End of story…now what?

Sir how sad that the Washington Consensus is just a mythical phrase coined by John Williamson and not a document or a statue because, if it was, we could at least burn or topple it just to get over it, once and for all, and save us so much unnecessary obsessed rambling about how malicious it was, even though most of us agree that whether the recipes in that consensus worked or not had mostly to do with what ingredients were used, who cooked and how the cooking was done.

In “The Fund faces up to the competition” David Rothkopf, October 22, sort of gleefully talks about the IMF having soften their conditions for helping out, without reflecting on the possible fact that they now are just prescribing painkillers instead of remedies, because they, like all, have run out of answers.

The alternatives that Rothkopf seems to favour as he says that “Mr. Chávez distributed four times as much aid in South America” are plain ludicrous since the source of that help is the higher price that has to be paid for oil; and for countries like Honduras and Nicaragua no aid comes even close to being as significant as the remittances sent by their workers, from the US.

The Washington Consensus as interpreted and implemented did not work, at least so we think, end of story; and so now what?

The Basel Consensus on bank regulations has demonstratively really not worked, but there we have unfortunately not yet reached the phase of “end of story, now what?”

What kind of reporting is this?

Sir Benedict Mander reports that “Drivers put cars blame on chávez for Caracas congestion” May 30, and nowhere does he mention that the purchases of cars is subsidized by means of the foreign exchange system and that petrol is sold for about 2 cents of a Euro per litre, and which has made a small country like Venezuela import 750.000 new cars to place on already jammed roads, in just two years. What kind of reporting is this?

Is Benedict Mander trying to hide the fact that this supposedly socialist government is taking way over 10% of Venezuela’s GDP from the poor people who have nothing and giving it to those citizens who have a car?

Go where the beef is

Sir, I really do not understand how, in “Latin Lessons”, July 10, you can even think about achieving a better US engagement in Latin America by entering the field of establishing comparison between the simple propagandas of “the $20m being spent on a four-month-long humanitarian health care mission, involving a visit by the Comfort hospital ship to 12 countries, to the scale of the health care plans launched by Mr chávez and his Cuban ally, President Fidel Castro”. That is like assessing the cultural efforts of Brittan in terms of how long the British Museum lends out their Tutankhamen collection to the world.

Of course the real dealings with Latin America have to occur in the real areas you mention such as energy, trade and of course migration, and there, if the US was to find a more constructive approach to Latin America, it needs primarily to start looking for a more constructive and consistent approach among themselves, in Washington at least.

The Inter-American Development Bank recently reported that the working migrants of Latin America remitted to their home countries $62.3bn in 2004 and if these represented 15% of what the workers earned, we are then talking about a yearly figure of around $415bn, of which the US contributes almost all, and clearly this beats anything that what Castro and chávez can come up using the money obtained by selling Venezuelan oil.

But the Venezuelans will not get their gasoline.

Sir, in your editorial “Chávez gets his oil” June 28 you mention that with current oil prices “it scarcely matter that the amount of oil produced has declined in Venezuela” and I would suggest you read Najmeh Bozorgmehr’s report in FT the same day on how “Fuel crisis increases pressure on Tehran” where Iran’s fuel rationing crisis is described.

For your information, according to projections based on the current sales of vehicles, Venezuela a country with only 26 million inhabitants and a GNI per capita of less than US$ 5.0000, will in the years of 2006 and 2007 have placed a total of 750.000 new gas guzzlers on its roads, partly thanks to the craziness of a domestic gasoline price of under 3 US cents per liter. Can you imagine what will happen when you have to start to adjust gasoline prices? One of the first symptoms of the existence of a purely populist government is that all planning gets thrown out the window and you live day by day.

Mr Mander should apologize

Sir, Benedict Mander reports, May 9, that “a parade of rowdy and at times hysterical protesters yelled and whistled their way through central Caracas recently in a desperate attempt to be heard before Venezuela’s oldest and most popular television is silenced forever” and I just ask who is he to come and characterize the protesters as “hysterical”. Has he any idea of what it is to live in a country where all the judiciary and the military respond and obey blindly one who loves to be called “The Commander” and the Congress has 167 members that support him and none, zero, zilch against even though the whole world knows it is a highly polarized country, and where now they are going after the free media?

I truly think Mr Mander owes these protesters an apology.

Red lights will not do

Sir Robert Wright when reporting in “The wrong line from London to Caracas” February 24, about the quid-pro-quos that Ken Livingstone should be planning in appreciation of Hugo Chavez’s (not Venezuela’s) petrol gifts to London and that will allow to cut the transport costs for its poor (and rich?), he mentions that Transport for London, the transport authority, might help to provide Caracas with good traffic lights. Forget it! Traffic lights amounts to a too indecent mirrors-for-pearls gift in a country where the price of petrol is less than 3 cents of US dollars per liter and therefore the traffic is unstoppable, and also its President is running amok after and through any red light he sees.

A mutual admiration club of superheroes?

Sir, Tom Burgis in “Chávez agrees fuel deal for London poor”, February 21, quotes London’s Mayor Ken Livingstone referring to it as “the work Hugo Chávez is doing around the world in tackling the problem of poverty”. Has your major gone nut? The way he goes about it next time he might even come up with that his superhero Hugo Chávez will also tackle the environmental problems of the world, ignoring such facts that eight years into Chavez’s peculiar to say the least socialist government, the petrol is sold in Venezuela at 3 US dollar cents per liter, transferring thereby around 10% of its GDP from the poorest of the poor to those who drive cars, damaging the environment and making it almost a mission impossible for your aspiring world-traffic-problem-tackling-mayor to allow his transport Chief Peter Hendy to find a solution for the traffic jams of Caracas.

We also read that Mr Livingstone will “actively and efficiently promote Venezuela’s image in the UK” and I cannot resist speculating on what Chávez would have said if, in Caracas, one of its majors had signed a similar deal to promote the image of for instance the USA.

Massachusetts, please show some dignity!

Sent to Boston Globe and Boston Herald, December 2005, destiny unknown

Late in 1998, the price of a barrel of oil fell under 7 US$, but we never heard anyone volunteering to help out Venezuela’s poor. In December 1999, Venezuela suffered some horrendous mudslides, but, when the US sent some well-equipped engineer corps to help out, Hugo Chávez, the president of Venezuela, refused them. Massachusetts has a yearly per capita income of US$ 41,801, while Venezuela has slightly less than a tenth of that, US$ 4.020

The ad in which Citgo, the oil company in the United States owned by PDVSA, the Venezuelan state owned oil company, announces the program shows a picture of a large, two-story, typical Massachusetts detached house, with a small garden and a big tree in front, beautifully decorated with what looks like Christmas ornaments, and a completely lit up porch. Please compare that house with our shanty towns in Venezuela. Of course it is a wrongly chosen photo, and your Massachusetts poor do live in bad conditions, but, in fact, that they were not even able to choose the right picture just adds salt to our national injury.

The same ad, spelling out the partnership between PDVSA and the government of Hugo Chávez, ends with the statement: “The fuel assistance program isn’t about politics. It’s about offering humanitarian aid to those who need it. What could be more American than that?” The radical leftist Noam Chomsky recently described this as “one of the more ironic gestures ever in the North-South dialogue,” but I, as a Venezuelan, can only classify it as a gesture of utmost cynical insolence.

Many Venezuelans are upset with Chávez giving away money all over the world, while our own country has so many very much poorer people but, currently at least, there is very little we can do about it and much less so after the elections for congress held on December 4, 2005. Although everyone knows that Venezuela is a country where opinions are highly divided, the result was that 167 representatives who favor the government of Hugo Chávez were elected, and none, zero, zilch, of who differ with him. There are many explanations for these results, but, at the end of the day, they are all irrelevant since a 167-to-0 ratio is plainly not acceptable. Just as Democrats would not stand for a United States Congress made up 100% of Republicans, and just as Republicans would not stand for a Congress made up of 100% Democrats, this principle is just as true in Venezuela.

In these circumstances, I wonder, would it be too much to ask for some dignity in Massachusetts? Do you really take any gifts from anyone? Where is the limit?

What is the financial world to do with a Venezuela?

Sir, In Venezuela, as in most other countries, Congress is supposed to exercise control over the executive branch and its Constitution establishes that ‘No contract in the municipal, state or national public interest s determined shall be entered into with foreign states or official entities, or with companies not domiciled in Venezuela, or transferred to any of the same, without the approval of the National Assembly.’

Now, even though Venezuela is currently known as a very polarized nation, after the elections of December 4, 2005, its Congress includes 167 members who are in favor of and obedient to him who wishes to be called ‘Commander’, and none, zero, zilch, of those many who are not in the least in agreement with Chávez´s confused vision of a twenty-first-century socialism. This should pose some serious questions about the Congress legitimacy and therefore serious challenges for those who issue those opinions needed by the financial sector.

For instance, what are legal counselors or credit-rating agencies to do after they might receive a letter from a Venezuelan citizen (or perhaps even read this letter in FT) informing them that sooner or later the debts now contracted by Venezuela might be questioned as ‘odious debt’, as they are not duly approved by a legitimate congress (167-0), nor are they needed, as can be evidenced by the many donations Venezuela, with its own so many very poor, has recently made, among them, to the somewhat poor of Massachusetts.

Sir, if a company like Nike has to worry about the labor conditions in the factories to which they outsource their production, why should the financial world be allowed to ignore civil representation issues in those countries it helps to finance?

Sent to FT, December 18 and December 28, 2005

Fuel advertisement rubs salt into Venezuelans' wounds

Published in FT, December 7, 2005

Sir, Andy Webb-Vidal got it absolutely right when he pointed out the incongruence of Venezuela, with its abounding extreme poverty, distributing subsidies through cheap heating oil to the less well-off in a Massachusetts, US, that has more than 10 times its per capita income.

But as Mr. Webb-Vidal most probably did not see the advertisement that ran last week in some US newspapers, he left out some details about what really rubs salt in the Venezuelans' wounds.

First, the picture in the ad, which is the one to be compared with the shanty towns in Venezuela, depicts a large, two storey, typical Massachusetts self-standing house, with a small garden and a big tree in front, beautifully decorated with what looks to be Christmas ornaments, and completely lit up, porch included.

Second, the ad ends with the statement: "The fuel assistance program isn't about politics. It's about offering humanitarian aid to those who need it. What could be more American than that?"

Today, unfortunately, I am truly disappointed with FT

Sir, I am absolutely flabbergasted with Andy Webb-Vidal’s report “Chávez puts chocolate factories back on map” and that praises a “cocoa revolution” and concludes that for a “small chocolate factory in the tropics, life has never been sweeter.” I cannot understand how a sophisticated paper like FT would fail to identify that this is but another perfect example of how haphazardly leaders of developing countries, especially when their egos are insufflated by a well endowed checking account fed by the oil, can come to consider themselves as visionary economic planners and perfect substitutes for the decision making process of the private sector. You’d be surprised by how many exact replicas of this chocolate project you could find over the last five decades in Venezuela and, in fact, when we read about “reopen a derelict chocolate factory”, it could very well be referring to a project that might initially have been advanced in exactly the same way, by for instance a Carlos Andres Perez government, 1974 - 1978. It is so sad that you fell for the anecdotal Willy Wonka cuteness of the story, instead of writing it from the perspective of a country in desperate need of some rational economic behavior. The need for a strong and effective government that helps to create a climate propitious for investments cannot be satisfied by a government making the investment themselves.

Sent to FT, September 27, 2005