Hugo Chavez has died. He made sure Venezuela’s economy and civil society went down for the dirtnap before he did.
Too bad he couldn’t take his asshole friends Danny Glover, Sean Penn and Robert F. Kennedy, Jr. with him.
What’s most interesting about this is what happened in 2006, when this dirty scumsucker addressed the United Nations and called George W. Bush the devil…
Guess what, Hugo? You’re about to find out what El Diablo REALLY looks like. And he doesn’t look like George W. Bush.
He looks a lot more like a communist dictator than a Republican president.
Meanwhile, in Venezuela the damage from Chavez’ incompetence is unmistakable, in the form of empty shelves…
Economists expected a big devaluation in the early months of this year. That would make revenue from oil exports go further in local currency, bridging a fiscal deficit which reached 8.5% of GDP last year after an increase in spending of 26% in real terms in the 12 months before a presidential election in October, won by Mr Chávez. But there is no sign of it, probably because the president’s agony means that a fresh election is just around the corner.
The underlying problem is a shortage of cash at the state oil monopoly, Petróleos de Venezuela (PDVSA), which provides 94% of the country’s foreign earnings. Under a plan announced in 2005, Venezuela should have produced 5.8m barrels a day by 2012. Even by the government’s reckoning, it pumped little more than 3m; private sources suggest the number was around 2.8m. Local consumption has risen sharply, partly because petrol is provided almost free to Venezuelans but also because power plants have switched to fuel oil because PDVSA is unable to supply them with gas. Around 270,000 b/d of oil goes to China, to repay loans to the government, and almost 400,000 b/d at a big discount to Cuba and other allies. Refinery and production snags have even forced the company to import crude and oil products.
PDVSA is also obliged by the government to divert billions of dollars into unaudited funds which the president manages at his discretion. The biggest, known as Fonden, absorbed $15.5 billion last year, forcing PDVSA to pay part of its taxes in the form of IOUs. The Central Bank’s foreign reserves have been depleted, too, to $30 billion (down from $42 billion in 2008). Most of that is in gold or other non-liquid assets; liquid reserves amount to only a couple of months’ worth of imports. Importers say it is taking six months to obtain foreign currency at the official rate.
Official propaganda proclaims that Mr Chávez’s socialist revolution has promoted sovereignty and “endogenous development”. But Venezuela is more dependent than ever on imports. Domestic production has fallen victim to an overvalued currency and government hostility to the private sector. A wave of expropriations and confiscations has left millions of hectares of farmland and a swathe of the food industry in government hands. The expansion of the money supply, along with redistributive policies, has raised demand for food and other basic goods, met largely by imports.
Officials blame private-sector “hoarders” and “speculators” for inflation and shortages. They have raided warehouses, seizing 8,520 tonnes of sugar, for example, from Pepsi-Cola, which the company says was imported with government permission. As with other staples, the state controls the price and import licences for sugar, and its distribution (which can only be carried out with government permits). It also owns most of the sugar industry. In the case of pre-cooked maize flour, the government owns half of production capacity, but only supplies a fifth of the market, according to figures from Datanálisis, a market-research company.
There will be an election, but Chavez’ thug vice president Nicolas Maduro insists he’ll be a 2.0 version of the dictator…
First there was the announcement that Venezuela will be expelling David Del Monaco, an Air Force attache for the U.S. Embassy, within 24 hours for allegedly trying to rope the Venezuelan military into a “conspiratorial plan” to destabilize the government. Back in 2008, Chávez gave the American ambassador 72 hours to leave the country after accusing the Bush administration of supporting a military plot to overthrow him.
Then there was Maduro’s promise to reveal “scientific proof” that Chávez’s foreign and domestic enemies had poisoned the Venezuelan leader (presumably with cancer). In 2011, Chávez leveled a similar charge — wondering aloud whether the United States was infecting Latin America’s leaders with cancer.
Maduro is a former bus driver with a high school education. It’s unlikely he’ll hold onto Chavez’ machine. If he tries to strong-arm his way to electoral victory the way Chavez did, the chances of avoiding unrest aren’t great.
Venezuela might be a free nation soon, with an opportunity to undo much of the damage Chavez did. And that makes this a good day. The tyrant is gone.
Exit question, for Michael Moore: if Cuba’s government-run health care system is so freakin’ good, how come Hugo Chavez – without whose oil and money Cuba’s economy would have completely collapsed years ago – is so freakin’ dead?