Good News From Venezuela

The long term prospects of Chavez's "revolutionary" state in Venezuela are not good. A long report in the Spanish edition of today's Miami Herald lays it out. Since the same story does not appear in the English edition I thought I'd offer at least a summary of this important article.

Everyone knows that Chavez's "revolution"--his popularity with the poor of Venezuela and his influence in the region--is entirely mortgaged to the price of oil. But few realize that it is even more dependent on the efficiency (or lack of it) of his state oil company, which goes by the acronymn PDVSA.

Since Chavez took office in 1999 Venezuela's oil production has dropped by 28 percent and PDVSA's debt has risen significantly. Meanwhile, some major foreign oil producers have left the country and taken their cutting edge technology with them.

The Venezuelan government claims that between 2006 and 2012 it will reinvest $76 billion of its earnings to increase production, but analysts canvassed by the three reporters who wrote the story think that the figure comes closer to between $2 and $5 billion a year--a drastic short-fall. Moreover, many of PDVSA's activities are now unrelated to oil--it has hatched subsidiaries to distribute powdered milk, or to mill corn, or even to build boats. (Anyone who knows Venezuela can imagine the lush opportunities this offers for illicit enrichment by the agency officials or the military who work with them.) Meanwhile, as oil production falters, the state company has decided to take on more employees. When Chavez took office PDVSA had 48,000 workers. It now has nearly 75,000, and the president-dictator has announced plans to hire an additional 30,000 by the end of next year. (One cannot help recalling the case of the Argentine YPF, which was the only oil company in the world that lost money in the go-go 1970s!)

This kind of crony capitalism is pushing Venezuela to the edge. Under these circumstances it won't take much of a decline in oil prices to destabilize Chavez's regime. Contrary to what the bloated dictator says on his radio programs every Sunday, the "empire" (that's the US) doesn't need to do anything at all to get rid of him. Fortunately he's doing our work for us.

What is really troubling to me is that Hollywood has embraced Chavez fully and so has Code Pink. Have you seen this transcript of Medea Benjamin on Tucker Carlson defending the closure of RCTV by Chavez? Here is is (I love how the extremists defend this guy):

CARLSON: The apparent successor to Fidel Castro‘s brand of socialism is mixing things up once again. This weekend Hugo Chavez shut down one of the main television stations in Caracas because it was critical of his administration. That move sent thousands of people into the streets to protest, but not in this country, where some places Chavez remains remarkably popular. Joining us now, Medea Benjamin, co-founder of Global Exchange, a group that organizes tours of Chavez supporting Venezuelan neighborhoods, co-ops and government financed media outlets. Medea thanks for coming on.

MEDEA BENJAMIN, GLOBAL EXCHANGES CO-FOUNDER: Thanks for having me on Tucker.

CARLSON: I want to do something to cruel to you. I want to read your own quote back. Here is what you wrote last year, I believe. Quote, “Another basic myth” — this is a piece about myths about Venezuela—“is that Chavez has limited freedom of speech and eroded civil rights.” That was March 4th, 2006. Do you want to revise that given the news that Hugo Chavez has closed the last nationally broadcast opposition television station for criticizing him?

BENJAMIN: Well that‘s just not true Tucker. What he did is he didn‘t renew the license. But there are still television shows, and television stations owned and run by the opposition media. I think that you hear more opposition to the government in Venezuela than you would here in the United States. That‘s in the TV, in the radio and in the print media.

CARLSON: I don‘t know what you have been smoking, Medea, but you are saying that this president just closed a television station because it criticized him, but somehow Venezuela has a freer press than America?

BENJAMIN: He did not close it because it criticized him. He closed it because it participated in a coup against a Democratically elected government, his government. If a television in United States advocated and was part of an effort to topple a Democratically government, the Bush administration let‘s take—I don‘t like it—

CARLSON: I am reading now from the 360 page white book on RCTV. This is published by Chavez‘s government. It accuses RCTV—that‘s the television station in question—of, quote, showing lack of respect for authorities and institutions. I would think, as a self described liberal, you would stand up for the right of people to, quote, challenge authorities and institutions. And yet, you are apologizing for the squelching of minority views. Why could that be?

BENJAMIN: Well, there are opposition TV press and print media all over Venezuela. I don‘t know if you have been there, Tucker, but you can go on a reality tour with us. You will see it everywhere you go.

CARLSON: Why would you—hold on. Why would you make excuses for that?

BENJAMIN: — that tried to topple a Democratically—

CARLSON: How can a television—let‘s be real. You are throwing a very serious charge out there, a charge for which people have been killed in Venezuela. I am asking you a very simple question, explain how a television station can cause a coup? They said they did not like the president. Is that the same as pushing a coup? I mean, what the hell are you talking about?

BENJAMIN: They falsified information. They got people out on the street. They falsified footage that showed pro Chavez supporters killing people, which did not happen. They refuse to cover any of the pro Chavez demonstrations. When Chavez—

CARLSON: They refuse to cover pro Chavez demonstrations? I wonder if you are even a tiny bit ashamed that you are apologizing for fascism on national television.

BENJAMIN: I wonder if you are ashamed of calling a Democratically elected government a fascist government.

CARLSON: He just shut down a television station because that television station, as you put it, did not cover pro government administration. You have got to be kidding. You are losing touch here a little bit.

BENJAMIN: It participated in a coup against a Democratically elected government. If it was done here in the United States, that TV station would not only not be on the air, the people that ran it would probably be in jail right now. You are holding Chavez to a different standard. Peru recently did not renew a license. Uruguay didn‘t renew a license. Why do you hold Venezuela to a different standard.

CARLSON: Medea, I think it‘s very clear that because Chavez hates the United States, you are sympathetic to him and willing to make excuses for his anti-Democratic, anti-liberal behavior. And it‘s a shame.

BENJAMIN: No, it‘s because he takes the oil money and does not give it to reach oil barons like in the United States, but gives it for literacy and health programs.

CARLSON: OK, I am glad we have this tape, and I think some day you will be ashamed of it. But I appreciate your coming on any way. Medea Benjamin, thanks for joining us.

BENJAMIN: Thank you.

CARLSON: When Al Gore is not telling you how to live your life, he is telling us in the press how to do our jobs. Gore takes a public shot at Paris Hilton and the people who cover her. Willie Geist, one of those people, takes great offense. Details when we come back. You‘re watching MSNBC.

(COMMERCIAL BREAK)

http://www.energy-daily.com/reports/Analysis_Venezuela_expands_influence_999.html

Seems like this is a good place as any to place this article for the couple dozen who are following Venezuela’s doings, although it could equally well go on the Natalee Hollywood thread:

Analysis: Venezuela expands influence

by Carmen Gentile
Miami (UPI) Jan 30, 2007
Venezuelan President Hugo Chavez recently announced his country’s decision to build a refinery on the Caribbean island of Dominica, part of his effort to further integrate the region’s energy supplies.
Chavez said Dominica’s refinery would be a jumping-off point for distributing Venezuelan oil to other eastern Caribbean countries.

The capacity of the proposed refinery was not announced during the recent meeting between Chavez and Dominican Prime Minister Roosevelt Skerrit.

However, Chavez did announce Dominica had joined the alternative trade bloc founded by Venezuela and Cuba known as the Bolivarian Alternative for the Americas, or ALBA.

ALBA presents itself as an alternative to the U.S.-backed Free Trade Area of the Americas, which has been stalled in negotiations for several years and has yet to be implemented.

“ALBA continues to grow as a new geopolitical, geoeconomic area and seeks the construction of a better world for those of us in the Caribbean and Latin America,” Chavez said earlier this week.

Awash with petrodollars, particularly now with oil prices remaining near record highs, Venezuela has sought to expand its influence in the Caribbean through its discount oil initiative known as Petrocaribe.

Launched in 2005, the agreement allows Caribbean member nations to purchase Venezuelan oil at a deeply discounted price, a deal that has alleviated many Caribbean nations’ energy woes and lessened their dependence on U.S. financial aid.

Cuba has been among Petrocaribe’s biggest beneficiaries, along with the Dominican Republic, Jamaica and Nicaragua.

The Dominica refinery initiative is just the latest effort by Chavez to draw regional neighbors closer through his country’s petroleum bounty. In December, Venezuela announced it would help Cuba get a Soviet-era oil refinery back online after decades of dormancy.

The plant went back online with the help of Venezuela and some $136 million in repairs funded by Caracas; it is believed to be capable of processing some 65,000 barrels per day. Venezuela meanwhile sends about 100,000 bpd to Cuba as a discounted price, part of the Petrocaribe agreement.

Cuban officials have lauded the return of operations at Camilo Cienfuegos, though some say the plant may still need work before becoming fully operational.

“It was a mess, that refinery,” said Larry Birns, director of the Council on Hemispheric Affairs in Washington and noted expert on Cuba.

Chavez is an ardent supporter of improving Cuba’s oil-producing capacity amid much international speculation about the island’s potential offshore petroleum reserves. So far, five international oil companies have paid reserve fees to the Cuban government to secure exploration rights there.

In 2007, during the Non-Aligned Movement Summit in Havana, Chavez said Cuba’s potentially lucrative offshore oil reserves could one day catapult the island onto the world petroleum stage and maybe even earn the country a place in the Organization of Petroleum Exporting Countries.

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