El Sur
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South American Politics and Government

Monday, September 30, 2002
Inflation down:
Bloomberg.com reports that inflation fell to 1.5 per cent for September, according to preliminary reports. Good news? Hardly, just more proof of the known fact that nothing defeats prevents price increases like a depression.

Economy down: A depression is exactly what Argentina is in the middle of, reports Latin Business Chronicle.
"Argentina is experiencing an economic contraction of unprecedented magnitude in its economic history, with the cumulative fall in output in the four years to the end of 2002 expected to be over 20 percent—about twice that experienced in the Great Depression of the 1930s,” the International Monetary Fund said in its latest World Economic Outlook.
Venezuela is also expected to decline this year, while Mexico and Brazil will grow, but slowly.

Another opinion: Also weighing in on Argentina is Business Week.

posted by Richard 6:53 AM
. . .
Saturday, September 28, 2002
Senate bribery investigation:
Under the authority of Judge Claudio Bonadio, raids have been conducted on the Buenos Aires office of HSBC Holdings reports
Bloomberg.com . Police are seeking evidence to support an allegation that banks attempted to bribe members of the Senate to head off legislation inimical to the interests of the banks. Argentina's banking organization has denied the allegations. An appeals court has opened an investigation into the judge's handling of the case. Apparently, there are concerns that Judge Bonadio is not respecting the rights of those under investigation. However, the state of Argentina's legal system is such that it is impossible to determine who, if anyone, is acting solely, or even primarily, in the interest of justice.

The paper that broke the original story, has a report today as well. And, the paper is more than a spectator in the case. According to today's Financial Times, the judge is seeking to obtain its phone records, apparently to determine the source of the original investigation. The paper has sought an injunction from another judge blocking Judge Bonadio.

The original story from the Financial Times, was noted in El Sur at the time.

posted by Richard 5:57 AM
. . .
Friday, September 27, 2002
Go it alone?
Today's Wall Street Journal (International section, no link) notes the "war of warnings" between officials from the International Monetary Fund and the government of Argentina over the probable consequences if Argentina fails to agree to a restructuring plan and defaults on some $3 billion in debts to multinational organizations coming due before the end of the year. Argentina plans to use reserves to make a September payment. But, Economy Minister Roberto Lavagna says the country will not dip into its reserves to pay the rest of the year's installments.

The paper suggests each side is seeking leverage. Among the charges so far, as noted in
El Sur, IMF deputy director Anne Krueger has warned Argentina about the "serious consequences" of default, while Economy Minister Roberto Lavagna said the IMF was partly to blame for Argentina's troubles and Chief of Cabinet Alfredo Atanasof has pointed to higher priorities, including government pensions, social programs and public employees' pay.

The Journal attributes the back-and-forth to efforts to gain leverage.
Mr. Lavagna is apparently betting that the IMF would rather strike a deal than face a default by Argentina...

It's a high-stakes wager for Argentina, which has struggled for nine months to reach an accord with the IMF. Last weekend, a group of prominent Argentine economists warned of "negative internal consequences" if Argentina fails to reach an agreement with the fund (noted and quoted in El Sur). They said Argentina risks being cut off from the international community if if fails to pay.
For today, at least, with the parties in Washington for IMF meetings, the dispute seems to have calmed down. Lavagna, reports La Nacion, would say only "that the country is up to date with its debt obligations to multinational organizationa, in spite of not having received financial assistance all year" ("que el país está al día con sus obligaciones de deuda con los organismos multilaterales, a pesar de no haber recibido asistencia financiera en todo el año"). And La Nacion quotes Krueger as saying that she understands that some international loans finance "part of the net of social protection and we are very worried about them" ("parte de la red de protección social y nosotros estamos muy preocupados por ello").

posted by Richard 8:11 AM
. . .
Boston Globe columnist H.D.S. Greenway says that "Tyranny by world standards is still in its infancy here" but "the trends are all bad, and the Chavez supporters who inspire violence are menacing." Greenway says the country lives on rumors and feeds on class hatred, stimulated mostly by President Hugo Chávez.
Chavez's admiration for Fidel Castro, his flirtations with Middle Eastern tyrants, and his alleged aid for leftist guerrillas in neighboring Colombia have sent alarm bells ringing across the Andes and in Washington....

''We have communism at our door,'' says Carlos Fernandez, chairman of the powerful business organization Fedecamaras.

''We are facing a dictatorship,'' says Carlos Ortega, chairman of the country's strongest labor federation, the Confederacion de Trabajadores de Venezuela. ''This is a situation we cannot stand.... The Castro model will not be fulfilled here.'' But for all the talk of Castro, it is that Latin populist of half a century ago, Juan Peron of Argentina, who most comes to mind, a man who also appealed to the ''shirtless ones,'' but who sent one of the world's well-off countries on a downward slide that has yet to be halted.

posted by Richard 7:16 AM
. . .
Thursday, September 26, 2002
Argentina Economy Minister Roberto Lavagna, about to leave for an Internaional Monetary Fund gathering in Washington, said the fund has to share the blame for Argentina's troubles. The
Financial Times has a report.
"The first responsibility in the breakdown of that model is obviously Argentina's," Mr Lavagna said. "But one should point out that during all those years, with a certain blindness, the multilateral organisations supported this model, which led to an enormous rise in indebtedness, unemployment, poverty and, finally, financial breakdown."
Lavagna went on to say that Argentina could not afford to user reserves to make a payment on a past IMF loan due in a little more than a month. Does he really think he's in a position to threaten the IMF? Apparently he does, using private investors for leverage, or so suggests the Buenos Aires Herald:
“We’ll see how talks (with the IMF) go in coming weeks and if we need to give private investors different treatment than we’ve been giving them up until today. There are growing voices from private investors who are bothered by the delay that the (IMF) is causing,” Lavagna said.The IMF, on the other hand seems unintimidated: Anne Krueger, the fund's deputy director, is quoted in today's La Nacion as warning of "serious consequences" if Argentina does not make the payment.

Meanwhile, Duhalde's Chief of Cabinet Alfredo Atanasof seems to be backing off threats he made earlier in the week, when he told reporters that Argentina had to pay for pensions, social programs and public employees' pay ahead of debts, as briefly noted in El Sur. According to today's La Nacion, he is not telling reporters that Argentina "will have neither default nor lower reserves" ("no habrá default ni baja de reservas") because he expects a compromise. Which remains to be seen.

posted by Richard 7:31 AM
. . .
Wednesday, September 25, 2002
Military divided:
Bloomberg.com has a brief report on the divided military.

posted by Richard 11:18 AM
. . .
Tuesday, September 24, 2002
Court rules against opposition: Venezuela's Supreme Court today ruled against the opposition in two cases brought against President Hugo Chávez, reports
El Nacional. The rulings were announced today by Iván Rincón, president of the court.

In the first case, Chávez was charged with illegally accepting campaign funds from a Spanish bank, BBVA. The case was rejected for lack of proof. In the second case, the attorney general, Isaías Rodríguez, was charged with abuse of power, denial of justice, using his authority to not investigate and being linked himself with the campaign contribution case by deliberately refusing to present proof. This case too was refused for lack of proof. In both cases, the court refused a request to investigate on its own, a request the plaintiffs made because they believe that Rodríguez, a Chávez ally, deliberately refused to investigate these cases.

Defense Department presses cases: Also today, the minister of defense sent a letter to General Vidal Rigoberto Martínez ordering him to present himself for additional investigation for his involvement in the events of April 11.
The attorney for the official, José Luis Tamayo, complained that the measure is in obvious retaliation for the general's press conference in which he denounced the existence of a witch hunt inside the national armed force and expressed his support for officials who are being persecuted for having acted on his orders on April 11.
El abogado del oficial, José Luis Tamayo, denunció que la medida es una retaliación evidente por la rueda de prensa ofrecida por el general en la que denunció la existencia de una cacería de brujas dentro de la Fuerza Armada Nacional y expresó su respaldo a los oficiales que están siendo perseguidos por haber acatado sus órdenes el 11 de abril.
The general himself has been suspended until October.

posted by Richard 3:58 PM
. . .
Autogolpe II: Yesterday,
El Sur quoted extensively from an interview in El Universal with Cuban exile Carlos Alberto Montaner, explaining the steps Venezuelan President Hugo Chávez can take and is taking toward conducting an eventual self-coup (autogolpe) against his own government. Among these, "to accelerate the purge in the armed forces and in the institutions he does not totally control, like the judiciary...militarize police bodies that he doesn't control and disarm the population, less his partisans..."

A story from Yahoo! News - AP shows how Chávez is accomplishing one of these goals.
A policeman's lot is never an easy one on the rowdy streets of Caracas. But now the police say they're up against a new adversary ? armed supporters of their own president, Hugo Chavez.

Recriminations are still flying almost two months after police responding to a street protest ran into a carefully planned ambush. Pinned down by snipers, officers radioed desperately for help as high-caliber bullets pierced their armor-plated water cannon. Three officers and four civilians were wounded...
The Aug. 2 incident on Sucre Avenue has sharpened the question of who polices the capital: Chavez's supporters or Greater Caracas Mayor Alfredo Pena, who supervises the metropolitan police.

Chavez accuses Pena of dispatching police to brutally suppress protests by his supporters. Pena says Chavez is trying to seize one of the few institutions not under his control.
The August 2 incident was noted at the time in El Sur

posted by Richard 1:45 PM
. . .
Let's make a deal:
Bloomberg.com carries a report that shows that Mexico is still not First World:
Mexico's state oil workers union, threatening a strike next week, called on the government to drop a criminal investigation into its leaders to end an impasse over wage negotiations.

The Petroleos Mexicanos union wants an investigation into whether its leaders funneled oil funds to their political party moved out of federal criminal jurisdiction and into a labor court, the union said in an e-mailed statement. Government and union negotiators were set to continue talks this morning.
Trading members' pay for what is, effectively leaders' criminal immunity is definitely Third World.

posted by Richard 1:13 PM
. . .
Monday, September 23, 2002
Poverty: Blogger T.L. Wilson, an American living in the Paris of South America, asks "What are the end results of corruption and inefficiency?" and links to an AP article in
The New York Times which suggest that one end result is turning people into scavangers.

Professional advice: The notion of telling the IMF to take a hike and go it alone--"vivir con lo nuestro"--has been making the rounds of the country's porky populists. Sunday's La Nacion has a report on an interview with seven leading Argentine economists who agree on little except that "it is necessary to comply with a responsible plan to regain foreign and domestic conficence and to anticipate two years difficulties" ("indispensable cumplir con un plan responsable para devolver la confianza externa e interna y esperan dos años dificiles"). Says the paper,
"We are broke and to fight with the Fund is to fight with the receiver," was the phrase most repeated.
"Estamos en quiebra y pelear con Fondo es como pelearse con el síndico", fue la frase más repetida.
Marcos Buscaglia, professor of Economícs and Finance at the IAE at the Universidad Austral, believes that refusing to sign an accord with international finance agencies is not an option if the country wants to prosper some day.
"Populism has progated a new myth in the last weeks, and it is that Argentina will be better off if we do not agree with the organizations and live with ourselves. As such, they endeavor to take the country into a select club made up of countries like Sudán, Liberia and Somalia," he indicated.
"El populismo ha propagado un nuevo mito en las últimas semanas, y es que los argentinos vamos a estar mejor si no acordamos con los organismos y vivimos con lo nuestro. Así, pretenden llevar al país a un selecto club que conforman países como Sudán, Liberia y Somalía", señala.
Luciana Díaz Frers, an economist at the Center for the Implementation of Public Policies for Equality and Growth (CIPPEC) believes Argentina has two options: Chile or the Congo.
"Chilean policy consisted in applying a profound change in the public accounts and generating persistent fiscal surpluses," she indicated.

And she explaned that "many say that Chile could do this because it was not a democracy, nevertheless, Chile had three years of surplus during the Pinochet government and already has accumulated 10 years of surpluses during the 12 that it has had its democracy"...

Luciana Díaz Frers says that the other road, called Congolese, is a euphemism that synthesizes the cases of the countries that today have arrearages with the IMF, like Afganistan, Iraq, Liberia, Somolia, Sudan and Zimbabwe. "All of these countries are characterized by a high proportion of the population sunk in poverty, that have decided to live with one's own, or better said, to turn their backs to the world."
"La política chilena consistió en aplicar un cambio profundo en las cuentas públicas y generar superávit fiscales persistentes", indica.

Y explica que "muchos dicen que Chile pudo hacer esto porque no tenía democracia, sin embargo, Chile tuvo tres años de superávit fiscal durante el gobierno de Pinochet (Augusto) y ya acumula diez años de superávit de los doce que tiene su democracia"...

Luciana Díaz Frers dice que el otro camino, el estilo congolés, es un eufemismo para sintetizar los casos de los países que hoy tienen atrasos con el FMI, como Afganistán, Irak, Liberia, Somalía, Sudán y Zimbabwe. "Todos estos países se caracterizan por tener una altísima proporción de la población sumida en la pobreza, que han decidido vivir con lo propio, o, mejor dicho, darle las espaldas al mundo."
Threats: Among those threatening the IMF is Chief of Cabinet Alfredo Atanasof, who, according to La Nacion informed the IMF that "if the large social safety net does not function, the country will be consumed with flames" ("si la enorme red de contención social no funcionara, el país estaría ardiendo en llamas".
In his regular press conference, Atanasof added that Argentina "maintains a delicate internal equilibrium composed of paying punctually its internal obligations that are the priority: pensions, social plans, and government workers pay, and after to attend to external obligations.
En su habitual conferencia de prensa, Atanasof añadió que la Argentina "mantiene un delicado equilibrio interno que consiste en pagar puntualmente sus compromisos internos que son la prioridad: jubilados, planes sociales y pago a trabajadores estatales, y luego atender los compromisos externos".
President Eduado Duhalde, meanwhile, reiterated in a radio interview that he believes a deal with the IMF is near. Of course he has been saying so since January.

posted by Richard 6:14 PM
. . .
Autogolpe: Three posts below,
El Sur quotes extensively from an El Universal interview with Cuban exile and Castro opponent Carlos Alberto Montaner, who describes Venezuelan President Hugo Chávez's plans for increasing repression, until it is possible for him to successfully conduct coup against his own government--an autogolpe. The plans are Castro inspired, says Montaner. Preparatory measures include attacking the media and politicizing of the military.

As if on cue:

Today's El Nacional reports on a press conference held by the InterAmerican Press Society and the International Institute of the Press. Representatives of the groups are in Venezuela to examine growing repression against the media of communications. Sure enough, one member of the mission soon mentions the "C"-word:
In a press conference the president of the SIP, Robert Cox, affirmed that "what happened in Cuba can happen here," because of which he urged Venezuelan journalists to not allow the truth to be silenced and recognized their bravery under the circumstances that prevail in the country.
En rueda de prensa, el presidente de la SIP, Robert Cox, aseguró que “aquí puede pasar lo que pasó en Cuba”, por lo que instó a los periodistas venezolanos a no permitir que se silencie la verdad y reconoció su valentía ante las circunstancias por las que atraviesa el país.
Here (in Venezuela) are organized groups that assault and persecute journalists and moreover are supported by the government," said Jorge Fascetto, president of the IPI, who added that dictators begin attacking reporters with violence that continues to increase and ends with the death of social communication.
Aquí son grupos organizados que agreden y persiguen a los periodistas y además son apoyados por el Gobierno”, dijo Jorge Fascetto , presidente del IPI, quien agregó que las dictaduras empiezan atacando a los periodistas con una violencia que luego se incrementa y termina con la muerte de comunicadores sociales.
Also on point, today's El Universal reports on an interview given Unión Radio by General Luis Alberto Camacho Kairuz, who "said that 'already there is a military coup' in the country" ("dijo que 'ya hay un golpe militar' en el país"). Among the specific events leading the general to this conclusion are the government's declaration of special security zones, the use of the National Guard to put down a small demonstration at the national oil company and the failure of the government to seriously investigate those who shot a demonstrators on April 11, killing 17.
Camacho recommended to unit commanders of the National Guard that they themselves read the law, which speaks of obedience. "We are permitted by the same law and the constitution to disobey orders of an illegal character, there there some things that are counted as unconstitutional..."

He declared that his call is not for rebellion but the activation of institutional mechanisms...
Camacho recomendó a los comandantes de unidades de la GN que se lean la Ley, la cual habla de obediencia. "Nosotros estamos permisados por la misma Ley y la Constitución para desobedecer órdenes de carácter ilegal, y allí hay unas cuantas que son inconstitucionales..."

Aclaró que su llamado no es a la rebelión sino a la activación de mecanismos institucionales...

posted by Richard 1:36 PM
. . .
Lula up, market down: A new poll shows that Luiz Inácio "Lula" da Silva of the far-left Workers' party (PT) has increased his lead to 25 points over his nearest competitor José Serra in the October 6 presidential election. As da Silva rises, Brazilian markets fall. Both the
Financial Times and Bloomberg.com have reports. From Bloomberg:
"No one wants to bet on Brazil before the elections," said Jeanmarie Vichot, who helps manage about $22 million in Brazilian bonds for Banque Sudameris in Paris. "If Lula is elected, a lot of people will take their money out of Brazil."

posted by Richard 11:54 AM
. . .
Latin America's economic and financial problems seem to have arrived at Mexico, according to a report in the
Financial Times. The central bank is expected to tighten money, in response to a declining currency.
The currency has come under pressure from continuing worries about the US economy, the Brazilian election, and Mexico's political stability after workers at the state oil monopoly Pemex, which provides a third of the government's revenue, threatened to strike....

Eduardo Cepeda, head of JP Morgan in Mexico, said the internal political problem was "the new phenomenon which we didn't have in the calculation before".
The internal political problem isn't just the possible Pemex strike, but increasing evidence that the Vicente Fox government is ineffective. Two other current examples: Fox's apparent inability to pass reform in the opposition-controlled national assembly and a losing conflict with farmers over taking land for a new Mexico City airport.

posted by Richard 11:54 AM
. . .
"Master manipulator" and "dazzled disciple": Sunday's
El Universal has an interview with the Cuban exile writer Carlos Alberto Montaner, headlined "The influence of Castro over Chávez is total" (La influencia de Castro sobre Chávez es total").

Montanero has a dark, perhaps excessively dark, vision for Latin America, though obviously more believable than it would have seemed even a year ago. With regard to Venezuela particularly, he believes Chávez is preparing an autogolpe, or self-coup. More generally, he sees a revitalized left, strengthened, paradoxically, by the demise of the Soviet Union, which has opened the way for utopian dreams ungrounded in the reality of the Russian failure and lulled the United States into complacency, never overly difficult in any case.
Confessed liberan and/or neoliberal, Montaner comes frequently to a Venezuela that appears to awaken in him a certain morbid inquietude of deja vu. Fidel, never failing to advise,has found an unexpected guinea pig to continue experimenting with his totalitarian engineering.

Q. This isn't an exaggeration and a bit of nonsense to establish a parallelism between the Cuban revolution and the political process that Chávez leads?

A. Of course not. Chávez is as close to Castro as Venezuelan circumstances and his personal limitations permit. Chávez feels a profound admiration for Fidel Castro, and the natural tendency of the human species is to imitate that which is admired. Moreover, the Cuban revolution has two elements that are very valuable to Chávez because the tend to legitimate his permancy in power, and, if possible, permanently. The first, is the fiction of a coherent political discourse: "one must transform the fundamentals of Venezuelan society in order to esbatlish the reign of equal justice." The second, is the method to achieve it: to smother the voices of the opposition, create mobs of thugs that terrorize the population, organize his partisans into cells of confidants in the political police, eventually, to create a single party.

Q. This discourse and this method is the same as those which Castro used in his time?

A. ...It is true that Chávez came to power by means of some elections, but this occurred not because he was a democrat, but because the coup of 1992 failed. If then he arrives in triumph he shoots the next day. His instinct was and is anti-democratic. And if today he is unable to accelerate what he pompously calls "the revolutionary process" it is because, in effect, he lacks control of the armed forces and the support of the majority of the people.

Q. Castro didn't have that either.

A. Castro in the Sierra Maestra created a revolutionary band. After the triumph of this band it was converted formally into an army, but continued functioning with the Mafioso codes of the such bands, with a system of loyalties based on blind obedience, and not to principles, values or rules. The dream of Chávez is to purify the army until he converts it into a revolutionary band. At the moment (and it will arrive) he will confiscate the means of production and try to unleash a ferocious class war throwing the poorest Venezuelans against the middle and upper classes.

Q. You believe that this explains Chávez's threats to nationalize the media and confiscate private property?

A. Of course. And it also explains the government's clumsy measures. He can only govern so badly if he wants to do harm. Chávez is not worrked about the increase in unemployment or that private businesses go broke one after the ohter. All of this suits him...Suppose that He is the owner of PDVSA (the state oil company). He has at his disposition thousands of millions of dollars that he spends as he wishes. Nothing less than 80 per cent of GNP. Suppose that the worse off are the "bourgeoise" and the more desperate the workers, the greater is his strength. Every unemployed worker is a person apart from union influence. Every businessman that goes broke is one less source of opposition...

Q. Is is possible to establish communist autocracies at this time in history, in a world without the Cold War nor the USSR and where Cuba as a result is a curiosity of political archaeology?

A. If you ask Tirofijo (Colombian guerilla leader Manuel Marulanda) or Fidel Castro they will answer yes. As irrational as that appears, Latin American communists continue dreaming of Marxism-Leninism. They are sure that in the USSR and Europe the system failed because the European comrades did things badly. They will not err. But now they add a new element of hope based on a surprising paradox: as the USSR no longer exists and the U.S. no longer feels threatened, there would be no international resistence to the establishment of a communist dictatorship in a Third World country.

Q. The United States will remain passive if Chávez imposes Cubanization?

A. After the end of the Cold War, the indifference of Washington before the Cuban dictator, when it had been simple enough to eliminate it as it could not count on Soviet support, tells the creole commuists that they can take power without anyone trying to impede them. All that they need to do is not to irritate Uncle Sam...

Q. Before beginning this fase of radicalization, Chávez met for nine hours with Fidel Castro. From where comes the influence and psychological power of Castro over Chávez?

A. Castro is a master of manipulaton and Chávez a dazzled disciple, so that the influence of the old over the young is total, crushing. Castro, moveover, possesses the secret that Chávez looks for desperately: how to make revolution and maintain himself in power indefinitely. I am sure that Castro advised Chávez about various things: first, the hard hand against the opposition. He should pass to the offensive. And get past the scare of April 11. The hour of the pistols, punishment and intimidation has arrived. Second, to accelerate the purge in the armed forces and in the institutions he does not totally control, like the judiciary. As soon as possible he should militarize police bodies that he doesn't control and disarm the population, less his partisans. Third, he should not unnecessarily annoy the United States. Soon it will be time for this in the future.

Q. Do you believe in the thesis according to which one of the objectives of the alliance between Chávez and and Castro is the creation of a Havana-Caracas axis that, with the support of the FARC, will light the spark of continental revolution?

A. I believe that they all feel more secure if there are other communist loci on the continent. Without doubt, Chávez is much closer to Tirofijo that Uribe. And if Lula da Silva wins the elections in Brazil, his support will be important. It is enough to see the pages of the Foro de Sao Paulo to advise that little by little a fundamentalist pole of enemies of free politics and economics is being forged. To a rational person the tale is filled with similar aberrations.
Liberal y/o neoliberal confeso, Montaner viene con frecuencia a una Venezuela que parece despertarle una cierta morbosa inquietud de deja vu. Fidel, no vacila en advertirlo, consiguió un inesperado conejillo de Indias para seguir experimentado con su ingeniería totalitaria.

_¿No resulta una exageración y un despropósito establecer un paralelismo entre la revolución cubana y el proceso político que lidera Chávez?

_Por supuesto que no. Chávez es la mayor cantidad de Fidel Castro que le permiten las circunstancias venezolanas y sus limitaciones personales. Chávez siente una profunda admiración por Fidel Castro, y la tendencia natural de los seres humanos es imitar aquello que se admira. Además, la Revolución Cubana tiene dos elementos muy valiosos que ofrecerle a Chávez para legitimar su permanencia en el poder, y, de ser posible, con carácter permanente. El primero, es la fijación de un discurso político coherente: 'hay que transformar los fundamentos de la sociedad venezolana para establecer el reino de la justicia igualitaria'. El segundo, es el método para lograrlo: ahogar las voces de la oposición, crear turbas de matones que aterroricen a la población, organizar a los partidarios en células de confidentes de la policía política, eventualmente, crear un partido único.

_¿Ese discurso y ese método son los mismos a los cuales apeló Castro en su momento?

..._Es verdad que Chávez llegó al poder por medio de unas elecciones, pero eso ocurrió no porque fuera un demócrata, sino porque le falló el golpe de 1992. Si entonces llega a triunfar comienza a fusilar al día siguiente. Su instinto era y es antidemocrático. Y si hoy no acelera lo que pomposamente llaman 'el proceso revolucionario' es porque, en efecto, no tiene el control de la Fuerza Armada ni el respaldo mayoritario del pueblo.

_Castro tampoco lo tenía.

_Castro desde la Sierra Maestra creó una banda revolucionaria. Después del triunfo esa banda formalmente se convirtió en un ejército, pero siguió funcionando con los códigos mafiosos de las bandas, con un sistema de lealtades basado en la obediencia ciega al jefe, y no a principios, valores o reglas. El sueño de Chávez es ir depurando el Ejército hasta convertirlo en su banda revolucionaria. En su momento (y todo llegará) confiscará los medios de producción y tratará de desatar una feroz lucha de clases arrojando a los venezolanos más pobres contra las clases medias y altas.

_¿Crees que eso explica la amenaza de Chávez de estatizar los medios y confiscar la propiedad privada?

_Por supuesto. Y también explica las torpes medidas de gobierno. Sólo se puede gobernar tan mal si se quiere hacer daño. A Chávez no le preocupa que aumente el desempleo o que las empresas privadas quiebren en cadena. Todo eso le conviene...Supone que mientras más débil esté la 'burguesía' y más desesperados los trabajadores, su fuerza es mayor. Cada trabajador desempleado es una persona alejada de la influencia sindical. Cada empresario en quiebra es una fuente menos de oposición...

_¿Es posible establecer autocracias comunistas a estas alturas de la historia, en un mundo sin guerra fría ni la URSS y donde Cuba resulta una curiosidad de la arqueología política?

_Si se le pregunta a Tirofijo o a Fidel Castro contestan que sí. Por irracional que parezca, los comunistas latinoamericanos continúan soñando con el marxismo-leninismo. Están seguros de que en la URSS y en Europa el sistema falló porque los camaradas europeos hicieron las cosas mal. Ellos no se equivocarán. Pero ahora añaden un nuevo elemento de esperanza basado en una sorprendente paradoja: al no existir la URSS ni sentirse amenazados EEUU, no hay resistencia internacional seria al establecimiento de una dictadura comunista en un país del Tercer Mundo.

_¿Permanecerán impasibles Estados Unidos si Chávez impulsa una cubanización?

_Tras el fin de la guerra fría, la indiferencia de Washington ante la dictadura cubana, cuando hubiera sido bastante sencillo eliminarla al no contar con el respaldo soviético, les indica a los comunistas criollos que pueden tomar el poder sin que nadie trate de impedirlo. Todo lo que tienen que hacer es no irritar al Tío Sam...

_Antes de comenzar esta fase de la radicalización, Chávez se reunió durante 9 horas con Fidel Castro. ¿Hasta dónde puede llegar la influencia y el poder psicológico de Castro sobre Chávez?

_Castro es un maestro de la manipulación y Chávez un discípulo deslumbrado, así que la influencia del viejo sobre el joven es total, apabullante. Castro, además, posee el secreto que Chávez busca desesperadamente: cómo hacer la revolución y mantenerse en el poder indefinidamente. Estoy seguro de que Castro le aconsejó varias cosas a Chávez: primero, mano dura contra los opositores. Debe pasar a la ofensiva. Ya pasó el susto del 11A. Llegó la hora de las pistolas, los escarmientos y las intimidaciones. Segundo, acelerar la purga en la Fuerza Armada y en las instituciones no controladas totalmente, como el Poder Judicial. Cuanto antes debe militarizar los cuerpos policíacos que no controla y desarmar a la población, menos a sus partidarios. Tercero, no mortificar innecesariamente a EEUU. Ya habrá tiempo de eso en el futuro.

_¿Crees en la tesis según la cual uno de los objetivos de la alianza entre Chávez y Castro es la creación de un eje La Habana-Caracas que, con el apoyo de las FARC, encienda la chispa de la revolución continental?

_Creo que todos se sienten más seguros si hay otros focos comunistas en el continente. Sin duda, Chávez está más cerca de Tirofijo que de Uribe. Y si Lula da Silva gana las elecciones en Brasil el respaldo será mayor. Basta ver los papeles del Foro de Sao Paulo para advertir que poco a poco se va forjando un polo fundamentalista de enemigos de las libertades políticas y económicas. A una persona racional y bien informada esto puede parecerle increíble, pero la historia está llena de aberraciones parecidas.

posted by Richard 7:10 AM
. . .
Saturday, September 21, 2002
Drive by: The home of Estela Carlotto was fired on in a drive-by shooting in the early morning hours of Friday. Carlotto is the leader of the group Grandmothers of the Plaza de Mayo, which seeks, among other things, to recover the identities of children who were born in prison to mothers arrested, held and later "disappeared" on suspicion of membership in left-wing urban guerilla units, and then adopted by members and allies of the then military dictatorship.

The story is in every paper in Argentina. Carlotto's group is internationally known. Beyond that, as
La Nacion notes:
The offense occurred two days after the Commission for Memory, over which Carlotto presided, complained to the Buenor Aires Supreme Court of Justice that the provincial police employ the practices of state terrorism.

The president of the Grandmothers of the Plaza de Mayo linked the attack with the complaint that had been presented 48 hours before, but did not accuse the Buenor Aires Police of what occurred in her home.
El atentado ocurrió dos días después de que la Comisión por la Memoria, que preside Carlotto, denunció ante la Suprema Corte de Justicia bonaerense que la policía provincial utiliza prácticas de terrorismo de Estado.

La presidenta de Abuelas de Plaza de Mayo vinculó el ataque con la denuncia que se había presentado 48 horas antes, pero no acusó a la policía bonaerense de lo ocurrido en su vivienda.

posted by Richard 11:12 PM
. . .
Politics and economics:

1. Argentina's Peronist president, Edurado Duhalde, asked the country's presidential "precandidates"--party primary candidates--to sign and observe an economic stability pact, reports
La Nacion. The idea is to smooth negotiations with the International Monetary Fund by giving assurance that the next president, whoever he or she may be, will keep Argentina's promises to the IMF.
"The international community asks of us a signal of the unity of the Argentine leadership in order to try to achieve an agreement, he emphasized.
"La comunidad internacional nos pide una señal de unidad de la dirigencia argentina para tratar de lograr un acuerdo", enfatizó.
Mainly, the accord will mean that Argentines and the IMF won't have to wait until after the election to find out these guys' promises are wortheless.

2. Bloomberg.com, quoting Clarin says that the Argentine government intends to ask the International Monetary Fund to provide aid on a monthly basis. So far, the IMF has been unwilling to give Argentina money on any basis.

3. An effort is underway to get Carlos Reutemann to run for President, says Clarin.
The crystalization of all the candidates for president at under 15 per cent support convinced a group of important Personist leaders, influential businessmen and President Eduardo Duhalde to make a final attempt to convince Carlos Reutemann launch his presidential candidacy.

They are all united by the same fear. That none of the current candidates has secured the consent necessary to carry forward an effort full of unresolved difficulties and conflicts like those Duhalde will leave the next president.
La cristalización de todos los candidatos a presidente por debajo del 15% de intención de voto convencieron a un grupo de dirigentes peronistas importantes, de empresarios influyentes y al presidente Eduardo Duhalde de hacer un último intento para convencer a Carlos Reutemann de que lance su candidatura presidencial.

A todos ellos los une el mismo temor. Que ninguno de los candidatos actuales consiga el consenso necesario para llevar adelante una gestión llena de dificultades y conflictos irresueltos, como la que Duhalde le dejará al próximo presidente.
Travelling to Santa Fe, where Reutemann is governor (see map linked at right) on Wednesday to make the case will be the governor of Buenos Aires, Felipe Solá, the foreign secretary, Carlos Ruckauf and the general secretary of the presidency, Aníbal Fernández. If the level of this delegation is any indication, Duhalde & Co. are desperate.

Reutemann, a former Formula 1 race driver, was widely considered to be both the Peronists party's strongest presidential candidate in next spring's general election and the man most capable of defeating former President Carlos Menem, who is running again. Reutemann declined to run in July, a surprise noted in El Sur.

posted by Richard 10:43 AM
. . .
Friday, September 20, 2002
Sugar: Cuba has begun to implement plans (noted in El Sur in June and July ,
here and here.), to drastically downsize the island's sugar industry, reports the Financial Times. Under the plan half of Cuba's sugar mills are closing and as many as 100,000 Cubans will be displaced from the industry.
"The speed and scope of this plan promises to be very disruptive," says Marta Beatriz Roque, a leading political dissident and independent economist. "You have to understand that for hundreds of Cuban communities harvesting and refining sugar is the only life they know."
In fact, the paper says, some 500,000 of Cuba's 11 million people work in the sugar industry.
The Cuban government has pledged to retrain or find new jobs for workers affected by the new sugar regime but some observers doubt that the resources exist to fulfil that promise, a policy that has met with some scepticism.

"The government has basically just told half a million Cubans that they will lose their livelihood," says Ms Roque.

"December marks the beginning of the sugar harvest. We will start to see then what the government can provide and how people react."
While Cuba is disrupted the main beneficiaries are likely to be Brazil, Europe and Thailand, because "with sugar prices languishing and surplus stocks at near-record levels, the market would welcome any dip in output."

The Financial Times is remarkably upbeat about the likelihood of success of this grand plan, given the failures of top-down socialist economic schemes generally, and the failure of the Cuban government to create anything other than poverty during its more than 40 years in power, particularly.
"This is really a challenge of replacing massive, monoculture production with smaller, variable-crop farming," says Luigi Tonini, head of Cuban operations for Italian agriculture firm Agridea, which has been working with Cuba's Agriculture Ministry for the past seven years.

Replacing cumbersome, Soviet-era farming equipment and installing new irrigation systems has helped tripled production in some areas, Mr Tonini says.

A trial tomato cultivation programme also proved successful and Mr Tonini predicts that output will continue to grow as modern farming techniques develop and fertile lands used for sugar cane are converted to other crops.
One would think a paper with "Financial" in its name would understand that operating a showcase farm under the daily supervision of Italian agribusiness is one thing and that it's something entirely different to get real-life Cubans to work diligently and intelligently when all but a pittance earned by their effort accrues to the nomenklatura. But apparently not.

Spice: A more skeptical--and almost certainly more realistic--view of Cuba's future appears in the Miami Herald, in an article reporting a speech given by defector Alcibíades Hidalgo to a large audience at the University of Miami's Institute for Cuban and Cuban-American Studies. Hidalgo, a former ambassador to the United Nations and personal secretary to First Brother and Heir Apparent Raul Castro, is the highest ranking Cuban defector in many years.

In Hidalgo's view Cuba's situation has worsened in recent months, with tourism and prices for key Cuban exports such as nickel, sugar and tobacco all down.
But no changes are possible until Fidel Castro leaves power because he rules Cuba single-handedly, with little or no input from supposedly powerful institutions like the Cuban Communist Party, said Hidalgo, who arrived last month.
As a result,
Castro's death will cause ''an enormous commotion,'' he said, adding that he would not rule out the possibility of a popular uprising.

''For me, Castroism without Fidel Castro will not exist,'' he said in between sometimes unfriendly questions from audience members who scolded him for his past support of Castro and wondered if he was a Cuban spy.

In August, El Sur quoted extensively from an interview Hidalgo gave Mary Anastasia O'Grady for her Americas column in The Wall Street Journal.

posted by Richard 9:22 PM
. . .
Citizen soldiers, soldier citizens: The
Miami Herald's Latin America columnist, Andres Oppenheimer, asks:
Will President Alvaro Uribe's plan to create a network of one million army informants and enlist 40,000 ''peasant-soldiers'' to help fight Latin America's bloodiest guerrilla war result in massive human rights abuses? Will it create a new cycle of violence in this country's 38-year-old armed conflict?
Oppenheimer notes the fears of various human rights groups. And, along with these groups, he recognizes that Colombia has not had a very happy experience groups of armed civilians.

Still, he cautions patience.
While many Colombians are concerned about the possibility of such abuses, most are far more worried about the FARC's violence against civilians. According to Colombian military sources, the Marxist guerrillas are making 60 percent of their income from drug trafficking and the rest from kidnappings for ransom. The FARC rebels are extremely unpopular: only one percent of the Colombian population has a positive view of them, while 93 percent reject them, and 6 percent do not respond, according to a recent Gallup-Invamer poll.
He notes that the new soldiers will be just that regular army, under regular army officers and carrying regular army small arms, different only in that they serve in their hometowns. And the million informants are not intended to be a militia, but a kind of neighborhood watch. Concludes Oppenheimer:
If it's going to be the way Uribe describes it, perhaps his biggest mistake has been to put intimidating labels such as ''peasant-soldiers'' and ''informant networks'' to what may be a simple project to enlarge a grossly understaffed army and its intelligence sources. We shall soon know.

posted by Richard 7:30 PM
. . .
More economic problems: Moody's has lowered the rating of Venezuelan debt, reports
El Universal. Sovereign debt denominated in foreign money was downgraded from B2 to B3: soverign debt in bolivars was cut from B3 Caa1. The reason is political risk.
In a plain report, Moody's explained that "government efforts to consolidate a new institutional framework are being challenged in a growing manner by a part of the Venezuelan population.

This has increased the risk that, at some point in the future, the government perhaps will confront domestic challenges that force it to reconsider the priorities of spending public resources in a way detrimental to investors," added the agency.
En un escueto comunicado, Moody's explica que ''los esfuerzos del Gobierno para consolidar un nuevo marco institucional están siendo desafiados de manera creciente por una porción de la población venezolana''.

''Esto ha aumentado el riesgo de que, en algún punto del futuro, el Gobierno tal vez enfrente desafíos domésticos que le fuercen a reconsiderar las prioridades de gasto de los recursos del sector público en una forma que vaya en detrimento de los inversores'', agregó la agencia.
Anti-government demonstration broken up: The National Guard tear gassed demonstrators near the headquarters of the Venezuelan state oil company, Petróleos de Venezuela, S.A. (PDVSA), reports El Nacional. About 60 demonstraters had gathered "with the intention of holding a vigil, in protest of the governmental management of President Chávez and to solicit the support of the military" ("con la intención de realizar una vigilia, en protesta a la gestión gubernamental del presidente Chávez y solicitar el apoyo de los militares"). Clearly, they didn't get that support.

Bloomberg.com also has a report.
"The government allowed the opposition to do whatever it wanted for the first three and half years," said Janet Kelley, a public policy professor at the Instituto de Estudios Superiores de Administracion in Caracas. "Now, they've decided to take steps. This could backfire."
At a minimum, it is the kind of thing that causes Moody's to see "political risk" and drop credit ratings.Last night, the government banned demonstrations in eight areas of Caracas, including around military bases, the Miraflores presidential palace, and government-owned television and radio stations.
"There's been a heightening of tensions," said Robert Bottome, director of research company Veneconomy in Caracas. "Some have suggested that the government may be trying to provoke a disturbance to justify taking more power, a self-coup" (or autogolpe).
Meanwhile, El Nacional reports, the Mayor of the Municipio Chacao, Leopoldo López, asserted that members of the National Guard impeded the passage of ambulances to and from the site of the demonstration, making it difficult to evacuate the injured.

According to another item in El Nacional, the government is denying that a crackdown on the opposition. On Thursday, the government arrested an opposition leader named Alejandro Peña Esclusa and the defense ministry continues to investigate high-ranking officers allegedly involved in the April ouster of President Chávez.
(Vice-President José Vicente) Rangel declared that all the actions of the government are founded in the constitution and rejected the idea that it has initiated political persecutions against any person.
Rangel declaró que todas las acciones del gobierno están fundamentadas en la constitución por lo que descartó que se hayan iniciado persecuciones políticas contra alguna persona.

posted by Richard 4:35 PM
. . .
Deadbeats: In today's Americas column in The Wall Street Journal, Mary Anastasia O'Grady, analyzes efforts in the U.S. Congress to allow U.S. agribusiness to sell farm commodities to Cuba on credit. It is already legal to sell farm commodities to Cuba for cash. Noting that Cuba owes vast sums to other countries in Europe and Latin America after defaulting on credit arrangements, O'Grady concludes that what's up in the Congress is not really an effort to permit private credit arrangements, but an effort to put U.S. taxpayers behind commodity loans to Cuba.
The University of Miami's Institute for Cuban and Cuban-American Studies has compiled a list of Cuba's bad debts. It says that Fidel owes the European Union at least $10.9 billion and hasn't paid principal or interest on its Paris Club debt since 1986. The former Soviet Union lent some $25 billion. Cuba is in arrears to its largest creditor, Japan, to the tune of $1.7 billion. Argentina is its next biggest creditor and is owed $1.58 billion. Cuba has debts to Chile of $20 million for unpaid fish imports, a "typical case of defaault on a foregin government's short-term food export credit program," according to the report.
Says O'Grady:
We're supposed to believe that into this morass of defaults the U.S. agriculture wants to jump, taking on "private" risk and boldly going where so many have gone before and lost their shirts.
El Nacional reports that Cuba is demanding that Venezuela's state-owned oil company, Petróleos de Venezuela, S.A. (PDVSA), pay $100 million in losses and damages caused when the oil company stopped deliveries in April because of a dispute over payments and the political upheaval in Venezuela.

posted by Richard 6:53 AM
. . .
Thursday, September 19, 2002
Economy still falling:
LA NACION LINE reports that Argentina's economy continues to fall. Quoting the government statistical office, INDEC (Instituto Nacional de Estadística y Censos), the paper says gross national product (Producto Bruto Interno, or PBI) fell 13.6 per cent in the second quarter of 2002, compared with one year ago, and 14.9 percent for the first half of the year.

posted by Richard 6:49 PM
. . .
Road to ruin: Venezuela continues to follow the path pioneered by Argentina. According to
Bloomberg.com (citing El Nacional):
The Venezuelan Banking Association said its members may buy three-year government bonds provided the yields are indexed to inflation, the newspaper said, citing unidentified bankers. No decision has yet been taken, Nacional reported...

Venezuela needs to finance an estimated deficit this year equal to 3 percent of gross domestic product, or about $3 billion. Banks have balked at buying government bonds with maturities longer than 12 months because of the risk of currency devaluation after a 48 percent drop in the bolivar this year, higher interest rates and political instability.
The government is pressuring banks to buy state debt that nobody not under pressure would buy. Argentina did the same thing, a year or so in advance of that country's default, with results for all to see.

posted by Richard 7:40 AM
. . .
Wednesday, September 18, 2002
New Argentine blog:
El-AmuChad has been around since June. It is in Spanish. However the picture, "gestos2.jpg," posted September 15 can be understood by all.

posted by Richard 11:59 AM
. . .
Lula: With Brazil's presidential election just three weeks away, it looks increasingly like perennial presidential candidate Luiz Inacio Lula da Silva is going to succeed this year.
Won - Reuters reports that da Silva has extended his lead, according to a poll released today.
The survey carried out by Vox Populi pollsters for Correio Braziliense newspaper showed Lula, a four-time candidate running for the Workers' Party, rising 3 percentage points to 42 percent of voter support compared to the previous Vox Populi poll published on Sept. 12.

Market favorite Jose Serra, the candidate backed by President Fernando Henrique Cardoso's ruling coalition, slipped to 17 percent support from 19 percent. Analysts are talking about a possible Lula's victory already in the first round on Oct. 6, a prospect that has hit financial markets.
Da Silva is a Socialist.

posted by Richard 10:24 AM
. . .
FARC spreads: A U.S. Senate caucus, made of members who take a special interest in drug trafficking, were told yesterday that Colombia's largest communist guerilla army, Revolutionary Armed Forces of Colombia (FARC), is becoming a regional danger, reports today's
Miami Herald.
"The tentacles of the FARC extend well beyond the boundaries of Colombia," Army Brig. Gen. Galen Jackman told the Senate caucus on international drug trafficking.
The FARC is establishing links with radicals in Peru and Bolivia and has set itself up in a lawless area of Paraguay, the paper says.

Jackman was accompanied by Deputy Secretary of State Richard Armitage and Drug Enforcement Agency (DEA) Administrator Asa Hutchinson. The officials suggested that U.S. citizens may be under increasing peril from the FARC.
"It's clear, based on the intelligence that we have, that they [the FARC] are involved with other terrorist organizations in Latin America to facilitate those things that they need, primarily arms, ammunition, medical supplies, those types of things," Jackman said.
Still, the officials said the Colombian groups are drugs are involved with drug trafficking not terrorism.
Armitage, in a written statement, told the senators that the FARC and two other outlaw groups in Colombia are not terrorist organizations with a global reach.

"This is not al Qaeda or Hezbollah," the statement said, referring to Middle East terrorist groups. "But the reach of their drugs is certainly global."

posted by Richard 10:03 AM
. . .
Cuba, Si? A story in
El Universal, entitled "Cubanization of the country advances" ("Avanza cubanización del país") finds parallels between certain policies of President Hugo Chávez today and of Fidel Castro in 1960. decree that nationalized all businesses in Cuba.
The Castro factor contained in the discourse of the President of Venezuela, Hugo Chávez Frias, is every time more blatant. The last references of the leader abut private participation in the national economy, are curiously similar to the those contained in a celebrated Cuban decree, in 1960, that expropriated the local industry in order to impose authoritarian control and state restriction. Meanwhile, analysts ask themselves if the country is every time more close to economic Cubanization.

The decree subscribed by Oswaldo Dorticós, then president of the island, and Fidel Castro, its prime minister, indicates that “many of the private businesses, far from assuming conduct consistent with the objectives of the revolutionary transformation of the economy, have continued a policy contrary to the interests of the revolution and economic development.”

Carried forward more than 40 years, Chávez, in a tone similar to the communist document (and leading a revolution that has many comparisons with the Cuban), denounces in Venezuela that the private sector has planned an “economic coup” contrary to his process.
The only change is the actor
The leader is confronted by a united business community. “They are the leading defenders of the savage neo-liberalism, who seek to defend the privileges that they lost,” he has said. While, in the decree one reads that there was the necessity “to impose laws to liquidate the privileges of the economic centers that, reacting violently, ignored and violated these laws, going to the extreme of using ill-gotten gains to finance groups of counter-revolutionaries, in a frank alliance with the imperialists.”

Despite his protests, Chávez is responsible for the economic contraction. “As they failed with the political coup, now they seek to create an economic coup, because they are not resigned to the fact that the revolution is a fact. They are conspiring, and one has to know that they are the ones that are betting on recession in Venezuela.”

Chávez affirms that the business sector promotes flight of capital and the rise of the dollar by means of currency speculation. While, in the Cuban text is read that “counter-revolutionary” businesses have executed “sabotage, extracting cash from the business and without adequately reinvesting, taking exaggerated financial measures without employing their own capital, in order to obtain cash to invest it overseas.
Imports and the bank
Although it is certain that Chávez disqualifies the importation of foreign products (“Already they bring us enough garbage from the global village and they sell them to us as if they were products of the first quality,” he has said), it is no less certain that the island’s decree indicated that the “revolution” requires, as an unavoidable condition, the restructuring of foreign commerce, in view of the fact that “great importing businesses operate only under the stimulus of earnings.” So the borders were closed and the entire national production was controlled. Today Venezuela faces international demands for safeguards and restrictions on foreign products.

In this same document, Dorticós and Castro also decided control of the banks that operated in Cuba, and of monetary and credit policies. Still it was “indispensable to transform the old structure and adapt it to the conditions of development derived from the revolution.” They publicly defined those functions, in order to prevent the businesses from functioning “under the spur of earnings.”

The decree “allocated to the state all the national private banking companies, constituted as banks of deposit or mortgage credit, or of growth and development, as concerns all the goods, rights and pertinent activities of these businesses.”

The situation recalls the pressures placed on the Venezuelan central bank over such matters as interest rates (in the middle of 2000 the leader threatened with to lower them, “by decree”), and the allocation of credit, in which it contracted for the creation of parallel entities like the Woman’s Bank and the Bank of the People, among others, that have turned credit applications and loan placements to other directions.

More recently, the institutions have been hit again a presidential word, but this time he argues that they don’t buy enough of the bonds representing public debt. “The bank is not collaborating as it ought to do,” he related around the time of the sale of government paper. “It cannot be that the international bankers come to tell us that they have instructions to not buy our bonds. It cannot be, because we would have to find other mechanisms,” pronounced the governor last August.
El factor castrista contenido en el discurso del presidente de Venezuela, Hugo Chávez Frías, es cada vez más notorio. Las últimas referencias del mandatario sobre la participación privada en la economía nacional, son curiosamente similares a las contenidas en el célebre decreto cubano que, en 1960, expropió a la industria local para imponer el control autoritario e irrestricto del Estado. Entretanto, analistas se preguntan si el país está cada vez más cerca de una cubanización económica.

El decreto suscrito por Oswaldo Dorticós, entonces presidente de la Isla, y Fidel Castro, su primer ministro, indica que "muchas de las empresas privadas, lejos de asumir una conducta consistente con los objetivos de la transformación revolucionaria de la economía, han seguido una política contraria a los intereses de la Revolución y del desarrollo económico".

Transcurridos más de 40 años, Chávez, con un tono similar al del documento comunista (y liderando una revolución que muchos han comparado con la cubana), denuncia en Venezuela que el empresariado privado ha planeado un 'golpe económico' en contra de su proceso.
Sólo cambia el actor
El mandatario se enfrenta contra un gremio empresarial unido. "Son cúpulas defensores del neoliberalismo salvaje, que buscan defender los privilegios que perdieron", ha dicho. Mientras, en el decreto se lee que hubo la necesidad "de imponer leyes para liquidar los privilegios de núcleos económicos que, reaccionando violentamente, ignoraron y violaron esas leyes, llegando al extremo de financiar con dineros mal adquiridos, a grupos contrarrevolucionarios, en franca alianza con el imperialismo".

Chávez responsabiliza a sus contrarios de la contracción económica. "Como fracasaron con el golpe político, ahora buscan dar un golpe económico, porque no se resignan a que la revolución es un hecho. Están conspirando, y tiene que saberse que ésos son los que están apostando a la recesión en Venezuela".

Asegura que el sector promueve fuga de capitales y el alza del dólar mediante la especulación cambiaria. Mientras, en el texto cubano se lee que las empresas "contrarrevolucionarias" han ejecutado un "sabotaje, extrayendo (fondos) del numerario sin reinversiones adecuadas, utilizando exageradamente medios de financiamiento sin el empleo del capital propio para obtener efectivo e invertirlo en el extranjero previa obtención clandestina de divisas".
Importaciones y banca
Si bien es cierto que Chávez descalifica la importación de productos foráneos ("Ya basta de que nos traigan basura de la aldea global y nos la vendan como si fueran productos de primera calidad", ha dicho), no es menos cierto que el decreto isleño indica que la "revolución" requiere como condición "insoslayable" la reestructuración del comercio exterior en vista de que "grandes empresas importadoras operan bajo el solo estímulo de la ganancia". Se cerraron así temporalmente las fronteras y se controló toda la producción nacional. Hoy Venezuela enfrenta señalamientos internacionales por la imposición de salvaguardias y restricciones a los productos foráneos.

Dorticós y Castro también se adjudicaron en ese mismo documento el control de la banca que operaba en Cuba, y de las políticas monetaria y crediticia, ya que era "indispensable transformar la vieja estructura y adecuarla a las condiciones de desarrollo derivadas de la revolución". Declararon públicas las funciones, para evitar que las empresas funcionaran "bajo el acicate de la ganancia".

El decreto '"adjudica a favor del Estado todas las empresas bancarias privadas nacionales, ya se trate de bancos de depósitos o créditos hipotecarios, o de fomento y desarrollo, así como todos los bienes, derechos y acciones pertenecientes a esas empresas."

La situación irremediablemente recuerda las presiones hechas a la banca venezolana por temas como las tasas de interés (a mediados de 2000 el mandatario amenazó con bajarlas, "así sea por decreto"), y la adjudicación de créditos, en donde contraatacó con la creación de entes paralelos como los bancos de La Mujer y del Pueblo, entre otros, que han desviado las solicitudes de créditos y colocación de fondos hacia otros nortes.

Más recientemente, las instituciones han sido golpeadas nuevamente por el verbo del Presidente, pero esta vez argumentando que no compran suficiente cantidad de Bonos de la Deuda Pública. "La banca no está colaborando como debería hacerlo", refirió acerca de adquisición de papeles. "No puede ser que los banqueros internacionales vengan a decirnos que tienen instrucciones de no comprarnos bonos. No puede ser, porque tendríamos que buscar otros mecanismos", sentenció el gobernante en el pasado mes de agosto.

posted by Richard 8:58 AM
. . .
Tuesday, September 17, 2002
Economy: Venezuela continues to trace the route pioneered by Argentina. Right now, it's still two years behind, moving up fast.

Bloomberg.com reports that the government of Venezuela has begun paying its bills with state bonds. Venezuela is "scrambling" to finance a deficit of about $3 billion, or three per cent of GDP, this year.

2. Over the weekend, President Hugo Chávez announced a decree that permits workers to take over companies that shut down to respect politically inspired lockouts. Últimas Noticias reports that the business group, Conindustria, intends to challenge the decree in court. As it happens, a national business shutdown has just been called by the Confederation of Venezuelan Workers (Confederación de Trabajadores de Venezuela or CTV) for October 7, reports El Mundo. The lockout is being called "under the argument of rejecting the political economy of the government and to compel the realization of a consultative referendum in order to take President Chávez from Miraflores and to renovate political powers" ("bajo el argumento de rechazar la política económica del Gobierno e impulsar la realización del referendo consultivo para sacar al presidente Chávez de Miraflores y renovar los poderes públicos.").

3. Chávez and his National Assembly allies are also moving to increase government control over the country's banks. One proposal, apparently to be introduced into the assembly soon, would limit the central bank's autonomy and increase the government's control over exchange rates. In addition, Chávez recently spoke about requiring private banks to turn deposits over to the state-owned Banco Industrial de Venezuela. El Universal, notes opposition to these ideas. It quotes First Justice (Primero Justicia) member Liliana Hernández as suggesting that "President Chávez intends to put the country into a 'corralito financiero' ("Chávez pretende meter al país por un 'corralito financiero'"). Nothing has been harder for Argentina than ending the "corralito financiero" put into effect last December.

4. Today's Wall Street Journal, International section (no link), reports that Venezuela's economy is "spiraling downward despite surging oil-export revenue."
The government of leftist President Hugo Chávez needs to fill an estimated $4.5 billion budget deficit by year's end. What's worse, some analysts fear that the fiscal hole could widen to as much as $15 billion next year as bills come due for debt repayments and postponed spending...

Mr. Chávez conceded over the weekend that 'we've had serious financial problems this year.' Inflation in June hit 16.2%, the highest level in almost three years. Price rises, held to 12.7% last year, now have hit a 30% annualized rate. So far this year, the bolivar has dropped in value by 46% against the U.S. dollar. Higher prices have hurt consumer spending. The drop, together with cuts in government expenditures has plunged Venezuela into a deep recession. Gross domestic product declined 7.1% in the first half of 2002.

Traditionally, a run-up in oil prices should give Venezuela more than enough income to boost spending, pay its foreign and domestic debts and pile up its international reserves...

This time around, however, the windfall isn't raising enough to balance the books.

posted by Richard 12:09 PM
. . .
Kidnapping: Kidnappings for money have been common in Colombia and Brazil and are becoming increasingly common in Argentina. Despite a better economy Mexico is increasingly afflicted too. Two chilling descriptions of the problem appear in the
Christian Science Monitor and on MSNBC's website.

posted by Richard 10:03 AM
. . .
Return of the hard left? Chile has been hit by a string of small bomb attacks, reports
It was the third bomb attack in Santiago in September, the month Chile commemorates the September 11, 1973, military coup that brought ex-dictator Gen. Augusto Pinochet to power.
Though comparatively peaceful, Chile remains divided by the legacy of Pinochet. Age and the years-long effort to get Pinochet proscecuted, have removed him from politics. Most recently, he resigned his position as Senator-for-life. The result is a clear if symbolic defeat for Chile's rightist coalition, which runs just a percentage or two behind the leftist coalition in elections, and the army (still the ultimate guarantor against populism and anarchy). This, plus the fact that market economics (called neo-liberalism) is under renewed assault throughout South America appears to have emboldened the left, predictably generating violence at the extreme.

For another recent example, an anti-Pinochet protest turned violent the weekend before the September 11 anniversary; the event was noted in El Sur.

posted by Richard 10:01 AM
. . .
Sunday, September 15, 2002
The delegation of representatives from the Organization of American States (Organización de Estados Americanos), United Nations Development Program (Programa de las Naciones Unidas para el Desarrollo) and the Carter Center (Centro Carter) left Venezuela at the end of last week, leaving a program containing three primary recommendations, reports
Yahoo! News - AP. These are, judicial independence, early elections and disarming violent street organizatons. President Hugo Chávez reportedly agreed to these steps conceptually, as did the opposition with more enthusiasm, since each responds to an opposition complaint and the achievement of each would mainly benefit them. Briefly, the three are: 1) Judicial independence: After the Supreme Court ruled four high-ranking officers could not be tried for rebellion, Chávez threatened the court and his loyalists in the National Assembly began seeking means of replacing enough members of the 20-member court to change its majority. 2) Early elections: Chávez's term runs to 2006; this is way to long for the opposition, which, based on polls, appears to have a popular majority. 3) Street gangs: The reference here is to the "Bolivarian Circles," organized by Chávez loyalists and modeled on Cuba's block committees.

The most important point is the report's support for early elections. In El Mundo's summary of what the mission was told in their meetings with the government and opposition:
According to the report, the parties to the conflict see that a peaceful end to the crisis must occur by the realization of agreed constitutional mechanisms allowing citizen participation in an election, the dismissal or continuation of their representatives, a subject that the is indissolubly linked to the handling of an "electoral package."
Según el informe, las partes en conflicto perciben que una salida pacífica de la crisis pasa necesariamente por la viabilización de los mecanismos previstos en la Constitución para la participación ciudadana en la elección, remoción o continuidad de sus representantes, tema que se encuentra indisolublemente vinculado al tratamiento de un “paquete electoral”.
What is clear in the document is that at no point are the approaches toward an electoral end to the crisis the report points to--the relegitimation of the moral, judicial and electoral powers--are imposed by the mission, but to the contrary, they provide for handling it through meetings.
Queda claro en el documento que en ningún momento los planteamientos que apuntan hacia una salida electoral, la relegitimación de los poderes Moral, Judicial y el Electoral contenidas en el informe, son impuestas por la misión, por el contrario, provienen de lo manejado en las reuniones.
These meetings would be between the government and opposition.

As might be expected the report received a tepid response from both sides. As he has in the past, Chávez reiterated that the earliest a referendum on his tenure can be held is 2003. The opposition is unwilling to meet to discuss anything else.

posted by Richard 12:49 PM
. . .
Free: The kidnapped service-station owner, Antonio Frisoni, was freed on payment of $200,000, reports
La Nacion.

posted by Richard 12:22 PM
. . .
Debt schedule: The Duhalde government proposes budgeting $4 billion for international debt repayment next year, reports
Bloomberg.com , citing Clarin.
The debt payment represents 40 percent of the overall debt with international creditors, the paper said. In December, the government defaulted on $95 billion of debt and devalued the currency.

posted by Richard 4:45 AM
. . .
Saturday, September 14, 2002
Crime wave: Crime mounts in the wake of economic collapse and political ineffectuality. As evidence, a 79-year-old Buenos Aires service-station owner, Antonio Frisoni, was kidnapped, according to
La Nacion. The kidnappers are asking $2 million for his release.

Part of the reason crime is up is too much money, reports Yahoo! News - AP. Too much money in mattresses and cupboards in homes, that is. With people unwilling to trust banks, robberies and kidnappings have increased to an alarming extent.
"Thieves in our country are one step ahead," said police Sgt. Jorge Avesani, who is in charge of protecting Buenos Aires' wealthiest neighborhood — home to 17 ambassadors.

"They know that the money circulating in the city isn't in the banks; it's in the homes of every citizen."

With their cash out of the vault and hidden at home, Argentines are learning that protecting their money from a banking crisis is simpler than protecting it from the multiplying bands of thieves prowling this capital of 10 million.

Kidnapping, once nearly unheard of, has become widespread as criminals hold their victims for hours or days while trying to collect ransom money they suspect is tucked away in closets and cupboards.

posted by Richard 2:18 PM
. . .
Thanks, but no thanks: A pro-Chávez workers group, El Frente Bolivariano de Trabajadores (FBT), has offered to take over businesses in case of a strike, reports
El Universal.
So said Jacob Torres, a member of the the FBT, who detailed: "If the businesses are going to stop for 24 hours, the workers have the complete capacity to avoid paralysis. In the name of the country that we want to build, we cannot permit that the businesses stop themselves.
Así lo expresó Jacabo Torres, miembro del FBT, quien detalló: "Si las empresas se van a parar 24 horas, los trabajadores tienen toda la capacidad para evitar que se paralicen. En nombre del país que queremos construir, no podemos permitir que las empresas se paren".

posted by Richard 1:33 PM
. . .
Friday, September 13, 2002

1. The three-party commission in Venezuela seeking to promote dialog is expected to present "electoral package" ("paquete electoral")as a way out of the country's political impasse, reports
El Universal.

The three parties are the Organization of American States (Organización de Estados Americanos), United Nations Development Program (Programa de las Naciones Unidas para el Desarrollo) and the Carter Center (Centro Carter). El Universal says the visitors, who have met with administrative representatives, including President Chávez, and the opposition,
are conscious of the urgency of finding a way out of the internal crisis, in order to avoid that the acute polarization has a violent outcome.
tiene conciencia de la urgencia de encontrar una salida a la crisis interna, para evitar que la aguda polarización tenga un desenlace violento.
The paper says the proposal will be for new internationally supervised elections.
The idea of convoking early elections has been raised by Coordinadora Democrática, political parties, non-governmental organizations, the church and the communications media. Nevertheless, President Hugo Chávez, after his first meeting with the commissioners, came forward to flatly deny any possibility of consulting the electorate, ahead of August 2003, the date after which it is constitutioally possible to convoke a recall referendum of the presidential mandate, which marks the mid-point of Chávez's six-year term.
La tesis de convocar elecciones adelantadas ha sido planteada a la misión por la Coordinadora Democrática, partidos políticos, organizaciones no gubernamentales, la Iglesia y los medios de comunicación. No obstante, el presidente Hugo Chávez, luego de su primera reunión con los comisionados, se adelantó a negar de plano cualquier posibilidad de consulta electoral, antes de agosto de 2003, fecha en la que es constitucionalmente posible convocar al referendo revocatorio del mandato presidencial, al cumplirse la mitad del período de seis años.
If this is what is proposes, it will be a very big victory for the opposition.

2. A Barquisimeto (see map linked at right) TV station was firebombed last night, report Bloomberg.com and El Nacional. No one was injured. Station president Jorge Kossowsky said:
We are not going to be intimidated. the channel is going to continue transmitting..."No nos van a amedrentar. El canal va a seguir transmitiendo...
Bloomberg.com notes that the opposition accuses Chávez supporters with trying to intimidate the press, which Chávez supporters deny.
"Our vehicles are always being damaged in the streets," Kossowksy said. "And our reporters are being attacked when they go out to report."

posted by Richard 11:35 AM
. . .
Send in the clown: According to
El Nacional:
President Hugo Chávez decided to travel at the last hour to New York in order to intervene in the 57th General Assembly of the United Nations that has been meeting since Wednesday.
El presidente Hugo Chávez decidió viajar a última hora a Nueva York para intervenir en la 57 Asamblea General de la Organización de las Naciones Unidas que se realiza desde el miércoles.
According to a spokesman, Chávez intends to spend some hours in New York, speaking to the assembly and giving a press conference.
"Most likely is that he will go tomorrow (today), because tonight (last night) the President has to complete a very full domestic agenda of great interest to the country," assured a high governmental source.
"Lo más probable es que se vaya mañana (hoy), porque esta noche (ayer) el Presidente debe cumplir una agenda interna muy apretada y de gran interés para el país", aseguraron altas fuentes gubernamentales.
After which he will go to New York, no doubt to give the world the benefit of his views on attacking Iraq.

posted by Richard 10:57 AM
. . .
Thursday, September 12, 2002
New talks: Colombia is again talking with Colombia's second and less lethal communist guerilla army, ELN (Ejército de Liberación Nacional), reports
El Tiempo, quoting Luis Carlos Restrepo, member of the country's peace commission. The meetings are being held in Cuba, "naturally, with the collaboration and knowledge of commandante Fidel Castro" ("naturalmente, con la colaboración y conocimiento del comandante Fidel Castro"). Earlier talks in Cuba between the Colombian government and the ELN broke down at the end of May.

posted by Richard 1:06 PM
. . .
Tuesday, September 10, 2002
Facilitated dialog: A three-party commission has arrived in Caracas to meet with the government and opposition in an attempt to promote dialog. The commission consists of representatives of the Organization of American States (OAS), United Nations and Carter Center.

El Universal has a report on the commission's meeting with Venezuelan President Hugo Chávez.
He (Chávez) added that the government is disposed to continue favoring dialog, but rejected any meeting with opposition groups "who are calling for example for a coup d' etat, that are calling for violence of for disrespect of constitutional principles."
Agregó que su gobierno está dispuesto a seguir propiciando el diálogo, pero rechazó cualquier encuentro con sectores opositores ''que estén llamando por ejemplo a golpe de estado, que estén llamando a la violencia o a desconocer los principios constitucionales''.
It appears that there is still some distance between the contending sides.

posted by Richard 7:46 PM
. . .
One important reason why an agreement on aid between Argentina and the IMF is delayed is the unpredictability and politicization of Argentina's courts, including the Supreme Court, says
La Razón. For its part, the Duhalde administration shares the IMF's worries about the court, but believes the agency ought to stick to economics and stay out of politics, the paper says.
The worry of the credit agency about the complicated relationship between the executive and the high court was raised by the number two person in the Fund: Anne Krueger. In London yesterday, she twice asked Secretary of Finance Guillermo Nielson about the subject. Nevertheless, the secretary general to the president, Anibal Fernández, said today that the IMF "has no reason to meddle in these things."
La inquietud del organismo de crédito por la complicada relación entre el Ejecutivo y el máximo tribunal llegó de boca de la número dos del Fondo: Anne Krueger. Dos veces le preguntó por el tema ayer en Londres al secretario de Finanzas Guillermo Nielsen. Sin embargo, el secretario general de la Presidencia, Aníbal Fernández, dijo hoy que FMI "no tiene por qué meterse en estas cosas".

posted by Richard 6:35 PM
. . .
The return of "petro-populism"?: The
Miami Herald's Latin America columnist, Andres Oppenheimer, worries about the hard an oil price increase would do to Latin America's oil producing countries. Yes, oil producing countries.
According to economic projections from UBS Warburg, a Stamford, Conn., economic research firm, if a war on Iraq were to push oil prices from their current $28 a barrel to $35 -- a conservative projection -- Latin America's oil exports would rise by $12.4 billion a year.

In the past, such oil price hikes have had a disastrous impact on Latin America. Buoyed by high oil prices after the oil crises of 1973 and 1979, Latin American governments began to subsidize key sectors of their economies and to take huge international bank loans, which virtually doubled the region's foreign debt between 1979 and 1982.

Petro-populism was fun while it lasted. But when the bubble burst and oil prices fell, Latin America found itself with mammoth foreign debt that is still choking its economies. It may happen again.
Among the big winner-losers, Venezuela (+$7 billion a year), Mexico (+$4.5 billion) and Ecuador (+$700 million a year). Loser-losers would be Brazil, Chile, Cuba and all of Central America. Why are there no winner-winners?
"The danger is that oil exporters will go on a borrowing binge, and that oil importers will find themselves against the wall," said Pedro Pablo Kuczynski, an investment banker who recently stepped down as Peru's economy minister. "And if the world economy slows down, everybody will be hurt."

posted by Richard 6:22 PM
. . .
Bank freeze to end! Economy Minister Roberto Lavagna "affirmed that the 'field' of all time deposits less than 7,000 pesos will be freed..." ("afirmó que se liberará el 'corralón' a todos los depósitos a plazo fijo inferiores a 7000 pesos..."), reports
La Nacion. Of course that will be on May 31, next year.

posted by Richard 6:11 PM
. . .
Monday, September 09, 2002
"No plan B" II:Last week, Alfredo Atanasof, cabinet secretary the administration of appointed-President Eduardo Duhalde, said there is "no Plan B," after a deal for new loans with the IMF (see
El Sur). He was roundly criticized for it. This morning, according to Clarin , the vice-chief of cabinet, Eduardo Amadeo, suggested that there was no Plan B because "the accord with the International Monetary Fund (IMF) es much closer that is believed "("el acuerdo con el Fondo Monetario Internacional (FMI) está más cerca de lo que se cree"). Members of the Duhalde administration have been promising a deal in the near future, say just two weeks or a month out, since last January. Every time, the date has come and gone, with nothing but a new promise.

Among the alternatives rejected, according to La Nacion's story on the subject, was going it alone:
Amadeo, in declarations to Radio America, rejected, on the other hand, the "Malaya solution" to get out of the crisis without the IM, affirming that it would be "like comparing a man who can run 100 meters in a second with another that was run over by a truck."
Amadeo, en declaraciones a radio América, descartó, por otra parte, la "solución malaya" para salir de la crisis sin el FMI, al afirmar que sería "como comparar a un hombre que corre cien metros en un segundo con otro que fue atropellado por un camión".

posted by Richard 5:30 PM
. . .
Violent protest: Now that September 11 is no longer a holiday in Chile, demonstrators moved to the weekend their annual protest against the 1973 military takeover that brought General Augusto Pinochet to power, reports
Yahoo! News - AP.
While most of the 1,500 demonstrators peacefully marched more than 25 blocks from downtown Santiago to the city's main cemetery, small groups of masked youth started throwing rocks and Molotov cocktails at stores, bank offices and at police.

As the march went past the presidential palace, which was destroyed by air force jets during the coup, the demonstrators burned a U.S. flag. It was widely believed that the U.S. government and CIA supported the coup.

Among the stores attacked by the demonstrators was a McDonald's restaurant, which was set on fire and had its windows smashed.
Government officials say they are doing everything possible to prevent a repeat on the actual anniversary, according to La Segunda. For example:
The general director of police, Alberto Cienfuegos, visited this morning Villa Franica--where habitually disorders have been produced every September 11--to share a pie and a glass of drink with the neighbors of the area, indicating that "this shows, simbolizes, our intention as Chilean police to continue increasing the integration of the community."
El General Director de Carabineros, Alberto Cienfuegos, visitó esta mañana la Villa Francia -donde habitualmente se producen desórdenes cada 11 de septiembre- para compartir una empanada y un vaso de chicha con los vecinos del sector, señalando que "esto demuestra, simboliza, nuestra intención como Carabineros de Chile de seguir incrementando la integración de la comunidad".
Note, in the Yahoo! News - AP story, how demonstration closely copies methods of recent anti-globalization demonstratons-- masked rioters, emerging out of a larger, avowedly peaceful demonstration, carrying weapons, including Molotov cocktails, and attacking a McDonalds. Also noteworthy, the same story says the march "was clearly smaller than in previous years."

posted by Richard 3:19 PM
. . .
Certified: Pursuant to a requirement of law, the U.S. government today certified that Colombia's military is meeting human rights standards, reports
Bloomberg.com . The certification is the first since Alvaro Uribe became president August 7. It comes over the opposition of human rights groups (surprise, surprise).
The U.S. is reasonably confident'' that Uribe's administration is meeting the conditions set by Congress for receiving aid, a senior State Department official told reporters at a briefing. A previous certification in May freed about $60 million that had been withheld by Congress.

The conflict is fueling drug production in a country that supplies about 90 percent of the cocaine sold in the U.S., the Bush administration says. The fighting also threatens to destabilize neighboring Venezuela, which provides the U.S. with about 14 percent of its oil.

After years of limiting U.S. aid to anti-narcotics programs, Congress agreed this year to accept a Bush administration request that U.S. dollars also help Colombia fight the rebels, led by the Revolutionary Armed Forces of Colombia, or FARC.

The administration sought to end the distinction, aimed at avoiding U.S. involvement in Colombia's civil war, after concluding that the rebels are involved in drug trafficking.
Yahoo! News - AP also has a story.

posted by Richard 3:06 PM
. . .
Saturday, September 07, 2002
Bad job: Blogger Joy in Argentina (
Muchos Posts) comments on Chief of Cabinet Alfredo Atanasof's statement that, absent a deal with the IMF, there is no Plan B:
The government denies having an alternative economic plan

What???? Oh, God!!!

The government denies having an alternative economic plan?
The government denies having an economic plan?
The government denies having a plan?
The government denies?
The government?
El Gobierno negó tener un plan económico alternativo

what????? ¡ohhhhh Dios!!!

¿El Gobierno negó tener un plan económico alternativo?
¿El Gobierno negó tener un plan económico?
¿El Gobierno negó tener un plan?
¿El Gobierno negó?
¿El Gobierno?

posted by Richard 6:28 PM
. . .

. . .