The Devil's Excrement

Not happy with the rate at which he has been destroying Venezuela and its institutions, Hugo Chavez has begun accelerating the pace at which he is doing it, either through ignorance or as a way of justifying the mess he himself has created by the total absence of control and management of the country.

Chavez announced last week that he would be taking over oil service companies and their assets and turn them into “social” companies. In this way, the National Guard took over drilling rigs, barges, boats and equipment that was being used to support the country’s oil production.

While Chavez argued nationalistic reasons for doing this, the true reason is that these companies are owed more than US$ 13 billion by PDVSA and many were refusing to continue their contracts until they got paid or were removing equipment from the country. Additionally, PDVSA was requesting that new contracts be signed at reduced rates and even that the service companies give PDVSA a discount on the amounts already owed.

Chavez said he would pay book vale for what was taken over, but this creates a legal and financial mess, which will take years to sort out. You see many of these boats, barges and drills do not even belong to the companies that have the contracts, but are leased from others. Thus, the equipment does not even appear in their books and there will be suits and arbitration processes that will keep lawyers working for quite a while.

Even worse, PDVSA will now absorb 8,000 workers into a company that the Government is already having troubles managing. In addition, this does very little to promote the sale of the heavy oil tracts that PDVSA wants foreign companies to buy into and provide financing for in the upcoming months. The Chavez Government has once again changed the rules on the fly, affecting the equity of these company’s shareholders. What guarantee do these large multinational oil companies have that there will be no more changes in the future? Many are now likely to have additional second thoughts

To me this is simply further evidence that Venezuela’s Dictator is simply out of control by now: In the face of the problem of the debt of the service companies, Chavez took the autocratic, expedient and simplistic solution of taking them over. This is just like a little kid playing a game that kicks the board because he is losing.

Except that the debts do not go away like the game on the little kid’s board, PDVSA can’t handle this new responsibility and the drop in oil production will not only continue to go down, but is likely to accelerate with these measures. And the debt itself does not go away either.

Because now besides the US$ 13 billion debt, there will be the compensation for their assets, which has to be added to the arbitration processes of Cemex, ConocoPhillips and ExxonMobil, as well as other takeovers that while not in arbitration have yet to paid for.

Thus, Chavez continues to dig Venezuela into a hole in order to protect himself from the realities of the drop in oil prices and the crisis that is already developing in our country. By now, only a dramatic jump in the price of oil can cover up a decade of mismanagement and the results of the irresponsible whims and decisions of Hugo Chavez.

One way or the other, with or without Hugo Chavez, it is Venezuelans that will one day have to pay for all of these decisions. And even more than before, the poor will be worse off in the end that Chavez’ much hated oligarchs.

I will once again be silent for a few days as I leave Budapest, but I can’t help but write a brief note on what is definitely the most absurd thing to come our way in a while: The Government will investigate Globovision for its reporting of the earthquake last week and if sanctioned, could shut down the TV station for 72 hours or completely. 

Globovision reported the tremor (conspiracy?) and noted that the webpage of Funvisis, in charge of seismic research in Venezuela was down and there was no information from the Government. (The same was true last month when a tremor hit Caracas on a Saturday afternoon, I had to use information from the US)

According to the investigation, Globovision created “fear” and “panic” with its report of the physical event, but of course people were avid for information as VTV showed a pre recorded Chavez tirade at 5 AM that morning.

What Globovision did was to use data from the US Geological service and note that it was a strong earthquake from a fault that had been dormant. 

I guess soon,the media will not be able to  report shortages, rain, floods or crime…

What a stupid revolution!

(Imagine if Globovision, or any other media outlet dared to report on Chavez’ “other”, “great”, “Science” and “Technology” project, the overpriced Simon Bolivar satellite, wobbling in orbit as a symbol and monument of the stupidity and ignorance of the revolution)

As I look at the effects of decades of communist rule in Bratislava, I can’t help but wonder what the results of years of the Chavista will be in our battered country. Hopefully our music will not become as sad as the Slovakian folk songs I have heard (above) nor our look as drab.

But I am not here for political enlightenment, but to disconnect, a task which is made harder by the earth deciding to shake so hard that I get phone calls at 5 AM from Caracas that scare the hell out of me, but were somewhat aimed at getting some comfort . Which I give, but I have no basis for, as the fault that produced Monday’s tremors had been dormant for quite a while and while never responsible for a big quake, it could unsettle more “traditional” faults in the North. But tell that t the revolution as the newly minted Minister of Science and Technology Jesse Chacon, recycled through many Cabinet positions, uses the opportunity to cal the people with information gathered from who knows whom and says that having a tremor stronger than the 5.4 on Monday would be a one thousand year phenomenon and the aftershocks are “natural”.

An irresponsible statement, as unjustified as Mr. Chacon being Minister of Science. Because Caracas is surrounded by faults known to induce a 6-plus earthquake every sixty years on average, which would destroy Mr. Chacon’s statistics easily, Of Course, Chacon is likely to be crossing his fingers as he makes these outrageous statements, hoping that he will never have to justify his mistake. And even if he were shown to be wrong, it would not be a problem as the revolution would find a way to blame the opposition, God or whomever, but never the process itself.

We are after all reassured that the country has the most modern equipment to monitor the tremors, but that is all that can be done, monitor after the fact, and even in that US geophysical services were faster and more precise to tell us where and what happened in the early hours of Monday.

And I also stay connected because my infamous Bolivar credit card stopped working this weekend, a fact communicated to me by many friends. I can’t complain about a system that I abhor, but I don’t suffer much from it, I do have other credit cards to complete my trip with. But how many Venezuelans were left out there stranded by the irresponsible policies of CADIVI? They travelled believing that they had a precise amount of money to use, but were cut dry in the middle. Whether fair or unfair is not the question. The question is whether any system should have such a random and chaotic factor associated with it. Of course, most that travel are the rabid anti-Chavistas, so why bother at all in any case.

And I also hear that in a country where confrontation between the Government and unions is on the rise after a repressive may 1st. celebration, a high ranking Toyota union leader was killed today. Another mystery never to be solved by a Government that intimidates its enemies and never is capable in finding out who the intimidators were.

And thus, even as I disconnect, the ties remain, the links are there, the never ending presence of a fake revolution that never lets you sleep in peace even if you are in Bratislava.