The Devil's Excrement

I must apologize. Last night, in discussing Rumor #3 about
a possible bond issue by Electricidad de Caracas, I suggested in very naïve
fashion, that it was Fonden that was buying the EDC bonds from the clients that
were being offered the bonds with automatic buyback.

The revolution does indeed work in mysterious ways. You have
to wonder what would happen if they applied the same creativity they use in making money for themselves to real problems, how much better things will be.
There is so little transparency and such remarkable financial innovation in the way
things are done, that every time I hear a rumor that makes little sense, I ask myself
how someone could make money off it and usually I am not capable of thinking as
wildly and incoherently as these guys are capable of doing so.

Rumor #1: A dual exchange rate ahead of us?

The rumor du jour (or du month) is that the Government may
be thinking of establishing a dual exchange system, in which food and medicines
would be purchased at the official rate of Bs. 2.15 per US$ and the
“remainder”, whatever that may mean, would be purchased as dollar denominated bonds sold by the
Government at the Caracas Stock Exchange for Bolivars. The rumor is so strong that it even
made it to
the international press.

Rumor #2: Government pushing down parallel swap rate aggressively by selling lots of dollars into it in order to achieve Rumor #1

The second rumor is that that this the reason why the Government has been
spending such large amounts of money to try to drive lower the parallel swap rate that cannot
be mentioned because it would be illegal to do so. In fact, the Government has
spent US$ 1.1 billion in Fondeen owned structured notes in the last seven weeks to lower the rate to below Bs. 4
per US$. However, it has been having problems pushing it much further down, as
demand gets very strong every time it goes down below the now almost magic Bs.
4 number. Of course, as with so many things the Government does, there is no
transparency in how these dollars reach the swap market and a lot of ill-gained
money is being made on the way. Only “friends” get these notes.

This is not very efficient. The Government does not sell its foreign
currency at the highest price it could obtain and many “intermediaries” make a mint,
both in the private sector and in the Government.

Rumor #3: The Government would sell US$ 650 million in a new Electricidad de Caracas bond to help push further down the parallel rate

This third rumor was difficult to even believe and it said that
in order to pay for the old Electricidad de Caracas (EDC) bond, which I wrote about
earlier, the Government would issue a new EDC bond. This definitely made
little if no sense, because EDC is slated to disappear by Presidential decree in May
2010, which is the reason for buying back the old one to begin with, which matures in 2014.
Thus, why issue another one? Who would want to buy it? How could you sell it?

But, always give some credit to robolutionary financial ingenuity and
try to figure out the profit motive behind it. I confess I couldn’t even guess
what was up.

But today I found out how it works and it is devilishly clever. There is indeed a new Electricidad de
Caracas dollar denominated bond being sold. But you have not heard about it, it is so non transparent that it is not even in the news. It
is only being offered in selective fashion to some corporations, brokers and
banks. But, they do not really offer you the bonds. They offer you to sell you the dollar bonds in
exchange for Bolivars and give you a guarantee that a certain European
investment bank will buy them back immediately from you at a certain price such that you
get a very attractive “implicit” exchange rate for the dollars.They basically sell you dollars with a bond in the middle that you don’t keep. Then you turn around and sell the dollars for a profit in the parallel market.

So, who you may ask buys the bonds and guarantees that it will do so? My
guess is that it is Fonden, the development fund that’s seems to spend more
time using its money on financial transactions than for real development
projects, which is what it is supposed to spend its money on.

So, the transaction is: EDC sells dollar denominated bonds for Bolivars,
Fonden buys the bonds, because right now there is little appetite for
Venezuelan bonds even if they are very attractive, but in any case nobody would
be interested in owning long term bonds of a company that is slated to disappear,
unless of course, you have the same owner. Venezuela owns Fonden and PDVSA, and PDVSA owns EDC. Fonden
pays dollars, which go to brokers, banks and corporations, relieving some
pressure from the parallel market. Of course, there are commissions, spreads
and who knows what in the middle at each step.

I mean, think about it this way: PDVSA gives money every week to
Fonden as part of its “social” contribution, so that Fonden can buy bonds of a PDVSA-owned company, so that this
company can buy its own bonds. Creative, no?

Which takes us back to the first rumor, that a of a dual
exchange rate system. Nothing has helped the swap exchange go down more than
the existence of the rumor itself: We will soon have two exchange rates, one for essentials and a
second one for the rest. But wait! It will actually be a triple exchange rate
system, as the parallel swap exchange rate will not really disappear.

Which is the reason why it is a mystery, at least to me, as
to why creating a second exchange rate has anything to do with lowering the
swap exchange rate.

You see, currently, the Government gives out US$ 180 million
a day via the foreign exchange office CADIVI. That’s like US 45 billion a year.
Of these, the Government gives 30% for “essential”, food and medicines, or
US$54 million per day. Thus, the Government would supposedly have to sell some US$ 126
million per day in the stock market in order to maintain the current daily
supply.

The difficulty lies in that first of all, the Government
controls what it approves every day, but it certainly does not approve every
request, it is controlling the flow. So, the first day at the stock market,
suppose the Government decided to sell US$ 200 million to the best bidders.
Well, with US$ 70 billion in monetary liquidity out there, you can bet much
more than US$ 200 million will be bid at the auction. Thus, the price would go
up.

In fact, given that the Government only gives money for
certain things today, if they were to open it up to everything, you could imagine a
lot of money flowing to the “second” market, driving it up again. But since everyone
will not get dollars, the “third” market, the swap market will still exist and
that price will also move up.

The math is simple: The Government has US$ 30 billion in
reserves and there are US$ 70 billion in local currency out there, if you open
up the floodgates with the “second” exchange rate, all US$ could disappear and
you still have US$ 40 billion in Bolivars floating around.

Which is the reason why I don’t quite understand the rumors
about the dual (in my mind triple) exchange rate or why the Government has used
such high resources (US$ 150 million per week) to lower the swap rate if this
is what it plans to do.

But maybe, there is a further and very creative financial and profit twist, which
will allow someone to make lots of money.

We have seen it so often…

I wanted to write about the deaths at the Maternidad Concepcion Palacios, but every time I tried to I would get to irked at the Government´s reaction. For a Government that claims to care so much about people, all they seem to worry about the media and not the deaths and the facts. Just when I begin writing something,. Chavez himself came on and in a very insensitive and careless fashion accused the media, in the same way he does not want to hear about the almost 100,000 deaths during his tenure. To him, these are numbers, not the real people that suffer the consequences of the ineffectiveness and ineptitude of his Government. So, while he gives away millions of dollars to other countries and buys perfectly functioning companies so that he can be involved, kids die because of his idiotic view of the world. I thought inspiration would come at some point once the outrage subsided, but then I read Bruni´s article on the subject at cuentos intrancesdentes and figured there was little to add to what she so eloquently said. I suggested she translated and despite some initial reluctance at whether she had time or not, she sent it right away and here it is. I will not say for your enjoyment, because there is little to enjoy in this grotesque tale of incompetence and insensitivity by the Chavez Government

On
neonatal deaths, figures and a huge lack of responsibility by Bruni

There
are many obscure points in the story of the six deaths at the Maternidad
Concepción Palacios on the night of 26 to March 27, 2008.

The
Maternidad is the only public hospital exclusively dedicated to prenatal and obstetric care in Caracas.

In
any serious country, the death of six patients on the same night in a single hospital would bring up
many questions. The public has indeed the right to know what happened and why
and to demand that public health facilities are reliable and competent.

The
role of a government, in such cases, is to immediately initiate an independent investigation,
help the families, calm public opinion and closely supervise the hospital
throughout the investigation.

In
Venezuela, instead of assuming its role, the government, in the person of
President Chavez and his Minister of Health, becomes a “guapetón de barrio”, insulting those who denounce what happened and calling them
“terrorists”.

The
minister’s statements are particularly revealing. They can be seen in this video.

The
minister began by explaining that it was not really six deaths of newborn
children, but three of the children were not born alive, as they were already
dead inside the womb of their mothers. The minister emphasized that, therefore,
the three children, or fetuses, cases were “stillborn” that do not
affect the statistics of neonatal deaths. Another child was born with a
congenital cardiology, one was not really born that night but died of
complications from an infection and another one was also a stillborn that was
produced due to a an obstetric complication….in other words ” everything
is fine Madame la Marquise “.

To
get a better understanding of the enormity of the lie that the media
“terrorists” is selling to us, the Minister brings us some figures on
the huge improvements in the statistics of neonatal deaths that Venezuela has
had in recent years.

According
to what the Minister says in the video, neonatal deaths in 1998 were 21.4 per
1000 live births, in 2006 there
were 14.4 and in 2007 the figure
has fallen to 13.

The
Minister, who a few minutes earlier had vehemently criticized those who take
advantage of human sufferings for political purposes, clearly explained that
such a decrease is due to the policy of Hugo Chavez, who has “saved 5274
children from death” in the nine years of his ruling. It is thanks to Hugo
Chavez, then, that these 5274 children have” filled with joy thousands of
homes over the years”.

The
Minister seems to overlook the fact that the normal trend should be a mortality
decline. In fact, in 1970,
Venezuela had 48 neonatal deaths per 1000 births (2007/2008
UNPD report). That means that, on average, the country had 0.95
deaths less per year until 1998 (if we take the Minister’s figure). On the
other hand, also using the Minister’s data, since Chavez is in power, the rate
had improved 0.93 deaths per year,
a slight decrease.

Now
let’s see how Venezuela compares with the best countries.

In
1970, the lowest rate was that of Sweden, with 11 deaths per 1000. Today, the
best country is Iceland (according
to statistics from 2005 that appears in the report of the 2007/2008 UNPD) with
a rate of 2. In 1970, Venezuela’s rate was 4.36 times higher than the country
with the best statistic. In 2005, Venezuela’s rate is 18, which is 9 times larger than the best
country.

In
other words, Venezuela has
significantly deteriorated its relative position since 1970.

But
the most surprisingly negative
figure, that was provided
by the minister himself as a positive point, is the number of neonatal
deaths in the Maternidad Concepcion Palacios itself.

Remember
that it is probably the most important maternal hospital in Venezuela.

The
Minister indicated that the Maternidad presented a rate of 40 deaths per 1000
in 2005 and has fallen to 21 per 1000 in 2007. He congratulated himself on such
a great progress.

How
on earth does the Minister welcome such a high figure? If the country’s
rate is 13 neonatal deaths
per 1000, how is it possible that the most important maternal hospital in
Venezuela presents almost twice the neonatal mortality of the country? Doesn’t the Minister realize that just such a
figure shows that there is a very
serious problem and that he should take action on it?

If
I were Minister of Health in Venezuela, I would immediately put under
guardianship the Maternidad to investigate why the neonatal mortality rate is
so high.

What
is it? Is it management problems? Medical? Social problems? What makes the
Maternidad’s neonatal death rate so high? Has anybody compared their statistics
with that of other hospitals in the same areas? And with other hospitals in
other areas of Caracas?

That,
Mr. Minister, is what a goverment
should be doing, not insulting the
media and calling them terrorists

Now,
let’s go back, again, to the opening words of the Minister that excused three
of the death cases because they were
“stillborns” as if, by the fact that they did not count in the
statistics for newborns, their cases were not as important for families and
public health policies. After all, of the six deaths, four were stillborns.

Let’s
see.

Those
women that arrive at the
Maternidad Concepcion Palacios are generally low-income and very often have had
no obstetric monitoring during their pregnancy. Precisely, one of the most
negative medical statistics of the government of Hugo Chavez has been the so-called
“maternal deaths” that occur from complications related to pregnancy.
Embarrassingly, despite Barrio Adentro and the phenomenal rise in the cost of oil, maternal deaths have
increased during the years of Hugo Chavez (see article in Ultimas Noticias here).

The
sad thing is that basic interventions like taken a blood pressure measure once
a month or a daily glass of milk,
can prevent or detect in time major complications.

I
do not know what were all the complications of the mothers who led to three of
the “stillborns” this March 26, but it is clear that in Venezuela
there is a problem with the monitoring of pregnant women.

One
thing is for sure, Mr. Minister, there is nothing to boast about, quite the
opposite.

Finally,
I conclude this post with an observation: La Maternidad Concepción Palacios is
the responsibility of the office of the Mayor of Caracas (Alcaldía Mayor)

So
since we are talking about responsibilities, I ask myself:

Where
is Mayor Juan Barreto?

I am a little behind in writing about some things and many will be not
covered as I am planning a long trip soon. But during the Easter week,
the Royal Court of Justice in London ruled in favour of PDVSA h.,
essentially cancelling the freezing order for US$ 12 billion on the
company’s assets. ExxonMobil had requested the freeze over the dispute
between the two companies over the takeover of Cerro Negro by PDVSA.
ExxonMobil refused to accept the change in ownership whereby PDVSA
would acquire a 60% control and simply walked away from the project
demanding compensation.

The judge in the case did not rule so much on the merits of PDVSA’s
actions, but more on the details of the freeze order and whether it is
the competence of the Court and whether the injunction is justified or
not. Thus, in a long and complicated decision, the Court ruled in the
context of UK laws whether to extend the injunction granted by a lower
judge.

The judge said in the decision that these type of freezing orders are
made to avoid companies from dissipating its assets and explicitly says
that for a freeze like the one requested by ExxonMobil to be justified,
there has to be compelling evidence of serious international fraud,
which is not the case for PDVSA.

However, the judge does refer to the takeover of Cerro Negro as an
expropriation and says that ExxonMobil does have an arguable case, but
it not only finds that the freeze can not be justified, but states that
ExxonMobil has other courses of action for its demands. The case is
found to be justified because the original agreements of the
association were breached and PDVSA acted in bad faith, but it is not
clear what the worth is and the judge made no attempt to resolve the
point as to whether the US$ 12 billion is justified or not.

The judge also ruled that in the absence of fraud, PDVSA would need to
have substantial assets located in the UK and Wales, which is not the
case. Moreover, the judge states, the fact that the seat of arbitration
is not UK-based, would make it inappropriate to grant the request. The
Judge also faults ExxonMobil for not seeking relief within the
Venezuelan Court system, which is clearly laughable given the current
state of the Venezuelan Justice system.

There are still injunctions in place in The Netherlands and the United
States that PDVSA will have to deal with in the near future. The ruling
does force PDVSA to abide and follow the arbitration steps as the judge
says the company has followed the steps even if with some delays. We
suspect that PDVSA and ExxonMobil will eventually settle a negotiated
agreement in which PDVSA will pay ExxonMobil with its stake in the
Chalmette refinery.

While it
comes as no surprise, today we got confirmation as to how former General
Prosecutor Isaias Rodriguez carried out gross miscarriages of justice while
occupying the office which is suppose to defend and uphold the laws in Venezuela.

It is no
surprise, because Rodriguez used his office to persecute the Government’s
enemies and seldom took the time to go after the Government’s friends.
Moreover, he was always suggesting that cases would be closed soon, while
actually completing few of them.

No case
may be more emblematic than that of the murder of one of his main Prosecutors,
Danilo Anderson, who was assassinated using explosives in his car. Rodriguez
accused the opposition from day one and failed to follow leads suggesting that Anderson carried out a
lifestyle beyond his means. In fact, Anderson’s
friends charged that the assassinated prosecutor kept large amounts of money in
his apartment, money that was never found and were certainly beyond Anderson’s means. Other indications were never followed up in the investigation.

After
raiding the homes of opposition figures and suggesting the case was almost
ready to be prosecuted, Rodriguez found a “star” witness who he used to
prosecute a number of opposition figures, including reporter Patricia Poleo,
who still remains in exile. All of the charges against those accused have been
dropped, including businessman Nelson Mezerhane.

Well,
today a Prosecutor that worked for Rodriguez in the Anderson
case named Jose Contreras, presented a formal accusation to the new General
Prosecutor in which he charges that Rodriguez manipulated the penal
investigation into the Anderson
case.  While the accusation may be
politically motivated, I would like to think that there are people with ethics and
principles within the Government who may be at times pressured to shut up, but
rebel when those involved leave Government or their behavior exceeds certain
limits. It may be that the Prosecutor making the charges was sick at reading
yesterday that his former boss was preparing the documentation necessary and
“working on” becoming  a member of the
Venezuelan Supreme Court, truly an insult to anyone with certain basic morals
and principles.

In any
case, the charges presented against Rodriguez are quite extensive and damaging
and I certainly hope they stop Rodriguez aspiration to become ea member of the
Supreme Court, although given the recent cases with other chavistas accusing
Government officials, maybe it will be Prosecutor Jose Contreras that gets
fired or accused of corruption.  

Contreras
says that Rodriguez himself switched and changed the files on the Danilo
Anderson case, who would argue that the content of the files had to be reviewed
by “High Government” since the investigation was a “State problem”. According
to Contreras, Rodriguez would later meet with them and would tell them to remove
a certain person’s name or include someone else’s, as well as describing that
person’s characteristics. Nothing in the investigations was done without the
precise instructions of the Prosecutor, says Contreras.

He also
said that Rodriguez said the star witness in the Anderson case had fooled him,
but Rodriguez never revealed who brought the star witness to him and why
Rodriguez never listened to the other prosecutors who told him the witness had
little or no credibility.

Contreras says he interviewed the star witness
exhaustively and was able to convince himself that the witness had interests
different from collaborating with Justice.

The prosecutor also charges that Rodriguez asked
people to be detained based on the star witness’s testimony, but most of them
have now been freed. He reminds the current General prosecutor that when she
was in charge of Processes he told her about the irregularities in the case and
as Isaias Rordriguez told him: “He needed to have a case..because the radical
currents of Chavismo were asking for results with the intellectual authors of
the crime in jail”. Contreras says Rodriguez’ egocentric personality and his
political involvement led him to deviate in his mandate as General Prosecutor.
(The full letter in Spanish is here)

The
case is just an example of what we have been saying about Justice under Chavez for years.
How Chavez has misused his power to neutralize enemies and how he has castrated
the independent institutions that are supposed to provide checks and balances
in a democratic society. The Prosecutor, the People’s Ombudsman and the
Comptroller have been puppets of Chavez for the last five years. They have been
used as tools of political pressure against the opposition and the fact that
their job was defined from above, implied these men ignored the mandates of
their position, allowing corruption, abuse of power and human rights violations
to flourish during the last nine years.  

Except
that by now, even Chavistas are totally fed up with it…

The last few days, there has been a soap opera going on in the National Assembly surrounding the accusations by a little known Chavista Deputy whose name is Wilmer Azuaje, who has been presenting evidence against what in Chavez’ own Barinas State is called the Chavez royal family. The whole thing is much like a soap opera, because one needs to look at the big picture and the littel details to try to understand, if at all possible, what is going on there.

Azuaje is not very well known nationally, up to now he has been loyal to the revolution, so loyal in fact, that he has been named to the Board of the Assembly a couple of times with the unanimous support of its members. He has no known track record in any field, other than sucking up to the boss and politicking in his own Barinas State. One of his few appearances in public was the injunction he asked against a reporter for defaming him, The reporter accused him of having no known education, job, training, being an ignorant and having no qualifications despite which he had accumulated substantial wealth in the years he had been a Deputy of the National Assembly. The injunction was granted.

The Chavez royal family is referred to that way as Chavez’ father is Governor of Barinas State, the brother is Secretary of the State (Argenis) and another brother (Anibal) is Mayor of Sabaneta, a city in that same State where Chavze was born. There are others, Adeliz is President of Sofitasa a financial institution used to pay all of Barinas’ public employees, Narciso, who used to be in the Canadian Embassy and, of course, Adan, the educated one, Minister of Education). Recall that Chavez has always claimed he was poor when growing up, which is why he joined the Army. This is not strictly true, both his parents were high school teachers in a country where all teachers have the same salary, independent of where they live or are, just how many years they have taught. Moreover, Chavez has never explained how come his older brother Adan managed to enter the University of Los Andes before he joined the Army if poverty was an issue. They were not poor, but they were not rich either, just lower to middle class.

Azuaje all of a sudden got ambitious and sensing the weakness of the Chavez name in Barinas, decided he could be Governor. Thus, despite the express prohibition by Chavez for people to announce candidacies, Azuaje announced he was running in November. However, he also decided to go for the jugular and denounced the Chavez family for corruption, saying they have accumulated large pieces of land, most of which they keep in somebody else’s name.

He brought the evidence to the Comptroller’s Commission of the National Assembly and the stuff is apparently quite thorough, so much that they had to admit it as evidence and open an investigation.

But nothing is straightforward in the revolution. Despite being the accuser, the commission decided at the same session to investigate him for enrichment and there were even proposals to remove him of his parliamentary immunity. Deputies in Venezuela receive immunity agaisnt prosecution so that they can speak openly without being threatened at every step. Only the National Assembly can remove him of his immunity, mostly in criminal cases and this Assembly in particular has never gone that far.

But this is the President’s family, so Azuaje certainly has his work cut out for him.

What Azuaje charges is that the Chavez family has been accumulating land around the only farm they owned when Chavez became President in 1998, a farm by the name of La Chavera. La Chavera is not huge, a mere 30-40 Hectareas, but according to Azuaje, it had no cattle in 1998 and now has over 5,000 heads of cattle. (Except he also charges they were removed last week after he presented his first accusations).

Azuaje charges that la Chavera is now huge, as the royal family has accumulated the surrounding properties under other people’s names. More specifically, he says that La Chavera now has a person managing it, who goes by the name of Nestor Izarra. Izarra an employee of the Chavez family, with barely US$ 2,000 in the only account he has in the banking system, happens to be the new owbner of the neighboring farm La Malagueña, which happens to be almsost 600,000 Hectares in size, something like 20,000 bigger than La Chavera. Of course, everyone wonders and has wondered how the manager of the 30 Ha. farm could buy the 600,000 Ha one, a question that has been asked for a long time, but Azuaje is the first one to bring it up publicly.

Azuaje makes charges with as many as six farms surrounding La Chavera and even said Chavez daughter in law should be investigated, as she not only owns a farm but has about 5,000 heads of cattle to her name.

But let’s just focus on one aspect: The farm owned by the Manger of La Chavera, named La Malagueña, has 600,000 hectares. Well, according to Chavez’ controversial Land Bill, any farm over 5,000 Hectares is consider a large farm state and should be expropriated in revolution that has taken over a British owned farm called El Charcote, which “only” had 13,000 Hectares, but somehow, right under the eyes of the Chavez family, a neighboring farm has 600,000 Hectares and nothing has been done about it?

In fact, this weekend Chavez announced taht he was taking over a 65,000 Hectares farm in Apure state, one of the largest in the Nation, which in reality is small, because it spends four months of the year under water and barely has 10,000 heads of cattle.

But while everyone worries about Azuaje’s charges, nobody asks these bigger questions as to why these huge properties still exists next door to the Chavez family while useless properties (the one in Apure is mostly a nature preserve)

The answer is nobody cares. Today the Chavez family asked once again that Azuaje’s parliamentary immunity be removed and even Nestor Izarra claims he will prove how he acquired La Malagueña. I would bet Izarra does not even file income taxes, despite his apparent wealth.

In the end, this soap opera is about power (Chavez, his family and the Governorship) and not about fighting Latifundia (Large farm states) or social justice. It is in the end a Barinas family feud or Barinas Peyton Place. In fcat, I talked to a friend to find out who Chavez plans to run as his candidate for Governor in November and was not that surprised at the answer:

His mother Elena…

truly a Barinas family sopa opera

Well, the most far fetched and explosive revelation of the Reyez computer was apparently confirmed today when it was revealed that the FARC did indeed have 30 Kilos of Uranium. While this will create a lot of scary headlines, the truth is that this was a commercial transaction, not an attempt by the FARC to build any type of nuclear device or dirty bomb.

You see, the Uranium found apparently is not enriched, i.e. it is mostly Uranium-238, rather than the enriched version Uranium-235 which would be required for a device. The Colombian authorities keep using the word “empobrecido” (impoverished) a term I had never heard, but which must mean depleted Uranium, what is left after Uranium is enriched and the enriched part is separated.

Thus, this may have actually have been a scam by the FARC to make someone naively believe that they could enrich this stuff. The possible buyer had to be fairly naive and/or stupid (Jeez, I can’t help having an obvious suspect, given this description!) given that depleted Uranium 238 is much less radioactive than even the Uranium found in nature.

One has to wonder where the FARC got this stuff, that should be a really interesting part of the never ending story of the stuff coming out of Reyes computer. I must say when I first read about it, I thought this was a far fetched plan by the FARC to obtain the stuff, but if confirmed, this proves the veracity of the material found in these computers.

You have to wonder how the Government chooses technological suppliers. The case of CADIVI, the foreign exchange control office comes into mind, because from day one it has been a cumbersome system and it seems to get worse, rather than better with time.

First of all, while I commend the use of the Internet for all tasks, there is no way of having access to CADIVI dollars unless you have an email and Internet access. In a country like Venezuela, this is a discriminatory tool, because there is no alternative. While people who live in Caracas may find no problem finding a connection to the Internet, when 12% of the population is rural and only a fraction has direct Internet access, you may want to create more democratic paths to the whol thing. For example, you could have a paper mechanism whereby people supply forms to banks directly.

But I digress, the first point is that anyone requesting CADIVI dollars has to provide an email and register.

It used to be that you would try to enter the CADIVI page and you would have to wait a while, companies actually pay people to do it during the night and on weekend. But rather than spend some money in servers or hosting the CADIVI page in a hst with good bandwidth like banks do, the problems has never been resolved. A while back, CADIVI then decided to create days for access. Weekends are a free for all, but then depending on which number your ID card ends in, you can only try it on a certain day of the week. It still takes a long time to get in and I know people that have spent two or three weeks trying to get in to fill a form.

Ironically, this system is a lot like the “Pico y Pala” day that some Caracas municipalities tried to implement to reduce traffic, whereby if your license plate ended in a certain number you could not drive during the morning and afternoon rush hours. The Chavez Government opposed this strongly, as this was implemented in municipalities in the hands of opposition mayors. The Government opposed it on the grounds that it restricted the people’s right to move around and judges immediately and not surprisingly issued injunctions banning these days. Funny, that nobody has applied the same concept to ban CADIVI from limiting people’s rights to information, which is in the Constitution. But I digress again.

CADIVI has been abysmal about calling people to prove how they spent their CADIVI dollars. As business sprouted around requesting CADIVI dollars to take advantage of the arbitrage, it took a long time for CADIVI to wise up to it. Finally, they issued a list calling those in it to go to CADIVI and prove how they had spent their subsidy.

The first list was a violation of people’s privacy, it was public and it contained people’s names and ID number (Cedula). This is not only a violation of people’s privacy, but it provides information to crooks which now know your cedula number and could use it illegally.

In later lists, they removed the names to protect people’s privacy.

But what is truly annoying and absurd is the latest list of 60,000 people that have to provide receipts. Given that CADIVI has everyone’s email, you would think they would simply send everyone in the list an email telling them to provide the information. Instead, a 9 MB Adobe Acrobat file with 60,000 ID numbers and request number is placed on the already overloaded CADIVI website to make everyone’s life miserable. As hundred of thousands people attempt to download the list to see if they are in it, other trying to get in to request their money can’t do it and they lose their weekly chance to do it.

I don’t know who are the geniuses that run the CADIVI systems, but if after five years of exchange controls they are so bad, they should be fired. Unless of course, they got the contract because they had a buddy in CADIVI or they paid a bribe, God forbid!

Fortunately, this morning I got up to watch the Major League baseball game in Japan early and I managed to get the download going (It was still not done when I left for work almost wto hours later). I now have the list and can email it to all my friends who want to know whether they are in it. You see, the penalty if you don’t provide the receipts is one year in which you don’t get your quotas for Internet or travel and in a country where people are now obsessed from taking advantage of the Oligarco Burguesito arbitrage, that is much worse and uncool than having your rights violated by being in the Tascon Facist list.

I found the article below in today’s El Nacional which was also sent to me by a friend, probably concerned about its implications. But what never ceases to amaze me is how two relatively intelligent and educated people like the Minister of Higher Education and the Minister of Science and Technology can defend programs like those described below. These are people who spent their life financed by the Government to do research in esoteric topics of scientific validity, but who now seem to think they wasted their whole life because they did not work in conucos.  (Never heard them complain when they received funding to finance their fairly mediocre research projects and scientific careers). Moreover, all technical studies show how the conuco is an unsustainable as a self supporting structure, but since their big leader, the almighty Chavez defends it, then it must be good. Maybe they have forgotten how to read (or think!)

What’s next? Making them obligatory? It would be better for the same students and/or Venezuela to have them spend their time programming in Basic or Fortran, at least theyw ill learn how to think!!!

Let history judge their stupidity

Education and Society
 
Program
 
University Stsudnets will plant black beans, corn and mandioca
 
With the arrival of the rainy season, the beginning of the program All hands to sow will also arrive, a program which is being backed by the Ministries of Higher Education, Agriculture and Science and technology.
 
The project stipulates that students, Professors, employees and workers organize themselves in brigades to plant mandioca, corn and black beans in 100 hectareas that have been provided to 17 institutions.
 
The teams must have between five and seven members who, voluntarily, will sow sseds in May and will harvest the crops in September, backed by producers from agrarian developments. “We will plant not only the established items, but we will sow the conscience in all involved students about the need that their education point towards the development of the country”, explained Minister Luis Acuña
 
Hector Navarro, Minister of Science and Technology, added that it means “adding efforts to substantially increase productive capacity, but not starting from the great units of production, but from the small and medium size producers”
 
The program implies the practical substitution of agrochemical practices by an agroecological and sustainable focus and will receive consulting from Cuban advisers.