(This week I am starting a new Caracas Chronicles column: the weekly Friday-afternoon-suggestion-for-a-controversial-conversation-topic-over-Sunday-lunch post.
Many extended Venezuelan families get together around the lunch table on Sundays, and after the meal is done, they engage in the “sobremesa,” a sacred Venezuelan tradition where people have dessert, drink coffee, chat, gossip, and generally bitch about the government.
The sobremesa is a great occasion to catch up with relatives and impress them with your weird theories. It’s also a good time to challenge ridiculous Venezuelan conventional wisdom and, if you’re one of our younger readers, annoy your parents with wacky stuff you’ve read on the Internet.
If you do this and a furiously passionate conversation unfolds, I would consider my job done. Regardless, I would love to hear how the conversation went in the comments section. Have a great weekend, everyone.)
The Venezuelan economy is in shambles. So is our public sphere.
You see, there have been a lot of rumblings lately about how chavistas have supposedly wasted away the nation’s fortunes. They “dilapidated” the oil boom. They “gave it away” to other countries. They “stole it all.”
Comparisons with the sovereign wealth funds of Norway, Saudi Arabia, or even Russia abound. Chavista incompetence and graft are blamed by all.
They make it sound like a trillion dollars of oil wealth simply disappeared inside one of Diosdado Cabello’s pockets.
Bull. Crap.
Sure, theft is a big part of the story of why we’re bankrupt. Venezuela is, in many respects, a kleptocracy. But we simply cannot claim that chavistas “squandered” the oil boom. All of us are to blame.
Misiones were giveaways that ended up in the pockets of millions of Venezuelans. Some of them surely spent their Misiones money on flat-screen TVs and additions to their ranchos which yielded few long-term benefits. The government does not bear the fault for their financial decisions.
Cadivi was a massive handout to the middle class. We all know people who have made a killing off of “raspar cupos” and generally taking advantage of exchange rate distortions – heck, they’re still doing so! Venezuelans of all stripes paid subsidized airplane tickets to travel extensively around the world these past ten years. Some saved the money they made off their allocations. Others decided to spend it all on holidays. Many reaped the bounty.
The government payroll increased by hundreds of thousands of people. These people don’t really do anything in their jobs. They just sit there, idly cashing in on the oil boom. Heck, even middle class housewives began getting a pension from Chávez a few years ago. What they decided to do with their little chunk of the oil boom had little to do with the government.
And let’s not even discuss the subsidies. One can make the case that Venezuelans were paying artificially low prices for everything from construction material to black beans the last few years. How much of the oil boom of the last ten years or so was literally burned away in free gasoline for everyone?
Finally, let’s remember that not all oil revenue was necessarily oil profit. Some of it went to pay for the cost of production – the drills, rigs, and ships needed to take the oil to market. Oil revenues are irrelevant – one has to look at oil profits to get the correct financial picture. Politicians who speak of oil “revenues” are being deliberately misleading, or just plain ignorant.
Chavistas have benefitted handsomely from the oil boom, and they have dilapidated a big chunk of it. But let’s not kid ourselves: some of the benefits trickled down to the rest of us. Any time we loaded our car with gas, went on a Cadivi-sponsored vacation, bought a Cadivi-subsidized Dutch cheese, cashed in a government paycheck or pension, or purchased something at Mercal or PDVAL, we too were “dilapidating” the oil boom. And any time we voted for the people engaged in these types of policies, whether government or opposition, we too were dilapidating the oil boom.
Ojo, I’m not making any judgments here. All I’m saying is that claims that chavistas simply squandered the oil boom – as if they held a party and none of us was invited – are factually incorrect.
Sprinkle that on your bienmesabe.
Caracas Chronicles 
Chamo como haces para leerme la mente asi! Tengo un par de dias pensando que lo que falta en Venezuela es un “vamos a asumir nuestro barranco” colectivo. Todo el que viajo con Cadivi, el que compro lomito subsidiado, el que le echo gasolina al Fairlane del 74 (o al yate/avion), el que le pago $200 mesuales a la senora que trabaja en la casa ademas de todos los que mencionas arriba, todo el mundo a asumir su barranco.
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Wolverines think alike my friend!
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Realmente eso de que “todos tienen la culpa” suena bastante a la excusa chavista estándar para perdonarle las marramucias al fiambre.
Además, no es culpa mía que el gobierno cree subsidios tan absurdos y quiera usarlos luego como un chantaje.
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De acuerdo! También es una característica de los sistemas totalitarios de involucrar la ciudadanía en sus prácticas y crímenes. Así que nadie es inocente, nadie debe protestar!
Es mala estrategia política para la oposición hacer hincapié en esta complicidad relativa.
Es mucho mas inteligente culpar al régimen por crear las prácticas, sumando fuerzas con toda la ciudadanía, no solamente con los “limpitos”.
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“Mucho más intelgente culpar al régimen por crear las practicas”, de repente, pero así no se resuelve nada. This government has probably the most to blame, but don’t fool yourselves, none of this could have happened without the complicity of the rest of population who benefitted from all the giveaways. The reality is that this has always been the case in venezuela, and I don’t really see this changing anytime soon. This is the defining characteristic of the Venezuelans, “la Viveza Criolla” or simply put, pull the scam yourself, before someone pulls it on you!
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No es por nada pero creo que varios ejemplos planteados estaban fuera del control del venezolano promedio o eran respuestas logicas y predecibles a un incentivo economico. En particular creo que el de comprar televisores es injusto porque se puede argumentar que los electrodomesticos se depreciaron menos que el bolivar fuerte, por lo que las personas que gastaron bolivares bien pudieron haber hecho lo mejor para proteger sus ingresos.
En cuanto a los empleados superfluos, creo que es ingenuo pensar que alguien prefiera estar desempleado en vez de tener un trabajo remunerado por muy superfluo que sea solo porque esta conciente de la situacion. Lo de raspar cupo tambien es un claro incentivo, ya que la disparidad entre la tasa oficial y el valor real del dolar permite proteger lo bolivares que se ganan de la inflacion.
Basicamente creo que culpar a la gente por actuar de forma acorde a los incentivos economicos y a su interes propio es como acusar al agua de ser mojada o a una vibora de ser venenosa.
Por ultimo, no creo que sea particularmente justa la acusacion de haberle sacado provecho a los precios regulados de los materiales de construccion/alimentos porque su precio real no se paga solamente en bolivares fuertes, sino en el tiempo que toma procurar los materiales y el costo de oportunidad incurrido al no poder conseguir materiales escasos (que por cierto, son causados por la mala gestion del gobierno de turno).
Con la gasolina/comida regulada diria que es mas complicado porque si bien el estado esta dejando de percibir entradas por vender a esos precios, no es practico a nivel individual evitarle la perdida al estado. Es decir, aun comprendiendo que el estado pierde plata cuando compro gasolina/comida regulada, necesito gasolina/comida para ir al trabajo/seguir vivo. Tambien como dije en el parrafo anterior el precio no se paga solo en bolivares fuertes, asi que tampoco la cosa esta tan regalada.
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Tus puntis son válidos y me parecce que tienes razon al decir que ,por ejemplo, nadie que este desempleado despreciará un trabajo en el gobierno. Sin embargo,el punto del articulo (al menos para mi) es que debemos entender que el dinero se va no sólo porque “se lo roban” sino por que existen un sinfín de defectos en el sistema que hacen que el dinero desaparezca.
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Yo habia entendido que el argumento era mas como decir “la culpa es de todos” por ejemplo, en este parrafo:
“Misiones were giveaways that ended up in the pockets of millions of Venezuelans. Some of them surely spent their Misiones money on flat-screen TVs and additions to their ranchos which yielded few long-term benefits. The government does not bear the fault for their financial decisions.”
Ahi el argumento no es que algun defecto en el sistema hizo que el dinero desapareciera. Mas bien fue que algunas personas malgastaron su plata y ese despilfarro en particular no fue culpa del gobierno, sino de los venezolanos.
Sin embargo, queda claro que en el contexto de la economia venezolana ahorrar no es una opcion por la inflacion y que el estado es enemigo de la empresa privada, por lo que el mejor uso del dinero bien podria ser gastarlo en algo que conserve mas su valor.
Dicho esto, es posible argumentar que ese gasto con “pocos beneficios a largo plazo” si son en parte culpa del estado, ya que si hubiesen controlado mejor la inflacion no habria incentivo para gastar en vez de ahorrar.
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Ojo, I’m not making any judgments here. All I’m saying is that claims that chavistas simply squandered the oil boom – as if they held a party and none of us was invited – are factually incorrect.
One problem with your claim. While you are correct that there are millions of beneficiaries of this squandered money, not just Army generals and Godgiven, the millions of beneficiaries were not the ones who set the government policies that resulted in such cash drains as Cadivi and gasoline cheaper than bottled water.
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That is true. But it is also true that everybody was super happy about it. I remember my family visiting us in the USA. How proud they were that gas was free, that services were almost free, and lets not even talk about cadivi.
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They used to say “Venezuela es el major pais del mundo”
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Quite true, yet nobody put a stop to it. In all fairness calling an end to that pachanga will be political suicide (for politicians) and will probably earn you a “can o’whoopass” from the people around you
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So what you are saying is that we should not drive a car, take a bus, take a taxi, shop at PDVAL, fly abroad, collect a pension, go to school or go to the doctor cause doing any of that would make us as guilty as any chavista? FFS theft and corruption ARE by far THE biggest factor why Venezuela is bankrupt!!!! And we are talking 100´s of billions of $$$$ …… $$$$$ not Mickey Mouse (hyper inflation) BsF!!!!!
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No no no, all I’m saying is that if you did all that … you can’t claim somebody else stole your oil windfall! At least not all of it.
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Exercising the rights granted by the social compact that is the Constitution (which was agreed between the State and the People) is not an excuse for government’s missmanagement.
Constitution grants a set of rights, and government should administrate resources to guarantee them, this government had the biggest oil boom and none of the rights agreed by means of the social compact have been granted properly, not in relation to the Republic’s income of the last 15 years.
“If you ate black beans, can’t blame government for their current shortage” that’s bullshit and it is no more than a mere excuse. Government exists to the only purpose to allow State manifestation in society, and this government not only exercised its power as government, but ultrapassed it making itself the State, so it shifted the social compact at its will by means of legislation and jurisprudency.
Beyond the frame stablished by government, against the original social compact, there’s no other ways to operate without punishment or success. So, Is a society guilty for the government missmanagement beyond the votings? I guess no, if policies were not consulted with and voted by the People, which only operates in direct democracy. Foreing currency exchange control was not voted, it was imposed against our economics rights. Gas subsides exists not as a part of our social compact, it was imposed just by will of government and there’s no other way to get gas. Petrocaribe agreement didn’t consultated People’s will before been enacted even though it supposed an enormous loss in our public accounting. When Maduro returns from its family honeymoon in Asia, will the society be responsible for the partition of Venezuela between russians, arabs, and chineses? No. When the government consultated the People about their policies beyond cheating a Plan de la Patria that doesn’t say anything about the operative framework of the policies? Never. Most of the voting will in this society was builded upon a scam by the politicians. People is not agree with the expropiation policy and it was adopted, people is not agreed with paying 2500 USD/month for each cuban medic and the Republic, WE are still paying that money.
Do you feel guilty because of not exercise the 350th article? How could you exercise it? There’s no legislation for the operationalisation of that right beyond civil rebellion. And civil rebellion is a crime according to the 1961-Constitution-adapted penal code. By omission, government (in a pervert State-all-branch-control system) prevent the People from the full exercise of rights. You can’t blame the people for being ignorants if there’s no way to properly illustrate them and the system swindles them, and this principle even applies to votings reducing People’s responsibility in the choosing of it leaders.
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“After the uprising of June 17th
The secretary of the Writers’ Union
Had leaflets distributed in the Stalinallee
Which said that the people had forfeited the government’s confidence
And could only win it back
By redoubled effort. Wouldn’t it
Be simpler in that case if the government
Dissolved the people and
Elected another?”
Bertolt Brecht. “The Solution”. 1953
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Its references like this that make the comments section always interesting.
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If I were a long time supporter or beneficiary of the regime I might simply think: oil prices are to blame for all of this. Or to put it another way, I’d reflect, God willing, oil prices will go up again soon, and then I’d go back to my routine.
And to speak to some of what you mention in terms of complicity, I wonder if a lot of people may at some point look back 4 or 5 years and talk about the good-old-days under Chavez, and how, as the old theme went, things only fell apart when they were left to his advisors.
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In reference to your second paragraph:
I too have often dreaded that scenario.
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But how are I am to get around than, were does my son gets his education, with what money does my mother in law do her shopping and where etc etc!? Its not our fault that government subsidizes so much. And stating that using or benefiting from those subsidies is wrong or takes away the right to bitch about where all the oil windfall went is just wrong I think!
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It doesn’t take away your right to bitch about it. All it does is take away your right to say that the oil windfall magically disappeared.
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Oh ok, my bad… Next time I will ask for the not-subsidized gas price at the gas station. Or tell my bank I’d prefer to use my credit card freely while travelling at the not-subsidized exchange rate. Chamo, I’m sorry to say, but what a poor argument…
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Sigh. You did not understand the post at all. You’re in good company, though. My fault probably.
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Well, you got the sobremesa going, all right :)
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I hate these “collective fault” arguments. Not ’cause I feel particularly offended, but I consider them as way too lazy and intellectually crude.
“The sense of responsibility has been weakened in modern times as much by overextending the range of an individual’s responsibilities as by exculpating him from the actual consequences of his actions… Responsibility, to be effective, must be individual responsibility. In a free society there cannot be any collective responsibility of members of a group as such, unless they have, by concerted action, all made themselves individually and severally responsible. A joint or divided responsibility may create for the individual the necessity of agreeing with others and thereby limit the powers of each. If the same concerns are made the responsibility of many without at the same time imposing a duty of joint and agreed action, the result is usually that nobody accepts responsibility. As everybody’s property in effect is nobody’s property, so everybody’s responsibility is nobody’s responsibility.” FA. Hayek.
So, this is pretty much why I hate sobremesas. ‘Cause I do not enjoy crudeness.
Someone is responsible for the incentives that move people to buy plasma TVs, raspar their cadivi dollars, and so on. Someone with power. Power to design institutions that model behavior.
Each person is responsible for their own actions: to murder, to rob, to be unproductive. But you can’t blame them for the Government’s incompetence in promoting proper behavior.
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Very good.
This point needs to be repeated until is understood.
The responsibility for the consequences of economic policies is on those that drafted and enacted those policies.
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Hear hear
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I subscribe completely Ego´s opinion. People respond to incentives, and incentives are consequence of policies and responsibility of policymakers. This collective blaming is exactly the equivalent of blaming bachaqueros for scarcity levels. Policies are to blame, people´s behavior are mere consequences.
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Juan, I re-read your argument and now I thing you have a valid point. Putting the entire focus on blaming the chavista kleptocracy of “wasting our boom” as JB did, also is a very counterproductive reaction, it diverts the focus away from the policies. And the focus must be on policies.
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Oh sure, it’s everyones fault. It’s the way things are, and you can’t make a stand on moral principle when everyone is making a profit off of it. Case in point, the gasoline. Everyone knows about the squadering of a potential profit there, that subsidy costs us dearly. Cadivi? Another massive drain of dollars. But you can’t seriously suggest that we look ourselves in the mirror and feel guilty. If and when we get out of this mess, all those “privileges” will disappear. Yes, it must, or we risk staying in one place. But your argument applies to those in charge, to those few who profit massively. To the regular citizen, middle class or whatever it boils down to simple survival. I use Cadivi because otherwise it would be impossible to travel. But Cadivi has boosted the black dollar so much that it is PRECISELY why it would be otherwise impossible to travel. Is there another rate for gas other than 2 cents a liter? No, so where is that soul seeking opportunity for redemption in paying for “what’s fair”? You can’t ask a person employed by a Ministry (pick any single one) to quit their job over principle if the country is so fucked up that they can’t find another job.
My point is, the situation can’t be Black and White, “Modus Ponens”. There are many shades of black, of white, of grey (more than fifty, ba dum tst).
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And besides, you can’t even compare what trickles down to us mortals to what devious bastards up top have skimmed to their bank accounts. Oh sure, I bought a subsidized plane ticket to Miami, I’m equally guilty of this mess as el Pollo Brito who cashed in on 79 million dollars last month with his drug operations. Or Juan, the bachaquero who made 55 thousand selling gas in Colombia.
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Ohhhhhhhhh! Fumble, fumble!! Horrible mistake!! El Pollo Brito is completely another kind of chicken, Dobleru. You meant el Pollo Carvajal, FGS. El Pollo Brito is an excellent musician and entertainer, well appreciated in his field. His group just won a Grammy Latino in the last edition. Apologies are in due, my friend.
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Wow, indeed what a massive fumble on my behalf. I did mean el Pollo Carvajal, the narcotics dealing general, not el Pollo Brito, acclaimed musician. My bad.
At least I got the nickname right so half points for me?
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There were decisions by the regime which benefited no one , for example those taken by regime supporters or bosses to line their own pockets or those of their partisans or allies . For example a road is built at thrice the normal cost because of bribes paid the regime bosses , the road of course benefits you as a car driver using that road but ultimately you were harmed in your interests considering what addional things could have been done with the bribe money and which you will now not be able to recieve . The harm is even worse when the road is badly built or never gets build despite the money spent on it..
Then there were benefits which one could not choose to reject because they were dispensed generally to the whole population , including yourself. e.g. the gas and other subsidies and which involved using things which you could not avoid using . .
Moreover there were decisions taken by govt bosses which resulted in more money being spent than was reasonable or rational simply because of the govts crass incompetence so that taken as a whole they resulted in money being wasted which could have been spent to benefit you or your descendants.
Ive heard people who didnt believe in the govt take advantage of some benefit the govt was offering with the argument that as citizens they were being stolen blind so that if they took advantage of that benefit they were only profiting with the little that the govt gave them . ( better something than nothing) .
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What else are ordinary citizens supposed to do with the oil windfall if the benefits they see from it are in bolivars, a currency that has absolutely no savings value. You only really have the following options with respect to excess cash:
– Spend on goods or real estate; real real estate is too expensive, so in the end all that is left are cars and other goods or enhancements to their “ranchos”, any of which will retain its value more than the bolivar over time. So “buying stuff” actually makes more sense than saving.Your only option for actually saving is buyings dollars in the black market, which is not as easy as you’d think for the ordinary venezuelan that has no USD bank account.
– Spend on services, vacation, enterntainment. Might as have some leasure value instead of leaving your money depreciating every minute while sitting in a VEB bank account.
– Take advantage of CADIVI travel dollars. Maybe the only way ordinary Venezuelans can have access to dollars.
You really can’t fault the common person for acting rationally based on the limited options that the system makes available for them.
The REAL blame on ordinary people is that they keep on voting for this government, but that’s a whole other discussion….
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I think this is too strong.
The many “private benefits” that are listed are mostly the result of chavernment policiies. If I hand out out money on the street to bums who spend it on cheap booze, did they squander the money or did I? The black hole of CADIVI was created by the chavernment.
Plus a lot of “benefits” became necessary ways for Venezuelans to compensate for the destructive policies of Chavismo.
In short, the chavernment established most of these drains (not the gas subsidy, of course), encouraged people to use them, and to a substantial degree made it impossible to survive without using them – or even to get through the year without breaking down. When crime is rampant, electricity and water missing half the time, food is short, roads and highways jammed or broken, and one’s pay is months in arrears… not taking a free Haier appliance or scamming some money off CADIVI is more scrupulous than most people can manage.
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I would like to know about articles taking the ALBA/Mercosur/latinamerican investment plan of chavismo seriously. How have countries in south america benefited?
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*takes another sip from the marroncito and digs a spoon into the Bienmesabe*
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the only valid responses to this post.
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I think that a lot of people are missing the point that Juan tried to make. What i got was that we cant claim that the stole ALL the money when so much of it went to huge amounts of subsidies and giveaways. And lets not forget to all the dollars given away to ALBA members, Cuba, etc.
I had the chance to do my undergrad abroad, which was only possible thanks to cadivi. Thats almost $100,000 that the government didnt steal. I think thats Juan’s point folks.
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That’s exactly what he’s, glad to see in your case that was money well spent.
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*saying
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The problem is, that it is not true that a huge amount of money went to subsides, assistencialism and giveaways. There was no giveaways indeed if you take in mind the right you have that your work should be worth the same inside and outside the country, and it is government responsibilty to guarantee this economic right. Maybe you studied abroad by means of a subside, but if this government macroeconomic policy had been right, your parents or yourself could had financed by free exchange your studies, maybe by a loan, a possibility that is real in countries like Nicaragua (at a 6-9%) for example.
Don’t fall into the Revolution’s-gifts-shit because the social compact called Constitution guaranteed (not just theoretically) a set of rights. Social security and a elderly retirement payment for example are not gifts of the Revolution or of this government, they are a right agreed between the State and the People, by means of referendum. Justice is not a gift, and the same is for the right to free sanitary assistance (via the Hospital system, the ambulatory network or Barrio Adentro Mission), access to public education (by public, subsided or copaid schools and universities) and all the economic rights (free availability of fund, free of asociation, free of entrepreneurship, etc) that are supposed to be exercised by WE the citizens of this country.
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You, sir, have just won the argument right there. Caution must be exercised when praising populist policies, lest we lose sight of the bigger picture and paradigm
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“the right you have that your work should be worth the same inside and outside the country”
Well, now you’re just making stuff up.
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Efectivamente la sociedad venezolana tiene una gran responsabilidad en el desmadre que se ha vuelto el país, pero, eso no implica que se pueda eximir al gobierno como agente administrador del Estado de su responsabilidad, principal, en la construcción de la situación actual, pues es el gobierno quién ha diseñado, ejecutado y legitimado un conjunto de políticas perversas que, dilapidando la mayor bonanza petrolera de la historia del país, ha exacerbado aquello que en Venezuela se llama “la cultura del vivo”, del pícaro, y que debe llamarse sin eufemismos, del corrupto.
Cuando se habla de la dilapidación de los ingresos de la República, la gente seria se refiere a que el gobierno, el administrador de los recursos públicos, ha malbaratado los recursos, ha contratado cantidad de proyectos para no ejecutarlos, ha emprendido la ejecución de otros sin culminarlos, ha distribuido una liquidez artificial en la economía, ha omitido ejercer una política macroeconómica seria, ha alimentado una espiral inflacionaria, ha creado un régimen de preferencias y controles, y ha establecido acuerdos y convenios en franca vulneración del interés nacional. En todos esos aspectos, la sociedad no puede recibir la responsabilidad ya que ninguno de los elementos causales de la debacle del país han sido consultadas a la sociedad, han sido impuestas, mediante un discurso engañoso, una estafa emprendida por los políticos que hacen pasto del gusto del venezolano por el mesianismo y el paternalismo.
Nada de lo que argumenta el Sr. Nagel es nuevo ni exclusivo de este gobierno, Venezuela siempre ha tenido controles de precios, controles cambiarios y sistemas preferenciales; pero en ningún momento se evidenció la postración de la economía que hoy experimentamos. Y no es que la sociedad haya cambiado, el tema es que en este gobierno se ha atizado la conducta del piñatismo, de la rebatiña. Cuando el gobierno como administrador de los recursos del Estado falla en la distribución de la riqueza, es lógico que cada cual intente tomar su porción de la torta, y el gobierno es responsable también por omisión de que esa cultura perviva al no ejercer su potestad para corregir las fallas de las políticas asistencialistas. Y hablando de números serios, Sr. Nagel, las migajas que han permeado a la sociedad a través de subsidios (a la gasolina, la electricidad, CADIVI, controles de precios) y políticas asistencialistas (misiones, seguridad social) no representan nada en comparación con el sumidero sin fin que ha sido la mala gestión macroeconómica, geopolítica y estratégica del gobierno.
Right, the venezuelan society has a big share in the what-the-heck Venezuela has become, but, this cannot imply the government can be excused about its responsibility, the main one, as the administrator agent of the State in the building up of the country’s current state. This is because is the goverment who desinged, executed, and legitimized a set of pervert policies that, wasting the biggest oil boom in our history, has exacerbated that what is called the “vivo culture”, the rascal’s one, and that should be called “the corrupt men culture”.
When serious people talk about the Republic’s income wasting, they say the government, the public funds administrator, has squandered the resources, has hired countless projects to not be executed, had started the execution of other ones without finish them, has distributed artificial monetary liquidity in the economy, has omitted to perform a serious macroeconomic and fiscal policy, has feeded an inflationary spiral, has created a regime of preferences and controls, and has stablished agreements in a frank vulneration of Venezuela’s national interests. About all those aspects, society cannot be blamed for, as none of those policies had been advised with the society, they has been imposed, through a deceptive speech, a scam undertaken by the politicians that takes profit of the venezuelan’s taste for messianism and paternalism.
None of Mr. Nagel’s arguments is new nor exclusive of this goverment, Venezuela has ever subjected to price and exchange controls and economical preference regimes, but never in history the country saw a prostrated economy like today. And it is not because of a change in society, it is because this government has poked the piñatism, the free-for-all behavior.
When the government as the State’s funds administrator fails in the wealth distribution, it is logic the people try to take its share of the cake, and the government is, by ommision, responsible for this behavior pervivence when it does not exercise its power to correct and address the fails in its assistencialist policies.
Now, talking about numbers, Mr. Nagel, the leftovers that have permeated to the society through subsides and assitencialist policies don’t represent anything of the endless leak that this government’s awful macroeconomic, geopolitic and strategic management has been.
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Space your paragraphs PLEASE!
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I am still abiding to the “squandered oil boom” statements on the basis that most of the points presented in the article are all part of the government’s economic policies, mostly designed to keep voting populace happy. Simply put, the government decided that the best use of the oil windfall was in a gigantic “bread and circus” campaign to gain political support; that it caused most of the economic mess we are living in, is kind of the point of this discussion. I agree with the argument that money simply did not banished, it was poorly spent.
But going around guilt tripping people about making use of a system set by the government that permanently changed the way people related to the state with no alternative, is by nature an ill conceived consideration and simply poorly constructed generalization. If taken to its logical conclusion, it implies placing responsibility on all people that make use of state services, as inefficient as they are, without considering that its almost impossible to live in the country without using them.
Gasoline price is criminally cheap? we know it’s bad, but we need to drive or use public transport to go to work, unless there is a reliable infrastructure for electric cars or bicycles, there is no way around the gasoline subsidy until the government decides to end it once and for all.
Cadivi keeps a worthless currency artificially strong? Heck yes, but do you know any other way to legally acquire foreign currency?. I would love to sell some property and pay for higher education of my choosing abroad at whatever rate a freely, legally recognized market sets; instead of complying with arbitrary limits on how much I can buy and how I can spend it.
Misiones, subsidies and public employment are inefficient money sinks enacted to create dependency of the poor on the state? Well, that’s kind of their point from the chavista perspective. For many people dragged into such draconian arrangements is the only bit of “progress” they are to find in an ever miserable existence perpetuated by an incompetent Socialist Administration.
The point is to recognize all the aforementioned practices as both disruptive and unsustainable for any rationally managed economy, in other words, coming to terms that the state can’t simply “hand out stuff” and that such privileges are to go, never to return, if the economy is to get in shape again. I think all of us reading this blog have accepted such notion.
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You can only blame everyone for a lack of foresight – who’d known for instance that infrastructure and services require upkeep and investment, or that oil prices would drop as they did? Only the brujos Castro!
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The only poorly constructed thing here is your straw man argument…
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“Us” me suena a Poliedro.
Having left in 1999 I have received nothing but bad news from Macondo ever since. Every call with the prefix “+58” is a dark presage.
I haven’t profited for any handout or scheme; the only thing Venezuela has given me is its back (lo unico que Venezuela me ha dado es la espalda).
So, if I haven’t cashed from, or voted for, the current or past chavista governments, I can hardly say I have a candle in this funeral. As the Spaniards say, each dog has to suck its own cock (cada perro que se chupe su capullo).
My connection to official Venezuela has been reduced to apply for passports and even that is unpleasant in so many levels (actually it is a useful remainder to keep away from the country, the whole process is an exorcism against nostalgia).
I think you make a fair point, and you may even extend this collective (ir)responsibility to decades before 1999, but saying “all of us” is overreaching.
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I’ve always wanted to discuss this issue
FACTS:
1- The government makes policies to distribute some of the state’s wealth to the citizens in a low liquidity form (subsidised and regulated products) or with forced expenses (“raspa cupos”, time wasted in line).
2- The society is willing to take advantage of any of those streams of wealth, for example, they are willing to fly when they don’t need to, buy subsidised/regulated products to resell’em, use gasoline for cleaning instead of cleaning products, waste electricity because is cheap.
3- The plundering only happens when Facts 1 and 2 are met. (There will be no plundering if the vicious stream of wealth does not exist, or if nobody takes advantage of it.)
4- The government is responsible for fact 1, and the society is responsible for fact 2.
I’m not rational enough to go beyond these facts. And from and objective perspective, we are both responsible.
But I think the government is responsible for the plundering, cause it’s his job to put our selfish motivations in sync with society’s well being, that’s what governments were created for, don’t you think?
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It’s like a crack adict blaming the drug peddler for providing crack at a discount… Everyone is wrong….
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If the purpose of the peddler were to take care of us, then yes, it’s his fault.
But we know that’s not his purpose, so it’s not a valid analogy.
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JC I beleive you are a bit unjust….”la culpa no es del ciego, es de quien le da el garrote”.
Who wrote the laws re those things you mentioned?
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No estoy asignando culpas!
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To me, things like these play an important role when some politicians from the opposition adress the masses, and they get misunderstood by some purists for not stating explicitly and out loud that CADIVI, e.g., has to be dismantled. I don’t like considering the people as much ignorant to not understand basic principles of Economics like this, if they are well explained; but let’s face it, explaining Economics at a decently deep level, can’t be part of any political speech in a society like ours, where emotions are way more important than technicisms in order to gain people’s liking. If I get your attention and all of a sudden I tell you “Follow me because I’m going to take away your cupo electrónico, so our economy improves in a couple of years”, I’ll have to be a hell of a charismatic leader for you to take that unhesitantly, knowing that you’re an average lower middle class surviving employee (the vast majority, those who started asking whether the cupo had already been renovated at Jan 1st 6:00 a.m.). A lot of us acknowledge the unsustainability of the model (readers of Caracas Chronicles and Aporrea alike) as well as leaders from both oposition and government, even if we have taken advantage of its “perks” one way or the other; but it seems that the model is so ingrown within our society’s psyche, that some (unorthodox, according to some folks) workarounds are necessary. The world is not all black and white.
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dood
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En una presentación de Diciembre 2014, IPD, una consultora de energía para Latino América, calcula que el operating expenditure + capital expenditure de PDVSA es $7.92bn. En un reporte de Credit Suisse o Barclays (lo estoy buscando pero no lo encuentro), dice que el Opex + Capex de PDVSA es $6.4 a 7 punto algo billones por año. Eso te da como $8 dólares por barril de capex y opex.
Lo que pasa con los financials (https://settysoutham.files.wordpress.com/2014/06/pdvsa-2013.pdf) de PDVSA es que incluyen un poco de costos absurdos (nómina de 120k personas vs. 40k pre-paro, misiones, pensiones, etc) que además los convierten a dólares a la tasa irreal de 6.30 VEB/USD. Sin esos costos en bolivares y con una tasa de cambio real, los estados financieros de PDVSA serian otros.
Si estos panas de IPD y Barclays o Creit Suisse no estan pelados, los costos de la operación central de PDVSA en dolares no son tan altos. La rochela principal fue con el arbitraje cambiario y la sobrefactura.
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Cual es la produccion real de Pdvsa segun estos consultores ??, (recordemos que las cifras oficiales estan muy por encima de las reales segun los datos publicados por Opep basado en sus propias fuentes) . tambien recordemos que la produccion con empresas mixtas son compradas a estas y no se consideran produccion Pdvsa ( aunque Pdvsa no paga sino parte del precio y a veces una fraccion ) . Se que el desperdicio es atroz asi como lo que se pierde por negociados . Por otro lado los gastos de mantenimientos en muchos casos no se hacen o se postergan lo que puede bajar el costo por bl aunque ello redunda en una situation de produccion mas comprometida para el futuro. Ademas Pdvsa no tiene plata y ello la obliga a dejar sin cubrir gastos necesarios o pagar costos de financiamiento recargados.
Esto dificulta determinar cual es el costo por bl producido. solo a titulo de ejemplo si la produccion reportada ( 3.1 MBD) realmente es de 1.4MBD (Cifra Opep y del EIA de EEUU) entonces sin mas el costo por bl sube a mas del doble .!! Las empresas mixtas son las que corren con el bulto de los gastos de sus campos , si estos gastos los asumiese Pdvsa en un 60% no se cual seria el costo por bl.
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Correction . indpendently reported production figures stand at 2.4 mbd not 1.4 mbd
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Today my husband (Venezuelan born), our three children, spouses, grandchildren and I got together to honor and remember my mother in law who died yesterday in Cardón, Falcón, Paraguaná. My mother in law was 92. Our conversation revolved around our memories of her, of course, but also included our extreme sorrow, frustration, anger that my father in law had to search for a casket, and then cement to seal her tomb. No one should ever be in this position. My husband couldn’t travel to Venezuela because the consulate here wouldn’t extend his soon to expire passport unless he had his original birth certificate (which he’s never seen or needed, ever). We were afraid to let him travel or travel ourselves because of the dangers we’ve all read about. I hate what this government has done to the people in Venezuela and to those of us outside who have loved ones there. I don’t know what else to say, except that I hope no one else has to go through what we are experiencing at the moment.
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I remember well your earlier frustration, Mary, when your mother-in-law was not well, and am so sorry to now read of the loss that you and your loved ones are currently experiencing. Thank you for letting us know about these details of what daily living has become, especially outside of Caracas. And you’re right, no one in any civilized country should have to deal with what your family is going through, especially your father-in-law.
That your heartfelt comment on this board has to follow the puerile trolling by a jerk with several anonymities and way too much time on his hands is par for the course regarding the lack of civility…
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Thank you, Syd, for your kind words. I am not a frequent poster but I read every day and have always respected your comments.
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Reading CC is sometimes like watching a train wreck taking place in slow motion: a little bit fascinating, but very very cringe worthy. Here we have the best, brightest English-language journalism about Venezuela.
And they come up with this “we are all to blame” antics.
I will not argue the points. I honestly think that I you explained the situation to my five year old boy, he would be smart enough to say “Heck yes, they stole/squandered it all. I bought the gas only because the system forced me to to it. THEY are the thieves, and they did this only to gain popularity/votes, not so I could drive “.
But I’ll say this: It saddens me to no end. Venezuela is doomed, and not because of chavismo. Venezuela is doomed because of the abysmal lack of common sense in the opposition.
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“But I’ll say this: It saddens me to no end. Venezuela is doomed, and not because of chavismo. Venezuela is doomed because of the abysmal lack of common sense in the opposition.”
Si vale, Venezuela está jodida por culpa de los estúpidos argumentos de CC.
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Debo decir que estoy extremadamente decepcionado de que la mayoría de los comentaristas NO ENTENDIERON lo que quise decir.
En ninguna parte dije que todos éramos iguales de culpables que el gobierno. Efectivamente, el gobierno implementa políticas que los ciudadanos aprovechan, y en eso no hay culpa. De hecho, no hay manera de “comprar gasolina a precio de mercado” si es que uno quisiera evadir el subsidio. Eso es obvio, y sería absurdo asignarle culpa a la gente de una compra en la cual no ha habido libertad de decisión.
Como bien establece el post, mi argumento es acerca de la alharaca absurda de que “se robaron todos los reales,” o de que “los chavistas desaparecieron el boom petrolero más grande de la historia.” El boom no desapareció completamente, sino que gran parte fue gastado en un sinfin de subsidios y dádivas de las que muchos (por no decir todos) fuimos beneficiarios.
El hecho de que este punto haya sido tergiversado y malentendido probablemente sea mi culpa, por no saber explicarme bien. De todas maneras, me frustra. Son posts como éste los que me hacen preguntarme si de verdad vale la pena seguir con este blog y seguir arando en el mar.
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Ni tanto ni tampoco.
Creo que el post pudo haber sido un poco mas explicito con su argumento. Estoy seguro que muchos de los que comentaros son gente muy preparada, imposible que todos seamos brutos o malasangre.
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accountability is a hard pill to swallow, dear Juan. Moreover, among countrymen and women infected by magical realism, no matter where they end up living. Do not allow the Fray, myself included, to get to you.
Your post is extremely valid though it’s even better to see some latent specifics that make your tenet a lot clearer. Un abrazo, vale, y no te descorazones.
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I understand you JC.It seems to be hard for most people to read with any objective comprehension.Most people are emotional readers and thinkers who over react to what is different.This is true throughout the world,which is why it is useless to try and convince..but it is still valuable to make an effort to express your views, as the truth always lies in paradox, and just the effort is appreciated which adds positive energy to the cause.Changes are not always precisely measurable.
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Disculpa Juan, pero son tus lectores los que deberían estar decepcionados de ti y no al revés. Cuando un columnista no logra transmitir claramente sus ideas a sus lectores, claramente quien ha fallado no son los lectores, sino quien escribió la publicación. Es como que un comerciante diga que está decepcionado con sus consumidores porque el mercado no le compra sus bienes/servicios que oferta.
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A ver, no se si su mision sea decepcionarse de sus lectores y comentaristas. Ni tampoco frustrar su vocacion.
Usted diga lo que piensa y ya habra quien lo vea como usted quiera, y quien no ¿Que importa?
Yo si entendi su mensaje, y mi respuesta es la misma, ni por rebote me toco nada. Los subsidios y dadivas no son tales, sino gastos electorales del gobierno. En ese sentido, tambien son corrupcion y tambien se lo fundieron ellos. Y si ademas lo hicieron para que todo el mundo chupase, pues tanto mas culpables son.
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El mensaje de Juan fue :
Aunque la mayor parte del ingreso publico petroleo se malverso , malgasto , desperdicio y robo , hubo alguno que se gasto bien o que gastandose mal produjo beneficios transitorios a una parte de la poblacion , beneficios que esta de hecho no tenia la posibilidad de rechazar o que parte de esta pudiendo rechazar decidio aprovechar antes que permitir que el regimen lo botara o malgastara de otra manera-
Por tanto es incorrecto decir que el regimen boto o malgasto TODO el ingreso petrolero que recibio , por que si alguien se beneficio de ese gasto entonces este no puede imculpar al gobienro de haberlo malgastado sin incurrir en una incongruencia moral , por que si acepto el beneficio es por que condonaba su uso.
No estoy seguro que si carecemos de control sobre como se gasta un dinero incurrimos en una suerte de implicita complicidad si ese gasto nos beneficia de alguna manera . Si un padre gasta dinero en hacerle fiestas a sus hijos y luego no tiene dinero para pagar su educacion , no siempre el hijo esta en capacidad de impedir a su padre que no gaste en fiestas y que las celebre a sabiendas que de parte de su padre ese no era un gasto responsable.
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Finally, let’s remember that oil revenue equals as “renta petrolera” and oil profits equals as “ingreso petrolero” in everyday language in Venezuela. Journalists who speak of oil “revenues” in a different context are being deliberately misleading, or just plain ignorant.
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