Saturday, November 17, 2007

Hacia la Economía Socialista Towards a Socialist Economy 

To dispel all the crazy contra(another name for the "opposition") bullshit about the suspension of "private property" to bring about "Castro-Communism", I leave you with this:
Article 115:
The right of property is guaranteed. Every person has the right to the use, enjoyment, usufruct and disposal of his or her goods. Property shall be subject to such contributions, restrictions and obligations as may be established by law in the service of the public or general interest.Only for reasons of public benefit or social interest by final judgment, with timely payment of fair compensation, the expropriation of any kind of property may be declared.

The late-capitalist bougi society, in which the majority of the worlds people find themselves under(literally), is in the process towards recession(the neo name of the crisis in capitalism). This decline negatively effects, much more, the majorities that produce the excess value on which, the upper crusts at the helm, live. And always, regardless of the recurring crisis or party, “private property” is the sacred cow that is the center of the economies of their capitalism.

What the owners of large sums of capital and of the means of production/information, "middle class serfs"(managerial class), and technocrats mean by private property is their right to accumulate and control this excess value without any consideration for the community that has produced it.
In other words the bougi state gives preponderance to these individual interests over community interests of all the people.

OW is correct when he say's
"to develop you have to pass through decades of producing a lot more than you consume and having high levels of investment. "
As is evident here with these proposed reforms the foundation of this wealth creation will have the collective interests of all the Venezuelan people at its forefront.

The only way to develop and call yourself democratic is with a free people, working with the means of production and information held in common. And Venezuela Bolivariana is walking on that path.

Proposed reform:
Article 115:
The many different forms of property are recognized and guaranteed.
Public property is that which belongs to state entities.
Social property is that which belongs to the people in their entirety and the future generations and may be of two types:

Indirect Social property, when exercised by the state in the name of the community.

direct social property, when the state assigns it, under distinct forms and within defined geographic territories, to one or various communities, to one or various communes, or to one or various cities thus considered as citizen property.

Collective property is that which belongs to social groups or people for their communal benefit, use, and enjoyment, being of a social or private origin.

Mixed property is formed between the public sector, the social sector, the collective sector, and the private sector in distinct combinations for the use of resources or execution of activities, and always with an absolute respect for the social and economic sovereignty of the nation;

private property is the kind that belongs to natural persons or juridical ones and is recognized as, over consumer and use goods, over means of production legitimately acquired with the attributes to use, enjoy, and dispose of within limitations and restrictions as established by law.

At the same time, all property shall be subject to such contributions, charges, restrictions and obligations as may be established by law in the service of the public or general interest. Only for reasons of public benefit or social interest by final judgment, with timely payment of fair
compensation, the expropriation of any kind of property may be declared and without prejudice to the power of the State, may occupy prior to or during the judicial process, the goods object of expropriation in conformance with the requirements established in the law.

Economic Rights

Article 112:
All persons may devote themselves freely to the economic activity of their choice, subject only to the limitations provided for in this Constitution and those established by law for reasons of
human development, security, health, environmental protection orother reasons in the social interest.

The State shall promote private
initiative, guaranteeing the creation and fair distribution of wealth, as well as the production of goods and services that meet the needs of the
populace, freedom of work, enterprise, commerce, industry, without prejudice to the power of the State to promulgate measures to plan, rationalize and regulate the economy and promote the overall development of the country
Proposed reform:
Article 112:
The State shall promote the development of a productive , intermediate, independent and diversified economic model founded on the humanistic values of cooperation and the preponderance of community interests over individual interests , that guarantees and satisfies the material and social needs of the people and for the greatest sum of political, social stability and happiness possible.

In the same way it will promote and develop distinct forms of enterprises and economic units of social property whether direct or comunal and indirect or state owned, as well as enterprises or economic units of social production and distribution, with these being of mixed property between the state, the private sector, and the comunal power, creating the best conditions for the collective and cooperative construction of a socialist economy.


Friday, November 16, 2007

Just what I thought 

Courtesy the Lubrio blog we have this neat contraption that allows you to watch alot of the advertisements in favor of the proposed constitutional reforms and you get to hear Chavez in his own words defending them (apologies in advance this is all in Spanish):

Haz click en cualquier video para verlo
Puedes ver más en www.radiomundial.com.ve

I haven't been able to watch most of it yet. But from what I've seen there is a) little focus on specifics - just vote for the reform because its the "revolutionary" thing to do b)Chavez playing his trump card of if you are against these reforms you are against me (which he is free to do but it certainly doesn't do much to elevate the level of discussion) and c) it seems to avoid most of the contraversial topics such as unlimited re-election, term leangth increase, and recall votes being made more difficult.

Interesting stuff but no substitute for a real discussion.


Ok, now I've had a chance to listen to more including Chavez's statements on the reduction of the work day to 6 hours. He says that PDVSA alone will have to hire 7,000 more workers to fully staff its operations with the reduced work day. The Venezuelan economy overall will see 150,000 new jobs created. Sounds about right.

BUT, even the host asks about how these people will be paid and won't it increase costs to business. Chavez then completely BS's this by going into some bogus arguement about the economy growing (which it is but that has nothing to do with this).

In point of fact, unless people take a cut in pay that corresponds with the reduction in the hours they work this will hurt the Venezuelan economy. Just one example. If PDVSA keeps paying all its current employees the same wages AND then has to hire 7,000 new employees on top of this they will see their costs increased by the salary and benefit cost of those 7,000 new employees. Given that its earnings will still be what they are (this doesn't change production or anything else) then PDVSA will have less money to pay to the government because now it has to spend more money paying salaries.

So this reform will be good if you are one of the lucky 7,000 people who gets a new job at PDVSA. However, for the remaining 27 million people they get hurt as the government will now have less oil revenue to spend on social programs, public works, and economic development projects.

In fact, that whole reform will work like that. A priviledged minority, mainly the couple million who work for the government, will benefit but most of the country will wind up worse off. Anyone with a reasonable understanding of economics should be able to see this quite easily, Chavez's tapping dancing around it notwhithstanding.

Now is it clear why the guy doesn't want to debate?


Thursday, November 15, 2007

CEPAL published their poverty reports for the region 

And not surprisingly they mirror the govt INE's (most likely they audited their reported numbers, evidenced by the yearly lag).

Indigencia = extreme poverty.



For all you insomniacs out there the Venezuelan Central Bank came out with its third quarter GDP statistics.

The third quarter grew 8.7% with respect to the third quarter of last year. The first quarter growth had been 8.6% and second quarter growth was 7.8% so this was the best quarter so far and brought the year to date average up to 8.4%. By Chinese standards this would be mediocre but by everyone elses standards it is quite good.

As usual, the non-oil sector led the way with growth of 9.7% while the petroleum sector shrank by 4.4%. That shrinkage in the petroleum sector roughly equals a drop of 132,000 barrels per day and would match the OPEC quota cuts that Venezuela had to abide by.

One difference in the numbers this time is that the the public sector outperformed the private sector 12.7% to 5.5%. The BCV attributes this to the nationalization of some big private companies like CANTV.

Now when we look at individual sectors we do see something interesting.

The fastest growth was in communications at 24.3% followed by commerce at 18.4% and then transportation at 15.5%. The lagging sectors were manufacturing at 7.7% and construction at 4%. Note that both manufacturing and contruction were both slower than growth in the economy as a whole. Clearly the increasing overvaluation of the Venezuelan economy is stunting manufacturing growth and keeping it below what it should be.

Interstingly the bank noted that agricultural production as been increasing at an average of 15% since 2005. So what shortages there are clearly result from increased demand not falling output.

In more general numbers imports were up 30.9% (is this good or bad?), consumption by consumers is up 20.4% (I guess this makes for happy voters), and fixed capital investment is up 17.3% which the government attributes to increased imports of machinery. However, for some time now we have seen investment go way up while production seems to be increasing but at a much slower rate.

Summing up, the numbers are good and any country would be happy with them. But it does appear that opportunities are being lost with imports crowding out domestic industry. For Venezuela to really thrive that needs to be reversed soon.


Wednesday, November 14, 2007

Intellectual cowardice 

To facilitate the discussion of the proposed constitutional reforms a debate was being organized by the Venezuelan National Electoral Council (the C.N.E.. The debate would have been between representatives of those favoring the reform (the "SI" side) and those opposing it (the "NO" side). The country might have been treated to the author of many of the proposed reforms, Hugo Chavez, debating their virtues with some of their main detractors.

Unfotunately, it turns out these debates will not happen. The official reason is that the C.N.E. is too busy with other things. But the widely acknowledged reason is the "SI" side, the side proposing all these changes in the first place, didn't want to partake in the debates. In fact their spokespeople said they were already carrying out debates in the "barrios". Apparently they don't see the need to explain themselves and defend their ideas before the entire country.

To be blunt, this is intellectual cowardice in the extreme. To see that lets think about this for a minute. Hugo Chavez should be intimately familiar with these proposals - in fact he should know them like the back of his hand. He presumabely spent weeks or months studying every word of them before they were even made public. He probably spent hours and hours discussing with his advisors the exact syntax and diction of each clause so as to convey the precise meaning desired. I am sure the pros and cons of each revision were given days of thought and consideration.

Given that Chavez should be able to run circles around anyone in a debate on their merrits. All the counter arguements would already have been thought through. So Chavez should be able to debate Petkoff, Rosales, Borges and any of the other opposition light weights and demolish their arguements easily.

Yet he has chosen not to. It would appear that in spite of everything said above he lacks confidence in his proposals and can't defend them in public. How lame is that!!!

This is not the first time we have seen this in Venezuela. Think back to last May when the protesting opposition students were given the opportunity to explain themselves to the entire country on TV and instead walked out.

Truthfully, that was not unexpected. The opposition itself as seldom put forth any ideas, even during its presidential campaigns, so why would we exect their students to stick around and debate.

Moreover, even opposition politcal parties are incapable of putting together a political program which they will put in the public domain and defend.

So when the opposition students exhibited their intellectual cowardice by walking their wasn't much of a feeling of dissappointement - it was expected. Further, a couple of decades from now when they look back on it in shame they can simply say it was a mistake of youth.

But that Hugo Chavez, nor any of his supporters, can go on TV to discuss and debate these very important constitutional reforms that will effect Venezuelans for decades to come is stunning. It is cowardice pure and simple.

This sort of intellectual cowardice from defenders of the old status quo is to be expected. But from people who claim to be revolutionaries it is pitifull.


Monday, November 12, 2007

If they would stop throwing rocks long enough to campaign... 

Just when I was bitching about the lack of polling data on the constitutional reform I managed to dig some up. Keller and Associates, a hard line opposition polling firm, did an extensive study last month that can be found here.

I wouldn't say Keller is the most reliable firm - both they the other hard line polling firm Hinterlaces have always struck me as bending over backwards to give the most favorable scenario for the opposition. But even if they do looking at their numbers can be interesting, keeping in mind that they are probably the most favorable numbers for the opposition that exist. [Apologies in advance for the poor quality of the slides - if you want to see better copies go to the actual presentation]

This slide shows how support for Chavez, the opposition, and neither have trended over the past year. Chavez of course has been consistently ahead. However, according to this his support slid some in this past quarter.

What happened in the past quarter that would make his support slide I don't know. The controversial RCTV shutdown happened in the second quarter for example.

What is also interesting to note is that the slight decline support for Chavez hasn't translated into higher support for the opposition. Instead, the group that increased were the "nuetrals" who support niether the opposition nor Chavez.

In other words maybe Chavez's hubris has turned some people off lately. Yet they look at the rock throwing opposition and blanch. So they choose niether. Makes sense.

This slide shows Chavez's support in relation to the support of the opposition over the last 5 years. Predictably Chavez is red, the opposition blue.

And as we know although Chavez may have been unpopular (barely) in 2002 the opposition self destructed with its coup attempts and oil strikes allowing Chavez to once again assume the lead, which he has never relinquished.

Interestingly the opposition has managed to recover its support somewhat over the past couple of years. I suspect that results from people's memories of the coup and oil strike fading. Also, the maturity the opposition showed in finally accepting an electoral defeat probably boosted their stature in some peoples eyes.

Finally, we get to what people think about the proposed reforms. On the left we see how people would vote if the vote were today with 41% saying they would vote for it to 35% saying they would vote against it. That is only a 6% margin - not all that much, especially for a constitutional reform which at least in theory you would like to see more of a mandate for. Further, a full 20% are still undecided meaning even without changing the minds of any of the people currently in favor of it the NO option can still win.

On the right, you see sample of what most of the rest of the poll is like - asking people hopelessly loaded and leading questions. The one in this case asks "If it was shown that this reform was only to keep Chavez in power, eliminate private property, eliminate states and munincipal governments, and hand the education of childrend over to the government would you vote yes or no".

Jeez, I wonder if Gallup will go around asking people in the U.S. "Who will you vote for Hillary Clinton, who will provide health care for all, or Rudy Guiliani, who will likely start a war with the entire muslim world". If such questions are of interest to you again feel free to check out the whole presentation.

Summing up, it is clear Chavez is still popular, significantly more popular than his opponents. It appears that that popularity will allow these reforms to pass.

However it is also clear that victory is still up for grabs and that for the first time in years the opposition has a fighting chance to win an actual vote. Of course, they would have to run an organized, well thought out, principled, and inclusive campiagn - not something they've been noted for in the past. Still there is hope for them and hope for all of us who think these proposals should be defeated.

Still, there is little margin for error on the part of the "NO" campaign. And doing stupid things like throwing rocks at people and setting buildings on fire isn't going to get it done.

So to our opposition friends, put down the rocks, leave the hatred aside, and speak to people. You can win but you have to do three things - persuade, persuade and persuade.

Do you have it in you to talk and persuade, or only to throw rocks and hate? What happens on December 2nd will likely turn on the answer to that question.


I hope they know what they are getting themselves into 

Very curiously there has been little polling data on the upcoming constitutional reform vote released to the public. In fact I don't think I've seen a single poll result given in a news report in Ultimas Noticias, the largest daily in Venezuela.

This is highly unusual as normally polls are coming out all over the place with at least 10 different polling firms giving numbers. Yet very strangely we see next to nothing. I find this very strange and it makes me think something is up. Maybe neither side likes the poll numbers it is seeing? Maybe the polling data is very contradictory? Or maybe the race is very close?

I don't know the answers to any of those questions but the further along we go like this the fishier it gets.

In any event some polls have been published in the form of advertisements. Here is a pro-Chavez one pointing out that that almost 60% of those polled approve of the extension of the presidential term to 7 years:

I.V.A.D. is a pretty reliable polling firm so it is likely this number is accurate. To which all I can say is I hope that 60% of the population knows what it is getting itself into.

If it doesn't, it should ask any gringo, whose country has had to put up with a highly unpopular and ineffectual president ever since Katrina did in New Orleans. Damn three years can go by awefully slowly when you have a lousy president! Now imagine what 7 years would seem like!!

Yeah, yeah, they have a recall provision in the constitution. But remember, they are also making it much harder to invoke that so it really is quite possible you could spend 5 or 6 years with some slug as president. I wonder if the polling firm reminded people of that OTHER change when asking them about this?

Lets hope Venezuelans don't come to regret this provision. But sooner or later I suspect they will.


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