New York Times: The rise and fall of Venezuela’s financial bolibourgeois elite

February 17, 2010

I am still on vacation, not in touch, so I thought I would publish the New York Times overview of how Chavez allowed the rise and fall of the financial bolibourgeois to suit his purposes, demonstrating once again that this robolution is anything but about the “people”

Purging Loyalists, Chávez Tightens His Inner Circle

By SIMON ROMERO
Published: February 16, 2010

Being one of Venezuela’s richest and most influential men, Mr. Fernández, 44, went to the headquarters of the Disip intelligence police to clear up the matter directly with the agency’s powerful spymaster.

Then a surprising thing happened, especially in a nation that had grown accustomed to the unfettered activities of pro-Chávez tycoons like Mr. Fernández. The self-described socialist revolution of Mr. Chávez notwithstanding, the prominence of these moguls was so well known it inspired a nickname — the Boligarchs — for their fast accumulation of wealth and their ties to the government, which reveres Simón Bolívar, the 19th-century aristocrat who won Venezuela’s freedom from Spain.

But instead of dismissing the matter, the intelligence chief imprisoned Mr. Fernández last year and ordered agents to start detaining other pro-Chávez magnates. Some slipped into hiding abroad and are still being sought. Several others and their associates were arrested and put in cells adjacent to Mr. Fernández’s.

The purge has revealed a power struggle at the highest levels of government, leading to the fall of some of Mr. Chávez’s military comrades and reports of secret dossiers on businessmen compiled here by intelligence agents from Cuba, Venezuela’s top ally.

At a time when Mr. Chávez struggles with public ire over electricity shortages and an economy in recession, the arrests show his ability to nimbly consolidate power while crisis swirls around him. To do so, Mr. Chávez is using tactics like secret-police raids and expropriations of some of his most powerful supporters’ businesses, relying on a dwindling number of military loyalists to carry out his orders.

“We are witnessing the battle between competing mafias who prospered at Chávez’s heel,” said Ismael García, a leftist legislator who broke with the president in 2007. “Chávez still has the cynicism to camouflage his rule in socialist rhetoric, but anyone with a brain sees that his loyalists are in it for just two things: the power and the money.”

Some bankers here apparently acquired too much of both. The rise of a shadowy group of pro-government tycoons had for years been an embarrassment to Mr. Chávez as he was promoting anti-capitalist values. Included in the Bolibourgeoisie (another name for the so-called Bolivarian moneyed class) were men like Arné Chacón, a former navy lieutenant who took part in Mr. Chávez’s failed 1992 coup attempt.

In newspaper photographs back then, Mr. Chacón, like Mr. Chávez, looked like a skinny idealist. But Mr. Chacón amassed a banking fortune, appearing in newspaper photographs here with more girth and a selection of the more than 40 purebred racehorses he owned.

Now Arné Chacón is just another jailed magnate, joining Mr. Fernández and eight other imprisoned bankers and state regulators as investigations into their activities slowly advance. Mr. Chávez himself announced that officials had seized Mr. Chacón’s properties, including his prized horses. The justification for the imprisonment of Mr. Chacón and other tycoons involved accusations of irregularities in bank acquisitions.

Reports by nongovernmental outlets here point to other motives for the crackdown. Teodoro Petkoff Malec, a former Marxist guerrilla and one of Venezuela’s leading intellectuals who now edits Tal Cual, a left-wing opposition newspaper, reported that a dossier prepared by Cuba’s intelligence service might have crystallized the purge.

The intelligence report, Mr. Petkoff said, was delivered to Mr. Chávez by yet another former military officer, Ronald Blanco, now Venezuela’s ambassador in Cuba; he passed it along as a form of retaliation after Mr. Fernández tried to have Mr. Blanco’s brother-in-law ousted from his post as the government’s superintendent of banks, Mr. Petkoff reported.

Mr. Chávez’s government has remained silent about the existence of a Cuban dossier. The president’s information minister, Blanca Eekhout, did not respond to requests for an interview.

But Mr. Chávez has clearly continued the purge, issuing warrants through Interpol for at least nine bankers thought to have fled Venezuela, and seizing 11 of their financial institutions to fold them into a new state banking company under his control. The fallout from the purge continued this month, when Mr. Chávez named a former army captain who took part in his 1992 coup attempt to oversee the seized banks.

Mr. Chávez is also relying more on his Cuban allies to address other issues. This month, he brought in Ramiro Valdés, Cuba’s 77-year-old vice president and a founder of its Soviet-inspired state intelligence apparatus in the 1960s, to advise him on the electricity shortages, an appointment that has further angered Mr. Chávez’s critics here.

None of the fallen Boligarchs have gripped the public fascination here like Mr. Fernández, who was arrested at the start of the purge. “Fernández Barrueco made the fundamental mistake of believing he was powerful,” said Juan Carlos Zapata, an investigate journalist who is writing a book on the Boligarchs. “By taking him out, Chávez sent a message to anyone who aspires to power in Venezuela.”

Mr. Fernández rose from obscurity to put together a web of 270 companies in industries as diverse as tuna-fishing and banking, amassing a fortune of about $1.6 billion by 2005, according to study by the Caracas affiliate of the KPMG accounting firm. He thrived in rural Venezuela, where Mr. Chávez’s dominance goes largely unchallenged, acquiring an interest in a pro-government newspaper in Barinas, a state that is a Chávez family bastion.

Still, Mr. Fernández remained an enigma as his wealth increased. Today, he resides in a military intelligence holding cell.

Other resignations in January from within Mr. Chávez’s ruling cadre followed the bankers’ arrests. Vice President Ramón Carrizalez and Eugenio Vásquez, the minister of public banking, left the government. It remains unclear whether their exit was related to the earlier purge.

Those who remain in Mr. Chávez’s good graces provide a glimpse into the president’s priorities. They include former military officers like Diosdado Cabello, who as chief communications regulator engineered the removal last month of RCTV, a television network critical of Mr. Chávez, from cable channels.

As for those swept out by the purge, Mr. Chávez has made few apologies. “I’m not a judge,” he said on national television referring to the arrest of the magnate, Mr. Fernández. “But I have enough evidence to say that he’s a criminal.”

38 Responses to “New York Times: The rise and fall of Venezuela’s financial bolibourgeois elite”


  1. […] that's what he means by income equality. Didn't Chavez take a thriving economy and trash it too? New York Times: The rise and fall of Venezuela?s financial bolibourgeois elite | The Devil's Excreme… Reply With […]


  2. […] is that most of the oligarchs of today are different than those of yesterday — the so called bolibourgeois. And of course, there are those who have managed to retain their quotas of power from the old days, […]

  3. Martin Says:

    Back to Speed Gibson’s first point; you really do have to start doing something like that (but please make it security spooks, not doctors!) or Chavez really won’t be going anywhere for a long, long time.

  4. moctavio Says:

    Arturo the troll is off-topic as usual

    BTW Inflation is a monetary phenonemon, learn that and you will do much better in life

  5. Antonio Says:

    Arturo

    If you search in Google: Cubanos en Venezuela, you have 103.000.000 web pages to search good source of info about invasion of Cuba in Venezuela.

    Curiously, if you put: Venezolanos en Venezuela, you only have 6.230.000 web pages.

    The problem of the Cuban slavery is that Venezuelan people suffer it, is for example, in “Barrio Adentro” Cuban doctors are in some cases, the bosses of natives doctors and nurses, so we have “second
    Grade” slavery. In other words, venezuelan people are third class citizen in their own coutry.

    Greatings

  6. An Interested Observer Says:

    Dodge, dodge, dodge. I won’t name names, Arturo, but you remind me of many who have come before you. Some of them actually tried to argue indefensible positions, which is more admirable than what you are doing so far.

    SLAVES, Arturo. Please explain why Cuban doctors in Venezuela under the Barrio Adentro program are not. If you can. You know, so we can be correctly informed. Thank you in advance. 🙂

  7. Arturo Says:

    “Some sources talk about 80.000 to 100.000 cubans technicians in Venezuela, they are in the army, in the Notarias, medical services and so on. That is an invasion. What we have to do?” – Tomas K.

    Please give a link to these sources so that we can all be correctly informed.

    Thank you.

  8. Arturo Says:

    It’s great being a government shill. hahahaha….I have contacts in INDEPABIS…..hahahahahaha. Anyone can go there an denounce speculation and it is more effective if you do it in writing.

    Finally, Kepler, you can hardly judge what is happening in Venezuela wiriting from Deutschland. And Octavio – my email is not false so please do not lie about it again.

  9. Tomas K Says:

    “The purge has revealed a power struggle at the highest levels of government, leading to the fall of some of Mr. Chávez’s military comrades and reports of secret dossiers on businessmen compiled here by intelligence agents from Cuba, Venezuela’s top ally.” (Simon Romero).
    Analising this paragraph we obtain two main conclusions, first, “we are witnessing the battle between competing mafias who prospered at Chávez’s heel” (Ismael Garcia). In 1999 with Chavez many malandros reach the power, civilians and army comrades. The new ruling class had no preparation at all, starting with Lieutenant Chavez.
    But in another hand we are a soft people or elastic people in moral matters, many venezuelans admire corrupt persons who get rich in a few years like Mr. Fernandez. That weakness come from the colonial times 300 years ago, it is not a Chavez goverment characteristic.
    The second conclusion is that the secret dossier was compiled by intelligence agents from Cuba. It is a very sad fact, it means that cubans are the real power. Some sources talk about 80.000 to 100.000 cubans technicians in Venezuela, they are in the army, in the Notarias, medical services and so on. That is an invasion. What we have to do?

  10. An Interested Observer Says:

    “To answer the question of whether Cubans are “slaves” – no they are doctors and sport trainers or technical advisers.”

    And blacks working on farms owned by whites in the U.S. South in the late 1700s and early 1800s were agricultural specialists. If you want to insist on your POV, then slavery has never existed anywhere in the world.

  11. Roberto N Says:

    Juancho, you have indeed hit the nail on the head.

  12. Kepler Says:

    Arturo,

    Do you realise this economic boom was produced by an unprecedented oil boom? And that the rise in oil prices was much much higher than the rise in income for normal Venezuelans? (not the boliburgueses like you)

    And do you know that the real income has actually gone down for several
    years now (I think since 2008 but it could be 2007 according to calculations Ow took from the national reports)?

    There is nothing in the pseudo-revolution (the one that needs so many red clothes to compensate) that was not produced because of continuously rising oil prices.

    Now everything is running down and oil prices are a dream compared to what we had in 1998.

  13. m_astera Says:

    I read here regularly, comment infrequently, but I’d like to chime in on the topic of banning Arturo.

    He is obviously a paid government shill, literate in English, commenting on an important blog. He is the best they can come up with. And that is a pretty pathetic best.

    He is valuable simply to show the shallowness and determined blindness of those presently ruining Venezuela’s future. His every comment shows this clearly. Because he was charged more at the farmacia, and because he has “contacts”, he had the farmacia shut down. And probably fined, which fine went into some corrupt chavista’s pocket.

    This shows he is bereft of understanding, humanity, compassion, and knowledge of the basic mechanisms of economics. Petty, spiteful, ignorant, and vindictive; and he brags about it.

    Keep him on the blog, let him post and be an example to everyone who reads here just how pobre, how spiritually and intellectually bankrupt the psychopath’s supporters are.

    He is the best they can come up with. How sad for them.

  14. Deckard Cain Says:

    QUOTE(LongJim @ Jan 7 2010, 05:01 PM) View Post

    Yeah, that whips my ass, too.

    Over-Under on how many times Musberger says "Colt McCoy"?

    Dude has serious priapism for him.

  15. Lazarus Says:

    Juancho, well said. And the Oppo? Nada.

  16. Juancho Says:

    DanielS wrote: “We have electricity shortages like not seen almost anywhere (Cuba?), rampant crime in the streets, bankers and tycoons involved in mega corruption scandals, food supply shortages, extinctions of exporting industries other than oil, record levels of dependency on imports, hostile environment for business, one of the highest inflation rate in the world, more than 2 million houses deficit, all this in one of the richest countries in energy resources of the world, and just after the biggest oil price boom of all time. How it can be that there are people obsessed with defending all this?”

    I normally just gloss over stuff here and maybe dash off a reply here and there but what DanielS has written above is, IMHO, crucial to grasp if we are to understand the beguiling core of the Chavista phenomenon.

    Know that the vast majority of Chavistas are not “defending” the banking meltdown, the energy and water crisis, vast government swindles, rampant violent crime, Cuban interlopers in every cranny of national business, and so forth. What Chavistas are defending is the right to be spoken to, to be considered at all, to be noticed as being alive and made to believe that they count for something in this world. This is an astonishing moment of affirmation for millions of people hitherto dissed as meaninglesss, superflous, and unwanted.

    In terms of actual results, we all know that the poor are not a whole lot better off than a dozen years ago. But Chavez realized from the start that popular support was key, and since the greatest numbers were found in the lower class, he directed his converstion to them, assailing the rich, the educated, the arrogent and racist, and all of those selfish “capitalists,” giving substance and voice to all the disdain and resentments and heartaches this lower class has always felt to the small, smug, lilly white ruling class.

    What Venezuelan does not know in his heart of hearts that the vast majority of old school dynosaurs – who ran this country for eons –
    never gave a rat’s ass for anything but their own gain, and who often treated every last campisino as chumps and cachifas filched off novellas and street corners, usless to themselves and the business of making them money.

    So here comes Chavez, who actually speaks to the 70% of disenfranchised folk who have never before been given the time of day. Is Chavez ineffective and a wholesale disaster to the civic and political health of Venezuela? I believe so. But an entire demographic – the majority of poor here in Venezuela – have been talked to directly for the first time, granted, with a very forked tongue by a hugely narcissistic military bufoon; but if someone is going to replace Chavez anytime soon, they’ll have to engage the poor majority with the same persistance as Hugo Chavez, or the wiley Lt. Coronel will be heaving-to at Miraflores for a very long time to come.

    Again, it’s not the itegrity of what is being said and certainly not the shocking harm being done to the country that sustains the Chavistas. It’s simply that the president is talking to THEM, as thought they matter and count for something, if to be no more than a captive audience for the interminable babbling of Alo Presidente.

    Curious note: If you look at child development, children who don’t receive enough attention run into major problems later down the road, and will often spend the remainder of their lives trying to be noticed and acknowledged in a million different ways. Chavez notices the poor and bereft. He is a scourge on most every front but he gives the impression of being THEIR president. And politics is largely about appearances, after all.

    Juancho

  17. moctavio Says:

    That’s what trolls do, they read superficially and write, write, write

  18. island canuck Says:

    “To answer the question of whether Cubans are “slaves” – no they are doctors and sport trainers or technical advisers. That’s all.”

    Wow. I couldn’t believe this answer.

    I clearly stated he was a doctor. That he was prohibited to travel, own a car or go to a movie and was paid a pittance to survive in his 1 room hovel.

    He is a SLAVE. Nothing more, nothing less.

  19. moctavio Says:

    Once again you are off topic, quite a record. Of course, Ramiro Valdes, an assasin of many Cubans is here to advise on electricity. Your hero Che Guevara, an Argentinian that killed many Cubans, I shoudl not be worried. When the Venezuelan lifeline looks like its dying the Cubans will take over.

    As to your advise, I don’t care for it. Are you Cuban? You seem so worried about the topic. There is nothing about that comment that should get me in trouble in a democracy. I forgot! This is not one.

    BTW. Inflation, Arturo, is a monetary phenomenon.

    And if you stay off topic, your comments will be erased.

  20. Arturo Says:

    “Cuba has invaded us, what will we do when they take charge?” Yes, what will you do when your unfounded paranoia comes true – is another way of putting the question.

    To answer the question of whether Cubans are “slaves” – no they are doctors and sport trainers or technical advisers. That’s all.

    To turn Daniel’s question on its head – how come that there were people trying to overthrow the government when there was an economic boom from 2004 – 2009? Now if Daniel is correct about the whole country being a disaster Chavez’s PSUV is destined to lose the AN elections. Let’s all accept Daniel’s theories and watch Chavez wipe the floor with the opposition yet again and see what explanation he invents on September 27th. (It’ll probably be “fraud”).

    Seriously Octavio, you should not let people make death threats on your blog. It could get you into big problems.

  21. bjohns15 Says:

    The NYtimes article says Chavez is nimble. Is the one thing that he is good at holding onto power while concurrently F’ing up royally?

  22. Roberto Says:

    We will do what we have to do to get the Cuban boot off of our necks, Miguel.

    Whatever that happens to be.

  23. DanielS Says:

    We have electricity shortages like not seen almost anywhere (Cuba?), rampant crime in the streets, bankers and tycoons involved in mega corruption scandals, food supply shortages, extinctions of exporting industries other than oil, record levels of dependency on imports, hostile environment for business, one of the highest inflation rate in the world, more than 2 million houses deficit, all this in one of the richest countries in energy resources of the world, and just after the biggest oil price boom of all time.
    How it can be that there are people obsessed with defending all this?
    Only explanation is that they are some idealistic person disconnected from reality, or they are getting some “special compensation” to make a blind eye for the management disaster.

  24. moctavio Says:

    No, he does not, my policy is not to erase comments until someone becomes abusive. People have replied to him already. So, why should I accept hundreds of Arturo’s empty, off opic commenst and erase this guy for one comment? It is typical Chavista illogic, he complains about censorship day after day but the firts comment he does not like he wants it censor. Sadly, I think that topic will come up more and more. Cuba has invaded us, what will we do when they take charge?

  25. Roberto Says:

    I thought them extinct, Half Empty, yet one can always marvel at the way Nature seems to be able to surprise us.

    You know Miguel, perhaps Arturo, even though he certainly has no concern for your wellbeing, or this blog’s wellbeing, has a point.

    In the sense that comments like Mr. Gibson’s may not be taken for what they are (inane), and may be used against you by other parties as an excuse to block this blog.

    So Arturo, what IS your position on the way that Cubans are used as slaves?

  26. moctavio Says:

    Arturo: Inflation is a monetary phenomenon

  27. An Interested Observer Says:

    “I ran into a Cuban doctor…He is a SLAVE.”

    All the more so when you consider that he was sent to Venezuela in exchange for oil. He wasn’t hired, he was bought. Like chattel. Comments, Arturo? Killing property isn’t like killing people.

  28. HalfEmpty Says:

    Looky look!
    It’s a rare Concern Troll.

  29. island canuck Says:

    Typical Arturo.

    No comment on the Cuban slavery however a comment on the government plant who puts an incendiary comment on an oppo blog.

    What a useless piece of ….!

  30. Arturo Says:

    Interesting how the blog owner permits people to make death threats against people – in this case the Cubans in Venezuela.

  31. Kepler Says:

    Island,

    Thanks and thanks again for your comment.
    Very interesting account on the cuban.

  32. jen Says:

    Amanpour today was great!

  33. Floyd Looney Says:

    They are definitely slaves, they get nothing even though countries pay good money for their use. Most of that goes into the Castro pocket.

    Hugo Chavez would like to have Venezuela as his own private plantation too.

  34. Eric Lavoie Says:

    Strangely when he said shhot the cubans I thought about the spooks working for the venezuelan security.

  35. island canuck Says:

    “free yourself……..start by targeting all the cubans and shooting them……get on with it already”

    When I read stuff like this it really burns me. You sound more like the government then the opposition & I suspect that you may be trying to incite some reaction for whatever reason.

    I ran into a Cuban doctor at a party a few weeks ago who, after a few beers sitting with me off in a corner, related what his situation really was.

    I won’t go into any details to protect him other than to say that he’s here without his family, he’s not here by his free will, he’s not allowed to travel even to other parts of Venezuela or own a car, he’s not allowed to go to a movie & is paid a pittance. He had a “handler” to accompany him to the party, a Venezuelan with strong Chavismo ties.

    He is a SLAVE. There is no better way to put it.

    He’s helping people as best he can. What would possibly be the advantage of shooting him. That’s just repulsive & stupid.

  36. Bois Says:

    Follow the money trail.

  37. Juancho Says:

    “Chávez still has the cynicism to camouflage his rule in socialist rhetoric, but anyone with a brain sees that his loyalists are in it for just two things: the power and the money.”

    As the money runs thin – and it is, like the electricity and water – expect the Chavista focus to shift almost entirely to preserving power. And as the ensuing power struggle heats up, expect rifts between Cuban nationalists and Venezuelan military forces to grow as well.

    Ultimately, we might see Chavez protected by Cuban loyalists alone, leading to his eventual expulsion to Cuba once the Bolivarian experiment melts down altogther.

    Juancho

  38. speed Gibson Says:

    free yourself……..start by targeting all the cubans and shooting them……get on with it already


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