The Devil's Excrement

Nelson Bocaranda reports in today El Universal that the nomme de plume Simón Andrés Zuñiga, frequently present in aporrea pontificating about economic matters corresponds to none other than Minister of Planning and former Minister of all things financial Jorge Giordani, citing as the source former Minister of Planning Felipe Perez.

I had read Zuñiga frequently, but if true his writings gain an added value because Zuñiga claims to be an economist.  But Zuñiga frequently shows weak points on economic matters, citing isolated cases, like Argentina’s Caja de Conversión but ignoring other experiences on the matter. (Hong Kong anyone? Or Venezuela pre-1970?). In fact, he cites Ecuador as another example, suggesting that Correa can not remove the dollarization he inherited because of its political cost. In fact, Zuñiga’s arguments are dense on ideology and short on content.

Because it takes a very ideological point of view to suggest dollarization, or any sort of foreign exchange flexibility, would “bad” for the workers, given that Chavista policies have generated 1000%-plus inflation over the last 14 years, truly hurting the working class, which managed periods of prosperity only when the Government had the foreign currency to keep the parallel rate down and whose purchasing power is currently decimated.

While the articles show an understanding of how the parallel market and why you need funds to lower it (At least better than Minister of Oil and Energy has), it seems to blame everything on conspiracies, as well as a deep belief that exchange controls have to be in place, despite the fact that economic history shows their recurrent failure. The main conspiracy: That players want to benefit form the bounty that Cadivi represents, but Zuñiga, whether Giordani or not, fails to note that it has been those near the revolution that have benefitted the most from it.

And that cyanide candy is not mentioned in the article.

In the latest move by the Maduro Government, the Vice-Presidency for the Supreme Social Happiness of of the Venezuelan people was created this week. While many have laughed at the idea, I disagree. I think this office was badly needed and will play an important role in celebrating life in Venezuela and making its citizens happy.

While there have been no details as to what the office will do, I can think of so many ways that it can celebrate and promote the happiness of all Venezuelans, particularly by pointing out happy events around the country, of which there are so many.

As an example, the Vice-Ministry could make sure to interview on TV anyone who managed to buy a package of corn flour, which has become one of the supreme moments of any Venezuelan’s life in the the last few months. And even if you think that finding toilet paper is another such happy moment, the Vice-Ministry could celebrate not only the finding of the roll of toilet paper by those citizens that lacked it, but more importantly recreate the moment of supreme happiness that represents using it for the first time after not having any for a while.

Since happiness is relative, imagine how happy someone that survives an express kidnapping is, another area where the Vice-Ministry is likely to have a strong participation.

It is unclear what the budget for the Vice-Ministry is, but there is some overlap in what it will do. For example, if you manage to get a new passport, should that be paid by the new Ministry, given the happiness that the moment will provide, or should it still be paid by the Ministry of the Interior? Same with Cadivi. If you get your foreign currency for travel, given the happiness that this induces in you and your family, should it come out of Cadivi’s budget or the Vice-Ministry?

The range and scope of the new office is so wide, that eventually the Vice Ministry may become the Government, since the role of Government is essentially to try to make the population happy. The danger however, is that the Vice-Ministry may one day join the opposition when it realizes that nothing will make the people happier than the departure of Chavismo from Government.

Yes, I have been traveling, but I have also been swamped with work, which happens a lot when traveling. But besides these factors, I just don’t want to be repetitive about what is going on in Venezuela. Everything just seems to be going downhill non stop. But if I thought I had heard everything about corruption, today the Minister for Sports tells us that her signature was faked in sixty files to request foreign currency for traveling sportsmen. Amazingly enough, a single “athlete” was given US$ 66 million over a period of a year and a half, according to the Minister.

What this says is that there is simply no control anywhere in Venezuela. If a single (and lowly) Minister’s signature can be faked and someone can obtain US$ 66 million illegally, imagine what a Minister of Finance or a Minister of Energy can sign for without anyone checking!

Even worse, is the ethical deterioration in that Ministry and among the “athletes”, including the Minister. Because she wants to protect the names of the people involved in order to “respect them as athletes”.

Say what?

These are people that faked signatures, newspaper clippings, trophies in order to rob the Venezuela people and she wants to respect them?

The only respect they deserve is jail. And the Minister should be fired for allowing this to happen. And the Comptroller of the Ministry too.

This is simply an insult to the average Venezuelan who is given a few hundred dollars after dozens of requests, checks and the like, while the Bolideportistas and the Boliestafadores can get anything they want. If Maduro wants to fight corruption, the first thing he will have to do is fire everyone around him and try to find someone within Chavismo that is still honest, which may be a tall task in itself given the immorality that this news represents.

Anyone that thinks they understand the sudden moves made by Nicolas Maduro during the last few weeks, should wait a while, because I don’t think the full picture is clear yet. What I do think is clear is two things: Maduro is not happy the way things are going, he knows his Government is not working well and the importance of Nelson Merentes has been substantially diminished.

In fact, Merentes’ slide seemed to begin earlier than two days ago, when in a puzzling move, Maduro failed to include him in his bombastically-named “Organo Supeiror para la Defensa de la Economia (OSDE)” , which was created on the last day of September and is presided by a General, whose power has been increasing, but despite its name, failed to include Merentes. This discrepancy was noted at the time, but nobody knew exactly what it really meant.

Merentes is clearly paying for his lack of accomplishments. The man that was supposed to be the “pragmatic” member of Maduro’s Caibent, was not energetic enough to push his agenda and the more ideologically minded members of the Cabinet managed to slow down all of his initiatives and Merentes has essentially nothing to show for his almost six months in the Ministry of Finance.

The second sudden move, was the removal of Maduro’s confidant Temir Porras from both the development bank Bandes and the development fund Fonden. Porras was a new figure in the economic side of the Government and had been reported to be Maduro’s sounding board on economic and financial matters. But faster that you could say Temir, he was pushed out last week with no explanation. And there is still no clear idea of what happened there, even if some suggests that Porras was removed due to Maduro’s displeasure with the French intelligent services pulling off the operation that allowed them to catch the drug in the Air France plane. Reportedly Porras’ inability to know about this forced him out. Others suggest that Porras’ team convinced Maduro that the Chinese would lend him the US$ 5 billion in cash, which did not happen.

Then this week, Merentes was removed as Vice President for the Economy, a position that is now occupied by the Minister f Energy and Mines and President of PDVSA Rafael Ramirez.  This position is not that important, but there is a “Revolutionary” Cabinet above the crowded Cabinet, which is composed of six Vice Presidents. This supra-Cabinet meets more often with Maduro and is supposed to have a coordinating role.

It turns out that Ramirez was already part of this supra-Cabinet, so whether it has a meaning or not that he replaces Merentes is not that clear. Ramirez was previously the Vice President for Territorial Development, a position now occupied by General Hebert Garcia (More on him later)

Ramirez being the new Vice-President for the Economy may not be so bad as many think. He is considered to be part of the more ideological and radical branch of the Government, but he has shown in the past that he can be quite pragmatic. In fact, the only area where there have been some positive signs since Maduro took over has been in PDVSA’s flexibility, which has been led by Ramirez. Ramirez may actually be more capable of convincing the radicals that some change is needed.

The problem is that Ramirez is no economist and the change needed is more than a foreign exchange system, like Merentes seemed to think. What is needed is a larger adjustment of the economy and its variables, before distortions gets further out of hand. Ramirez will certainly not deliver that.

Caracas is full of rumors and among them, the possibility that Ramirez may also be moved sideways is one of them. PDVSA is where the money is and some Madurista groups may be trying to get closer to the honey pot and the Royal Family having a bigger influence there.

As for General Hebert Garcia, he now occupies three positions, the one in the supra-Cabinet, the President of Mision Vivienda and the President of OSDE, signifying that Maduro trusts him and he is the point military man to organize the economy and reduce shortages and build housing. Sounds like a tall order for a single person, let alone a Venezuelan General. But as PMB comments today, there seems to be this belief in Chavista circles that the military can organize things despite fifteen years of proving the contrary.

So, stay tuned, Maduro may yet make other moves pronto, which will allow us to better understand the ones he has made, excluding how he fell from that bicycle.

Americo Da Grazia, the opposition Deputy from Bolivar State, the same one that was pushed down the stairs of the National Assembly a few months ago by a group of Chavista Deputies, gave this excellent speech during the discussion to approve a resolution backing Maduro’s decision to expel three US diplomats. Da Grazia is a member of Causa R, the Guayana socialist party associated with the union movement.

For those that do not speak Spanish, Da Grazia starts by showing his birth certificate and saying he is Venezuelan and where he was born. He then recalls the murder of a Causa R leader last weekend. He then says among other things:

-What a pity that this assembly refuses to discuss Venezuela’s problems.

-Pity you don’t care about what Venezuelans care about.

-We are not lackeys of the gringo empire, but we are also not lackeys of the Chinese empire. But you just gave away the Las Cristinas gold mine to the Chinese empire while on your knees. Shame on you!

-You also gave Guyana (the country) the disputed territory.

-You dont say anything or discuss anything about the Sidor strike, the Ferrominera strike or the miners that are in jail.

-Because of you electricity consumption is back to the 80’s in Guayana because you ruined the electric infrastructure. And you don’t talk about it.

-How many of you know that in Guayana there is not asingle hospital that can provide chemotherapy or radiotherapy treatment to cancer patients. single hospital that provides chemotherapy or radiotherapy to cancer patients, but then you want to discuss this “pendejada”.

-He then says ironically that he just told his daughter not to go to the market, because thanks to kicking out the americans, there will be no shortages, there will be toilet paper and the dollar will go down in price.

-He then calls them stupid and imbeciles.

-He then calls for a democratic solution to Venezuela’s political problem.

-He then mentions all the positions, CNE, Comptroller that need to be elected and says they are illegitimate.

A Chavista Deputy then answers him with ideological BS.

Hat Tip: Damian Pratt who made the effort to place the video in youtube