The election needs to be bought

How many votes can we get for this pile of steel?

How many votes can we get for this pile of steel?

It’s distressing to think about the Venezuelan government’s latest financial moves. Not for what the moves entail, necessarily, but because of the obvious reason that is driving them.

First, the government announces it is tapping IMF holdings, about $389 million it held in its “Special Drawing Rights.”

Then, they announced a new “agreement” (i.e. loan) with China worth $5 billion.

Now, we learn that the Venezuelan government is privatizing – yes, privatizing – a refinery in Chalmette, Louisiana. The operation is for $322 million, although part of it goes to our partner in the refinery, Exxon Mobil. (Yes, that Exxon Mobil) And you can bet the sticky paws of a certain bête noire of this blog is involved in the deal.

Scraping the bottom of the barrel (literally!) is done for a single purpose: the legislative elections. Thetiming for these announcements perfectly matches the upcoming election season. In fact, I venture to wager that scarcity will wither down in the coming months, and that suddenly washing machines and refrigerators will begin to prop up in public squares near you.

The government is raising debt and selling off the few assets it has left, but that in itself is not a terrible thing. Governments issue debt and sell off assets all the time. The problem is that what is driving them is pure populism. There is no underlying economic strategy at play, no debate on the pros and cons of selling Chalmette. It’s simply populism at work.

The government is bankrupt, but it has a few chips it can still cash in. You know, for old times’ sake.

After that … well, all bets are off.

(HT: Emi)

34 thoughts on “The election needs to be bought

  1. Oh I dunno that we need to jump to conclusions about what the money’ll be spent on. I hear Tareck El Aissami’s yacht hasn’t had its interior redecorated in ages…

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    • Yes, there is no basis to conclude that chavismo will use the little money it can scrounge up on buying an election. No basis at all for that.

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      • I’m tempted to believe chavista regime heads are so incompetent and idiots that they could sink an oil and drugs exporting country…

        You know, because the idea they’re doing this on purpose to keep people under control by starving them sounds like some crackpot conspiracy…

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  2. In fact, I venture to wager that scarcity will wither down in the coming months, and that suddenly washing machines and refrigerators will begin to prop up in public squares near you.”

    This is what the entire opposition should sink its teeth into: use every means possible, every media venue left, public campaigns, flyers, whatever.. to warn people about Bribes for votes, sudden product availability and shorter colas, false promises; and their counterparts: multiple types of threats and intimidation.

    Let’s see if the average Chavista Venezuelans can be bought or intimidated that easily. It’s up to everyone to educate and warn those who still believe Chavez, Sucialismo and Cuba are great. Millions. Those who can’t comprehend the “obvious?” opposition programs people like Gustavo Tarre have cleared up for us.

    The laughable “elections” result is probably written in stone, anyway, regardless of the effectiveness of this new borrowed Cash will have as bribes and false promises: A little Gerrymandering, couple malicious twists from el Mago Rodriguez on Chavez’s Fraudmatic Lottery machines, and we’ll have an utterly meaningless “55% victoria a favor de la oposicion!”

    Maybe then, next year, as the Economy finally crashes into the abyss, the same people that were bribed or cheated, again, or even voluntarily voted for Chavismo, again, maybe they’ll start learning about what a real Parliament is, or a simple Democracy or better yet, a Republic. Maybe then they’ll even have time to reflect in the endless colas, (as they ponder whether or not to re-elect Masburro in 2019, when the Oil barrel is back at 100$ and they might sell their votes and souls for more freebies)

    http://prodavinci.com/2014/11/26/actualidad/tarre-briceno-y-la-separacion-de-poderes-por-gerardo-fernandez/

    —– Sres. de Editorial Sube-Cerros: Favor traducir esto en buen Criollo antes del 2019.

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  3. ” And you can bet the sticky paws of a certain bête noire of this blog is involved in the deal.”

    Tweeted something really nice to Senator Senator Mary Landrieu, but she’s gone:

    http://www.politico.com/story/2014/12/bill-cassidy-mary-landrieu-2014-louisiana-senate-elections-results-113367.html

    Let’s see if the new Senator’s secretary here replies.. doubt it.

    Floyd ‏@GrooveSurvey 4m4 minutes ago
    @BillCassidy . Mr Cassidy, Have you heard about this scandal?

    http://caracaschronicles.com/2015/06/18/the-election-needs-to-be-bought/#comment-196052

    http://caracaschronicles.com/2014/08/05/aholes-and-oil-1-human-rights-0/

    Best Regards from Venezuela!

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  4. The refinery pictured is what General Jackson was defending against that sticky fingered Packingham bastard, it rightfully belongs to us.

    Srsly tho, Chalmette battlefield park is less than a cannon shot away and Jackson Barracks about .5 miles west.

    200th Anniversary coming up quickly.

    /Johnny Horton

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  5. 2 comments : one : the 5 billion from China are earmarked exclusively to be used in specific oil industry projects (most of which co owned with China) , none of it is to be used in social programs or electoral gimmicks , the Chinese are at the end of the thether and will only make loans that have a quick pay out .

    The amount obtained for Pdvsa’s 50% share in the sale of Chalmette Refinery is incredibly low , this is a gem of a refinery , there is something fishy in this transaction , the price is too too low, less I believe than what Mobil originally paid for it some 20 years ago. !!.

    These measly amounts dont go very far in helping the regime come up with the money it must pay its creditors at the end of the year if its to avoid default. , they are a drop in the bucket. Dont believe there is enough money in these transactions to be used to help the regimes faltering finances.

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    • What China and Kleptozuela “earmark” always include Huge kick-backs for both sides, so at least Tareck El Aissami’s yach will be covered..

      The interesting part there, related to the elusive, hilarious “elections” is that the 5 Billoncitos will probably become available only “in the next few months”, which might explain Tibisay’s funky behavior, constantly delaying the date of such elections.. Next headline we might see.. “Las elecciones seran cuando la CNE lo disponga, o mejor dicho, cuando los reales de los Chinos, la IMF y la Exxon esten disponibles ‘pa pagar la propaganda, escualidos!”

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      • The kick backs are paid by the contractors and suppliers of those projects , not by the chinese govt agencies themselves , and those projects take time to get started and executed so nothing coming from there in the next few months . (remember the chinese are no happy about making these loans, they have their doubts ) The press release itself says that the money is to be spent on oil project (implying that in nothing else)

        The other money might have to be used to avoid default next october and november when some heavy service debt payments fall due. Lets remember the money that has to be paid to international creditors at the end of the year and later in the next two years.

        .

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    • Not a lawyer, but why won’t Venezuela’s creditors with adjudicated claims attach the proceeds of the sale?

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      • Because the asset technically belongs to PDVSA. While PDVSA may be a government owned entitiy, there is some question as to whether assets of PDVSA can be legally attached due to the actions of the government (through expropriations).

        Seems silly on several levels if those funds are simply remanded to the state, but, that’s a court issue to decide and I’m not sure anyone is that interested in bothering at this point since it would likely be a prolonged and expensive thing to pursue.

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        • I am pretty sure that the legal distinction between the government and PDVSA has long since been eliminated by both word and deed, no doubt against the advise of counsel.

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  6. The other Ralph wrote: “Not a lawyer, but why won’t Venezuela’s creditors with adjudicated claims attach the proceeds of the sale?”

    From what I’m hearing, there are so many claims against Venezuela these days – from airlines to drug companies to Guatamala to fill-in-the-blank – that attempts to dodge that debt will soon end. Even oil revenues can be garnered by international decree. Freighters carrying Ven oil can even be seized under certain situations. Owing to us having to import virtually all necessary goods, external powers will soon have us by the short hairs. They will simply cut us off and any petro flowing out of the country will be nabbed.

    The western world is skilled at bleeding debtor countries – when it is possible. Often the IMF and other are forced to simply write off bad debt (Iceland, etc.) but NEVER when there are resources (read oil) that can generate cash flow to pay down the nut. For going on 16 years the socialist buffoons have said fuck you or have simply double-talked everyone, especially those who they owe. Now many countries are licking their chops at the chance to get theirs.

    The problem with gran narcissists like Chavez is that they never think they will be called out and made to account for running roughshod over people and institutions and foreign governments. There is no way we can pay down the next round of foreign debts. Once we dafault on that, Citgo will immediately go on the blocks I am told. Then the wolves will start circling.

    This is only starting to get interesting.

    JL

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    • Good to know.. thanks for the info. A definitive Default is just what the doctor ordered to check-mate Chavismo in Vzla.

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  7. This just in from the Wall Street Journal. Seems there are even more pressing issues for the dough above and beyond buying an election:

    ” Exxon Mobil Corp. and the national oil company of Venezuela are ending their business partnership, as they are selling a jointly owned Louisiana refinery for $322 million to PBF Energy Inc. Once the deal closes, Exxon will no longer have any joint ventures with Petróleos de Venezuela SA. Jesus Luongo, PdVSA’s vice president of refining, said the plant no longer “aligned with the commercial policies of the company and the country.”

    “The refinery sale comes a week after a World Bank arbitration court denied Venezuela’s attempt to annul a $1.6 billion payment to Exxon for oil-and-gas properties expropriated by the South American government in 2007.

    “Barclays analyst Alejandro Arreaza said Venezuela will use proceeds from the sale to help pay its debt to Exxon. “Selling assets is definitely not something good for the long term because you’re splitting up parts of the company,” he said, adding the sale offers minor but much-needed relief for the oil-exporting nation as it grapples with a severe economic crisis amid low oil prices.”

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  8. And yet, there’s still more steel there than procduced by SIDOR in a year…

    My question is why is the opposition not attacking this viciously as an honest and actual literal case of “vende patria”? Highlight the mismanagement of the country and point out that the government has been reduced to selling off assets of the country?

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    • Meh. Piss on the scripting and italics.

      I had it headed with the subscripted photo: How many votes can we get for this pile of steel?

      #weakhtmlskills

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      • I think it’s funny that with all the blogs and talk boards that allow format tags, there there is probably more hand-coded HTML being produced now than in say 2000.

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        • Yes. The world changes, but things keep coming back. Like high-waisted jeans, scrunchies, Jurassic Park, Crystal Pepsi, cutoffs, JNCO jeans, Tamagotchi, Boy/Girl Meets World, and crop tops.

          Or perhaps more apropos to Venezuela: dengue, the Latin American debt crisis, poverty, gangs, yellow fever, anarchy and malaria.

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    • “…why is the opposition not attacking this viciously as an honest and actual literal case of “vende patria”? ”

      Because there’s this crazy belief that putting the fault on a single red name will make disgruntled chavistas go vote in droves for castro’s (oops, chavista) candidates just because the opposition “picked on one of our own”

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  9. The Chalmette sale is chump change. The Regime is having critical problems just keeping minimum amounts of food/basics on shelves now, to become even more critical/dire 6 months from now.

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  10. “Chump change” is slang for no mucho, or nearly that. A pittance. Nada. Not enough to matter. But most anything is welcome now that “Venezuela faces almost 30 arbitration cases at the Icsid, filed after late president Hugo Chávez started a series of nationalizations in 2007.”

    Ten to one that the Chinese and Russian bailout dough never comes through, as they are merely thrown good money at bad. Will be interesting to see how the Greeks fare this weekend.

    JL

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