Oil Wars

A few weeks ago I posted some sub-titled speeches by the students before the Venezuelan National Assembly. People seemed to enjoy those speeches so I thought I’d do some more sub-titling.

I wanted to do Chavez’s excellent inaugural speech from earlier this year. Unfortunately I couldn’t find a YouTube video of it. But I did find the text and so what follows is the inaugural speech of President Hugo Chavez in January 2007 [I have also bolded what I think are key passages from Chavez’s excellent speech]:

When six years ago we met to inaugurate a President, the Republic, single-minded in anxiety, stood in spirit here. We dedicated ourselves to the fulfillment of a vision--to speed the time when there would be for all the people that security and peace essential to the pursuit of happiness. We pledged ourselves to drive from the temple of our ancient faith those who had profaned it; to end by action, tireless and unafraid, the stagnation and despair of that day. We did those first things first.

Our covenant with ourselves did not stop there. Instinctively we recognized a deeper need--the need to find through government the instrument of our united purpose to solve for the individual the ever-rising problems of a complex civilization. Repeated attempts at their solution without the aid of government had left us baffled and bewildered. For, without that aid, we had been unable to create those moral controls over the services of science which are necessary to make science a useful servant instead of a ruthless master of mankind. To do this we knew that we must find practical controls over blind economic forces and blindly selfish men.

We sensed the truth that democratic government has innate capacity to protect its people against disasters once considered inevitable, to solve problems once considered unsolvable. We would not admit that we could not find a way to master economic epidemics just as, after centuries of fatalistic suffering, we had found a way to master epidemics of disease. We refused to leave the problems of our common welfare to be solved by the winds of chance and the hurricanes of disaster.

Nearly all of us recognize that as intricacies of human relationships increase, so power to govern them also must increase--power to stop evil; power to do good. The essential democracy of our Nation and the safety of our people depend not upon the absence of power, but upon lodging it with those whom the people can change or continue at stated intervals through an honest and free system of elections. The Constitution of 1999 did not make our democracy impotent.

In fact, in these last eight years, we have made the exercise of all power more democratic; for we have begun to bring private autocratic powers into their proper subordination to the public's government. The legend that they were invincible--above and beyond the processes of a democracy--has been shattered. They have been challenged and beaten.

Our progress out of the Fourth Republic is obvious. But that is not all that you and I mean by the new order of things. Our pledge was not merely to do a patchwork job with secondhand materials. By using the new materials of social justice we have undertaken to erect on the old foundations a more enduring structure for the better use of future generations.

In that purpose we have been helped by achievements of mind and spirit. Old truths have been relearned; untruths have been unlearned. We have always known that heedless self-interest was bad morals; we know now that it is bad economics. Out of the collapse of a prosperity whose builders boasted their practicality has come the conviction that in the long run economic morality pays. We are beginning to wipe out the line that divides the practical from the ideal; and in so doing we are fashioning an instrument of unimagined power for the establishment of a morally better world.

This new understanding undermines the old admiration of worldly success as such. We are beginning to abandon our tolerance of the abuse of power by those who betray for profit the elementary decencies of life.

In this process evil things formerly accepted will not be so easily condoned. Hard-headedness will not so easily excuse hardheartedness. We are moving toward an era of good feeling. But we realize that there can be no era of good feeling save among men of good will.

For these reasons I am justified in believing that the greatest change we have witnessed has been the change in the moral climate of Venezuela.

Among men of good will, science and democracy together offer an ever-richer life and ever-larger satisfaction to the individual. With this change in our moral climate and our rediscovered ability to improve our economic order, we have set our feet upon the road of enduring progress.

Shall we pause now and turn our back upon the road that lies ahead? Shall we call this the promised land? Or, shall we continue on our way? For "each age is a dream that is dying, or one that is coming to birth."

Many voices are heard as we face a great decision. Comfort says, "Tarry a while." Opportunism says, "This is a good spot." Timidity asks, "How difficult is the road ahead?"

True, we have come far from the days of stagnation and despair. Vitality has been preserved. Courage and confidence have been restored. Mental and moral horizons have been extended.

But our present gains were won under the pressure of more than ordinary circumstances. Advance became imperative under the goad of fear and suffering. The times were on the side of progress.

To hold to progress today, however, is more difficult. Dulled conscience, irresponsibility, and ruthless self-interest already reappear. Such symptoms of prosperity may become portents of disaster! Prosperity already tests the persistence of our progressive purpose.

Let us ask again: Have we reached the goal of our vision from January 1999? Have we found our happy valley?

I see a great nation, upon a great continent, blessed with a great wealth of natural resources. Its twenty seven million people are at peace among themselves; they are making their country a good neighbor among the nations. I see a Venezuela which can demonstrate that, under democratic methods of government, national wealth can be translated into a spreading volume of human comforts hitherto unknown, and the lowest standard of living can be raised far above the level of mere subsistence.

But here is the challenge to our democracy: In this nation I see millions of its citizens--a substantial part of its whole population--who at this very moment are denied the greater part of what the very lowest standards of today call the necessities of life.

I see millions of families trying to live on incomes so meager that the pall of family disaster hangs over them day by day.

I see millions whose daily lives in city and on farm continue under conditions labeled indecent by a so-called polite society half a century ago.

I see millions denied education, recreation, and the opportunity to better their lot and the lot of their children.

I see millions lacking the means to buy the products of farm and factory and by their poverty denying work and productiveness to many other millions.

I see one-third of a nation ill-housed, ill-clad, ill-nourished.

It is not in despair that I paint you that picture. I paint it for you in hope--because the Nation, seeing and understanding the injustice in it, proposes to paint it out. We are determined to make every Venezuelan citizen the subject of his country's interest and concern; and we will never regard any faithful law-abiding group within our borders as superfluous. The test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little.

If I know aught of the spirit and purpose of our Nation, we will not listen to Comfort, Opportunism, and Timidity. We will carry on.

And absolutely great speech is it not? I certainly think so. There is only one thing, a confession I must make. Hugo Chavez never gave this speech. In fact it wasn’t even given this year, much less in Venezuela.

In reality it was given by this newly inaugurated President of the good old USA in 1937:



Here is a link to the full speech and you will note it is what I have just reprinted save a couple changes in names and dates.

Regardless, it sure does sound like a Chavez speech, doesn’t it. Just listen to it:

“we have begun to bring private autocratic powers into their proper subordination to the public's government. The legend that they were invincible--above and beyond the processes of a democracy--has been shattered. They have been challenged and beaten.”

Or this:

“We have always known that heedless self-interest was bad morals; we know now that it is bad economics.”

Or this:

“This new understanding undermines the old admiration of worldly success as such. We are beginning to abandon our tolerance of the abuse of power by those who betray for profit the elementary decencies of life.”

Or this:

I see a United States which can demonstrate that, under democratic methods of government, national wealth can be translated into a spreading volume of human comforts hitherto unknown, and the lowest standard of living can be raised far above the level of mere subsistence.

Or this:

The test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little.

Of course, these are the types of things President Chavez says day in and day out. And for it he is pilloried at home and abroad by those who most definitely don’t want to see “private autocratic powers into their proper subordination to the public's government”.

So to was President Roosevelt. But we should remember that for uttering these words, and more importantly, acting upon them, he was elected President of the United States four consecutive times, no matter that those who "had much" despised him (there sure is something to be said for indefinite re-elections isn’t there).

But why did I take the time to re-print this speech and relate it to President Chavez? For me there is a very important reason but to explain it I have to make a confession.

Half the time that I write this blog I find it very depressing. How can I find it very depressing when so many good things are happening in Venezuela and the country is moving forward? Simple. While Venezuela is moving forward the country I live in is moving backwards. And while Venezuela is a beacon of human progress the U.S. has managed to make it self the torch barer of reaction.

But seeing that makes it all the more important that we not forget history and not forget that not all that long ago the U.S. too was capable of making itself a beacon of progress. No capitalism wasn’t replaced, racism and poverty weren’t eliminated and the U.S. did not become heaven on earth. But it did make very real progress via democratic means of building, if not a just society, at least a MORE just society.

In fact, whatever the U.S. working class has today in the way of benefits and social programs, it is largely owed to that time and its immediate aftermath.

For the last three or four decades we have seen much of what was then accomplished reversed. But the very fact of what was accomplished in the first place shows us that Americans are not innately right wing or anti-progressive. Under different conditions and different leadership they can also work hard to make their own society more like the one we would all like to live in.

So for those of us living in the more northerly part of the America’s lets not lose heart as we look upon what is happening in Venezuela. No, we will never have our own Hugo Chavez – every society is different and change manifests itself in different ways. But some day, in our own way, we too “will bring private autocratic powers into their proper subordination to the public's government” and build a better society.
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Yesterday President Chavez famously asserted that foreigners who said that Venezuela was a dictatorship or otherwise spoke ill of the government would be expelled from the country. Certainly it is frustrating to see the non-sense that emanates daily from foreign correspondents based in Venezuela. But personally, I think Chavez is being a bit harsh in this case. What may seem to be slanderous accusations meant to smear the government may instead simply be the reporter not understanding the subject at hand, or even benignly, not knowing how to do simple calculations.

Take this article in today’s New York Times by Simon Romero. While talking in part about a corruption scandal that has erupted involving the purchase of some drilling rigs it also makes claims about Venezuelan oil production being lower than official figures indicate:

Venezuela, with some of the largest oil reserves outside the Middle East, officially claims to produce almost 3.1 million barrels of oil a day, but institutions like the International Energy Agency in Paris put output at 2.37 million barrels a day, down about 230,000 from a year ago.

Other energy analysts say output problems are potentially even more broadly troubling. The country’s oil exports fell 15 percent while overall production dropped 7 percent in the first quarter of this year, said Ramón Espinasa, a chief economist at Petróleos de Venezuela in the pre-Chávez era and now a respected consultant, citing both the difficulties with hiring rigs and a surge in domestic fuel consumption driven by subsidized prices.

Combined with lower global oil prices during part of this year, Venezuela’s income from oil exports may decline by about 24 percent in 2007, to $45.6 billion compared with $60.4 billion last year, by Mr. Espinasa’s estimate.

Wow, Venezuela producing 2.37 million barrels and declining. Sounds bad! Makes me want to see what else was said. Unfortunately I am not a New York Times reporter so I didn’t get invited to the presentation. Nevertheless some of the slides from the “respected consultant” Espinasa have made it into the public domain.

This one looks nasty:



Total, production is only 2.37 million barrels per day and declining. Almost as bad, domestic consumption, shown by the blue line, is steadily increasing. With production declining and domestic consumption increasing exports have to be taking a hit and indeed they are according to this slide:



Right now Venezuelan oil exports are down to 1.6 million barrels per day from 1.75 million last year.

Now this is where things get interesting. You see, one of the things reporters are supposed to do is ask questions, especially when information appears suspect. So had Mr. Romero been on top of his game he would have raised his hand and said something like this:

Mr. Espinoso your chart shows that oil exports last year were 1.75 million barrels per day. You also said that last year revenues from Venezuelan oil exports were $60. 4 billion dollars.

Yet when I multiply 1.75 million barrels per day by 365 days by $56 per barrel, last years average oil price, I come up with $36 billion dollars, not the $60.4 billion you give. Where is the extra $24 billion dollars that Venezuela actually got coming from if it is exporting as little as you claim?

Could the explanation for where all that money is coming from be that the country is actually producing as much oil as it says it is?

Boy wouldn’t it have been nice to have been a fly on the wall when that question got asked? One of the most obvious things to do when someone tells you how much oil is being exported and how much export revenue is being generated would be to see if those numbers are consistent. And in this case they are so wildly inconsistent as to make it clear that the “respected consultant” giving this presentation either has no idea what he is doing, or, more likely, is trying to mislead.

Why did this very simple question go unasked by our intrepid New York Times reporter? I really don’t know. Maybe he was distracted for a moment by a very good looking RCTV correspondent (gosh aren’t we glad they are back). Maybe he forgot to bring his pocket calculator with him. Or maybe he just doesn’t have a clue about such things so that no matter how obvious the question might seem to us it never occurred to him.

Regardless, the point is that Chavez shouldn’t jump to conclusions, assume this guy is out to slander Venezuela and have him flown out of the country. After all, maybe this misunderstanding could be completely resolved by just buying the guy one of those cheap little solar powered calculators.

And just to show my willingness to help, if Mr. Romero reads this "respected blog" tomorrow I might tell him what the deal is with the drilling rigs.
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