Negotiations in Venezuela

The Bolivarian Revolution that Venezuelan President Hugo Chavez pledged to launch has boomeranged. After recovering from a short-lived McCoup in April, Mr. Chavez has faced escalating opposition. On Saturday, more than 1 million demonstrators rallied against Mr. Chavez, and an ongoing oil strike, which began Dec. 2, has paralyzed the country financially. Earlier this month, three anti-Chavez protesters were shot dead by government loyalists. If a deal isn't reached soon between Mr. Chavez and the discontented, the political future of Venezuela will be decided on the streets ? and blood-drenched streets they could be.

Venezuela Strikers Defy Court Order, Press Protest***The struggle, centered on the strategic oil industry, has become a grueling war of attrition between the two sides which has kept world oil markets on tenterhooks and stoked fears of violence in the politically divided South American nation.

……… "The people will stay out in the streets until this dictator leaves once and for all," opposition union boss Carlos Ortega, a sworn political enemy of Chavez, said. Opponents of the populist president accuse him of ruling like a dictator, threatening democratic freedoms and dragging the country toward Cuba-style communism modeled on the rule of his friend and political ally Cuban President Fidel Castro. "Venezuela is not Cuba," Ortega said.

Chavez dismisses his foes as a minority of rich, resentful elites who oppose his social reforms in favor of the poor. He says they are seeking to overthrow him in a repeat of the April coup in which he was briefly toppled by rebel officers. Supporters of the president planned to hold their own pro-government demonstrations in Caracas Friday.

Following the Supreme Court ruling, striking oil workers, including PDVSA executives, tanker captains and refinery and port operators, were bracing for renewed government attempts to wrest control from them of oil tankers and installations. The president has already sent in troops to take over strike-bound oil ships, refineries and port terminals. A government decree authorized the military to commandeer private planes, ships and trucks to distribute fuel and food supplies.***

Venezuela's strike heads to gas pump - No end in sight*** ……………But the strike at PDVSA is the key. PDVSA produces 87 percent of the country's oil and gas, and accounts for 70 percent of the government's revenues. The price of gas in Venezuela is regulated and thus remains stable, but supplies are dwindling and lines are growing. The country has few gasoline-storage facilities because no one ever expected an oil-flush nation would need them. Other important sectors of the economy, such as mining, require natural gas for production - and without it they are being forced to shut down. In addition, many domestic commercial flights have been canceled.

Other businesses are being affected indirectly. Dr. Martínez says he just got off the phone with a manager at a major Venezuelan bank who is unable to transport money because he can't find diesel fuel for the trucks. "All segments of the economy are feeling it very strongly, in spite of what the government says," he says. "They know that this is very critical." As more and more shops shut down in support of the strike, worried residents are stocking up on groceries and other necessities. To prevent hoarding, Chávez yesterday ordered military officials to seize any vehicle delivering gas or food. Opposition leaders claim they are allowing enough basic supplies through their blockades to meet the population's needs. But there is talk of power outages in parts of Caracas. And every day there are protests and marches in the streets.

Ricardo Hausmann, an economics professor at Harvard University and former Venezuelan planning minister, says the situation was inevitable. The economy has been in a tailspin since Chávez took power in 1998, contracting 15 percent - a full 7 percent of that coming this year alone. "This is completely unprecedented for us," he says, "because essentially we have a president who's trying to lead a country in a radical course for which he has no mandate: destroying the economy and a sense of shared values." Mr. Hausmann says it's hard to imagine a resolution to the crisis with Chávez remaining in power. He believes the president, in true Latin American fashion, wants to be overthrown rather than beaten at the ballot box. ……..***

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