The Devil's Excrement

The Governor of Zulia State challenged Hugo Chavez today over the takeover of the ports and airports of that State

later all four Governors continued to challenge Chavez over his unconstitutional threats to take over what is the exclusive competence of the State Governors according to the Constitution.

So far, there has been no response from Chavez, except for reports that the port of Guamache in Nueva Esparta State was being taken over by the military.

This gets interesting.

I have to say the Venezuelan National Assembly reivindicated itself in my mind this week. You see, for two years the Dear members of that respected body did essentially nothing, since they yielded all legislative powers to Chavez so that he could pass as laws, what the voters rejected in the 2007 referendum. Then, after the Enabling Boll expired they devoted all of their efforts to campaign for Chavez’ candidates for Governor, whether they liked them or not.

The year began and once again our distinguished Deputies found themselves busy elsewhere, this time campaigning so that Chavez can be their boss forever, given that they all know they have reached way above their Peter principle and can’t aspire to any higher position.

So, it was about time they got to working and this week they certainly did in style, getting their hands dirty and doing a magnificent job on all fronts. To witt:

• Completed investigation on the large farms owned by the Chavez family in Barinas State

In an exhaustive and extremely professional investigation, the National Assembly determined that the large farms owned by the Chavez family in Barinas state were all acquired legitimately and that all accusations were unfounded. The extremely “prudent” investigation determined that despite Chavez claim to poverty, the Chavez family has always been rich or near rich and thus all of the 600,000 Hectareas of the Malaguena farm and the Chavera are perfectly legitimate and legally acquired with the Chavez family fortune. The Committee made no judgment on why Chavez always claimed to be poor and whether this represents or not mental instability, but this was not part of the evaluation.  The Committee did not study either why it is that the Chavez family can own farms that are laregr than allowed by the Land Bill, but this was not part of the investigation either. Case closed. (The same committee will continue investigating where Manuel Rosales got the money to buy a car and give it away, there is simply no possible explanation for such a large purchase on a Governor’s salary)

• The National Assembly approved a new Decentralization Bill

In an effort to reign in the democratic abuses of the newly elected opposition Governors, the Assembly approved a new “Decentralization” Bill that centralizes things so that Chavez can have more power and the Governors can have less. This is essential, because a bunch of opposition (read oligarchic and fascist) Governors were somehow elected last November, together with the new Mayor of the Metropolitan area of Caracas. Thus, with this Bill, not only were many important responsibilities taken away from these Governors, but a new position was created so that Chavez can control and neutralize the newly elected Mayor of the Metropolitan area of Caracas Antonio Ledezma.

You have to understand that Ledezma is not only a capitalist, but was never in the military and thus can not be prepared to hold the position. The Assembly hopes, even if it can not pressure the President, that Chavez names the man Ledezma defeated to the position, Aristobulo Isturiz, so that Ledezma learns his lesson and never again gets himself elected democratically to any position. Even if Ledezma were elected President, Chavez would find a way of naming someone above him.

If these people can’t understand what Chavista democracy is all about, we will teach them!

• Assembly asks that OPEC should concentrate on adding new members to the organization

Finally, the President of the Energy and Mines Commission of the National Assembly held a press conference this week to urge OPEC to devote all of its time to convince oil producing countries which are not part of the organization to become members.

The idea is quite simple and extremely clever. If these countries joined OPEC, not only would the organization control over half of the world’s oil production (if Russia joined, for example), but it would help cover up all of the cheating that member countries have carried out, whenever production quotas are reduced.

You see, oil prices continue to fall, but OPEC would look silly announcing another production cut (and indeed did not cut today), when the previous ones have yet to be completed. Venezuela, for example, has complied with only half of the cut that it was assigned. If Russia joined, then the organization would get an important additional cut, even if Russia did not comply fully with its assigned cut.

The strategy is brilliant, as the new members would get really mad at the old members and talk about “moral hazard” and leaving OPEC, but we would not cut anyway (We can’t afford it!) and we can continue cheating. But in the end OPEC would produce less, and that is the whole point.

Absolutely brilliant!

Thus, an excellent and extraordinary week for the Venezuelan National Assembly after its two year hiatus, which not only makes us proud, but which are an indication of the wonderful things to come in the near future as they finally get to work.

Maybe they should consider extending their term from six to eight years, so that they can make up for the time lost in the last couple of years. If this week is an indication, they surely deserve it. The six year term is in the Constitution, but who pays attention anyway!

In clear violation of the Venezuelan Constitution and acting like the outright Dictator he is quickly becoming, President Hugo Chavez just ordered the takeover by the central Government of all of the maritime ports which are in the states of Zulia, Carabobo and Nueva Esparta. Coincidentally these states were won by opposition Governors in the November regional elections.

Just so that there is no doubt about the unconstitutional character of this order, this is Article 164, paragraph 10 of the 2000 Venezuelan Constitution:

Articulo 164: It is the exclusive competence of the States..

10. The conservation, administration and use of roads, highways, as well as ports and airports for commercial use, in coordination with the Executive Branch.

There is no grey area here, this is is the exclusive competence of the Governors, but Chavez wants to centralize everything and remove responsibilities from the democratically elected Governors who do not belong to his party. Chavez threatened to detain the Governors if they oppose the takeover by the Navy of the ports.

The true dictatorial face of Hugo Chavez is being shown to the world. Do we hear anything from the PSF’s?

A local newspaper published an article this week saying that the Venezuelan Central Bank had sold 7 Tons of gold in order to generate gains so as to cover the hole left by the transfer of US$ 12 billion to the development fund Fonden.

Well, the first part may be true, the Central Bank may have sold some gold, but the rest of the story is simply not true and in the end absolutely irrelevant.

First of all, the Venezuelan Central Bank has (or had) some US$ 10 billion in either gold coins or gold bars, according to the December 2008 balance sheet, adjusted for the change in the price of gold since that date.

But let’s look at how much 7 Tons of gold is. One Troy Ton of gols represents some 32,000 Troy ounces of gold. At current prices of US$ 900 per Troy ounce, this represents US$ 189 million, sounds like a lot to you and me, but in te scale of the US$ 10 billion in gold or US$ 28 billion in reserves, it is very little. It is also small in the scale of the US$ 12 billion transferred to Fonden and would have generated in gains, if the story was true, 1% of the amount transferred to Fonden.

But what makes the story absolutely incorrect is the fact that as can be seen in the financial statements of the Central Bank, the bank marks to market the gold, i.e. it registers it evey month at the current market price of the gold.

Most likely this was a decision by the Venezuelan Central Bank to keep gold as a fraction of reserves at a certain level. Given that gold has gone up in price so much in the last year and that reserves are down, such a strategy would make a lot of sense.

I have no clue or information as to how the gold in the reserves is managed, but what is clear to me is that the size of the trade was mostly irrelevant and the reason given can not possibly be true.

Unfortunately the media jumped on it and has been repeating the story, without verifying the facts.

Chavismo has shown an amazing ability at twisting the law and the Constitution to control the country and at the same time make it appear as if there was some sort of democracy in Venezuela.

Given Chavez’ coalition control of most municipalities in the Caracas metropolitan area, it was only natural for him to propose in the 2000 Constitution that the Governorship of the Federal District be eliminated and replaced by a “Metropolitan Mayor” elected to oversee the work of the municipalities of Caracas, to be over them and in that way control the Mayors of Baruta, El Hatillo and Chacao, where the opposition ruled, while winning in the Libertador and Sucre municipalities, thus insuring political control over the whole metropolitan area. This actually was logical, bt may not have been implemented if Chavismo could not prevail in elections.

Except that Chavez chose reporter Alfredo Peña to be the first Metropolitan Mayor of Caracas and he quickly became part of the opposition as the Government began violating the rights of the citizens of Caracas.

In 2004, Peña was replaced by Juan Barreto, who turned out not only to be incredible incompetent, but had this autocratic view of life that led him to hire thousands of Chavista activists to carry out political work, rather than work for his municipality. Millions of Bolivars were spent on these salaries as Barreto enjoyed the trappings of his office.

As the 2008 regional election approached, it was clear that if Leopoldo Lopez ran for Metropolitan Mayor, no matter whom Chavismo ran, Lopez would win. Thus, the Comptroller was quickly prompted to ban Lopez from running arguing that he had misallocated some funds from one budget line to another, in violation of the law. Once Lopez was out, the opposition had no choice but field dinosaur Antonio Ledezma against Chavez’ choice of Aristobulo Isturiz for Metropolitan Mayor.

But if Ledezma was perceived as a dinosaur, Isturiz could not fool enough Chavistas into voting for him and Ledezma prevailed, grabbing the position of Metropolitan Mayor, as Primero Justicia’s Ocariz stole the Sucre municipality from under Chavez’ nose, as Chavismo fielded  overexposed and negative-charisma Jesse Chacon as their candidate.

This changed the whole outcome of the 2008 regional elections, as Chavismo not only managed to lose in the ballot box the Metropolitan mayor’s office but one of the country’s most symbolic poor areas and shantytowns in the Sucre District, including Petare.

This was clearly a huge defeat for Chavismo: The opposition not only won, but won easily in its urban territory, controlling all but one of the five Metropolitan districts and the Metropolitan Mayor, all at the same time. Only the former CNE President and later country’s Vice President Jorge Rodriguez, managed to pull a win in the Libertador District, despite his lack of charisma and almost unpleasant personality.

So far Chavismo has made Ledezma’s life impossible. Soon after his victory, the Government took away the control of the Metropolitan police from him, while all of the schools and hospitals were reassigned to the central Government. Meanwhile Chavista hoodlums took over the Mayors office weakening Ledezma’s ability to work for his constituents. Despite this, Ledezma has projected a very positive image in his first 100 days in office and his approval rating has soared, even above the levels of his November elections.

But for Chavismo, only Chavez can have any success and a new plan has been conceived: If you can’t beat Ledezma, make him irrelevant. Thus, the Venezuelan National Assembly is now looking into creating a “Vice-Presidency”, obviously to be named by Hugo Chavez, that would be above the Metropolitan Mayor, whose functions would be above those of the elected Metropolitan Mayor and would keep not only Ledezma, but all of the other Mayors of the Metropolitan area of Caracas in check.

This simply represents a double bypass of the mandate of the electorate and the Constitution. Not only did the voters elect Ledezma to be their rightful Mayor, but the idea of Chavez hand-picking regional Vice-Presidents was rejected by the Venezuelan voters in the 2007 Constitutional referendum. So much for Chavez’ infamus and pompous claim to be in favor of participatory democracy.

Thus, once again Chavez tramples on the country’s democracy, while his foreign unconditional supporters try to tell the world what a democrat he is. The truth is that Chavez has spent the last ten years trampling and twisting the law and the Venezuelan institutions to adapt them to his desires and whims, reducing them to puppets of his orders.

With this new legislation, Chavez and Chavismo will prove, once again, what little respect they have for democracy and the will of the people, despite their constant claims to act on their behalf. Remarkably, it has been the rather gray figure of Antonio Ledezma that has forced them into conceiving this plan, showing once again, that Chavez is by now afraid of his own shadow and that even someone like Ledezma can rise from his own ashes and represent a significant threat to Chavez’ autocratic goal of long term control of the country.

A democrat Chavez is not, but will democracy be able to get rid of him by democratic means?

It had all of the ingredients of a high level confrontation: 3:30 AM, the workers of the state highway system, accompanied by the Secretary of the Governor of the State, ready to place signs and traffic signals so that the express lane against the normal direction of the traffic could be set up on Km. 12 of the Caracas-Guarenas highway.

Opposite to them the “enemy”, dressed in riot gear including shields, the Venezuelan National Guard stood firm to block the two trucks from the Governor’s office from proceeding forward.

In the middle, public transportation vehicles filled with passengers, you could call them the “people”, wondering who will prevail, either the National Guard, in which case it would take them two hours to drive the 12 Kms. or the Governor, implying they could arrive in 12 to 15 minutes to their destination.

This is not a border dispute, it is a silly and dangerous confrontation in polarized Venezuela, between the Governor of Miranda State who wants to alleviate traffic, and the Chavez Government, who opposes the idea, because they did not propose it first. As simple as that.

Their argument? Article 50 of the Venezuelan Constitution that says that every person has the right to “transit freely” within the Venezuelan territory, as if it said “transit easily” , something which is becoming rarer these days all over the same territory. And in any case, isn’t this the same National Guard that arbitrarily blocks roads and highways daily, stopping each vehicle and harassing travelers? Where is Art. 50 when they do that?

And, of course, these are the same guys that trampled over the same Constitution, so that they could please Chávez and hold the referendum on Feb. 15th. , because, just one example, fourteen articles later, Art. 64 says all Venezuelans who are eighteen have the right to vote, which was not respected on Feb. 15th. To do so, would have delayed the votes three months.

But going back to the battle of Guarenas, at 4:45 AM, the Governor of the State arrives. His arrival encourages the people, car lights begin flashing, horns blare stridently, the “people” shout, bus drivers threaten to shutdown the highway if the express lane is not opened.

In the face of a near riot (Isn’t that what anti-riot equipment is for?), the National Guard Captain in charge of the operation backs down (maybe he lives in Guarenas too!) and the express lane is opened. Buses arrive in Caracas in less than fifteen minutes to the delight of passengers (who will get to work faster) and drivers (who can turn around, go back and fill the bus again)

The bizarro Battle of Guarenas ends peacefully, the question is whether this was a Pyrrhic victory and the National Guard will come back tomorrow reinforced to impose the autocratic decision or whether there is some understanding that the “people” are willing to fight for this.

There are in the end no possible “winners” in such a confrontation, unless imposing your will and controlling the other side is your only goal.

I had not seen this article in Time Magaxine about efforts to revive Venezuela’s best cacao, the criollo bean. It describes the private efforts near the coastal town of Choroni to revive what is considered to be the best cacao in the world.

In the last two decades there has been a strong private effort to develop and project both the country’s cacao and the country’s chocolate. There are some unsung heroes of this effort which has been quite successful, it is truly said when one of them, Jorge Redmond,  is quoted in the article saying:

“Jorge Redmond, president of Chocolates El Rey, a Venezuelan company that has been processing premium cacao since 1929, says El Rey saw almost 865 acres (350 hectares) decimated recently when 40 families invaded. “A 10-year effort was destroyed in days,” he says. “We were able to produce one batch of San Joaquin Private Reserve chocolate before this happened, but we will never taste that chocolate again. It was an incredible chocolate.” His tone is one of heartbreak, lamenting a sweet romance that has often ended in tragedy.”

Not much can be said in the face of the wholesale destruction of such positive efforts by the robolution.

It is getting a little tiring to write about Hugo Chavez and his Government. How irresponsible can he be? Today he said he would turn on the tanks and the Sukhoi jet fighters if Colombia violates Venezuela’s sovereignty and gave Coca Cola two weeks to give up some land it owns in the west of Caracas.

First of al, there is no need to threaten another country when all its Minister of Defense has said is to repeat that it will pursue guerrillas wherever they may be, without mentioning country’s names. Because in the end, Chavez is only bragging. Last time, he “turned on” the tanks, they went nowhere, as the deploprable state of Venezuela’s highways made it impossible to move them. Moreover, the military refused to move anything and the major highway of the country was blocked by protesters that same day.

But in the end, Colombia’s military is much better trained that Venezuela’s and has been engaged for years in its own war. Venezuela’s military has problems holding a parade, as uniforms come unglued and vehicles burn. So, Chavez is once again talking to the gallery, but should threa carefully should the Colombians take him as his word.

Coc Cola is on the other hand screwed. There are no private property rights in Venezuela anymore. Whatever whim Chavez may have, whether a legally built Mall or a parking lot, he decides what to take away and if the owner of Polar “se pone comico” (he gets funny, like going to Court or something like that) Chavez will also take it over and pay with worthless paper, in his own words.

Because Chavez has interpreted the recent referendum victory as carte blanche to carry forward his personal supposedly socialist project, despite the fact that the results of the Dec. 2nd. 2007, referendum should still stand. But Chavez is no democrat and he has long forgotten that the “people” rejected that same project at the time.

And to get an idea about the autocrat’s frame of mind, he no longer uses Bolivar, Zamora or other heroes of the Venezuelan independence. What for? Why use those references when you have him: Hugo Chavez, the hero (?) of so many epic episodes (?) of Venezuela’s history.

Thus, in his latest hair brained scheme, Chavez proposes a chain of Restaurant Chavez, Mac Chavez, so that Venezuelans can eat at a reasonable price with wine and candles (his words)

So, Chavez not only wants to intervene now in every facet of Venezuelan’s life, but he now wants to use his own name for the projects in a clear sign that we will see more and more traits of a cult of personalty as we go forward.

It is all about Chavez, not socialism or any other project.

But the worst part is the passivity of those that are against Chavez. Not of the so called opposition, but of the every day Venezuelan who watches this alarmed but feels powerless to do anything about it.

And expect more in the upcoming days, it is clear that pushing his project forward is more important for Chavez than implementing measures that would help alleviate the upcoming economic crisis that all Venezuelans, but mostly the poor, are going to feel.

(P.S. I am an avid Coca Cola drinker, I will take to the streets if I have to do without that!)

The new Minister of  Commerce announced today that the Government will review areperas, the popular fast food joints where you can buy the typical staple of Venezuelans. According to this genius of commerce, Eduardo Saman, he went into an arepa place and there was a pork arepa which cost Bs. 20. Then, he argued, from a package of regulated corn flour he says he can make 20 arepas with one kilo of pork, which costs him Bs. 16.

Where should I start?

First of all, a 50 gram pork arepa (20 from a kilo) sounds really small, I am not sure which arepera Mr. Saman went to, but the arepears I go to don’t make such small sizes. Second, the arepera I go to has prices which are about 25% cheaper (including VAT, which the Minister did not mention. Finally, maybe the people can buy pork at Bs. 16 per kilo in Mercal, but commercial establishments certainly can not and there you have to pay around Bs. 36 per kilo for pork, which always including some bone. Add to that the 10% VAT that is included in the price and Mr. Saman’s math certainly needs to be looked at.

But, in the end, Mr. Saman can not accuse areperas of usury as he suggested, because ussur only applies to interest charged on loans. There are no regulations on the price of arepas, but it sounds like we will see one in the near future.

This is actually quite sad for me. I still recall when I acme back from my studies abroad some time ago, how disappointed I was to find that most areperas had turned into hamburger joints, after the Carlos Andres Perez Government (I) regulated the price. One of the few things Luis Herrera did which was a positive was to deregulate arepas and immediately areperas sprouted all over the country.

But Chavismo is clearly set in ruining the country. After all, if it was so cheap to make an arepa, how come there are not hundreds of arepa carts around the city, selling them at half the price?

Maybe a cook in my audience could take the time to figure out how many arepas (arepera size) with pork filling (also arepera size) you can make with one kilo of pork and one package of Harina Pan and we can figure out what the margins are for the arepa, without talking into account overhead and the like.

Clearly in Venezuela, what is not illegal, maybe so under Chavismo criteria…

What’s next, the arepa decree?