Saturday, July 17, 2004

Some candor from Bloomberg 

Leave it to Bloomberg news service to write one of the best and most informative articles on the referendum process under way in Venezuela.  In fact it is so good it deserves to be reproduced here:
July 16 (Bloomberg) -- Venezuela's opposition opened a monthlong campaign period leading up to an Aug. 15 referendum to recall President Hugo Chavez, blaming him in television and radio ads for unemployment, crime and political polarization.
With media advertising restricted by the National Electoral Council, the opposition is counting on about 400,000 volunteers to contact at least half the nation's 12 million registered voters during the 30-day campaign, as they seek to stem Chavez's growing support, opposition leaders said.
``The problem for the opposition is that most of their strengths are negative rather than positive,'' said Dr. Julia Buxton, a professor of political science at the U.K.'s Kingston University. ``They need to channel negative feelings about Chavez into positive support for the opposition.''
Opposition leaders such as Jesus Torrealba of the Democratic Coordinator say the referendum is a chance to stop Venezuela from sliding into dictatorship and to boost private investment in an economy 5 percent smaller than when Chavez took office in 1999. Chavez, who makes his views known in a 4-hour radio and television show most weekends, says ``oligarchs'' and ``squalid people'' seek a return to power to take away benefits the poor have won from his ``revolutionary'' government.
``We're frank when we talk to people,'' Torrealba said. ``Things were done very poorly in this country in the past, but in the last five years these bad things have been made even worse.''
Chavez's popularity has surged in recent opinion polls after government spending on health, education and public works more than doubled to 13.5 trillion bolivars ($7.04 billion) in the first four months of this year from the same period in 2003.
Venezuela's benchmark 9 1/4 percent bond maturing in 2027 rose 1.50 cents on the dollar to a two-month high of 89.60 cents on the dollar, lowering the yield to 10.44 percent, according to J.P. Morgan at 5:00 p.m. New York time. The bond's price has risen 13.35 cents since May 10.
Programs the government calls `Missions'' have given Chavez strong boost, said Robert Bottome, an analyst with research company Veneconomy in Caracas. There are Missions offering literacy courses while one placed about 10,000 Cuban doctors in poor neighborhoods for free medical care. `Mission Identity' gave citizenship in the last three months to about 216,000 foreign nationals living in Venezuela.
``Chavez is touching all the right buttons with his slogans and message, and the missions have a lot to do with it,'' Bottome said.
The Missions are so popular that after Chavez said they'd be scrapped if the recall succeeded, the opposition promised to keep them running.
``The positive aspects of the missions must continue, perhaps with a few changes,'' radio talk show host and Democratic Coordinator leader Elias Santana said in an interview. ``For example, putting doctors in the communities was a positive idea but maybe they should be Venezuelan and not Cuban.''
Campaign Ads
Chavez says the opposition represents the upper and middle classes affiliated with the parties that ruled Venezuela since democracy was reinstated in 1958 until 1999.
``They will never come back,'' Chavez said in a televised speech yesterday in Caracas, dressed in a red shirt bearing the phrase `A battle for hope.'
As of today, the electoral council will allow each side to air six 30-second advertisements per television station per day, and ten 30-second radio spots per station per day, along with a daily page or half-page ad in each of the country's newspapers. The council will fund the entire media campaign,
Recent polls show Chavez, 49, gaining support as the economy pulls out of recession.
Rising Popularity
In a poll released last week, 54.5 percent of registered voters favored recalling Chavez compared with 65.8 percent in favor in March. The poll, by Consultores 21 and funded by seven private companies, had margin of error of 2.5 percentage points.
A separate poll last month by Washington-based Greenberg Quinlan Rosner Research Inc., paid for by RCTV television station, also showed Chavez gaining.
Recalling Chavez requires at least 3.76 million votes and a majority of votes cast. The electoral council said last month opposition groups collected more than the 2.4 million signatures required to trigger the referendum.
The economy's performance under Chavez may dominate the vote if the opposition can pin him with the blame for it, said Vilati Meschoulam, an analyst with HSBC Securities in New York.
The economy shrank 8.9 percent in 2002 and 9.4 percent last year before rebounding 30 percent in the first quarter. Unemployment fell to 15.6 percent in March from a record high of 21 percent in February 2003.
Chavez has also been unable to reduce one of the highest crime rates in Latin America. Murders in Caracas, a capital with about four million residents, jumped 10 percent last year to 2,265, police said. Caracas had the third-highest murder rate of any city in the Americas between 1999 and 2003, according to the Inter-American Development Bank.
Opposition leaders, some of whom call Chavez a communist, will argue during the campaign that they seek to unite the country after five years of such bitter political fighting, Torrealba said.
'Not Negotiable'
``Chavez has tried to divide the country into patriots and oligarchs, revolutionaries and traitors while we want national reconciliation among all Venezuelans,'' Torrealba said in an interview.''
``There will be no reconciliation with the enemy,'' Vice President Jose Vicente Rangel said in a speech earlier this month. ``The revolution is not negotiable.''


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