Saturday, May 21, 2005

Arabic, anyone? 

Just noticed this on a Yahoo website. All I have to say is this is what happens when you pick a fight with a good chunk of the world.


O'Grady does Venezuela 

Mary Anastasia O’Grady is the Wall Street Journalist Op-Ed writer on Latin America. For much of the past several years this has consisted of haranguing against Venezuela and President Chavez. I feel for Ms. O’Grady.

She has a very difficult job. For example, she had to show that the coup against Chavez on April 11, 2002 wasn’t really a coup. Then she had to pretend the 02/03 “strike” was a smashing success even as it fizzled. Later she had to insist that the opposition would win a recall referendum against President Chavez even when almost all the polls showed they would lose, badly. And when that illusion was smashed by the actual vote she to insist that, all evidence to the contrary, the vote wasn’t real.

All I can say is I hope she is well paid – it’s not easy doing what she has to do. In any event, Ms. O’Grady was out there today trying to earn another paycheck. Lets have a look at how she fared:

Oil Wells Refuse to Obey Chávez Commands

By Mary Anastasia O'Grady | The Wall Street Journal

May 20, 2005 | "We have a little problem," Venezuelan President Hugo Chávez reportedly told Venezuelans on May 3, "and we are fixing it." The "problem" is the drop in output by the Venezuelan state-owned oil company known as PdVSA. The Chávez fixes, thus far, have entailed sending military troops to the oil-rich west of Venezuela to investigate "management errors" and allegations of sabotage, while in Caracas the government is threatening foreign oil companies with contract cancellations and tax hikes.

For most chavistas this may suggest that the whole stink about Venezuela's oil industry's underperformance is about to be resolved. Yet it is likely that the magnitude of the drop in petroleum output is a lot bigger than what Chávez has described. It is equally probable that a military invasion of PdVSA and property confiscations in the private sector won't fix it. Statist economic policies have a sorry productivity record and in this case that record is highly unlikely to be improved.

So here we go with the stories of Venezuela’s oil industries demise again. As was pointed out previously these reports have tended to be greatly exaggerated and, well, completely wrong. But more on this later.

The big trouble is that Chávez has put Venezuela on a centrally planned economic path not much different from the failed experiments of the 20th century. Indeed, last year he declared that Venezuela was preparing for "the great leap," a seeming reference to Maoist China's 1950s agricultural policies that spread famine. Maybe his books about Chairman Mao never mentioned that disaster.

Venezuela – a centrally planned economy?!?!? Maybe I missed something but the great majority of the Venezuelan economy is private – the banks, telecommunication companies, transportation, manufacturing, and on and on. Most everything is private. Heck you can’t walk more than a few blocks in any Venezuelan city without bumping into a McDonalds, Pizza Hut, Subway, Wendy’s … you get the idea. Mao’s China Venezuela is not.

Closer to home, Chávez emulates Fidel Castro, who once commanded that a 10-million-ton sugar harvest spring from the soil. Fidel also promised to clone a prolific wonder-cow called "Ubre Blanca," so that Cuba would promptly rival Switzerland in cheese yields. Almost 50 years into the revolution, Cuba still isn't Switzerland and milk is a luxury. Venezuela is on the same trajectory.

Ah, the old fall back. You can’t paint Chavez as Communist dictator like you want ‘cause he keeps winning democratic elections and presides over a decidedly capitalistic economy. So what to do? Easy. Tell the world that he is friends with Castro and poof, Venezuela must be a second Cuba and anything Castro may be guilty of Chavez must be guilty of too.

Ok that doesn’t make any sense. But give her some credit – at least she’s trying.

Chávez has at least one thing right: Tight control of the country's political agenda requires tight control of the country's economy. In Venezuela, that means controlling PdVSA.

PdVSA was born in 1976. Until the Chávez government came to power in 1999, the company made some effort to be politically nonpartisan. Getting a job at PdVSA required business, engineering or technical know-how, not political connections.

Ok, Ms. O’Grady is right, there are some parts of the Venezuelan economy controlled by the Government – and PDSVA is one of them. So there you go – Chavez must be a Commy!!! Well, not really. See, PDVSA was formed when the Venezuelan government in 1976 nationalized the Exxon and Shell operations in Venezuela (without compensation I might add). This was all done under the government of Carlos Andres Perez, a die-hard capitalist and sworn enemy of Chavez. He also set up the state run industries in Venezuelan Guyana. Funny how O’Grady is good friends with the president who actually put a lot of the Venezuelan economy under state control but views the current president, who hasn’t nationalized a single company, as a dyed in the wool communist.

Was PDVSA well run and non-political? It certainly wasn’t well run. It didn’t figure out how to make unleaded gasoline until 20 years after the rest of the world and in the mid-90s Venezuelan gasoline was actually banned from the U.S. by the Environmental Protection Agency.

Non-political? I guess. Mainly because the people running it weren’t interested in politics; they were interested in money. They just wanted the politicians to stay out of their way so that they could be free to run PDVSA in a way that would make the most money for them. This is an interesting topic that will be the subject of future posts.

That has changed. Not content with just the golden eggs, Chávez wanted the goose. As he began to consolidate his power, he began politicizing both the management and labor arms of the company. That prompted a 66-day strike by employees on Dec. 2, 2002, which brought production levels as low as 150,000 barrels per day (b/d). When the strike ended on Feb. 4, 2003, 18,000 workers were let go, taking the skills and knowledge necessary to run the company with them.

Gee weren’t we just talking about this the other day . The managers of PDVSA got a little upset because Chavez, unlike previous governments, insisted on obeying OPEC quotas and maximizing the amount of money PDVSA generated for Venezuela. The managers of PDVSA didn’t like this and went on a strike to overthrow the government. Chavez did what he had to do, he fired them. Unfortunately though, not before the country lost billions of dollars.

PdVSA has never fully recovered.
Today Chávez claims that production is down by a mere 200,000 b/d for a daily output of 3.1 million barrels. Industry experts dispute this and this month critics grew more vocal.

Ok, this is where she starts getting a little imaginative. Yes, getting straight answers out of oil exporting countries on how much they are producing is difficult. But PDVSA never fully recovered? Well the folks at the U.S. Department of Energy don’t seem to agree. Lets have a look at a graph of Venezuelan oil production published by the U.S. government here:

Now if O’Grady wants to be a nitpicker production IS down a little, maybe a two or three hundred thousand barrels per day. But that isn’t what jumps out at me from the graph. What strikes me is how rapidly and nearly completely production recovered. Considering a good part of your work force walks off the job, damages equipment and computer systems, and throws the country into turmoil getting production back up and running so quickly and completely is nothing short of miraculous.

On May 4, Alberto Ramos, an analyst for Goldman Sachs' Emerging Markets Economic Research, noted that since the strike local and international oil analysts have consistently put PdVSA production some 500,000 to 600,000 b/d below government claims. "Such level of production is also corroborated by production statistics published by OPEC and other international energy agencies."

Venezuela's El Nacional (a daily newspaper) Web site issued a similar report on May 15 -- according to a translation by BBC Monitoring Americas: "An extensive survey of oil industry engineers, geologists, geophysicists and experts indicates that corrective measures have not been taken and the decline in Venezuelan oil production is nearing 1,000,000 b/d. This drop, coupled with a shortfall of associated natural gas, creates an alarming situation with the foreseeable consequence of diminishing crude oil extraction."

In his report, Mr. Ramos also noted that "several oil analysts" attribute the company's inability to return to pre-strike levels of production to "corruption, mismanagement, inadequate investment levels, sloppy maintenance, and lack of qualified technical personnel."

She is a really a dog with a bone on this, but nevertheless completely wrong. Lets look at some statistics, again from the U.S. government . Here are average daily production statistics in thousands for the period before the strike:

Month Production
January 02 2,630
February 02 2,600
March 02 2,620
April 02 2,530
May 02 2,730
June 02 2,735
July 02 2,735
August 02 2,765
September 02 2,955
October 02 2,980
November 02 2,972

And here are average daily production statistics in thousands for the last 6 months:

Month Production
September 04 2,540
October 04 2,640
November 04 2,540
December 04 2,640
January 05 2,640
February 05 2,640

And what do we see here? That prior to the strike Venezuela was producting about 2.6 to 2.7 million barrels daily and now it is producing 2.64 million barrels daily. In other words there is virtually no decline at all in Venezuelan oil production!! So in referring to a “million barrel” decline in production Ms. O’Grady is resorting to outright lies. So desperate is she that distortions and twisting the truth is no longer enough – only straight out lies will suffice.

The lack of maintenance, management and qualified personnel can be traced to the strike and the layoffs. It is also possible that disgruntled employees are not toiling as they did when they felt they were measured by their work, not their politics. Yet human capital is but one factor of production. Investment is also scarce and likely to grow scarcer as Chávez puts the squeeze on foreign oil companies.

Since being named president of PdVSA, Chávez ally Rafael Ramirez has been working to expand the company's control of the entire industry. On May 6, the research firm Oxford Analytica reported the government is arm-twisting to force the conversion of 32 foreign company contracts into joint ventures that will give the government 51% ownership. The newsletter also said that the government wants -- as prescribed by Chávez -- to raise income taxes on foreign oil companies to 50% from 34%. On Tuesday, Reuters reported that Venezuelan tax authorities "held a second round of talks with seven foreign oil companies, including units of Chevron and Shell" on the matter. The government has also said it will no longer pay foreign oil firms in dollars.

I know Ms. O’Grady loves sweetheart deals but those days are over. With oil commanding high prices if the foreign companies want Venezuelan oil they are going to have to pay for it. President Chavez runs a serious government that knows how to defend its country’s interests whether people like Ms. O’Grady like it or not. And as for the foreign oil companies, they’ll keep investing in Venezuela. After all, it’s where the oil is.

Added to the drain on human and financial capital, are serious internal problems that this power grab is producing at PdVSA. Oxford Analytica writes that Mr. Ramirez fired 30 "Chavista managers" on corruption grounds soon after he took over his post -- although he did not present proof.

Oxford Analytica said that the move was "interpreted inside the Chavista movement as Ramirez settling old scores with high-ranking executives of the previous PDVSA administration." This has provoked an increase in job insecurity among chavistas who thought their politics gave them security. Analytica says that, "crossed accusations of corruption based on leaked internal documents have increased among different Chavista factions."

Mr. Ramos notes that "aggressive" policies toward the private sector and weak investment in PdVSA "raise serious risks of a further gradual decline in oil production," making Venezuela all the more vulnerable to a drop in world oil prices. It's quite possible that Chávez will have no more luck commanding oil out of the ground than Fidel had getting cows to give more milk. The "great leap" is looking more and more like a great flop.

Seeing as she ran out of even lies to make up she delves into some idle and unsubstantiated gossip. As far as “further” declines in oil production go, I’m not going to lose any sleep over it considering that the declines up to this point she keeps going on about apparently never happened. And I seriously doubt there will be any declines going forward unless Chavez does something completely stupid like hiring the “Oily People” back.

I have never heard Chavez say anything about a “great leap”. But the economy did grow more than 17% last year and is poised for double digit growth again this year. So maybe he just said “the economy is growing by leaps and bounds” and she misunderstood him.


Thursday, May 19, 2005

Oily People are workers too - NOT 

In my post of a couple of days ago you may have noticed that on the Power Point slides in addition to their being a logo for "Gente de Petroleo" (aka, Oily People) there is another logo for Unapetrol.

Unapetrol was a union for white collar workers at the state oil company PDVSA. However, Unapetrol isn't your average everyday union. It was made up of and run largely for upper level management and executives of PDVSA. They formed a union not because of poor pay or working conditions (a number of them made hundreds of thousands of dollars yearly)but because they wanted to be free to run PDVSA as their own little company without having to worry about the owners, the people of Venezuela and the Venezuelan government, firing them. In fact, they didn't even attempt to form this union until the time of their failed coup against Chavez of April 11, 2002.

Unapetrol, along with the Oily People (they are really the same executives which is why the Power Point presentation has both logos)then led a strike in December 2002 that largely shut down oil production for over a month and cost Venezuela billion of dollars. This damage sent the economy into a free fall with over a 20% decline in GDP.

During this "strike", which had political not collective bargaining objectives and was therefore not legal, these employees were fired. They were fired both for job abandonment and the large scale vandalism carried out by them against PDVSA installations such as damaging control systems, breaking pipes and valves, and deleting computer files and programs.

The strike failed because most oil workers actually staid at their jobs and many others voluntarily came back out of retirement to help restart production. Once it was apparent that the strike was failing the Oily People immediately started clamoring for their jobs back. Of course, the government has refused to re-hire them not only because of the tremendous damage they caused but also because December was not the first time they had gone on strike. They had tried to shut down production before on several occasion including immediately prior to the April 11 coup.

But these Oily People/Unapetrol types don't give up easily. They are still trying to get reinstated. To do that they are actually petitioning the International Labor Organization to hear their case. Lets take a look at some of what they say:

We support and demand a "strict and forcefull action" against the current Venezuelan government for the following reasons:

Massive, illegal, and unjustified firing of more than 20,000 workers in PDVSA for participating in a strike or national civic strike in December 2002.

Unjustified firing??? What are these people smoking? They think they can go on an indefinite strike to overthrow a democratically elected government and nothing should happen to them? Unreal. Anyways, this won't go far as the ILO expects unions to focus on collective bargaining issues and be apolitical - not the case here.

Violation of special procedures for firing disabled workers, pregnant women, and union leaders.

This was a clever strategy by Oily People - claim you weren't really on strike but were out sick (I'm sure they can get a doctors note), disabled, or suddenly realized you were pregnant and had to stay home. Actually, the most common excuse they used was that they were on vacation ( for two months?!?!) and didn't even know there was a strike. In any event the strike began at the beginning of December and the firings didn't begin until mid-January. Everyone had ample warning and ample opportunity to return to work before anyone was fired.

Mass illegal evictions of workers from their homes.

This is a good one. In the country club atmosphere that prevailed in PDSVA prior to the strike not only were these managers paid very good salaries (many of them over $50,000 in a poor country) but they were given other goodies such as free housing and special schools for their children. And after going on strike they actually thought they'd be able to keep these great freebies? Well, I guess you can't blame them for trying.

Violation of the right to unionize.

This is rather dubious on two counts. First this union included everyone from managers all the way up to the top executives of PDSVA - that's right including the President, CFO, etc. Has anyone ever heard of the executives of a company forming a union so they can't be replaced by the shareholders no matter how bad their performance is? Can you imagine the executives of Exxon/Mobil forming a union? Bizarre. Secondly, the senior executives didn't even attempt to form this "union" until after they had already been fired from the company. I think to form a union you are supposed to actually have a job. Fortunately for them, in the wake of the April 11th coup Chavez was in a magnanimous mood as he tried to reconicle the country and he gave them their jobs back which they kept until their strike in December. Chavez won't make that mistake again.

Violation of the freedom of work at companies other than PDVSA.

The Oily People claim they have been blacklisted and other oil contractors won't hire them. The government denies it. In any event, most companies frown on executives going on strike and destroying company property and are therefore probably reluctant to hire them.

Its not looking good for the Oily People getting their jobs back. The country and PDVSA have both moved on and our doing well without them. And even the Oily People don't seem to believe in their cause any more - when I checked how many people signed the petition it was only about 7,000 - a lot less than the number of them that were fired.


Posada Update IV 

Luis Posada, who was arrested on Tuesday has finally been charged with entering the U.S. illegally. This may, I repeat, may, lead to his extradition to Venezuela. We will have to see if that legal requirement as per the U.S. - Venezuelan mutual extradition treaty is lived up to.

Despite the clammer of loonies in South Florida like Andres Oppenhiember of the Miami Herald, who just want to deport him to Mexico or Panama ?!?!?! (why, so he can blow up more airplanes?) there are some in the media who realize what is at stake. For instance, check out exerpts of the L.A. Times editorial:

Send Him to Caracas
It may outrage the radical fringe in the Cuban exile community in Miami, but the Bush administration did the right thing in ordering Tuesday's arrest of Luis Posada Carriles. Washington now needs to send the old anti-Castro fighter to Venezuela to face charges that he was involved in blowing up a Cuban airplane in 1976, causing 73 deaths.
Washington has pursued a lot of flawed policies to placate anti-Castro activists in the past, but surely no one in this administration will want to go soft on terrorism — or try to define away the problem by claiming that Posada is a legitimate freedom fighter.

Venezuela's judiciary admittedly does not have all the due-process guarantees Posada might have found in a U.S. court, and it may be tempting to try him here under the theory that terrorism is a crime of universal jurisdiction. But it would be a misguided move, seen elsewhere as politically driven and hypocritical. In prosecuting terrorism, the U.S. works with many countries whose legal systems are no worse than Venezuela's.

Moreover, there is a process already underway against Posada in Venezuela. He was tried and acquitted there twice but escaped from jail while awaiting an appeal by prosecutors in 1985. Venezuelan law allows the jailing of defendants until all appeals have been dealt with.

According to recently declassified FBI documents from 1976, Posada was present at two meetings in which the bombing of the Cuban plane departing from Caracas was discussed. In 2000, Posada resurfaced in Panama in the company of three other terrorists previously convicted of serious crimes. The four were tried, convicted and jailed. But then, in August 2004, Panamanian President Mireya Moscoso pardoned the four a few days before she left office. Three of the men went to Miami, where they were greeted like heroes by hard-line exiles. The whereabouts of Posada remained unknown until now.

Why these four violent men were pardoned is a mystery. The fact that three of them were admitted into the U.S. is alarming. Doesn't President Bush mean it when he says no country should harbor those accused of terrorism? To answer that question in the affirmative, U.S. authorities must extradite Posada to Caracas and review the status of any other Cuban exiles in this country who stand accused of terrorism.

I know money is kind of tight in Washington these days with the deficits and all so in an effort to help the Bush Administration do the right thing at a reasonable price here are some possibly usefully links to help get this terrorist on a plane bound for Caracas: Expedia, Travelocity, Priceline.com, CheapTickets.com.


Wednesday, May 18, 2005

Ahora es de todos 

"Now Venezuela belongs to everyone." That is the slogan used by the Venezuelan government and reproduced on the top of this blog. Yesterday an event occurred which showed how apt that slogan is.

Caracas fue declarada territorio libre de homofobia
Juan Barreto suscribió un decreto a favor de homosexuales


Caracas. La celebración del Día Internacional contra la Homofobia representó un avance en la lucha por los derechos de esta comunidad. Por primera vez conmemoraron la fecha en un acto público en la Plaza Bolívar de Caracas.

En el acto se anunció un decreto, suscrito por el alcalde metropolitano, Juan Barreto, en el que se declara a la capital venezolana territorio libre de homofobia, un paso adelante hacia la igualdad de oportunidades.


The celebration of the International Day against Homophobia respresented an advance in the struggle for the rights of that community. For the first time they commemorated a public act in Caracas's Plaza Bolivar.

In the act they read a decree, signed by the Metropolitan Mayor, Juan Barreto, in which the Venezuelan capital is proclaimed territory free of homophobia, in a step towards equality of opportunities

A little background. Venezuela, like most Latin American countries, has a "macho" culture which has not been particularly tolerant of gays and lesbians. However, Venezuela had made progress in this area and was one of the more liberal Latin countries in this regard.

Unfortunately, along came the reactionary opposition to President Chavez. As with so many other things, they set back Venezuela years, if not decades, on issues of sexual orientation. Opposition hacks think nothing of launching vicious attacks based on sexual orientation (as well as race - but that is for another day) in an attempt to divide the population and weaken the government. The man who signed this decree, Juan Barreto, was himself subject to such attacks last year as he campaigned for office.

Many examples of this could be given but I don't like to give such hateful sentiments too much publicity. So one example will do:

This is a picture from an opposition rally a couple of years ago. The sign which is about a National Guard officer (and current Carabobo governor) reads:

The navy has a boat
The airforce has a plane
and the National Guard has Acosta
who is a tremendous "faggot"

It certainly is depressing to watch what the opposition has tried to do to Venezuela and its people over the past several years. But when one sees events like yesterdays and sees how much courage the citizenry and the government have in the face of this sort of reactionary hatred ones spirits are lifted.


Tuesday, May 17, 2005

This is why you don’t mess with British MPs 

Today Senator Coleman learned the hard way why U.S. politicians shouldn’t get into debates with British Mps –especially ones like George Galloway who don’t suffer fools gladly. U.S. politicians, who are in big trouble anytime their teleprompter breaks down, are hardly going to measure up against people who have to go through the daily debates of the British Parliament.

Given the mismatch in debating skills one would think the Yanks would at least have their ducks lined up. Alas, not in this case. Quite frankly this smackdown was so thorough, so complete, so well deserved, and , yes, so entertaining that C-span should set up a pay per view channel so we can watch it again – I would certainly pay. The full transcript of Galloway’s remarks can, and really, really should be read here .

Here though are a few tidbits:

Now I know that standards have slipped in the last few years in Washington, but for a lawyer you are remarkably cavalier with any idea of justice. I am here today but last week you already found me guilty. You traduced my name around the world without ever having asked me a single question, without ever having contacted me, without ever written to me or telephoned me, without any attempt to contact me whatsoever. And you call that justice.

. . . . . . . . . . . .

Now you say in this document, you quote a source, you have the gall to quote a source, without ever having asked me whether the allegation from the source is true, that I am 'the owner of a company which has made substantial profits from trading in Iraqi oil'.

Senator, I do not own any companies, beyond a small company whose entire purpose, whose sole purpose, is to receive the income from my journalistic earnings from my employer, Associated Newspapers, in London. I do not own a company that's been trading in Iraqi oil. And you have no business to carry a quotation, utterly unsubstantiated and false, implying otherwise.

. . . . . . . . . . . .

I told the world that Iraq, contrary to your claims did not have weapons of mass destruction. I told the world, contrary to your claims, that Iraq had no connection to al-Qaeda. I told the world, contrary to your claims, that Iraq had no connection to the atrocity on 9/11 2001. I told the world, contrary to your claims, that the Iraqi people would resist a British and American invasion of their country and that the fall of Baghdad would not be the beginning of the end, but merely the end of the beginning.

Senator, in everything I said about Iraq, I turned out to be right and you turned out to be wrong and 100,000 people paid with their lives; 1600 of them American soldiers sent to their deaths on a pack of lies; 15,000 of them wounded, many of them disabled forever on a pack of lies.

I can’t wait to watch the next round – provided Senator Coleman ever gets up off the canvas. And I suspect next time instead of watching the good fun on C-span I’ll have to call my local cable provider and get HBO Pay Per View.


Posada Update III 

The U.S. finally arrested Posada. The excuse that the Bush administration has been using up to this point for not extraditing him was that supposedly they didn't even know he was in the U.S. I guess that excuse is out the window.

Hopefully, the U.S. will honor its extradition treaty with Venezuela and put Mr. Posada on a Caracas bound plane. We will see shortly.


Monday, May 16, 2005

Rumours of PDVSA's demise have been greatly exagerated. 

If you stay up with your opposition propoganda then you know the “crisis” of the day is that the Venezuela state oil company PDVSA is supposedly collapsing. Actually though, this is not a new issue; this “crisis” has now been talked about for years.

This goes back now more than two years to when in the opposition lead strike of 2002/2003 the then managers and bureaucrats in PDSVA thought that they could bring down the Chavez government by shutting down the oil industry. Of course even most oil workers did not support them, the strike collapsed (after doing billions of dollars of damage) and the striking managers were fired.

Oil production quickly recovered which in turn helped lead to the economic boom which Venezuela currently enjoys. The strikers – who formed a organization called Gente de Petroleo – People of Oil or as I call them, Oily People- seeing that all they had accomplished was to get themselves fired, quickly backpedaled and sought to get their jobs back. To do this they came out with a very slick little power point presentation to show how vital it was for the country's future that they be hired back. Lets have a look at some of it:

The beginning of Oily Peoples predictions. The bottom of the slide says "without rehiring the 12,500 fired". In other words this is where they will show how dire things will be without them.

In this interesting slide we see two columns – one of what PDVSA will be able to produce without rehiring the strikers under “Status Quo” in comparison to what it produced before under “PDVSA” Note that the Oily People thought that the Chavez government wouldn’t be able to get production to more than 2.1 million barrels per day. Off course, during 2003 production reached either 2.6 million to over 3 million barrels per day depending on who you listen to. So much for Oily Peoples predictions. But the best is yet to come.

Image hosted by Photobucket.com

In this graph the Oily People show what they claim the countries cash flow will be. This graph shows in red what the cash flow will be without re-hiring the strikers and in blue what it will be if they are rehired. As you can see they show the cash flow going sharply negative . And the key point in the line down the middle with a label that hardly needs translation – “Economic Collapse”. That’s right, the opposition, in all seriousness predicted that with PDVSA under Chavez’s management and without the “meritocracy” of the old management the country would go bankrupt. In fact, the title to the slide says – “Even using the special reserve fund the collapse will occur in the second trimester of 2003”

Well, here we are more than 24 months later and what is the reality – international reserves of $28 billion, 17% growth last year, 11% growth so far this year, and no end in sight to the boom. The bottom line is that these Oily People couldn’t have been more wrong. Rather than collapsing PDVSA and Venezuela have thrived without them. If this is how clueless they are with regard to the oil industry they should have been fired much sooner!!

So the next time you read the latest drivel by Oily People, Gustavo Coronel, or any of the other anti-Chavez malcontents you might want to remember what the track record of their predictions and analysis is.

And the bottom line regarding PDVSAs future is if you are waiting for it to collapse, don’t hold your breath.

Update: A number of readers have inquired as to where the document posted here came from and where the full version could be found. I originally recieved this in an e-mail directly from the Oily People. However, I have found a copy of it on the internet here.


Posada update II 

So far no response from the US on the request for the Cuban terrorist Posada to be extradited to Venezuela. Nor have they moved to arrest him so he gets to continue with his leisurely life.

In contrast to the disgraceful conduct of the US government Venezuela today showed how terrorists should be dealt with. From today’s Panorama:

Venezuela entrega a jefe de las FARC 'Chigüiro' pedido en extradición


Venezuela entregará este lunes al jefe de las FARC Martín Vega, alias 'Chigüiro', capturado en ese país cuando participaba en un secuestro y pedido en extradición por el gobierno de Alvaro Uribe, que lo investiga por el asesinato de dos estadounidenses, informó la policía.

El coronel Jaime Gutiérrez, subdirector de la Policía Judicial (Dijín), dijo a la AFP que el líder rebelde llegará la tarde de este lunes a Bogotá escoltado por agentes colombianos que se desplazaron hasta Caracas para recibirlo.

Vega fue capturado el 18 de febrero pasado en Venezuela por participar en el secuestro de la madre del beisbolista de las Grandes Ligas Ugueth Urbina.

'Chigüiro', a quien Bogotá señala como uno de los jefes del frente 16 de las Fuerzas Armadas Revolucionarias de Colombia (FARC), también es acusado del secuestro y asesinato en junio de 1995 de los misioneros estadounidenses Sthephen Everet y Thimoty Dike.

Además, se le acusa de coordinar el tráfico de drogas en una región del departamento colombiano de Vichada, fronterizo con Venezuela.

Al momento de la liberación de la madre del lanzador de los Tigres de Detroit de Grandes Ligas, las autoridades venezolanas hallaron en poder del insurgente unos 600 kilos de cocaína en una posada abandonada en el Estado minero de Bolívar (550 km al sureste de Caracas).


Venezuela will hand over this Monday a leader of the FARC, Martin Vega, aka Chiguir, who was captured there when he participated in a kidnapping and when Colombia requested his extradition for killing to U.S. citizens.

Coronel Jaime Gutierrez, subdirector of the Judicial Police, said to AFP that the rebel leader will arrive this afternoon in Bogata escorted by Colombian agents that went to Caracas to retrieve him.

Vega was captured last February 18th in Venezuela when he participated in the kidnapping of the mother of baseball player Ugueth Urbina.

Chiguiro, which Bogota says is one of the leader of the 16th Group of the Revolutionary Armed Forces of Colombia (FARC), and is also accused of kidnapping and murder in the June 1995 deaths of the US missionarys Stephen Everet and Timothy Dike.

Additionally, he is accused of coordinating drug trafficking in a the Colombian department Vichada, in the frontier with Venezeula.

At the moment of the liberation of the pitcher of the Detroit Tigers the Venezuelan authorities found in his possession 600 kilos of cocaine in an abandoned motel 550 kilometers southeast of Caracas.

So Mr. Bush, here you have a clear example of how extradition request should be dealt with. Its not that hard. If Venezuela can do it you can too. Show the world your not just a cheap hypocrite.


Whats Cuba got to do with it? 

Again and again the Venezuelan oppenents of Chavez accuse him of trying to convert the country into another Cuba. The fallacy of this has been pointed out on this blog before but given that the opposition keeps repeating this assertion it is worthwhile to keep rebutting it. To that end it is interesting what President Chavez said yesterday in his weekly TV program Alo Presidente:

" We cannot copy the Cuban model and we are not going to copy it. Cuba is Cuba and Venezuela is Venezuela. Each country has its own peculiarities"

"In Cuba there is a model that is a product of particular circumstances. And here there is a model that is a product of other circumstances. Does Cuba advocate socialism? Yes. Us too. But each country has its own circumstances and its own model."

Chavez went on to point out how socialism takes many different forms in countrys like China, Brazil, and Spain and that no one complains about Spain becoming another Cuba when it elects a socialist government.

So there you have it straight from the horses mouth.


Sunday, May 15, 2005

What scares them so much? 

The editor of Ultimas Noticias, which is by far the most widely read and respected paper in Venezuela (it actually always tries to tell both sides of the story which is a novel concept in Venezuela these days), Eleazar Diaz Rangel writes a column each Sunday called “The Sundays of Diaz Rangel”. They are often very good so I will be reproducing many of them here in english. Here is this weeks column which makes a very important point:

Los Domingos de Diaz Rangel

What worrys them so much?

Pilgrims running around the world against Venezuela

That is a question that Venezuelans are asking them selves for months now, when at the highest levels of the American government they keep declaring their concern for Venezuela. When they had a chance to get rid of Chavez they tried various options: the coup of April 2002, the strike and the revocatory referendum. And as they have already given up on being able to beat Chavez in the 2006 elections they are now desperately looking for other ways with the support of Latin American.

What worrys them so? Clearly, it can’t be that almost a million and a half Venezuelans have learned to read and write. And why should it bother them that so many poor people have access to health care through Mission Barrio Adentro [Places 20,000+ Cuban and Venezuelan doctors in poor neighborhoods to provide free health care]? Or that people can purchase basic necessities at low cost in the Mercal markets? Nothing that is occuring here, not even that Chavez has 70% support and that the opposition finds itself in its worst moment; nothing of that is really the true cause for so much concern in the White House.

The answer could be somethign that Dr. Ramon Velasquez told me more than a year ago: that the United States is more worried about the influence that Chavez has abroad then what is actually happening here inside Venezuela.

Many years ago, Roger Maris, member of the Nacional Security Counsel of the U.S. said: “Henry Kissenger considered Allende a much more dangerous threat than Castro. If the consciousness of Latin America was awakened some day it wouldn’t be because of Castro. It was Allende that was the living example of social reform and democracy in South America. There were ocurring disasterous events in the world at that time, but only Chile frightened Kissinger”

It doesn’t take much imagination to change the names and dates and realize that Bush and his collaborators have arrived at similiar conclusions.

In the Oval Office one must have heard the alarm over events – “The Presidents of Central America are very concerned over the increasing protests in Nicaragua demanding the resignation of the President there.” – revealed an article in the Associated Press. More than a million Mexicans forced president Fox to take a step back and allow Lopez Obrador to be a presidential candidate and from all appearences he’ll be the next president of Mexico. In Ecuador, President Gutierrez, who was very aligned with U.S. policies was forced out and the future is uncertain. And nearby, in Peru, the popularity of Toledo is only 6%. The situation in Bolivia couldn’t be more worrying as Evo Morales will probably win the next elections. And leftists won the presidential and parlimentary elections in Uruguay for the first time in 100 years.

The agreements between Brazil, Argentina, and Venezuela in oil and other areas have gone much further than had been thought. (They must be carefull in their disagreements with Brazil and Argentina due to their position in the Security Council of the U.N.) And Bush’s proposed free trade agreement, ACLA, couldn’t be doing worse.

But that is not all. No one a year ago imagined that a South American Community of Nations would be created- much less that it would have a summit with 22 Arab countries. And did you read the final declaration from that summit? Each paragraph condemmed U.S. policies: a unipolar hegemonistic world, unilateral measures, and what the U.S. conception of terrorism is. But what is even worse is what happened in the OAS. The U.S. backed a conservative Salvadoran and after a little while they saw that wasn’t going to work; then they supported the Mexican candidate and the OAS divided into equal factions of 17 countries each; when facing certain defeat they had to abandon the Mexican and finally support the Chilean candidate.

That is how things have been recently. (Years ago, the U.S. candidate to head the Interamerican Human Rights Commission was defeated for the first time in the history of the OAS, in spite of Colin Powell’s lobbying; worse still it was a Venezuelan that won). Luigi Einaudi of the U.S. didn’t hide his disgust in front of a group of journalists over the influece that Venezuela has had even over english speaking countries (“they sell them cheap oil”) and that Venezuela’s proposals always get as many votes as those of the U.S. Even more recenlty Lulu [President of Brazil] was in Venezuela to sign a “strategic alliance”.

Even the extreme right newspaper, the Washington Times, editorialized over the failed trips of Condoleezza Rice and Donald Rumsfeld who tried to condem Venezuela in the OAS. Everywhere their message was rejected. For example, the position of Chilean President Lagos is to move even closer to Venezuela. Even the Colombians don’t go along and “turn the page on the purchase of arms” contraversy that the Bush administration had been bringin up everywhere.

Naturally, the U.S. thinks Chavez is guilty of everything. But with this tack they will certianly keep failing in their Latin America policy. They simply don’t realize that the changes that are occurring in Latin America come from within each individual country and region, although certainly encouraged by the news of what is happening in Venezuela. Maybe if some day they would just listen to Violeta Parra, Ruben Blades, and Ali Primera they would understand better what is happening.

I think Diaz Rangel has really hit the nail on the head here. What concerns the U.S. isn’t Venzezuela becoming another Cuba – that certainly is not going to happen. As has been mentioned here before even most Chavez supporters neither think nor desire that Venezuela become another Cuba. And having another Cuba wouldn’t scare the U.S. so. A dictatorial country with a failed economy certainly isn’t going to serve as a role model for change in Latin America.

But the Venezuelan model, with complete democracy, freedom, and a very succesfull economy all combined with extensive and highly popular social programs most certainly is a model which people all over Latin America are seeking to emulate. When Chavez shows up on a stage in Brazil with Lula it is Chavez who is cheered and who has to tell the crowd not to boo Lula. From the Tierra del Fuego to the Rio Grande there is no one more popular right now than Chavez with his 6 years in office and 70% approval rating. You don’t win office in Latin America these days by running away from Chavez, you win by getting him to stand on the stage with you. And THAT has the powers that be in Washington mortified.


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