POVERTY AND TRASH....
During the last nine years Venezuelan democracy has been transformed into a tropical monarchy. For the first time since Fidel Castro’s 1962’s missile crisis a Latin American despot has pretensions of global hegemony. Oil and hate are being combined to produce a greatly dangerous threat to U.S. national security. What is the potential impact of these strategies on hemispheric and, even, world’s political stability
1. From Democracy to tropical Monarchy.
Hugo Chavez has now received close to $250-300 billion in oil income. Instead of using this money in long-range programs to eradicate poverty and create new employment, he has chosen to institute a policy of handouts that is actually making Venezuelans more dependent on the welfare state and less capable of becoming self-starters. Raining money on the poor and on a corrupt bureaucracy is allowing him to gain total political control over the country. In this manner he has been able to convert a democratic system into a sort of tropical monarchy, where one man reigns supreme, there are no checks and balances and accountability does not exist. Currently there is a constitutional reform in the makings that would give him unlimited shots at the presidency, organized and supervised by an electoral system he controls, as well as absolute control over the financial resources of
the country.
2. A Latin Dictator with global pretensions.
For the first time since the Cuban missile crisis of 1962 a Latin dictator pretends to become a geopolitical player. Regional caudillos had been mostly contented with prevailing in their modest domains: Peron, Velasco Alvarado, Stroessner, Pinochet, Rojas Pinilla, Perez Jimenez, Trujillo, Somoza, Evita. Only Castro had tried to become a world player by targeting the U.S. with the missiles he had allowed the Russians to smuggle into the island. Today Hugo Chavez, with plenty of money and under the tutoring of Fidel Castro, is trying to put together a global alliance against the United States, traveling far from his country and from the region to fulfill this objective. In trying to do so he exhibits an embarrassing political narcissism, representing himself as a new Simon Bolivar.
3. Oil and Hate: a dangerous combination.
In addition to maintaining a greedy and corrupt bureaucracy of some two million people, as well as a legion of rabble-rousers and shock troops, Hugo Chavez is spending Venezuela’s oil money in three main ways: (a), about $80-90 billion in domestic handouts, giving the poor free or highly subsidized food, free basic medical attention with the help of 30,000 Cuban medical or Para-medical staff and free or highly subsidized education and transport of very low quality; (b), about $12 to $15 billion in the acquisition or in the ordering of weapons from Russia, Belarus, China, Iran and Spain, mostly jet fighters, rifles, surface to air missiles, tanks and submarines; (c), some $70 billion in actual or promised donations, grants and financing of projects and programs in Latin American and Caribbean countries that he wants to influence politically. These expenditures are designed to increase his political control at home and to try to structure a wide anti-American alliance both in the hemisphere and in other regions of the world. Some examples of his largesse include giving essentially free oil to Cuba at a cost of more than $2 billion per year, buying about $4 billion in government bonds from Argentina and close to $10 billion in weapons from Russia, while thousands of abandoned children beg for money in the streets of Venezuela.
4. Main oil strategies of Hugo Chavez.
Chavez has put in place six main oil strategies:
· He is using oil money to consolidate political control in the country. He does this by distributing money to the poor, giving them an illusion of prosperity that is only temporary. He is not using the money to create jobs or to empower Venezuelans to become self-starters.
· Replacing multinational, private oil companies with state-owned oil companies from ideologically friendly countries such as Iran, China, Belarus, or tolerant of his political style such as Brazil and, less so, Spain.
· Use of oil money and oil subsidies to gain the temporary loyalty of governments in countries that depend heavily on oil imports, such as the Caribbean states, some central American and South American countries and to form political alliances with governments in countries that share his hate against the U.S., such as those in Bolivia, Nicaragua, Argentina and Ecuador.
· Promoting oil production cuts within OPEC, in order to generate price increases that will harm the economies of the consuming countries. So far, only Iran and less so Nigeria share this position within the organization.
· Using oil money to establish global alliances against the United States. He has promised Belarus a loan to pay its $460 million debt to Russia, spent close to one billion dollars trying to get a seat in the UN’s security council and has promised to build refineries in Vietnam, Syria and, even, the Fiji Islands, in an attempt at gaining influence worldwide. He keeps making friendly overtures to China and Russia while aligning his regime with Mugabe’s Zimbabwe, Assad’s Syria, Kim IL Sung’s North Korea and Ahmadinejad’s Iran, while trying, somewhat unsuccessfully, to stay close to Ghadaffi’s Libya.
· Using Citgo as a political weapon within the U.S. This company is being used, in a non- commercial manner, to distribute subsidized fuel to “poor” U.S. citizens that have average incomes ten times higher than the Venezuelan poor and, through manipulation of internal price transfers, is being used to minimize tax payments in the U.S. while maximizing money transfers to the Venezuelan government, a tax evasion mechanism which has so far been allowed by U.S. tax authorities. Today Citgo is totally controlled by a Board made up of Chavez’s followers and is no longer perceived as a “U.S. company”.
5. Domestic and Global Impact of these strategies.
So far these strategies have had only modest success, not at all proportional to their high cost. The wasteful expenditures in the country have robbed Petroleos de Venezuela, the state-owned oil company, of funds needed for investment and maintenance. As the cow is over-milked and under-fed the company has lost about 800,000 barrels per day of production capacity. When combined with its poor management and politicized environment the company can no longer be considered a reliable supplier to the U.S. The alignment of Chavez with Iran poses an increasing threat to global petroleum supply, as these two countries are the source of some four million barrels of oil exports per day. If there were a politically motivated interruption of this supply the world would receive a major economic shock that could lead to global war. Another main outcome of Chavez’s strategies has been the increasing political friction existing in the hemisphere between countries aligned with Chavez, essentially Bolivia, Nicaragua and Ecuador and countries which oppose his authoritarian style, particularly Mexico, Peru, Colombia and most of Central America.
6. Implications for U.S. national security.
The supply of Venezuelan oil to the U.S. has been decreasing in the last four years but is still significant, some 1.4 million barrels per day of crude oil and products. It is also becoming very unreliable due to the loss of production capacity by Venezuela and to Chavez’s political inclinations to interrupt this supply. At this time, such an initiative by Chavez is unlikely because he has no immediate direct export alternatives for the bulk of this oil, which is of a nature that can only be refined in U.S. based, special refineries. In a few years’ time, however, Chinese refineries might have been built to process this oil and Chavez would be able (and probably willing) to cut oil supply to the U.S. This means that any strategic initiative by the U.S. regarding Venezuela has to be taken sooner than later, certainly before Chavez has developed his alternatives. The development of a contingency plan for the replacement of U.S. oil imports from Venezuela is of vital importance to the U.S. In fact, if and when such a plan is in place, the U.S. should take the strategic initiative of cutting Venezuelan oil imports, although this would be a delicate and somewhat risky maneuver.
7. Weak strategic flanks of the U.S.
Today the U.S. has some weak flanks that might limit its capacity to act strategically against Chavez: the Iraq war, its significant oil dependency, the lurch to the left being taken by governments in Latin America, the growing Iranian threat. Some of these weak flanks are closely related to the role Chavez is playing and might play in the future. There is no doubt, therefore, that Chavez represents a major problem for U.S. national security. At present the policy of the U.S. government is to do nothing about Chavez, to let the Venezuelan internal political process take its course, in the hope that Chavez will fall of his own weight. Given the international blunders committed by Chavez, his wasteful expenditures, the chaotic manner in which he is managing the economy and the increasing opposition his policies find domestically, this posture of the U.S. has some merit. However, the risks of a major, Chavez induced international crisis are very much present while he is in power and actually increase as his domestic political position deteriorates. I believe that Chavez is determined to go down in history either as the conqueror of the empire or as its martyr. Both scenarios probably include a violent global crisis that would be of much greater cost to the U.S. than the cost of an earlier initiative.
7. The Venezuelan mid-term outlook.
Chavez has a 40% chance of becoming a socialist dictator, Fidel Castro style and a 60% chance of self-destructing or of being toppled by frustrated Venezuelans. This chance would increase if the opposition to Chavez could agree on a common strategy of intense, popular confrontation against his regime. So far this is not happening, as some sectors of the opposition insist in playing by traditional democratic rules (elections) while it is obvious that Chavez has long abandoned such rules.
Chavez controls all government agencies, including the Electoral Council. Therefore, elections are no longer a valid option in our country. Now the Venezuelan people must act to restore democracy by other means. This is not the easy way but it seems to be the only way. In fact, it is a constitutional imperative, as articles 344 and 350 of the current constitution make it a civic duty for Venezuelans to rebel against an undemocratic usurper.
1. From Democracy to tropical Monarchy.
Hugo Chavez has now received close to $250-300 billion in oil income. Instead of using this money in long-range programs to eradicate poverty and create new employment, he has chosen to institute a policy of handouts that is actually making Venezuelans more dependent on the welfare state and less capable of becoming self-starters. Raining money on the poor and on a corrupt bureaucracy is allowing him to gain total political control over the country. In this manner he has been able to convert a democratic system into a sort of tropical monarchy, where one man reigns supreme, there are no checks and balances and accountability does not exist. Currently there is a constitutional reform in the makings that would give him unlimited shots at the presidency, organized and supervised by an electoral system he controls, as well as absolute control over the financial resources of
the country.2. A Latin Dictator with global pretensions.
For the first time since the Cuban missile crisis of 1962 a Latin dictator pretends to become a geopolitical player. Regional caudillos had been mostly contented with prevailing in their modest domains: Peron, Velasco Alvarado, Stroessner, Pinochet, Rojas Pinilla, Perez Jimenez, Trujillo, Somoza, Evita. Only Castro had tried to become a world player by targeting the U.S. with the missiles he had allowed the Russians to smuggle into the island. Today Hugo Chavez, with plenty of money and under the tutoring of Fidel Castro, is trying to put together a global alliance against the United States, traveling far from his country and from the region to fulfill this objective. In trying to do so he exhibits an embarrassing political narcissism, representing himself as a new Simon Bolivar.
3. Oil and Hate: a dangerous combination.
In addition to maintaining a greedy and corrupt bureaucracy of some two million people, as well as a legion of rabble-rousers and shock troops, Hugo Chavez is spending Venezuela’s oil money in three main ways: (a), about $80-90 billion in domestic handouts, giving the poor free or highly subsidized food, free basic medical attention with the help of 30,000 Cuban medical or Para-medical staff and free or highly subsidized education and transport of very low quality; (b), about $12 to $15 billion in the acquisition or in the ordering of weapons from Russia, Belarus, China, Iran and Spain, mostly jet fighters, rifles, surface to air missiles, tanks and submarines; (c), some $70 billion in actual or promised donations, grants and financing of projects and programs in Latin American and Caribbean countries that he wants to influence politically. These expenditures are designed to increase his political control at home and to try to structure a wide anti-American alliance both in the hemisphere and in other regions of the world. Some examples of his largesse include giving essentially free oil to Cuba at a cost of more than $2 billion per year, buying about $4 billion in government bonds from Argentina and close to $10 billion in weapons from Russia, while thousands of abandoned children beg for money in the streets of Venezuela.
4. Main oil strategies of Hugo Chavez.
Chavez has put in place six main oil strategies:
· He is using oil money to consolidate political control in the country. He does this by distributing money to the poor, giving them an illusion of prosperity that is only temporary. He is not using the money to create jobs or to empower Venezuelans to become self-starters.
· Replacing multinational, private oil companies with state-owned oil companies from ideologically friendly countries such as Iran, China, Belarus, or tolerant of his political style such as Brazil and, less so, Spain.
· Use of oil money and oil subsidies to gain the temporary loyalty of governments in countries that depend heavily on oil imports, such as the Caribbean states, some central American and South American countries and to form political alliances with governments in countries that share his hate against the U.S., such as those in Bolivia, Nicaragua, Argentina and Ecuador.
· Promoting oil production cuts within OPEC, in order to generate price increases that will harm the economies of the consuming countries. So far, only Iran and less so Nigeria share this position within the organization.
· Using oil money to establish global alliances against the United States. He has promised Belarus a loan to pay its $460 million debt to Russia, spent close to one billion dollars trying to get a seat in the UN’s security council and has promised to build refineries in Vietnam, Syria and, even, the Fiji Islands, in an attempt at gaining influence worldwide. He keeps making friendly overtures to China and Russia while aligning his regime with Mugabe’s Zimbabwe, Assad’s Syria, Kim IL Sung’s North Korea and Ahmadinejad’s Iran, while trying, somewhat unsuccessfully, to stay close to Ghadaffi’s Libya.
· Using Citgo as a political weapon within the U.S. This company is being used, in a non- commercial manner, to distribute subsidized fuel to “poor” U.S. citizens that have average incomes ten times higher than the Venezuelan poor and, through manipulation of internal price transfers, is being used to minimize tax payments in the U.S. while maximizing money transfers to the Venezuelan government, a tax evasion mechanism which has so far been allowed by U.S. tax authorities. Today Citgo is totally controlled by a Board made up of Chavez’s followers and is no longer perceived as a “U.S. company”.
5. Domestic and Global Impact of these strategies.
So far these strategies have had only modest success, not at all proportional to their high cost. The wasteful expenditures in the country have robbed Petroleos de Venezuela, the state-owned oil company, of funds needed for investment and maintenance. As the cow is over-milked and under-fed the company has lost about 800,000 barrels per day of production capacity. When combined with its poor management and politicized environment the company can no longer be considered a reliable supplier to the U.S. The alignment of Chavez with Iran poses an increasing threat to global petroleum supply, as these two countries are the source of some four million barrels of oil exports per day. If there were a politically motivated interruption of this supply the world would receive a major economic shock that could lead to global war. Another main outcome of Chavez’s strategies has been the increasing political friction existing in the hemisphere between countries aligned with Chavez, essentially Bolivia, Nicaragua and Ecuador and countries which oppose his authoritarian style, particularly Mexico, Peru, Colombia and most of Central America.
6. Implications for U.S. national security.
The supply of Venezuelan oil to the U.S. has been decreasing in the last four years but is still significant, some 1.4 million barrels per day of crude oil and products. It is also becoming very unreliable due to the loss of production capacity by Venezuela and to Chavez’s political inclinations to interrupt this supply. At this time, such an initiative by Chavez is unlikely because he has no immediate direct export alternatives for the bulk of this oil, which is of a nature that can only be refined in U.S. based, special refineries. In a few years’ time, however, Chinese refineries might have been built to process this oil and Chavez would be able (and probably willing) to cut oil supply to the U.S. This means that any strategic initiative by the U.S. regarding Venezuela has to be taken sooner than later, certainly before Chavez has developed his alternatives. The development of a contingency plan for the replacement of U.S. oil imports from Venezuela is of vital importance to the U.S. In fact, if and when such a plan is in place, the U.S. should take the strategic initiative of cutting Venezuelan oil imports, although this would be a delicate and somewhat risky maneuver.
7. Weak strategic flanks of the U.S.
Today the U.S. has some weak flanks that might limit its capacity to act strategically against Chavez: the Iraq war, its significant oil dependency, the lurch to the left being taken by governments in Latin America, the growing Iranian threat. Some of these weak flanks are closely related to the role Chavez is playing and might play in the future. There is no doubt, therefore, that Chavez represents a major problem for U.S. national security. At present the policy of the U.S. government is to do nothing about Chavez, to let the Venezuelan internal political process take its course, in the hope that Chavez will fall of his own weight. Given the international blunders committed by Chavez, his wasteful expenditures, the chaotic manner in which he is managing the economy and the increasing opposition his policies find domestically, this posture of the U.S. has some merit. However, the risks of a major, Chavez induced international crisis are very much present while he is in power and actually increase as his domestic political position deteriorates. I believe that Chavez is determined to go down in history either as the conqueror of the empire or as its martyr. Both scenarios probably include a violent global crisis that would be of much greater cost to the U.S. than the cost of an earlier initiative.
7. The Venezuelan mid-term outlook.
Chavez has a 40% chance of becoming a socialist dictator, Fidel Castro style and a 60% chance of self-destructing or of being toppled by frustrated Venezuelans. This chance would increase if the opposition to Chavez could agree on a common strategy of intense, popular confrontation against his regime. So far this is not happening, as some sectors of the opposition insist in playing by traditional democratic rules (elections) while it is obvious that Chavez has long abandoned such rules.
Chavez controls all government agencies, including the Electoral Council. Therefore, elections are no longer a valid option in our country. Now the Venezuelan people must act to restore democracy by other means. This is not the easy way but it seems to be the only way. In fact, it is a constitutional imperative, as articles 344 and 350 of the current constitution make it a civic duty for Venezuelans to rebel against an undemocratic usurper.
Muy bien estructurado artículo sobre la estrategia de Chávez en Venezuela, Sr. Coronel. No hay que olvidar que la lucha contra su mentada reforma educativa puede aumentar la proporcíón del 60% en contra de Chávez a niveles más elevados. Hoy ya se habla de que la abstención en el referendo de la reforma constitucional puede alcanzar el 80%. El gobierno se lanzará con todos los hierros en una campaña publicitaria para rebajar los índices de la abstención. Por otra parte, un punto que seguramente jugará a favor de Chávez en el ámbito internacional, es el papel de mediador que bobaliconamente le ha sido asignado por Uribe. Ya se dice que de lograr algún fruto, como la liberación de Ingrid Betancourt, Chávez saldrá oloroso a premio Nobel de la Paz. No se entiende cómo Uribe pudo haber cometido semejante dislate, pues un mediador debe ser neutral y Chávez se ha inclinado siempre a favor de las FARC. Salvo, claro está, que Uribe quiera lograr una negociación favorable a Colombia en relación con el diferendo sobre el Golfo de Venezuela, por aquello de "dando y dando". Como siempre, el perjudicado será el pueblo venezolano. Lo saluda, su siempre lector, Manuel Urdaneta Bermudez
ResponderEliminar