, produce and as one coffee grower put it: why
should I even pick the coffee to sell it at a loss? There goes jobs,
investments, etc.

And then
today we had the bully himself, Hugo Chavez, saying that if coffee growers do
not sell the coffee to the distributirs, “we will take it away, that coffee
does not belong to them, it belongs to the country”. Well, so did the Caracas-La
Guaira viaduct and those entrusted with taking care of it did not and I see
nobody assuming that responsibility. And then Chavez began arguing about the
law, which guarantees private property and not the coffee for the President to

This is no way to run a country and these
industries will slowly disappear, much like the sugar industry in Cuba did, due
to Government control stifling it. The Government can not be coffee grower,
airline owner, telecom owner, hospital runner, regulator, steel producer and
oil producer all at the same time, just to give some examples. This Government,
much like the Cepal-oriented ones of the 60’s in Venezuela, is trying to do it all and
it just does not work. You need investment, technology and the ability to
compete here or abroad to make all these industries grow and be competitive. You
can’t regulate below cost of production. But when knowledge and common sense
are left aside the outlook simply becomes grim. And right now it is as grim as
the feeling one gets when looking at the pictures of the viaduct