Some impressions on visiting Venezuela

May 3, 2011

(Only socialism saves!)

I know, I know, it’s been a while. Between Easter in Mexico, a birthday, my dog’s rough encounter with a Bufo toad and a visit to Venezuela which included packing the orchids, it has been rather hard to sit down and write. As usual, there are lots of stories to tell, but I thought I would start with my impressions during my visit.

The first thing that shocked me was the number of politicians who aspire to be candidates for President and plan to enter their names into the race. I mean, when even Eduardo Fernandez, once know as “El Tigre”, thinks he is relevant, you realize how out of touch many Venezuelan politicians are. I mean, I love democracy and everyone has a right to enter their name in the race, but being involved with politics is not an “on” and “off” button you turn on whenever you feel like it, least of all, when you have a track record of failures that proved you are not what the Venezuelan people wanted ten years ago, least of all ten years into the new century.

Then there is the excessive optimism of many in the opposition. It is as if they can’t wait to hold the election because they are soooo sure Chavez will lose. Hey guys! Remember 2003? Remember 2009? Have you noticed that oil is above US$ 100 and that the opposition has little money and  a front runner whose charisma is measured in microcharms?

And then, Chavez comes up with his new Bill to control prices and protect salaries. Once again, a Bill which is illegal under the Enabling Bill, but I guess legality is not a useful concept any more around here. The worst part is not that Chavez is proposing this Bill, including a “Maximum Price for Sale” that will be determined by the Government, but that the same unions that are being ignored by the Government in their salary demands, back the Bill.

Does anyone remember the word “Conacopresa”. This is the same thing, except with no talks, the Government decides everything. This solution is sooo Cuarta Republica!

But in the end, the problem is that these are just useless measures. Price controls have never worked, all you do is delay adjustments, insuring the permanence of inflation or generate shortages. I guess Chavismo’s goals is to maintain a balance so that the two coexist.

But now there will be a “Monitoring room for production costs in order to establish maximum profit rates which will be adjusted quarterly”. I guess the rate will always go down, this is after all, a revolution, with little sympathy for profits, unless they come from exorbitant oil prices.

The problem in the end is too much monetary liquidity, so the Government goes and reduces bank’s legal reserves, freeing a couple of billion dollars in additional liquidity to give inflation another push.

Way to go! Samuelson and Friedman must be turning over in their graves!

Finally, an airport without water is not precisely pleasant, thanks God for flights that are on time!

18 Responses to “Some impressions on visiting Venezuela”

  1. loroferoz Says:

    Kepler: I want to keep some integrity and some convictions. I fantasize that if I ever got to such a post I would tell the beggars and never-do-wells respectable constituents to go $(&\/\/ themselves, sink or swim and solve their own |) @ /\/\ |\| [ |) problems on their own. But power corrupts…

    Seriously, we have to face and defeat our long national legacy of centralism, caudillismo, and of managing a huge country with millions of people like Ño Pernalete managed his district.

    We Venezuelans seem to be staging a theatrical version of Doña Barbara over and over again. Bless Gallegos for he was a magnificent bastard. He produced the most efficient, observant and elegant allegory of Venezuela ever.

  2. Kepler Says:

    “It seems that the old adage that every Venezuelan wants to be President is not such a gross exaggeration. For my part, I do not want to run for a government post in Venezuela, ever. ”

    So, Loroferoz, that makes two Venezuelans who do not want to be president of Venezuela: you and me. Well, that is if I believe you but perhaps you are just trying to pretend not to be aiming for the presidency so that I lower my guard and lose the race. I won’t be fooled.

    Seriously: this is really a problem…perhaps Venezuelans should start mocking about it

  3. moctavio Says:

    Maria: Yes, it is encouraging, but we have been there before. Chavez has all the money, the opposition none, once we define a candidate Chavez will pund on him and I am still amazed (appalled?) by the fact that 53% qualify Chavez’ Government as between regular y Bueno.

  4. maria gonzalez Says:

    MO did you see the last poll by Consultores 21? I think if the opposition get their shit together still there is hope…what do you think?

    I have been gone for 25 years and although I always detected some changes every time that I visited Venezuela. The changes have been more notable during the last 10 years…the garbage in the street, the traffic, the lack of public transportation. However I found Venezuelans to be very friendly people in every one of my trips.

  5. syd Says:

    when you have a track record of failures that proved you are not what the .. people wanted ten years ago, least of all ten years into the new century

    Can you say Alan Garcia II?

  6. loroferoz Says:

    It seems that the old adage that every Venezuelan wants to be President is not such a gross exaggeration. For my part, I do not want to run for a government post in Venezuela, ever. The pick of prospective colleagues is discouraging: Criminals, psychos, narcissists, would-be-caudillos, sociopaths, the simply deluded, a hundred or so to a sane, level person.

    I wonder how far Hugo Chavez & Co. do realize that they are resorting to the mixture of Fourth Republic populist/socialist/demagogic practices that did not work in the past. That the failure of such practices was a precondition to chavistas’ own ascent to power. Are they desperate or deluded? Or trying to delude everyone, which is their natural state?

  7. megaescualidus Says:

    Wait until you’ve been away for 15 years. In my case I’ve seen, once a year, which is as often as we’ve managed to visit, that infrastructure has changed … unfortunately for the worse (pretty much nothing has been built since Chavez took over, but plenty has deteriorated during that time) (you’ve posted about this a few times). And then, if you’re lucky, in addition to visiting Caracas, also visiting “el interior del pais” (San Cristobal, in my case). During those 15 years, again, pretty much nothing remarkable has been built (sorry, my mistake, San Cristobal got a Sambil at some point during that time …, but indistinctively, lately, one of the two “carreteras” that take you to “la hermana republica” is always closed for repairs after “las lluvias”).

  8. Andres F Says:

    Somehow, I doubt Samuelson and Friedman ever thought of experiments such as the Venezuelan one.

  9. Roberto N Says:

    As long as there are no Boa Constrictors or Anacondas packed in with the orchids, he should be OK!

  10. jsb Says:

    Half Empty, it’s easier to get them through if you’re permitted in advance:

    Click to access importing.pdf

  11. HalfEmpty Says:

    Can’t be living in Florida, getting the orichids thru the agricultural inspection points would be impossible.


  12. Speed Gibson Says:

    you have to know that thimble dick Hugo now realizes that no matter how many cubans protect him…he can still be gotten too….I see red mist in his future

  13. jau Says:

    I have not been back to Vzla since january 2010 and I am dreading going back! I have been avoiding it for a long time now…

  14. Yes, i missed that post, i am sorry. Just for curiosity in which country are you now? And you are physic and works with stock exchange? Thats not comun. I recently started following your post and twitter because i bought PDVSA 2017N bonds and you are the only one that tweet the prices. Thanks for that, was very helpful!

  15. albionoldboy Says:

    On a tangent, Bin Laden’s death could be a real problem for Chavez, a possible repeat of the FARK Ecuador computer scandal.

    If anyone rememberer’s Chavez’es personal pilot back in early 2,000 said after being fired, that Chavez gave Bin Laden one million dollars, some say it was sour grapes but if the evidence turns-up on Bin Laden’s computer’s hard drives it will make the Ecuador case look like a storm in a tea cup.

    If Bin Laden had any record of this (he seem to have been a closet bureaucratic record keeper) or other help from Chavez he’s in deep dodo

  16. moctavio Says:


    I guess you missed this post:

    it answers part of your question.

  17. Roberto N Says:

    Wait until you spend a year away from Venezuela, the shock at what you find is several orders of magnitude from what you felt this time around!

    I hope the new “monitoring room”, henceforth known as “another chance to ask for a bribe” doesn’t use the same model that gave us the socialist arepa!

  18. Hi, great post. Just one question, where do you live? I thought you were living in Venezuela.

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