At long last socialism

Finance Minister with a common touch

Three banks and a common touch

After Nicolás Maduro’s State of the Union speech yesterday, one of the first things I did was try and fetch information on Venezuela’s new Finance Minister, Rodolfo Marco Torres. Apparently he was a military man, and after a stint at the Banco del Tesoro, he headed the state-owned Banco de Venezuela, and then the Banco Bicentenario – in fact, he headed all three at the same time. In all these posts he apparently did reasonably well, i.e., he didn’t completely wreck the place like one would expect from a chavista bureaucrat.

Marco’s Twitter account doesn’t strike me as particularly offensive. He does not appear to be a friend of Jorge Giordani, nor of Nelson Merentes, so he is kind of a middle-ground bureaucrat … no fire-breather, but not entirely rational either.

Ultimately, though, it’s not about Marco Torres (“Marco” is his last name – copy editors take note). Marco or no Marco, the people involved have ceased being relevant.

What happened yesterday is that the government doubled down on the insane economic policies that, in case you have not heard, have brought growth to a standstill, fueled inflation, generated unprecedented scarcity, and has sent the black market into overdrive.

In other words, what we are getting from now on is more socialism. There will be little play with the private sector, other than tinkering with the country’s banks in order to shore up the government’s finances. Yes, Cadivi is dying and shifting to other bureaucracies, and yes, some kleptocrat named Alejandro Fleming will now give out cheap dollars at BsF6.30 (very few, 6.30 is dead). Yes, they now say they will set profit margins for every single economic activity in the country (they can’t, they really can’t).

Ultimately, they didn’t announce any changes yesterday. The more things change, the more Maduro and his gang stay the same, incapable or unwilling to shift the dynamic in the country. They are almost literally re-shuffling the deck chairs while the boat plunges toward the sea floor. The government is not budging, so it remains incredibly vulnerable to even the slightest dip in oil prices.

The government used to like to say that they needed to “build socialism.” Well, after yesterday it’s safe to say socialism is here to stay for a while.

Scarcity, corruption, overbearing regulations, black markets galore, little to no press freedom, isolation in various forms, continuous depreciation of your purchasing power … all while a few powerful members of the elite enjoy the perks of the government’s petro-checkbook.

Socialism has indeed arrived.

44 thoughts on “At long last socialism

  1. There is no real incompetence or (instrumental) irrationality in the government’s economic policies. Advancing towards socialism and making it irreversible is not possible without destroying capitalism, i.e. making it unfeasible. Most of the economic policies in recent years have been consistent with this purpose: they have been slowly strangling private enterprise, controlling prices, limiting access to inputs and capital goods, making labor more expensive and preventing layoffs for any reason, arbitrarily expropriating without compensation, and finally destroying the currency and making it in fact non-convertible. That this has meant a high social cost and will involve a greater one doesn’t matter to the ruling elite, because it’s part of the goal. When people, desperate, try to rebel, there wont’ be a chance to protest, or to return to a market economy. This will be the opportunity to further deepen socialism.


  2. Sumary of the Memoria y cuenta:

    We can’t do shit, we have no idea how to reduce crime or curb inflation. So we’re just going to insist a little more on the same failed policies.

    Let’s blame crime on telenovelas, inflation and scarcity on speculators and CADIVI corruption on a few bad apples. Meanwhile let’s rename stuff and shuffle the same guys around (maybe this time it’ll work). Let’s use citations and adjectives such as [popular, autoctono, soberano, nacional, productivo, justo, equilibrado] (insert at least two of these) extensively to sound convincing.



  3. You forget another check, the disappearance of a middle class, thanks to the distortions Venezuelan young professionals who are not enchufados, have no access to home or car ownership. In Venezuela you work in order to barely buy food.
    The disappearance of a middle class by international standards has been the unsung casualty of chavista Venezuela and the true evidence of the march to “socialismo”


    • Absolutely correct. Not only has the middle class disappeared, they’ve fled the country as well. How many ‘votes’ have left Venezuela since 2002? Surely enough to have prevented an uneducated former bus driver from assuming the Presidency in April of 2013. Right?


    • Im 25, about to graduate.Me and my wife are already planning to starting over somewhere else with a few bucks just to get a job as anything in someplace i’ve never been to. Seeing how fast everythings decaying, i might not even graduate and will be celebrating a holiday i don’t understand this very year.


  4. Socialism can’t function when there is no more money to steal from those who produce and in Venezuela’s case, when there is no capitalistic country out there with billions of $$$ to buy oil. Then the government’s ability to stay in power will depend on how well it can convince the people that the reason there is no milk is because a CIA agent shot the cows.


    • Key point here from DH’s comment : convincing the people of why things turn out the way they do.

      Chavismo success factor building a tight , if totally untruthful narrative.
      Easy to re tell and use: Blame the capitalismo, Socialismo is the aswer….

      But more importantly instituted a excellence in leadership and modelling style:
      With the revolution everything (riches, power, impunity) against the revolution jail time, exile, discrimination or worse.

      Pranes knew well how to align with this,
      so did moral invertebrate adecopeyanos of yesterday fame.

      Many oppo leaders, were caught in the traditional game of quitate tu pa’ponerme yo, and have not challenged the chavismo model on grounds of principle and value.

      Very few have challenged the petro state with hopes of being able to survive the NAUFRAGIO and to take over the coroto.

      Tiempos dificiles Venezuela.


  5. At some point, the revolution must be declared a failure. Maybe not publicly, but the promises and expectations sold to the believers has to fade away into the past. The one common truth is that our lives don’t wait. We all get old and die!


    • Gordo, read Cal’s post above. The revolution is a success from the revolutionaries’ perspective. And that is all they care for, don’t they?


        • Los Piratas del Caribe are not accountable to election platforms nor will they ever be on the record as conqueror’s of Venezuela, They are well satisfied to be the de facto rulers and to enjoy the war spoils.


  6. Is this “El plan de la patria”?
    1. Corrupt the youth and give them absolute sexual freedom.
    2. Infiltrate and take control of the mass communication media.
    3. Divide the population into antagonist groups; encourage arguments between them over social issues.
    4. Destroy the people’s confidence in their leaders.
    5. Talk all the time bout democracy and republic, but when the opportunity arises, seize power as a dictator.
    6. Cooperate with the drainage of public funds; discrediting the image of the country, especially overseas, and create panics within the population through the launching of an inflationary process.
    7. Encourage strikes, even if they are illegal, in the country’s key industries.
    8. Promote riots while conspire to prevent intervention by law enforcement.
    9. Cooperate actively in destroying the moral foundations of society and honesty and trust in the government’s promises. Infiltrate other parties with your own people, forcing them to vote for what is useful to your own party’s interest.
    10. Register everyone who has firearms, in order to confiscate them when the time comes, preventing them form opposing your revolution.


    • I don’t know what to make of these items:

      “1. Corrupt the youth and give them absolute sexual freedom.”

      “10. Register everyone who has firearms, in order to confiscate them when the time comes, preventing them form opposing your revolution.”


        • That’s silly. You probably are taking over a US topic.
          Hold it in the US, particularly in the Mid-West.
          By the way: Northern Europe has quite a lot of sexual freedom, much more than in Venezuela…and yet the murder rate is 1/4 that of the US and 1/60 that of Venezuela.


      • I found this to be lenin’s decalogue in 1913. A few changes 100 yrs later may be what we are experiencing behind the scene. Google it.


        • I think Lenin was a psychopath, a criminal, by all means a terrorist, but those statements sound like not something Lenin would have written in…1913? Or in 2014, for that matter.

          1913? I have read a couple of books written by him and a couple of articles, I know there are quite some methods commies used time after time, but those two topics so dear to the US far right do NOT really seem to remind me of anything from those times in Russia…perhaps I am wrong.

          I found now this

          and stuff about a decalog hoax.

          Can you show me the original Russian title? I have read What is To Be Done, I have read a couple of his articles and I have read a little bit of secondary literature about the period, from both Soviet/Russian and US/British scholars…but so far I haven’t found that piece. Thanks for the original (not a US blog about them).


          • You seems to know very well Lenin and Soviet history, I got this from a Brazilian friend today who is married with a Venezuelan and follows both countries. Populism is in Brazil big time now (Bolsa Família, bolsa escola, and many similar to Las misiones), 5,000 Cuban doctors have arrived with plans to increase to 15K, more plans now since Dilma acceptance was low after protest and corruption is big from Lula legacy. People in Brazil knows they are not isolated from Argentina and Venezuela current situations.
            I have many Argentinean and Brazilian friends that see Venezuela as a model their counties are following now, that’s very sad.

            Whatever plan the chavistas put there it doesn’t mater as they follow a hiden agenda similar to what is there jus take these two points.


        • I googled it. The first result is a 2010 blog post from a “Dr. Kent Show”, who uses as a source another article that doesn’t reference the original document either.

          The rest of the results is Tea-Party-ish anti-Obama articles.

          Until a proper source is provided, I’ll put that Decalogue in the “Hoax” category.

          Furthermore, complaining about young people having sex AND the government taking people’s guns has “US southern evangelical republican” written all over it. They might as well throw in some reference against teaching evolution.


          • Agreed! I am not the owner of the true but also careful with google… Depending where your IP is you may see different contents from other places and it is influenced by many factors (Marketing, Governments, informational embargoes or purely classification…)
            As I mentioned above to Kepler I got this from a Brazilian friend and this is going around in Brazil, my point is not the literal content but the hidden agenda of “Social Engineering” going on in Venezuela same as many other places.
            The government do different from what they tell and I wouldn’t discard something like this being pas hand by hand up to Fidel and Chavismo that is not in google or public books or libraries.


    • I support a corrupted, sexually free youth (with a little irresponsibility and unaccountability sprinkled on top, please)


  7. I disagree that “Socialism” has arrived in Venezuela, or for that matter anywhere else.

    Socialism/Communism is an utopia, an unreachable world in which individual human nature and liberty are crushed in favor of a “common” good.

    Talk to a commie today and he’ll say “the USSR and its satellites failed because true communism was never implemented”.

    Thus, what screwed every single communist country and is screwing Venezuela today under “socialism” is the process of trying to get to the utopia. When it fails (not if, mind you) they’ll blame not the doctrine, but some other entities (you know what I’m talking about here). When the country finally hits rock bottom, other frustrated parasites somewhere else will say that “Venezuela never had a really socialist regime going on…”

    This is why I hate these bastards so much. They’ll run Venezuela to the ground while attempting the unobtainable, and people I love will suffer the consequences. I’m getting the hell out once again very shortly, but I can’t take 80-90 people with me. I know I’ll never be 100% happy unless I hit the Lotto and charter a Boeing 737 out of this mess for my relatives and close friends.


  8. What the autor of this post fails to understand is that all what matters is to defeat hunger and poverty and we are well on the way to do that.

    Statements implying that there are no dollars are simply facile and mendacious. Considering that government estimates indicate that around US$12 billion was stolen from Cadivi in the last year by unscrupulous importers means that a new system is needed.

    It means that stricter controls will be exercised in impoorters and infractions will mean jail time.

    I note from my own experience this week tha tprices have dipped sharply in the supermarkets probably due to a good dose of fear inhected into speculators minds in the last two months.

    Continue dreaming. The country will not go bankrupt however much you pray. Every uear CC starts with the same crap and ends up having to clear it up when the country arrives at December 31st still afloat with no sign of political change.

    We do not want to be in the shit hole like the Europeans or the US with milions upon millions of unemployed when unemployment here is under 6%.

    Poverty has dipped for the first time below 20% (19.6%), extreme poverty is under 6% (5.5%). These are the things that matter and no matter how you spin it – the economy has grown for 12 consecutive quarters so no one is complaining and the stock market in Caracas hit anotehr historical high today. Wages have increased by 59% since May. Formal employment is now 63% and informal employment 33% – the reverse of the mess the IV Republic left us.

    So even by your capitalist criteris this is a great performance by an excelletn economic team.

    I cannor understand the mumbo jumbo reasonaing you give?


    • Give a poor man a fish, and you give him a meal.
      Teach a poor man a fish, and you give him meals for the rest of his life.
      Socialize fishing, and the poor man would rather not fish.


    • Arturo, you can’t pick and choose which indicators to look at.

      For example, half the poor is a good indicator, half the poor at five times the income is a bad one.


    • “I note from my own experience this week tha tprices have dipped sharply in the supermarkets probably due to a good dose of fear inhected into speculators minds in the last two months.”
      – Odd, I have it from two different sources in two different cities, Valencia and Merida, that prices have edged up slightly. The parallel rate has continued trickling upward as well, which would support that statement.

      “We do not want to be in the shit hole like the Europeans or the US with milions upon millions of unemployed when unemployment here is under 6%.”
      – Yes, please, let me continue living in a “shit hole” with 1/20th the murders, 2% inflation, packed store shelves, toilet paper whenever I want it, and only moderately crumbling infrastructure compared to completely crumbling infrastructure and equivocal unemployment. Yeah. I said equivocal. Unemployment in the US was 6.7% in December. There might be millions of unemployed, but, as a general rule, the population is 10 times that of Venezuela, so that should be the case. Did I mention how, with some exceptions, the informal economy is discounted from US unemployment figures. I don’t always agree with how the BLS quantifies unemployment, but as a general rule, the informal folk aren’t considered employed, unlike in Venezuela. If you want to hock pirated DVDs on a corner, 3/30 bolos, and call that a job, more power to you.

      “Poverty has dipped for the first time below 20% (19.6%), extreme poverty is under 6% (5.5%).”
      – While I concede that the poverty numbers have been reduced, this isn’t quite as outstanding when compared regionally. Additionally, inflating your way out of a stationary global metric isn’t exactly progress, since the poor remain poor; it all comes down to purchasing power which hasn’t fared well under the current regime.

      “– the economy has grown for 12 consecutive quarters so no one is complaining and the stock market in Caracas hit anotehr historical high today.”
      – While the economy has grown, according to the BCV, that growth has become tepid. Why? Oh, a little BOP issue, I imagine, as reserves dwindle. In hippy-lingo, its called unsustainable. The trend line, considering the non-stationary nature of the data, is actually probably not that accurate given your limited window, but represents something vaguely terrifying.

      Likewise, citing the BVC is a horrible economic indicator. It is thinly traded and only has a few issues on it. Some of the components don’t even trade consistently or have been subsumed elsewhere. The BVC should never be used to tout the power of the Venezuelan economy…using your same logic, Bangladesh must be having a horrible year, the DHAKA doesn’t even trade anymore.

      “Wages have increased by 59% since May. Formal employment is now 63% and informal employment 33% – the reverse of the mess the IV Republic left us. ”
      – And inflation and scarcity have increased by how much? Also, where is the missing 4%, or is this chavista math? And all of this, as extorres always notes, in light of 5x increase in oil prices/government incomes.

      “So even by your capitalist criteris this is a great performance by an excelletn economic team.”
      – Not hardly by capitalist standards, or anyone elses’. I have 2nd year pothead econ students that are likely more capable of formulating a cogent economic policy than your entire cabinet. All 151 of them. Your revenue streams of hard cash will dwindle as you mortgage your future income away for cheesy loans and credit card borrowing rates. Your government, even in its “decree by decree” mode cannot come up with the adjustments needed to save itself. Socialism = suicidal governments. You should be ever so proud.


    • Ok. I really have no time to pick on your comment argument per argument. Clear flaws in your reasoning. For example, mentioning that the stock market in Caracas hit another historical high is not indicative of anything, especially when the liquidity is close to none (Bs.F 1,350 on avg. per day during last year!). And actually, to be technically correct, it would have been the index that reached a historical high not the stock market itself. It might sound pedantic but your behaviour its exactly one of the things that are wrong with our country, people talking out of their scope without any professional background whatsoever (both in opposition and govt.). Respect for professionals was lost a long time ago, encouraged by Chavistas who think that because “professionals” in the 70’s/80’s ruined our country then anyone can run a country (i.e. a bus driver with no professional/academic experience whatsoever in a relevant organisation/country ) . I hope you acknowledge your lack of knowledge in the field and at least apologise if you want some sort of respect.


    • I think Arturo has a point, I mean, the sheer amount of North Americans and Europeans lining up at Venezuelan embassies around the world are a clear sign that the excellent economic team at the helm of Venezuelan finance is no match for the shitty economists elsewhere… I hear the UK is attempting to impose a CADIVI of their own to close the floodgates of educated young Britons from fleeing their doomed shit hole in panic to this tropical paradise.

      of course, any VTV viewer would be glad to confirm that the only reason Venezuela is still not the superpower that chabe promised, as we hear each and every December 31st, is because of those opposition capitalists and their conspiracies… fuck them, fuck them in their asses with the long arm of Diosdado!


  9. “They are almost literally re-shuffling the deck chairs while the boat plunges toward the sea floor”

    And the passengers haven’t yet noticed that the ships crew are all wearing pilfered SCUBA gear?


  10. Does the building of a socialist economy require shortages , high inflation , interminable queues , falling production , the ruin of govt enterprises, huge delays and deficiencies in govt services , a destroyed infrastructure , rampant crime ? or is that necessary in order to create a tyranical political sytem that feeds the fantasies and over blown egos of few self deluded megalomaniacs by destroying the economy that would make ordinary people independent from their dominance .??


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