The Devil's Excrement

I haven’t said much about the upcoming elections, Daniel and Quico, know much more about the subject quantitatively than I do, so I have enjoyed reading their projections and insights. I am a little concerned that the people around me are somewhat over optimistic about the upcoming results, they read that Chavez’ popularity is below 40% and interpret it to mean the opposition has 60%. But nothing is further from the truth, the other 60% is composed of a block slightly below Chavez’ size and then there are the Ni-Nis, the undecided and the apathetic, all of which will be key in what happens.

I view this election as an incremental step, but somehow people view it as a deciding one. This election will be one more step towards a more balanced country and yes, a more democratic one, not only because the other side, known as the opposition, will occupy a larger and more space in the Assembly, but because as people are more and disappointed with the revolution, they are more willing to tolerate and listen to other points of view.

Case in point is the picture above, taken today, of opposition candidates openly campaigning in the 23 de Enero parish, something which would have been unthinkable three or four years ago. And they went there with concrete proposals for urban renewal, protected not by a bunch of thugs or bodyguards, but by the fact that their increasing support in what once was a Chavista stronghold, protects them from abuse as threatening or harassing them would only give them more votes.

Because of the gerrymandering and redistricting, this is a very difficult election to predict. Chavez is using all of his resources and those of the State without morals and this reflects in the polls, he has been going up in the last eight weeks, but the scandals, inflation and skepticism about the President  make it difficult for him to recover his lost popularity in the last two weeks.

I am in the 50/50 camp, the vote will split evenly which will favor Chavismo, but I know that the final number will be a matter of how motivated Chavismo is to go out and vote. I am assuming it is less motivated than in the February 2009 referendum, but not as lazy as in the 2007 one, thus my 50% split prediction. I do hope I am wrong.

But one has to view this election more in terms of goals. These are for em the major ones:

Base Scenario: Opposition obtains enough votes to stop Chavismo from having a two thirds majority.

This should be the most basic goal of the opposition, to obtain enough Deputies such that Chavez can no longer Legislate by whim as he has done in the last five years. Not getting to this level would represent a dramatic defeat for the opposition. Remarkably, this would occur if the opposition got below 47% of the vote, showing how rigged the system is, with 47% of the vote, you get less than 33% of the Deputies in the National Assembly. It looks like the opposition will achieve this.

Second Best Case: The opposition obtains 50% of the popular vote.

Even if obtaining 50%+ of the popular vote will only give the opposition around 43% of the 165 Deputies, it would send a strong warning to Chavismo and would show the world that Chavez’ famous legitimacy does not exist as even in the face of a popular defeat, he retains control of the National Assembly.

Third Best Case: The opposition obtains a majority of the Deputies.

This happens around 53-54% of the popular vote and would be quite a dramatic victory for the opposition. Chavismo, which has been accustomed to not talking to anyone, will have to sit down. This will shake the confidence of the most ardent Chavista and will allow the opposition to open investigations on all cases of interest. Obviously Chavez will ignore and bypass the National Assembly, but the visibility of the opposition will increase dramatically.

Can this happen? Certainly. Large Chavista abstention in key areas of the interior of the country could swing the majority to the opposition. The opposition is motivated, we just don’t know how motivated Chavismo is or isn’t or if it is distributed geographically to produce this result.

Dramatic Opposition Victory: Opposition wins 66% of the National Assembly allowing it to change “revolutionary” laws.

This scenario is possible, only because of the redistricting and gerrymandering that has taken place, the opposition could reach this with as little as 58% of the popular vote. This is unlikely to happen unless disappointment is such that Chavismo stays at home. I don’t see it being that large.

I personally believe today that we will get the second case, a 50/50 split and around 60-plus opposition Deputies out of 165. The precise details will depend on abstention, with abstention on the Chavista side being more critical than that of the opposition.

Will update right before the election my prediction and any changes.

To Kika, with all our cariño

What’s up with Fidel Castro and Hugo, really? They have been sending mixed signals in the last few days that would make a Chavista squirm.

I mean, to have Fidel say the Cuban model has failed, while Huguito is trying to imposed an oil rich based version of the Cuban model in Venezuela, must be somewhat unsettling to those peddling (or attempting to peddle) XXIst. Century Socialism and the Chavez revolution here.

In fact, The Simpsons thought Fidel doing this would actually be funny:

But nothing funny to local Chavistas about the old man reneging.

This is worse than the Venezuelan communist party suing the opposition for accusing the Communist party of…

being communists.

And just when I learned that the Jerusalem Post has called Jews in Venezuela “the most embattled Jewish community in the world“, with half its members leaving the country in the last ten years, here comes Huguito’s mentor Fidel, father-image and all and goes and questions the anti-Semitism of Iranian President Mahmoud Ahmadinejad and urged him to recognize the Jewish Holocaust and Israel’s reasons to fear for its existence.

What is going on here? Is the man senile or doesn’t he know Hugo is running for his life?

And just as fast as you can say Ahmadinejad without stuttering, Hugo himself comes out and says “We respect and love the Jewish people” and that he has been unfairly painted as being anti-Semite.

Jeez, I wonder who talked about the “descendants of the killers of Christ controlling the world” or even being responsible for Simon Bolivars death. Was that you Hugo or your alter ego? Remember Norberto Ceresole? Remember the raid on Hebraica? Wasn’t that your police? The desecration of the synagogue?

How come you never questioned these events and now you are buddy-buddy with the Venezuelan Jewish community?

What changed? or is this just posturing by the old man and yourself Hugo?

The truth is, the whole thing must really confuse Chavista purists, those that chant the party line day after day.

Maybe tomorrow they will say Fidel is getting old. But I would bet this will only happen after the election, you don’t want to embarrass Hugo.

Por ahora… For now…

But the truth is that half of the Venezuelan Jewish community which was welcomed to Venezuelan society in the 40’s, 50’s and 60’s has now left the country in fear, despite their magnificent contributions to this country.

You will all be missed, thank you for all you did, but who can blame you for leaving…

Over 100 Venezuelan ONG’s and thirteen international ones, including what I think are the leading Human Rights ONG’s in the country, Provea and COFAVIC, held a press conference and issued a communique today asking that the Venezuelan Government stop persecuting them and rejecting legal decisions that attempt to take away legitimacy and criminalize the rights of the people to participate in public matters. Among the activites of the Government denounced and documented by the group were the systematic disqualification of the media, the opening of trials and judicial processes, intimidation via public threats and the jailing of members.

Liliana Ortega who leads COFAVIC, which has spent twenty years defending the rights of those that died in the Caracazo in 1989 said:”A fundamental condition of a democratic state is to utilize dialogue as a strategy of persuation and conviction, but in Venezuela exchanges and the search for a consensus has been prohibited and satanized. When a State does not make its positions flexible, does not back out of its positions, nor does it search for solutions that satisfy everyone, what it puts in evidence is that the authoritarian model gains more and more space as a form of governing”

The spokesman for Provea said the attacks look to erode the autonomy of social organizations and stop independent controls as well as the true exercize of of the rights contained in the Constitution. According to Provea, the reaction of the Prosecutor to more protests has been to criminalize and bring to trial protesters with the complicity of the People’s Ombudsman (Defender in Spanish).

The organizations present ask public powers to revert the campaign to damage their prestige and to help increase the possibilities so that people can exercize their rights. They also ratified their right to receive help from international groups like Amnesty International, Social Watch and Greenpeace that fight for democracy, protection of the environment and the elimination of injustices.

The communique concludes by asking the Venezuelan Government to:

1.- Take necessary measures to stop the threats agasint the ONG’s and human right ddefenders that live on the country.

2.- To respect constitutional guarantees and international instruments that protect our right to free association and participation in public matters, as well as international cooperation, freedom of speech and the right to work.

3.- Immediately comply with all of the precuatelary and provisional measures given put by the interamerican ssystem, to human rights defenders and start exhaustive and independent  investigations over the matters denounced in order to prevent that impunity prevails and similar situations of agression and persecution agsint human righst defenders may multiply.

4.- Open communication channels with the organizations of civil society to look for a joint search for the paths that will make a reality the full validity of human rights and the exercize of democratic freedoms in Venezuela.

I am glad this gathering and press conference took place. The groups that participated, their long time record and reputation should be sufficient to raise the attention of international groups that know them and who will understand the seriousness of the situation these human rights organizations face today in Venezuela under Hugo Chavez.

Yesterday, Minister of Finance and Planning Giordani came out of whatever hiding place his spends his time at and gave us his economic predictions for the remainder of the year. Giordani, who is not an economist, loves to predict and has made some famour ones in his lifetime, like:

-The North Korean economy is healthy, which he said in 1994, right before that country’s famous famine.

-We are going to have to take off investors off our backs with our hats. Sais in 2000, nobody has seen the hat or the investors since then.

-We will have single digit inflation. Said in 2000 and 2001, we are still waiting.

-Our piggy bank is full. Said in 2001, the “piggy bank, called FIEM was empy by February od 2002.

Despite this, here comes Giordani again, Planning Minister for eight out of Chavez’ eleven years, telling us that the economy will grow by the end of the year and that inflation will be less than 30%.

Geez, I guess we should be grateful, the whole world relishes in having single digit inflation and Giordani is telling us, as if it were an achievement, that inflation will be less than 30% for the year and that in August, typically a seasonally low month, it will be between 1 and 2%. How ungrateful can we be at his accomplishments.

And then he says that by the end of the year GDP will be positive, as if this were an incredible achievement. The whole world came out of of the recession lafter the 2008 financial crisis and Venezuela is still showing negative numbers. These are GDP numbers for the last six quarters

-2.6%, -4.6%, -5.8%, -3.3%, -5.2% and the latest -1.9%

And most economists don’t believe the last number, the underlying figures are simply inconsistent. But maybe they can get to positive by fudging the numbers and convincing us they are true.

Because all of these predictions are not new. last year, after only one quarter of economic contraction, the guy laughing at the top, right, Nelson Merentes also had his predictions right about this time of the year, but last year. Merentes, who is a Mathematician, with no economic training or experience either told us boldly on August 31st. 2009, that GDP would actually be positive for 2009, barely positive at 0.2%, but positive. Instead, the year came in at 3.3%, showing what a horrific prediction he made and how clueless he was.

Eventually the Venezuelan economy will grow, at some point you can’t contract any more. But I suspect it will not happen this year. Last year, when Merentes was predicting growth, the Government had about US$ 20 billion in parallel funds like Fonden and it issued about US$ 11 billion in PDVSA and sovereign debt in the second half of 2009.

In contrast, this year, the funds have about US$ 7 billion and we have seen issuance of US$ 4 billion so far in the second half of 2010, but I doubt we will see more than a total of US$ 7 billion. That’s US$ 13 billion dollars less, that gets barely compensated by higher oil prices.

Given that the problem is foreign currency, that means that the Government does not have the tools to make this economy grow until the first quarter of 2011.

Why then?

Easy, the electric crisis played a big role in the contraction of 1Q10, it is hard to expect that it can get as bad as then once again, but with these guys you never know.

Meanwhile, so called “economists” funded by the Venezuelan Government, publish papers and are quoted in the international press, telling glowing tales about the Venezuelan economy in the remainder of the year. Unfortunately for them, they still fail to understand how the Venezuelan economy really works under Chavez, the role of the parallel funds and how the Government has not been able to increase spending before the election, simply because it has no money. And even if the economy managed to eke out a gain of 0.1%, there will be another forced devaluation in early 2011 and the predictions will have to become more of the same:

“In 2011 we are going to have the economy grow and inflation will surely come in under 30%”

You would think even Chavez would get tired of this same old song.

Like Yogi Berra said, this is like Deja Vu all over again.