Archive for November 10th, 2007

King of Spain tells Venezuela’s President Hugo Chavez to shut up

November 10, 2007

Even the ultimate diplomat (and oligarch!) the King of Spain could not stand it any more and told Chavez:

“Why don’t you shut up!”

After Chavez threatened the Continent with violence, relived his mythical story of the 2002 coup with the 5,000 around the palace now in the millions and insulting former Spanish Prime Minister Aznar.

November 10, 2007

In today’s El Nacional, Prof. Luis Pedro Espaņa exposes very clearly how distorted things are getting distorted in Venezuela. Espaņa is without a doubt the country’s foremost expert on poverty, but the Government unfortunately has no use for his extensive knowledge of that matter.

Hummer for eggs by Luis Pedro Espaņa

There is no milk but
there is yogurt. There is no sugar, but there is Splenda. There are no
eggs, nor meat, nor rice, but there is caviar, salmon and all the
things needed to make Sushi. What type of economy is this? Who are the
geniuses that play politics in the name of the poor and the result is
that all that is available are the goods for the rich?

The battle against inflation does not only consist in that
articles do no go up in price, it is also necessary for goods to be on
the shelves. Scarcity is the hidden face of inflation. When you try to
fit it into a corset, not only the economy, but human nature itself, the
senseless signs of communism or Bolivarian socialism begin to appear:
there is no milk for the kids, but there are imported crackers for pets
The Government knows it and I suppose they must be surprised at it. But
its reaction, its next economic measures will likely be even worse. The
little understanding, when it is not ideological denial of the basic
rules of economics will take them to make the disequilibria even more

They are not going to rectify. They will continue with the
senseless interventions. That is why we are only centimeters away from
one of the multiple ministries aaproving quarterly price lists for
3,000 to 5,000 articles of consumption. It is probable that before
December Mercal will introduce the “famous Cuban rationing cards” for
articles like sugar, rice and powdered milk. Thus, while the poor stand
in long lines, their hands are stamped so that they do not go back to
the end of the line, or they ask for their ID card to buy things
simultaneously, on the other hand, the middle and high classes travel
at half or a third of the price and they buy even more imported

The horror of the authorities because of the importation of
luxury items, whether they are Hummers or the much-maligned Scotch
whisky, is forcing them to introduce even more controls. Now they will
prohibit car imports and surely many other luxury items, but we will
continue seeing them, the political bosses or their wives will show off
what is forbidden to everyone else. Inflation, scarcity of basic goods
and the pernicious regressive subsidies that are behind the price of
gasoline and the huge foreign exchange differential, only work in the
direction opposite to what the intention of the controls is supposed to
be. This Government that pretends to be the Robin Hood of Latin
America, in reality is a Hood Robin. A villain that takes away from the
poor in order to give it to the rich.

But we know what will be the end of these decisions. The whole
continent lived through it after the collapse of its economies in the
eighties and we lived it after Lusinchis’ Government and the terrorific
adjustment of Perez II.

The Government appears not to understand that only
stimulating, creating the conditions for productive investment and
increasing national production it is that it will be possible to
placate inflation, defeat scarcities and provide good employment for

It is quite probable that the authorities are counting on the
price of oil as the artifice to sustain the economic unfeasibility of
its international policy. But the reality is different. Whatever the
price may be, nothing will save us from the economic chaos we will
undergo, a product of the gigantic error that is implied in getting rid
of local production, attacking property and ignoring the most
elementary rules of economics.

Sooner or later we will pay the political obstinacy of the State
of doing without that part of society, which it considers it enemy.
While that arrives, we can test the barter system that the Government
likes so much, thus, I trade a Hummer for twelve dozen eggs!