CHAVEZ'S FIVE MAIN ENEMIES

CHAVEZ FIVE MAIN ENEMIES.
Gustavo Coronel
From Washington.


The regime of Hugo Chavez is weakening. His pretensions of establishing a socialist state where children will be indoctrinated, political dissenters will be gagged and capitalism will be replaced by a socialist-fascist state, are fading rapidly. His regime is floundering in a sea of corruption, incompetence and internal political cannibalism. The five main reasons for this collapse are:

1. His increasingly fragile financial situation.
Although the income at the disposal of Hugo Chavez has been enormous, over $220 billion coming from oil and about $50 billion more coming from new national debt, plus the income from taxes and other sources, a great total of some $400 billion in eight years, Chavez is running out of money to keep financing his revolution at home and abroad. His acquisition of weapons, his donations to countries where he wants to impose his will, the policy of handouts to the poor that he has exercised from the start, the very high level of corruption inside the government, the record levels of imports due to the lack of domestic production, the inefficiency of the government bureaucracy, all have combined to generate a gigantic waste of public funds, the likes of which have never been seen before in Venezuela. Today the national budget shows a strong deficit and the state-owned oil company has been ordered to issue bonds for up to eight billion dollars to meet government’s commitments.
2. Poor management, corruption and diminishing production capacity in Petroleos de Venezuela.
The state of financial disarray described above has made it impossible for Petroleos de Venezuela to expand or, even, to maintain its original production capacity. Current production by the company is about 700,000 barrels per day lower than in 1998. The financial resources that would be needed to maintain production have been spent and/or wasted in the activities described above. At this very moment Petroleos de Venezuela is in “operational emergency”, as testified to the Venezuelan National Assembly by one of the members of the corrupt top management team, Exploration and Production Vice-president Luis Vierma. I think Vierma’s apocalyptic statements are at least partly designed to hide the corruption that permeates the activities under his supervision. Still, the company faces an acute shortage of drilling rigs. Although PDVSA officers and the minister/president Rafael Ramirez claim that the company is operating over 100 rigs in operation, the truth is that many of these rigs are only engaged in repair work and only about half of them are drilling new wells. This is one fourth of the amount they need. The company would require almost 200 rigs drilling new wells to reach the production targets in the five-year plan. As a result production keeps sliding and is now below 2.4 million barrels per day
The recent contracting of rigs has ended in a failure and much corruption, as companies without experience but probably associated with high–level PDVSA officers have been given huge contracts they have been unable to execute. This is the reason Vierma was called to testify before the National Assembly, where he chose to claim that this contracting “was not his responsibility” and that he only signed, “What he had been told to sign”.

3. The prostitution of the armed forces.
The manipulations of the armed forces at the hands of Chavez have led to a high level of unhappiness among the middle ranks. The order to soldiers to chant “Fatherland, socialism or death” has been met with increasing, still silent, protests. Chavez’s main military advisor, General Alberto Muller Rojas, has denounced publicly the politicization of the institution and has openly criticized the enormous expense, over $6 billion so far, in the acquisition of weapons. Muller Rojas thinks that conventional weapons would be useless in a confrontation with the United States and favors the structuring of an irregular army, trained and armed to conduct a guerrilla-type war. Chavez, who does not tolerate dissent, has dismissed Muller Rojas. The Minister of Defense, Raul Baduel, the man who put him back in power after he had resigned in April 2002, has also been dismissed. He left the institution giving a speech in which he openly criticized Chavez’s trend towards “socialism”, which he considers both undemocratic and more akin to “state capitalism” than to true socialism.
4. A growing and better-organized opposition.
During the last weeks a student led series of protests have taken place in numerous cities of Venezuela. The students demand freedom of expression and the return of RCTV, the TV station closed down by Chavez. They demand complete autonomy for universities and the return to democracy. In many ways this has been the most effective protest against the Chavez’s regime since April 2002 and, uncharacteristically, has taken Chavez completely out of his rhythm and has led him to commit further errors. The insults against the Catholic Church have increased both in frequency and magnitude. He recently accused the Cardinal of Honduras of being “a clown and a parrot”. He regularly brow beats the top hierarchy of the Venezuelan Catholic Church in his weekly TV programs. By opening two parallel fronts, one against the students and the other against the Catholic Church, together with his fiscal problems, the collapse of the oil industry and the growing dissent within the Armed Forces, he is rapidly losing grip on political control.
5. Loss of good-will and credibility abroad.
This year Hugo Chavez has lost considerable support abroad due to his vulgar and
aggressive nature. During recent weeks he has insulted the Brazilian Congress, the
Paraguayan Congress, the Chilean Congress, the Cardinal of Honduras and the
Spanish Government. The international press has openly started to talk about him as
a dictator. All leading presidential candidates in the U.S. have been very critical of
him. His popularity is being restricted to those rogue countries where the political
leadership identifies with him: North Korea, Iran, Cuba, Syria, Belarus and
Zimbabwe.
These are Chavez’s main areas of vulnerability. There are others that we will anlyze in future entries.