The Grinch that DID steal Christmas

On November first Nicolas Maduro announced that Christmas had started and he went as far as already lightening up the traditional cross on the Avila mountain which is normally turned on December 1. Well, since then he did his utmost to wreck the Christmas of joy he promised in spite of shortages, crime and what not. After what happened this week, he has definitely wrecked Christmas for all, without possible redemption by December 24.

The news of today are dramatic, and even tragic as there is at least one dead protester/looter. At this point people are hungry and frustrated enough so the line between looter and protester is easily crossed.


Reports of looting and protests from all around Venezuela came in. They included even the looting of banks in the belief that the regime kept inside the new bills that are not appearing anywhere. And that is the crux of the problem, the regime has not made available the proposed new bills as it was taken away all the ones that were the blood line of a wrecked economy.

For your understanding. A large portion of Venezuelan everyday economy is run through cash transactions, in particular outside of Caracas. There is a very large sector of the population that does not hold a real job and do not even have a savings account. And even if they have one, they probably do not have an ATM card (not that this matters much as ATM are not delivering bills these days). And in many small towns and villages there may not even be a bank, and if they have electronic payment points those are limited to very few stores and do not work well due to the distance and bad communications with rerouters and the like.

As a consequence of that a large chunk of the population did not deposit their 100 banknotes because they had nowhere to deposit them. They had to wait for today when the banknote exchange would officially start at the state owned banks and the Central Bank. But it did not happen and the population were furious when the only thing offered, if at all, was a certificate of deposit to be honored when the new bills would arrive.  How would these people buy food? Take the bus? Buy something for their child's fever? Even less, prepare for Christmas?  No wonder we had serious stuff happening all through the day (I re tweeted some, you can find them on my time line on the right).

What is quite amazing is how tone deaf the regime has been. Last night Maduro pushed his chutzpah at reducing the number of days allowed for exchange at the Central Bank, probably assuming that most people had deposited. It is simply amazing that a government of "el pueblo" ignores the real life conditions of that "el pueblo". But tonight we learned that in spite of Maduro words the Central Bank will open this week end...  We'll see, and at any rate in an unsafe area of Caracas at 10 PM people were in line at the Central Bank building. Also, additional proof of the regime utter mess is announcing that the subway would be free which is like applying a small bandage on a large open broken bleeding leg.

To finish this post, there is no point in dwelling on how fucked up the regime is, how lost Christmas are, you just need to watch the news or read twitter to understand the magnitude of the disaster. Journalists are having a field day with a furious population that has unusually harsh words against Maduro. Let's instead try to perceive why the regime took such an idiotic, ill planned measure.

From what I can gather, the leftist economic counselors of Maduro, from Cuba and Spain Podemos, suggested that a spiraling black market rate of the dollar could be countered by merely reducing the monetary mass.  That simplistic of a theory is believed, ignoring that the structural inflation of Venezuela is its lack of production due to a decade and a half of wrong headed economic decisions. To which you may add internal chavista infighting where a gang was willing to risk such a disaster in order to punish another gang. There were probably other motivations such as increasing control over the populace by making them more dependent on the government by the mere fact of monetary scarcity, so to speak.  Indeed there was a tiny grain of truth in it. Incorporating the new higher denomination bills would have been a sudden increase in monetary mass without support, and hence accrued inflation. But the solution was a slow incorporation as the old bills were removed.  Not what happened.

So why did the government act so brutally at possibly the very worst time? This is were the conspiracy theories take hold. Some say that the crazy measures may have been ignored by those who knew better in order to speed up the end of Maduro. Others, that Maduro felt that by doing such a change was an irresistible way to show resolve and vision. The border mafias could be accused, The conspiratorial NGO treachery could be advanced with hoards of 100 bills in Switzerland vaults, etc. The nincompoopier the better. While at the same time slowing down inflation long enough for, say, a snap election advantage.

I do not know whether inflation will be stopped, My guess is that December inflation instead of being 30% may end up being a mere 20%, only to roar back in January.  The black market rate did indeed dropped by half but that is no surprise. There was a speculative component to it. But what Maduro cannot stop is that there are Colombians that need to buy bolivars to pay for their businesses inside Venezuela and as such they need to sell Pesos even though nobody right now has the cash for them. Hence the  temporary drop in the black market quotes. But just you wait. That the black market rate is still the double of what it was two months ago is an early sign of failure.

Had Maduro listened to any one else than the commie hacks that surround him, he would have been told that as long as the lingering structural causes of inflation were not dealt with it the only thing he could get through crunching monetary mass was a brief, very brief lull in inflation. But never an end to it. That and the hubris of wanting to be in control of a general situation that has escaped his hands explains while he took such a gamble that even if well prepared would not have turned out well. Instead it brought upon his regime a new disaster and probably the loss of a significant chunk of whatever support he may have still had.

Now let's see if the opposition can cash in that mess.

Tales from the breadlines

Two short tales on food lines.


There are breadlines everyday in front of the bakeries that will be making bread. Not all do, some because they cannot deal with the mess and others because, well, they have no flour. The lines start forming around 11 AM or 5 PM. That is that.

The other day I was in El Recreo district and stuck in traffic I watched what is a short line. Yes, a short breadline. I have seen some that are 3, 4, 6 times as long as the one you can see in this Instagram video I posted. Being bored I did make a croquis of that line, to locate the picture below.

This is the little tail on the map below where
it says foto.

On other news, a tale from my cleaning lady.

Now she needs to go a get a number the day before her appointed day for shopping (note: for certain items you can only shop on the day that corresponds to your last number of your ID card). That line to get the number by itself lasts a couple of hours, at least, if you want to be sure to get a number. And then you still need to go early next day and do, at least, another couple of hours standing in line if you want to make sure supplies are not exhausted before your turn comes.

This is already bad enough but it gets worse. See, while they are in line people chat, get comfy, start exchanging phone numbers so they can text each other when things arrive. So far so good. But the bachaqueros, those people making a living out of buying and reselling what they get in line, have noticed. So they play the friendly game without passing for bachaqueros and THEN, when they happen to not get as many number line as they wished for, they start calling people and threaten them if they refuse to give up the number they got.

In other words, within the long line there is a now a surveillance network of bachaqueros that notice who are the weak links and when they do get a number. Then, voila, extortion on those poor friendly souls.

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Added in proof: I just learned that the regime is now threatening to close/fine the bakeries that have lines outside. Apparently Maduro says that there is enough flour and that the bakers, in a giant conspiracy I suppose, want to force people in line to give bad propaganda to the regime.

Now I can die, I have seen it all.

Corruption creativity

Two short posts this week end, for your reading pleasure. The first one on corruption latest updates.

The current crisis cannot be solved because the change in economic policies would result in the recognition that the robolución was a gigantic fraud. And I am not even discussing those who would go to jail. The point is that these people are not going to jeopardize their power or income. And yet these measures are possible without immediately questioning their power.

The first measures, not enough to solve the crisis but a must, are simple: stop sending Cuba its colonial stipend; remove price control and replace it with cash stipend to the populations at risk; rein in somewhat corruption so that at least a larger percentage of the state income goes to food and medicine purchase. Not that difficult, no?  Not only these measures are not even broached but corruption is worse than ever as there is less to steal. 

For example we have been offered a deal on DICOM dollars. Our contact would approve a certain sum every week so we can start paying our debts slowly, or at least purchase spare parts and the like. In exchange we need to give them 25% of what we get. That is, once we got the USD transferred to our account outside the country we are supposed to transfer 25% to a given account of a front man. Needless to say that this can only be done through the very opaque state banking system.

You would say "Daniel, that's not too bad and there is no other way to get foreign currency. Go for it!". But there is of course a catch. Once we sum up our expenses and the 25% "commission" the few USD we would get are not even 20% below the black market rate!  That is, I have in hand the proof that DICOM is just a tool for the regime to skim the private business still dysfunctionally working (and willing to pay the "mark up"). If in the middle of a national starvation and disease crisis the regime is unable to let go, even if temporarily, arbitration, then there is nothing to expect.

Note: clearly if the market is accepting a value so close to the black market value, then there is no need pretend that the bolivar value is not 1000 to the dollar.

Another corruption business model updating.

We have had recently "brokers" from Miami and Panama trying to short us on the foreign business we represent. They want them to sell and ship directly to them in Panama or Florida with the excuse that they have a client with access to foreign currency guaranteed. Since they are the ones that "found the client in Venezuela with dollars in hand" they want a commission from our provider. In exchange our providers would be paid directly in cash. No need for paperwork. Then the someone in Venezuela that has the approved USD would buy the lot from the "broker" at a mystery gross overprice (we have been offered our share if we wanted to go that way or at least shut up). It is all squared up by the "broker" and there is no need to go through decent but currency impaired intermediaries like us that, God forbid, would charge the market price. I let you ponder the multiple consequences of such schemes. 

I will just let you know that we have a pretty good idea of who that broker client is and they are, of course, tightly associated with the regime. Also, this makes sense for the "client" since the client will 1) get its share of the overprice paid to the broker, and 2) assuming that the client imports all of it, it will be more than its needs and he could resell enough of it at the black market rate to pay what corresponds to its own needs (we have advised our partners to stay clear of such "brokers").

So there you go, as long as currency control persists in the hands of these people there is nothing that can be done to improve the lot of my fellow countrymen. Regime change is the lone solution. 

When the statist state runs out of ideas (and other's people money)

AS expected the rise of general Vladimir Padrino as co-president of Maduro has changed nothing. After all Venezuela has been a dictatorship for a while, of a new XXI century kind certainly, but a dictatorship nevertheless. It was all just a formality.

Padrino cannot succeed in his attempt at putting food on the table of Venezuelans. His multiple inspections, in combat drag, of food producers have revealed no scandal so far, no hoarding, no lack of manufacturing will. The reason why there is no food production in Venezuela is simple, it is because there is nothing to make food out of.

For better or for worse, and with chavista bred officers it is likely for worse, Padrino seems to have been put there to prepare, or chair, a transition out of Maduro's mess. We already have the first signs on how doomed this might be as clashes between radicals and pragmatists, military and civilians have come to the forefront this past week.


One, for example, has been setting up a system for forced labor. I kid you not. A decree states that the regime can draft workers from private agribusiness to work for up to 60 days (and 60 more if needed) in the state agricultural undertakings. That is right, I repeat, workers from agribusiness, even myself, could be forced to go to work where the regime decides. I am not insulting the intelligence of readers discussing the historical precedents that say that forced labor never ended up in something positive, and always brought different levels of tragedy. No, the details are more interesting in a decree that cannot be applied.

First, there is no provision as to what would happen to a worker refusing to go to a state run facility (employers MUST part with the employees drafted while preserving their social benefits and their penalty does not need to be expressed since we know by experience what the regime does to us). Second, those business that still produce something could well come to a stop if they lose their trained personnel. Where would be the food relief in the country?.

One chavista union official quickly went to say that no one would be forced to serve against their will. But that is quite hollow when you read the decree where only different forms of expressing obligations can be found (I highlighted them in the scan from the decree on the right, if you can read Spanish).

I find it interesting that besides being an extraordinary sloppy job of a decree it is also so direct and self assuming of its importance. If you ask me it is from the hand of a military turned bureaucrat, used to give orders and be obeyed. But in real life that does not work.

Another example of the confusion reigning inside the regime comes from a "debate" between the head of the state oil monopoly PDVSA and Elias Jaua, a representative of the more radicalo-communist wing of the regime. It all started with del Pino saying that the nationalization of the services of the oil industry in Maracaibo Lake by Chavez in 2009 was a mistake. It is a taboo in Venezuela: oil industry should belong to the state. At least some good sense had prevailed in letting competitive services manage a large chunk of the oil industry, usually the more delicate work that required nimbleness, something that was not a given even in PDVSA best days.

In short what del Pino was suggesting is that the private sector should not be banned outright from Venezuela's oil industry. Something very pragmatic since oil output has been dropping after 2009 and that with current oil prices and Venezuela bankruptcy we do not even have the money to keep the current level of production for much longer. That is anathema to the radical left that is unable to come to grips that the Chavez and Cuban models have failed, that the country is broke and that we have run out of food and medicine. In their minds there is a course traced by Chavez (Plan de la Patria) and it should be followed, period. Elias Jaua even goes one more stating that the said plan was discussed and voted upon and turned into law (it was an emanation of Chavez and thus was never properly discussed to begin with, and a monstrosity to read by the way).

And thus we see the plain division between the "civilian" groups of chavismo, between those who think that something should be done and those that think nothing should be done, that we are all doing fine and that the only thing needed are yet more regulations, more controls, and now forced labor.

It is interesting to note that even if one were to agree with the need for some strong initiative to restart production these come too late for Venezuela. When Chavez came to office in 1999 there was already a strong tendency for the state to rule over everything. On that aspect Chavez simply did one better, pushing the system to its last consequences, benefiting of disproportionate and undeserved oil rent to smooth things over and thus pretending that the private sector was not needed. Now there are voices inside chavismo that want to re discuss the model, and there are even admissions that only the private sector can take us out of the mess, After all, the forced labor decree is simply a way for the regime to force technicians from the private sector to work for derelict state companies. This is an admission, if any, that the public sector is incompetent, at least on that front to be charitable.

Ways out of the mess, doubtful all, military for sure, recall it ain't

Last I wrote on ways to get out of this mess was June 11 (and April). Things have changed somewhat since these entries. Time to include recent developments.

What has not changed

It is still a matter of a group of narko-mobsters holding Miraflores Palace who cannot surrender power because they will go to jail. All problems originate from this.

Period  1.

This has been a military regime for quite a while. Naming Vladimir Padrino as the head honcho co-president does not change things much, except on some stylistic matters, such as more naked repression, always a possibility.

Period 2.

What has changed

Even people that were reluctant to use the D word (D not for Democracy) are coming around and calling a spade, a spade. That for me it was officially a dictatorship since January 2013 is no consolation. Ever the Cassandra, sometimes even the laughing stock, but oh, so right.

The economic crisis is nearing tragedy proportions and the regime is simply unable comprehend, instead resorting to scrapping the very last bolivar that can be found. The cruelty shown by the regime is reaching genocidal proportions. This is for all to see, even at home in spite of heavy censorship of the air waves and even threats at social media.

And to drive in the point of the crisis there are reports of belt tightening in Cuba which proves that the colony is having problems supporting its master. From there to think that Cuba may want to get rid of Venezuela it is not that long of a stretch.

As a consequence there is some intensifying international movement. The OAS is starting the proceedings to apply its democratic charter on Venezuela. Mercosur does not want to give the rotating presidency to Venezuela. But the US seems to have misplaced views at forcing a "dialogue" upon Venezuelan opposition least a final collapse of Venezuela sends waves of Cuban, and Haitians, and Caribbeans, and Venezuelans to the Florida shores.

Facing all of this, the military had to take a more visible direct role. Why? They are already responsible for the mess, nobody believes for a second that their corrupt structure is going to change anything.  Two possible reasons.

First, and foremost in my opinion, there is not enough to loot and the higher ranks have decided to limit the robbery intake and restrain it some, to some. That extremely corrupt Marcos Torres is not sacked and remain in office would point that way. Let me remind you that he was the one managing the billions at HSBC Spain and is yet to account on how that money was used. He has been censored by the National Assembly and yet Maduro keeps him even though his signature on contracts has no more validity as far as the National Assembly is concerned. His direction of the economy in the last couple of years, well, speaks for itself.

Second, the army does not want to do Maduro's dirty job. That is, they do not want Maduro to call on them for rough repression and be the ones to go to trial some day for it. That co-presidency sounds to me like a "if I go down you go down with me" thing

What are the current exits

This being considered we can review quickly which could be the possible exits to Venezuela's political crisis today. Which may be invalid by tomorrow but that is another story.

The best one for the chavista party PSUV to avoid a final collapse is to have Maduro resign. This can be done in such a way that Maduro remains in office for, say, three more months before a new election to complete the 6 years term of office, even if the opposition (if not divided) is certain to win. That way chavismo can put all the blame on Maduro and pull out a relatively untainted figure that would ensure the PSUV to bounce back to the 20ies it currently hold in polls to a more palatable 30ies, or even 40ies.

Odds? since it makes sense the odds are not good. Also, it requires several things. That Cuba approves. That Maduro accepts to abide. That the opposition gets into the deal and offers a more "moderate" candidate than Capriles or Lopez or Machado. That X Y and Z.

The coup is a resuscitated option, the more so when one sees the probably faked coup of Erdogan in Turkey that is allowing him to get a MASSIVE purge of public officials in there. After all, there is a precedent in Venezuela. Chavez himself admitted to have provoked the 2002 crisis and used his survival to purge all what he could in the Venezuelan state.

There are two modalities for the coup depending on what the "provocation" may be. One is a simple dissolution of the National Assembly, akin to the Peruvian "Fujimorazo". The other, a variation, is a more extreme state of emergency removing all powers of the state,  Both options are "moderated" through a promise of  elections within a year.

Odds? since it is reckless, since they are more into the current style of Maduro, Cabello and all the others that are going to jail sooner or later, the odds are not bad. Since Venezuela is already a bankrupt pariah state, who cares?!

There is the possibility of general collapse. It is clear that the army, no matter what Padrino tries to do, is less and less in control. The latest shopping exodus to Colombia is an evidence. Just as when the Iron Curtain borders control collapsed announcing the end of Communist Eastern Europe.

La foto más impactante de los venezolanos cruzando la frontera con Colombia https://t.co/qANXRl7mah pic.twitter.com/PQUTD56pQc

— El Nacional (@ElNacionalWeb) 17 de julio de 2016

What would happen if general looting started, if people started marching from chavista former strongholds like Catia to Miraflores Palace?  All is possible, from civil war, to military bloody coup to a swift regime collapse like Argentina's De La Rua escape from Casa Rosada in 2001. Many variations are possible but all drive from a provisional regime to an opposition take over that would have to face the highly unpopular economic measures necessary to end and correct the chavista narko-corruption mess. Let´s not speculate on that for the time being.


Odds? Probably the highest at this point as it seems that the "civilian" and narko wings of chavismo would chose this way out, either to exculpate its mistakes or to purge once and for all its opposition. But it is doubtful that the military would accept that last one as they will be finding themselves at The Hague benches. We are in the XXI century after all. Hence probably the recent take over by Padrino, which is far from ruling out that option as the guy has started by counting chickens in combat vest.

@vladimirpadrino visita Empresa de Alimentos El Tunal, en Lara, como parte de la Gran Mision Abastecimiento Soberano pic.twitter.com/Hec5CVYXQ2

— Vladimir Padrino L. (@vladimirpadrino) 16 de julio de 2016

So that is that.

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PD: something probably thought that I did not discuss the Recall Election scenario. There will be no Recall Election. Nor any election for that matter (can you imagine chavismo losing 90% of State House in December!!!!).

A recall  election is the worse case scenario for chavismo. If Maduro is recalled, say, with a 20 points spread, that would reverberate badly downstream and the following presidential election could go to a spread half as larger!  That is, the end of PSUV.  Thus why I think that if the regime were to be forced into a Recall Election before 2017 it would have Maduro resign first, a less damaging option for the PSUV.

Scenes of a bitter return

Warning: absolutely non politically correct post follows (á la Trump?)
But real.

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I am coming up from the airport.  Reaching the curb from a grocery store not too far away from home I notice the food line that reaches a crossing that it never reached before. Think 6 blocks.

Since there is traffic I can observe the line. Not only these people are not from the area, but they look like goons and thugs. They are, to tell you the truth, scary. I grab the camera to film but the light goes green.

Down the hill I arrive at the store. No line there. There are plenty of cops and the line has been in fact pushed back by them two blocks away. Which explains why I found it so long. The explanation? There was a looting attempt by people who come from far away from the neighborhood.

I suppose it is just a matter of time the locals decide to loot first least these "bachaqueros" take all of their food quota first?

Welcome home Kotter.

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In my first few days at home I notice a dramatic change. There are now lines ALWAYS at any of the grocery stores of the area. Whether things arrive is irrelevant, there is a crowd, always the same type of crowd from some far starved/bachaquero lumpen that have put the area under siege. They leave around 5 PM so they can make it back to their homes before night fall.

After all, they are equally victims of crime, the more so if they back home in the dark with some food.

Oh, and yes!  These unfortunate people look as wretched, as lumpen as they looked 17 years ago when Chavez was elected. There you go with your XXI century socialism.

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My cleaning lady is upset and scared, and near tears when she tells me the stories.

In the past three weeks the area has become very unsafe in day time. People that walk the streets are now getting mugged broad daylight. And she has more trouble than ever to get food.  Why?

The invasion of bachaqueros in the area follows a clear modus operandi.

They arrive in "busetas", those worn down mini vans or mini bus that can carry up to 20 people, more if necessary... These unload the bachaqueros in front of a given store. The group arrives and breaks to the front of the line threatening as needed the locals, who terrified give them sway, the more so when home made weaponry is shown (chuzos like those made in Venezuelan jails). Sometimes more busetas arrive when from some magical knowledge they learn that this particular store will get more supplies than usual. There is indeed deep internal corruption links with some of the employees of these grocery stores. They get their cut of the loot.

Remember that what bachaqueros buy is for resale at bloated prices. That is their job, stand in line every day and find more than what they need so as to make their income out of black market prices. there are no other jobs available for them in chavista Venezuela.

So you may have different groups of bachaqueros holding the line (there are inter bachaquero fights reported by the locals who flee the scene). But all within a group need not to stand in line. After all with an SMS they can quickly come back as soon as a delivery truck is spotted. So what do these do? They scour the neighborhood to track down solitary walkers, isolated cars, and the like. Crime rises. No way around it since the scarce cops that Baruta town hall can afford as budgets shrink are not enough to keep order at the front of the line.

My cleaning lady tells me that know she leaves at 4AM to get on line in the vain hope sometimes that she will beat the bachaqueros. And sometimes, if she got significant stuff she is forced to take a cab back home. A cab, needless to say, that is a heavy burden on her budget.

Poor people stealing from poor people since people like me either do not consume much of the basic price controlled staples (starch/oil) or can afford black market (up to a point that is).

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So a few days ago I am having lunch at the fast food court of the Tolon mall with somebody visiting and that wants to know more about Venezuela.

I am having a chicken sandwich and yuca breaded sticks (no potatoes so manioc will do, quite well actually). Yes, food courts are still reasonably supplied. They are expensive and less people can afford them. Thus if you can afford, the supply exists for the privileged still hanging on......

The food court is on the top of the mall and yet now beggarly characters do manage to get up there (mall budgets cannot afford guards as they should, nor do the guards would care or be able to do much about it anyway).

One comes to our table and asks money for food. Annoyed at the interruption and out of cash I try to wave him away. He points out to my yuca sticks and ask for one. Without thinking about it I grab one with my fingers and handle it to him. He picks it and goes away eating it.

This is how damaged we have all become after 17 years, all, including myself.

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Last Friday there were the first food riots about 4 blocks from Miraflores Palace as the regime has decided to grab the increasingly scarcer controlled items and to reserve them to their followers. Exclusively, through the already infamous CLAP, the new violent sect being bred to enforce a political apartheid in Venezuela. Holomodor is it already called on the net.

I may be damaged, but clearly the regime holders are now beyond any redemption.

Back to the XIX century

Regular readers may remember that often I wrote that chavismo was a mere reactionary movement, harking back to an ideal time of macho caudillos and independence wars. That violence and poverty ruled over Venezuela from 1805 until Gomez established the first stable regime of our history is apparently not an historical fact that chavistas can be bothered with: all that is wrong in Venezuela comes exclusively from the 1958-98 period and the evil empire up North.

Well, chavismo should be delighted because we are getting back to these halcyon days of robber barons (cheap ones, not rich ones as in the US) and grinding poverty. Four items to frighten you.


No tests

My brother went to get his normal blood work before his annual date with his cardiologue. What was his surprise that this huge private clinic, very well known, could not test for hemoglobin (nor three other items of the 20 that include that test).

My SO, also this week, needs a test for the marker of his disease. I had to spend three hours to find finally a lab that could still perform that test.

I suppose that if there are no tests for diseases then there will be no disease and like in the XIX century we shall rely some herbal stuff for pretty much any ailment. I watched in horror the other day as a show on public TV had a kid vaunting herbal medicine saying it was a way for us to "free ourselves from the negative influence of the traditional scientific capitalist medicine".  There you go: got cancer, get a plaster of gamelote on your ulcer. Traditional science, whatever that moronic oxymoron may mean, is bogus, what our ancestors did more than a century ago is the way to go.

Robbing animal feed

As I have reported before the situation in battery raised livestock, representing 80% of the protein consumed of Venezuela is going down hill because the regime monopole on grain import and distribution is not working. Note: organic food is the privilege of the very, very rich in Venezuela. Well, now this scarcity is made worse by the increasing robberies in animal feed plants. A customer told me that there are gangs now that break in the storage aras of animal feed plants to steal vitamins, amino acids, antiobiotics, etc...  They can steal trucks of stuff and curiously, in spite of the multiple check points held by the Nazional Guard on all Venezuelan rodas, these trucks never seem to be inspected, and even less stopped. Imagine that!?

Thus we are back tot he XIX except that cattle stealing has been replaced by feed stealing, with the same impunity as before when the local caudillo helped himself to whatever it needed and that was that. The caudillos have been replaced by caudillos in military uniform as this type of robbery can only take place with support from the people inside the army, be it drug traffic or feed traffic. Needless to say that such robberies may cause feed plants to be stopped for days.  Too bad for the animals counting on that. And further scarcity on markets.

Squatters rights

Apparently now consejos comunales, that ersatz local power soviet invented by Chavez for political control and patronage, have the right to seize any property that they deem under occupied.

A friend of mine has a small week end farm in Carabobo. For a variety of reasons, insecurity being one, he has stopped visiting it with the frequency he used to. Still, he or a relative or someone goes at least once a month to aerate the house, pick up the garbage, etc so the place does not look abandoned. That is not enough, he has to sell it now because he has been informed that the local consejo comunal has an eye on it even though his neighbors are defending him, that he has all property rights, all taxes paid, etc. never mind that the neighbors are scared about what lumpen would the consejo install there, probably the real reason why they defend my friend against the consejo... Note that the existence of a consejo in an area by itself make property lose up to half its value in the area as a consejo can butt in on anything they want.

We are just back to the XIX century when a torn down village during one of our numerous civil wars was simply occupied by a group of people because, well, it was abandoned. That was no expropriation or agrarian reform, it was just a "look, there is no one there, let's move in" moment.

I would like to note that if the regime was indeed building ALL THE HOUSING it claims to be inaugurating, why would any consejo comunal have the need to steal somebody else property? But I suppose that I am digressing, that I do not understand that such things are done for the good of el pueblo.

Your local pig

When I was a child, and we went on the adventure tourism that Venezuela was then in the 60ies and 70ies, small villages had pigs used as garbage disposal units. That is right, villagers would bring their garbage to a dump at the outskirts and a couple of pigs would come regularly to forage. Eventually those pigs were killed and eaten or sold on the road side surrounded by a significant amount of flies. That was, well, the only source of meat sometimes. Fortunately by the 80ies animal farms and sanitary controls and distribution chains and refrigerated facilites had set and thus Venezuelans could buy fresh or frozen meats prepared with all the desired hygienic standards.

This is over. With food scarcity and creeping poverty not only backyard chickens are back but your foraging pig is making a return. Well, not quite as the pig can now be stolen so you better lock it up....  So in the country side some are now having a pig or two in their back yards.

Why would that be wrong, you may ask? Well, the veterinarian and health official support for such activity does not exist anymore in Venezuela. That is, the pigs raised this way will have no veterinary supervision even if the owner could afford it anyway. And there is very little medicine available for livestock, by the way.

That new backyard livestock activity increases dramatically the probability to revive parasitic diseases due to the proximity of animals, without counting on well known plagues like the flu associated with apartment raising chickens in China.

There also we are enjoying a return of the halcyon unsanitary days of yesteryear.

That is chavista progress for you.

Not amused

I am watching and reading some of the news on Venezuela, slightly bemused. Apparently they are so unbelievable for the civilized world that one would be forgiven to think that Venezuela: survivor is just your latest reality show fade, somewhere between the Kardashians for its bad taste and Chopped for its cut throat run for food. My favorite of the day comes from a segment from yesterday nightly news (the big one at France 2) which starts with a food line. Yet readers of this blog have seen much more impressive lines filmed by yours truly, in this blog or Instagram.

But it is getting serious and CÑN tonight had a title with "no bread in Venezuela".

It is true and it is not amusing.


I eat little bread for diet reasons, limiting myself to full fiber sliced super market loaves. But the SO wanted some bakery bread. I went to 4. I did not find any. The last one I found some "pan dulce" and that was that, good enough to eat with a cup of coffee, if you have it. They also told me that they bake bread only twice a day now, for early breakfast and for diner when people come back from work. Depending on the bakery they give one or two "canillas" (sort of our local baguette). And that within 15 minutes it is usually all gone.

But this is not the only item missing.

Since my return early February things have been getting worse, almost on a daily basis. Supermarket shelves are getting emptier, lines are less frequent because nothing arrives, and when something arrives lines get truly huge in no time. If bakery bread is missing sliced bread is down at the grocery store and my favorite brand has now a weird taste. I am not complaining, I can still switch to another brand. For how long?

Bottled water seems to be gone for good.

Choice is also gone.  Deli is getting to a "it is that or nothing level". Now grocery stores are not even trying to hide the empty spaces with junk.

On the medical front things are worse, if possible. Today I learned of the arrival of some generics from a medicine for triglycerides that I had to stop taking. I arrived in time at my local "LOCATEL". I tried to get also a small bottle of rubbing alcohol. To my surprise there is none. The lone brand on the market has stopped delivering. No more rubbing alcohol for your disinfection needs!

Since my SO, and the mother in law, are physically unable to stand in line for anything for more than half an hour, we must all share the burden. I cannot so I am resorting more and more to black market. I put on Instagram the latest of my loot on toilet paper, two heavy bags at 8 times the normal cost (and I learned that actually I got it for cheap!). But I also got 12 kilos of pasta that way, albeit at only twice the normal cost. Currently I am waiting for milk (it will be twice) and rice (at least thrice). But I have also been told not to hope much for that arrival. Corn flour is too political so my black market guy does not dare to go there. For that I will need to go to "buhoneros" in Petare at 4 times the cost, if not more, under the eyes of the Nazional Guard.

There is no black market for medicine because  there is none. Well, almost no black market. One of my siblings got some of his heart medicine from some one bringing it form the US and cashing it in USD!!!!!!! Well, in all fairness apparently there had been some mistake so the guy sold what he did not need through contacts, but in dollars, with overhead anyway. I am expecting some form of black market for some medicines to start organizing.

At this point the neglect of the regime can only be qualified as of criminal, worthy of large scale human right violations and The Hague court. It is as such because the regime refuses to let any opening for anything, aware as they are that if they relinquish control over any item they risk to see everything tumble down fast. So if "el pueblo" suffers a secret Zika epidemic because there is no fumigation, there is no insect repellent, there is not even material to do mosquito netting, well too bad. I also read that HIV may be getting out of control since there has been a lack of protection for over a year, and lack of testing. This in addition to malaria and tuberculosis that made a come back BEFORE Chavez died.

Make no mistake: it is Chavez electorate that is suffering the most. And it is the one that lately seems to start heating up.

So you will excuse me if articles about gas hike in Venezuela or lack of tourists, even though it is the cheapest destination in the Western hemisphere, leave me cold.

I, for one, could not care less if my car gasoline refill is now 350 instead of 5.

In fact I do not give a shit about gas price.

I have real problems elsewhere. Let foreign journos that are into spectator sports take care of that.

Maduro's economic measures get a D- ; but the objective is elsewhere

Finally, after nearly three years in office, Nicolas Maduro decided (or was it decided for him?) to take some economic measures. Too little, too late. He does not get an F because he dares to increase the price of gas. I suppose that gives him a C for effort, and the rest is F. Before I get into the details it is noteworthy that the measures are announced barely hours after he fired his economic minister (Salas) and failed to put in jail Polar's CEO Mendoza and expropriate the group as radicals wanted. Combine that with the creation of a new monster controlled by the military, CAMIMPEG, and you know that the military are behind the whole thing (but more on that in a future post).

Thus, even if I have other things in my mind these days I need to summarize what happened today to give you guys the real meaning of the whole thing. In no particular order.

Gas price increase. C for effort. F for method. D- for benefits.

In Venezuela we have nearly free gas in two grades. Now we will have the same two categories, not quite free, but with a 5 fold difference in price. Consequence number 1 expect shortages of the lowest grade immediately. Consequence number two, people are stupid enough that they rushed to gas station tonight to fill up with free gas to avoid paying almost free gas in a couple of days so there may not be gas this week end in Caracas. But if people were smart and knew how to count and manage, surely chavismo would be by now a long forgotten bad memory.

Will it help? No. We still have the cheapest gas in the world (at the black market rate which is the one that matters). It is quite possible that gas will still be sold below production cost. And smuggling of gas will continue to be a brisk business at the borders as long as it is less than a quarter the price of gas in Colombia or Brazil or T&T. And when your tip to a valet parking attendant is already higher than what it will take you to fill your tank of gas at the new price, then there is no incentive to save on gas by driving less.

Devaluation of currency. D for effort. D+ for simplification. F for benefits.

We had three exchange rates (Cencoex, Sicad and Simadi) plus the black market. Now Sicad disappears (ir was invisible anyway) and we are left with a new Cencoex that goes down from 6.3 to 10, or a 37% depreciation against the USD. Simadi which was kept through mysterious ways at 200 for one USD will start to float. How? No details but if it is not in a transparent way and if the regime does not supply a steady, even if small, supply of dollars the black market rate of 1000 to a USD will keep going up.

We can expect that the floating new Simadi, or whatever the name will be, to be a tad more supplied because apparently we may be getting travel money through its value (right now we are getting nothing). But otherwise I see no improvement on economic conditions. The Cencoex rate should have gone down, in my opinion, to at least 50 to make any difference. After all with an inflation somewhere between 200 and 300% that depreciation hike of 87% would have been already factored in. But the real problem here is that the same people who had access to the 6,3 rate are the ones that will retain access at 10, and will resell it on the black market through "arbitration". This is where the big business of the military and bolibourgeoisie resides and it remains untouched. In other words the economic system of privileges remains untouched and thus the crisis will remain as it is.

Minimum wage increase. F. Period

With a minimum wage increase of 20% and a current inflation of at the very least 200%, you do the math.

New system for price control and food distribution. D for simplification. D- for benefits.

Too early to pass a definitive judgment here. Anything that wants to perpetuate price control is doomed from the start. However the way things are announced it would seem that the regime is willing to let a significant portion of the economy out of price control, keeping a "100" list of essentials only which will be sold/controlled at their true production costs, whatever that may mean. The other possible good news is that the complex system of food fairs, MERCAL, PDVAL and whatever will be fused in, well, basically food fairs in critical areas. Apparently too much corruption and black market....  Gee...  They found out.....

Electronic ration card. C for practicality. D- for possible corruption. F for ethics and admission of economic failure.

So the regime revived an old Rosales proposal of 2006, the "tarjeta mi negra" which was intended to give a pre loaded credit card to the poor so they could use it for only some specific services. Now it is a card from the Banco Venezuela, with chip and all, that will be given to social Mision holders. And probably will be used first as a ration card...  But in front of the black market crisis and the huge lines that the poor suffer the most and the impossibility that the country produces enough in the near future I suppose that we should look at it as the lesser evil. The real problem here is through which political hoops will people have to jump to get it............

Conclusion. D- (and I am generous)

I think that Maduro was forced into a plan that he did not want. His first intention (and Cabello probably) was to make a last stand, to take down Polar and see what happened (suffer a coup and leave as martyrs of the revolution?). The military knowing full well the unrest that massive shortages will result from Polar demise put a stop to it and had Salas fired (the point man of the PODEMOS wacko school from Spain). After all they would be blamed for the repression.

The creation of CAMIMPEG was immediately seen by all observers, and yours truly, as a way to hide assets from a likely bankruptcy of the state oil company PDVSA (amen of creating a gigantic military cartel, Sino-Korean style circa early years of their capitalism, or what has been done in Cuba already for its army). Expect more creations like that to shield whatever assets the regime can hide, and to bolster the army fortunes.

What happened today was the beginning of the exit of Maduro. The measures taken are woefully inadequate if they are not accompanied by less controls, some fiscal restraint, a loosening of labor market, quick investment in basic health care so workers can show up for work, etc. Yet they are anti chavista in nature, in particular the hike in gas price that Chavez promised that it would never happen while he was president (perhaps the only promise he ever kept, to our great disgrace). This is the unavoidable turn in economic policies and Maduro cannot take the helm. He pronounced them but he cannot run them, he will sabotage them if he must. So he is planing to leave (or some devious scheme to backtrack at some point, it is possible).

However the real benefit here is that the regime can now go to the IMF with part of its homework done and claim that the austerity measures were taken out of its own seriousness and not because they were imposed. Appearance of independence is preserved. Utter hypocrisy but in the end who cares if it helps us avoid starvation.  Too bad for them that what the IMF (or any lender) really wants is fiscal restraint and realistic exchange rate.

When ration cards are an economic best option

I guess long time readers of this blog may blanch at the title, but bear with me a tad longer.


I have stopped living regularly in Yaracuy but I am in close touch. I still hold a home there. So checking things when I came back from my recent trip overseas I learned what is simply a staggering piece of news.

Now people need to register for a list of food items, namely the most wanted list of regulated basic staples: corn flour, corn oil, chicken and a half dozen more. The system will work as follow.

Somebody will come to your home and will register you and how many live there. Then, as items become available, someone will visit you in advance and you need to pay. You will get informed at what date delivery will come and you will need to have someone at home to receive the goods. These goods cannot be purchased anymore at any store in Yaracuy. You can only get them through registration at your local town hall and receive them either through home delivery or neighborhood distribution. Apparently local branches of PDVAL and MERCAL will simply close.

I could not get all the details as it seems they sort of vary according to the type of neighborhood you live in. One contact got a distribution of corn flour and chicken at the end of the street just because the consejo comunal knew she lived there (she had registered anyway). Another one has duly registered early in January. Once she received black beans after a two weeks delay after paying for them (200 Bs, 2 dimes!). Another time she got corn flour and mayo or something.

What is wrong with this picture?

First, the apparent commodity of having home delivery is an excuse: you can control better on an individual basis who gets what and remind them of that each and every time,

Second, the state can do significant "savings" on goods availability. Indeed, being absent from Yaracuy during this registration process I cannot purchase anything and I am sure that registering after the fact is not going to be easy. Never mind that if there is nobody home when you are visited at putting the order time, well, you get no delivery. And the better if delivery is when, say, you are at work.

Third, this is a monstrously complicated and expensive system to set in place. A ration card system with an assigned store would be much simpler and cheaper, if you must ration. Hence the title of this post.

Fourth, it is extremely sectarian and anti business. Of course. Not only stores are now forbidden to sell certain type of goods but you cannot buy certain type of goods out of your living areas. Soon enough we move on to conditions like soviet areas where people in certain cities had access to more varied type of goods than folks in small towns and country side where nobody could visit and thus could figure out what was going on. A little bit more and you will need a permit to travel between San Felipe and Caracas.

Why, oh why?

Julio Leon Heredia is Yaracuy governor and he is a fascist. I do not know as of this typing if other states are having such schemes set up, but I would not be surprised at all that Yaracuy is ahead of the pack.  This is quite along the lines of the autocratic mentality of Heredia, someone blocked to any dialogue and who in addition is still in shock at the loss of his own brother election in December 6 and who is probably delighted at punishing the Yaracuy people that did not vote for him at a 80% rate. It is just that simple, I know the character, I have already been a victim of his administration.

La fuite en avant or is it La politique du pire ?

French political language is rich and dates from the French Revolution where between 1789 and 1815, depending on how you count, up to 12 government systems could be identified. There are two sentences that need to be used for this entry. La fuite en avant refers as when you have no option but just make a run for it straight ahead and hope for the best (escaping straight ahead). La politique du pire refers to make the situation worse in the hope that people will want to go back to a past situation because it was less worse, grammatical mistake on purpose. Or to destroy everything so no one can do anything against you.

Today we can use BOTH expressions.


But before I keep going on you need to understand that the regime is acting as it does because its top leaders know full well that if a semi functional Assembly manages to get hold too many of them will end in jail. If you do not understand that then maybe what comes next will make little sense to you.

The mechanic of Wednesday events started with a series of videos summarized in a Tal Cual entry. These videos explicitly show how all the Chavez propaganda at the National Assembly was taken down Tuesday evening. But that is not the real story. These videos which pretend to be amateur are, I am sure of it, a carefully thought provocation by the new chair of the Assembly, Ramos Allup. Among other things he says that the only pictographie allowed in the Assembly are the official classic portraits of Simon Bolivar, that the necrophiliac reconstruction of Bolivar by Chavez was something crazy and that it should be taken with all the rest to Sabaneta (Chavez birth place) or Miraflores Palace or the trash, that he could not care less but all had to go.

Sure enough the assembly was under siege by chavista supporters Wednesday night...

So why did Ramos Allup took such a chance? Because he knows that a confrontation with the regime is unavoidable. It is going to happen, it is just a calendar question and Ramos Allup has decided that he will hold the calendar of the confrontation. So far at least today he is proven right: chavismo at Wednesday's session was out of itself to the point of hearing stupid things like a decomposed Cabello saying that there will be no money for the Assembly. I suppose that he thinks that international lenders will come and approve loans to Venezuela that are not signed by its National Assembly.....

Ramos Allup also proceeded into the swearing in of the dismissed representatives of Amazonas (though apparently they are refraining from voting). This is the other side of the coin. It may look as a provocation but as long as these never vote the decisions of the assembly cannot be judged illegal. On the other hand the blood thirsty radical wing of the opposition will get a bone to chew on while Ramos Allup woks on the really pressing matters.

In short, Ramos Allup got today the hysteria of the regime in full display showing them saying anything, preparing any thing to stop (or escape from?) the Assembly, la fuite en avant.

That night we got further regime reaction with the naming of the new Maduro government. I have not much to say on that except for a few points that are telling enough.

First, the regime has decided to cave in its radical left. Luis Salas is the new coordinator of the economy. He is a "professor" at the bolivarian university founded by Chavez to "form" all the public administration he needs. Objectivity has never been a value taught at the UBV. He has worked with PODEMOS in Spain. And if that is enough to scare you to death, you just need to read the titles of his opus at Aporrea where you can find gems like "The price of gas as a fetish" or "Economic war and social war. The mafiosi and paramilitary code behind the fascist violence". Yes, an "economic professor" penned title that a serious blogger would never dare to pen.

In his team we have a Caracas PSUV candidate defeated and now available to occupy a seat in an administration in search of its Kerensky. For commerce Maduro named Jesus Farias, a guy holding a positon in the Communist Party until 2007. As if a commie had any idea about what "Exterior Commerce and Foreign Investment" was all about.

At least for some levity Maduro also appointed someone for the banking system that has an idea of what is to be done. He also named for Vice President the governor of Anzoategui, Aristobulo Isturiz, a survivor of pre Chavez years, just like Ramos Allup.

What can we conclude from that? The regime is unable to change its economical system. It simply cannot. So Maduro names the most radical wing to the economy position, to increase further controls as if it were possible. La politique du pire, burnt earth... And the creation of a ministry of "Urban Agriculture" is not going to make us avoid starvation.

But on the other hand the regime has not solved its internal contradictions and the side aware that things have changed has managed to put someone to try not to see the banks fold, and perhaps the only person in the regime that can negotiate a settlement with Ramos Allup: Isturiz. (1)

The only problem here is that I wonder if Maduro has the luxury of time anymore. If he persists in listening to people like Salas that are convinced that the country can produce enough just if capitalism is flushed out then he may be in for a rude awakening. He lost on 6D in 23 de Enero and they are just across the street from Miraflores.

I cannot believe that our hopes are now solely on Isturiz shoulders!

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1) Besides the impression that reaching to lunatics like Salas show that Maduro is short on people willing to work with him, we should note that Venezuela has a 1.500 million dollar bond issue coming to term. Can anyone imagine Salas negotiating an extension? Is default a near certainty? Is this why Medina went banking control, to prepare for default?

Meanwhile, let's check back at the ranch

While Caracas gets ready for tomorrow's hoe down let's check out what are the wheat and cattle yields at the ranch. The picture is grim.


It is certainly near impossible these days to get reliable figures of anything. So the devoted reader will have to take me at face value.

I can tell you that the animal protein production of the country is spiraling down, fast, as the regime is not allowing for the importation of what is required for animal feed. And since the Venezuelan crops are not too good, and must be used first for human feed (deficient amounts per se), you get the picture. For example poultry production stands at 50% of its potential and going down. Well, that is what I was told late November. I see nothing to improve that number and I suspect it is lower today.

If you want more subjective pictures hang around a supermarket. There are less lines. But because there is nothing coming in. If you are into luxury items like fresh produce, yogurt, milk, you can still sort of find. Yes, I include milk in the luxury items. The latest case of UHT milk I bought, "Mi Vaca" brand, cost me 3500 for 12 liters. That is 291 VEB per liter. In dollar it is nothing but in minimum wage percentile it is ruinous: 290/9500*100= 3.1% (rounding numbers).

That is right, the only milk available for the last three months represents 3% of the MONTHLY minimum wage for a single liter. I do not remember the last time I bought fresh milk; and powder milk at controlled price arrives, if ever, at some governmental store. For all practical purposes the regime has yielded and allows production of UHT skim milk with limited controls as the only occasional source of milk.

I can still manage because I do not eat either meat or arepas and I can afford milk, but I wonder how the hoi polloi makes it.

If you want even more subjective....  Tradition had that at midnight on Christmas eve and New Year's eve there were all sorts of private fireworks, some spectacular (people literally love to blow their money). In Caracas the smoke cloud used to be thick enough to dim the city lights. This is over. And poor pets went crazy days before as at anytime some jerk would blast out something somewhere. This is over too. Pets are happy. Christmas fireworks were sparse and lasted a few minutes. New Year's works did last a little bit longer than the ones on the 24 but the air remained clean and 15 minutes after midnight it was all over. The crisis has struck everyone, no money for fireworks this year.

And presents were scarce also. Not only the offerings were limited but the prices were out of reach. People offered food. A jar of imported marmalade was considered a nice present.

The real problem is unfortunately elsewhere. The regime is doing nothing. NOTHING structural. And the very few initiatives taken these past few weeks consisted in increasing taxes, put new controls and approve today, on the very last day of the outgoing assembly, huge special lame duck credits that basically leave the coffers empty for a while without Maduro needing to request money tot he incoming Assembly.

It is not idle to state that a lot of the last minute desperate maneuvers of the regime may be illegal since supposedly the Maduro cabinet was asked to resign a few days after 6D election. To this writing Maduro has yet to name a new cabinet and I doubt that a caretaker administration can request the funds demanded to an outgoing assembly that did not even bother to gather in full, letting such a momentous vote go to a "comision delegada", a substitute of congress strictly for control and emergency measures until the assembly can be called back out of its normal sessions.

All the recent measures, to give them a name, could have been easily accomplished through a feeble gas hike instead of increasing taxes and pushing further into the nation (the measures are special credits out of budget). The only rational explanation I can come up with is that the regime is planning an election in the next few months and is refusing to deal with the mess in the vain hope to pin it on the opposition.

Now I must stop, time to see if anything arrived at the grocery store nearby today.

Hard blues to shake off

Explanation in text

I have to admit that I have a hard time to recover from the news of the last two weeks. And my deep blues comes in part from that Cassandra syndrome that affects me on occasion. People minimize what I say or feel and I am, unfortunately, proven right later, but too late for any good or any comfort. There is always a Clytemnestra to put our kind out of our misery.

The two news that bear heavily on me are the 1.3 tons of coke through a regular Air France flight, and the looting of a truck over the dead body of the driver. I think that these news were covered barely adequately but I fail to sense a feel of outrage, even among readers of this blog. I read here and there stuff that can be summarized as follows: "there has always been looting in Venezuela" or "Air France, Water Spain, Truck Mexico, same difference". It is not. I see those two events as seminal examples on how bad, and doomed?, Venezuela may be.


Yes, indeed, bigger loads of coke have been caught. But they came from stolen private planes, kidnapped fishing boats, unregistered lorries crossing borders, etc... The mean of transport was by itself product of a crime. Never mind that the cargo was even bigger of a crime. But the ease in which the traffickers sneaked in 1.3 tons in a regular air flight is one order of magnitude bigger. This prowess implies too many things that are dangerous. First, since airport security depends on the armed forces, then it follows that these are deeply involved in drug traffic at very high level, much higher than the silly sergeants arrested at first. We are talking generals here. Can we entrust the future of our country, a possible coming "transition" to an army that is so corrupt that even those not in the money loop prefer to shut up rather than protest, or at least leak the names involved?  We have grave concerns for the Venezuelan army, be they those that traffic or steal state money, or those that enable them by their silence.

But this is not all. It was a ruthless act to put such an amount of drug in an airplane, even if we assume airline complicity, voluntary or not. It can be a major security risk for passenger as an airplane may be easily overloaded. It could have been bombs, or explosives that could have exploded during the flight. The reckless contempt for the security of innocent passenger speaks volumes about the amorality and cruelty of those involved with that shipment. Now we can only feel safe away from Venezuela only once we are outside of the receiving airport....

We would be mistaken in thinking that 14 years of Chavez degraded deeply only the military sector. A week after the drug haul we were reminded, for some, or told, for most, that there is a civilian component to that cruelty against the victims. Certainly, we already knew what happens in the horror of Venezuelan jails, or how easy it was for gangs to settle accounts in the barrios, or how unnecessarily victims of robbery were killed for a mere few bucks worth of loot. We also knew that on roads inside the country the stopping of trucks for looting is not an isolated incident. Last Friday it all converged on a truck, in Caracas, in a business district, not a residential one, and within minutes a horde of motorbikers were looting the truck, for this climbing over the agonizing and soon dead driver, without offering any assistance.

There is a video that gives only a partial impression of what the looting mood at Los Ruices was last Friday (in the second half) with authorities barely exerting control. But what that video illustrates quite well is the plague that motorbikers have become in Venezuela, the huge numbers they are and their ruthless contempt at blocking traffic and reckless driving. Chavez is the man that has allowed the rise of that cast of violent folks. True, they may be, for all that I know, a minority inside the motorbiker "community". Chavez made motorbikes easily available for his supporters, and with the ridiculous price of gas they had no problem in learning to use their bikes all the time. Chavez wanted that because he wanted a form of storm troopers ready to mobilize on short notice across Caracas, to launch counter protests wherever needed, the threaten whomever was necessary with a "spontaneous" protest of chavismo own. Soon, they were even allowed without helmets in the highways, a place they were banned from until Chavez.

The result was to be expected. After a decade of driving recklessly, of scratching and banging the cars stuck in traffic as they sneak through it, these storm troopers are realizing that they can mobilize themselves by the hundreds, attack whatever they want to attack, and push back the authorities. They are on the loose on Caracas, a violent mob like gang.

It is clear that the regime permissiveness has created these unruly monsters of which I only describe two today.  And what is the reply to this by the regime. None, because they have none credible to offer, being the Dr. Frankenstein of the story. Or rather, they regurgitate the Cuban invented leitmotiv reply: it is someone else fault, preferably the US and its right wing fascist allies at home, never mind that a Liberal holds the chair in Washington. But the increasing uselessness of the standard reply is forcing the regime into direct threats against the press, threatening sanctions if this one speaks of stuff such as the food scarcity. If the enabling law that Maduro is requesting passes, will it ban coverage of gruesome looting like the one in Los Ruices?  The response of the regime is, as usual, of the same moral caliber as the ones that smuggled the drug in Air France plane, or those who looted over a dead body.

Thus to finish our opening cartoon, another multi layered geniality of Weil at Tal Cual. Chavez is dead, driving an egotistical oversize image of Venezuela that could not pass under the bridge (note: Weil painted Chavez as an army boot). And his wreckage, which is also ours, attracts all sorts of rats stealing our oil, our riches. He created our current society and he escaped having to face the consequences of his misrule.

Food card rationing, XXI century style

The mind reels.

The government of Zulia state has announced that a new system to control purchases will be set in place sometime in June. Although full details are not available yet, we must assume that through an electronic ID system the state will know who buys what and where out of a list of 20 "monitored" items.  That is, maybe through some form of finger printing as for the voting system, or though presentation of your ID card to the cashier, you will be allowed to buy, say, 2 sticks of margarine and a tube of toothpaste, every so often, no matter what store you go.  That is right, you will need an ID to shop. No ration cards, Windows 7 or Linux will take care of the rest once your ID is shown. Forget leaving home in a rush to the corner store for a last minute purchase of a pound of corn flour: no shoes, no shirts, no ID, no service.

Now, the terrifying thing in this is that once the system is set, it opens itself to include all forms of electronic discrimination, which will have the advantage of not being as easily traceable as if they were printed on a ration card.  The picture attached will give you the idea.

And of course forget about the contraband it is supposed to stop as subsidized food items leave Venezuela for resale in Colombia. Those that do and control that traffic are in the army and you can bet anything that the electronic system will fail to detect them....

Will the Venezuelan regime dare to put Polar on the scaffold? (or gallows, depending you local lingo)

I was on the road today and only tonight did I get the latest idiocies of the regime. This one must feel quite a lot of heat to consider taking over Polar, the largest private company in Venezuela, which today may represent about 4% of the GNP of Venezuela, a high number not because of any monopolistic intentions from Polar but because in a sea of bankruptcies and expropriations the Polar ship is somehow still afloat.

But first a little bit of background.

Last Wednesday  as evidence of food shortages increased I wrote a template for people to understand what is going on (it is my line of work, you know, and in all modesty I think I know better than Maduro). Not wanting to be repetitive, in a nutshell, the regime controls the distribution of food in Venezuela, and the supply of raw materials to food manufacturers, either through access to currency, or by simply authorizing who gets what of each crop, or deciding what raw material can be imported  regardless of the country rel needs. To this you had disastrous expropriations of productive lands, labor laws that make it very difficult to get a stable working schedule, the poor state of infrastructure from terrible roads to frequent power outages and you can guess why is it that the country needs to import straight half of its food at least.

All of this is not news but since the disease of Chavez the only care of the regime has been to survive and thus economic matters have simply not been dealt with. Period. As a consequence in the last two months the scarcity crisis has started to take a dangerous turn and the difficulty to get the basic corn flour for the "arepa" is becoming fast a political problem for the regime, as if it needed yet one more.

Anticipating an attack from the regime, Polar has already being preparing itself. After all, Polar is tired of all the attacks that Chavez himself did, but always balking once at the edge. After all, Chavez had the required intelligence to understand that his expropriations were a failure and that he simply could not afford to starve the country if he dared to take Polar. I am afraid his heirs have no such notion and may be willing to take that chance, in particular the idiot serving as Vice President, Arreaza, just because he nailed one of Chavez daughters, el bragetazo, the zipper flash, you know what for....

The market share for corn flour by Polar, Harina P.A.N., is roughly half of it. Certainly if the regime would let it be so, Polar has the technical expertise to grow all the required corn and produce 100% of corn flour required in Venezuela. I am willing to wager that in half a decade Polar could reach that goal if it wanted to and were allowed to do so, and we would all be the better for. But Chavez has hated Polar always because Polar is the symbol of what is good in Venezuelans  that we can be successful and productive and honest and creative when chavismo is neither of those, plus a few tares of its own. I apologize for the chauvinistic tone of this paragraph but sometimes things need to be spelled out for the idiot chavista that still visit this blog. Thus Chavez has tried to counter Polar by taking over or pretending to build the competition of Polar, going as far as taking away grain producers from Polar so that it would not have access to corn. Polar let it be, knowing full well that the inherent chavismo incompetence would show sooner or later.

Sure enough, we got that show this week.

Thus, perhaps unwisely but knowing that the regime would attack anyway, Polar in its official tweet states that the problem is not Harina PAN which is working full speed but the other brands that are not produced anymore.  I pick a couple of the tweets for your information.

Harina PAN atiende el 48% del mercado y se está produciendo al 100% de capacidad. ¿Dónde están las demás marcas?
— Empresas Polar (@EmpresasPolar) May 9, 2013

Harina PAN se produce al 100% de su capacidad, pero no alcanza para todos por la insuficiente oferta de otras marcas
— Empresas Polar (@EmpresasPolar) May 9, 2013

Maduro coming back from a not very successful foreign tour finds this mess and decides to take the offensive. In the video below you see the moment in today's cadena when he grotesquely demands that Lorenzo Mendoza, CEO/owner of Polar, comes next Tuesday to the office of Arreaza to account on why is Polar not producing as much as "it is supposed", why it is dropping production and all sorts of other stuff which the readers by now know are not the fault of Polar but of the regime which controls are simply suffocating all. Polar has accepted the challenge. And Arreaza is an idiot for suggesting such a scene (I am sure he did, he is mean and idiot enough for that mistake, for giving Polar a platform to criticize visibly the regime policies if it wishes so).



I am not concerned about Polar whatsoever: I know that they have ALL the paper trail from the regime itself that can prove that not only they cannot hoard shit, but that they produce as much as they are able to do. It is possible that Polar has "decreased" its production artificially because its corn supply is not enough and on their own they have started a mild form of rationing by becoming on purpose and provisionally less productive. But even if this were to be true, can we blame Polar? Would it be a good idea to pull it all out of the silos in a couple of weeks and then wait for the next harvest starting at best in July?

What I am concerned with is the regime, that it is clearly losing its senses, if it had any left.  In Maduro demands against Polar today we even learned that the regime had already sustained meetings with Polar, so we wonder why is it they want Lorenzo Mendoza Tuesday in Arreaza's office. But one of these meetings was with the dense Rafael Ramirez, the one that has ruined PDVSA, the biggest enabler of corruption himself in Venezuela. So we learn that he met "cordially" with Polar's Mendoza himself,  that he told him collaboration was possible but that they would never sign a pact with the bourgeoisie. Huh?  I wonder if really Ramirez is that stupid, though I can believe that he has become that stupid, that he now believes that threats against the last person able to help him out in Venezuela are going to stimulate Mendoza.....

I am telling you, this show today worries me because the regime feels cornered and it is thus becoming mental. In their pathological need to prove that they won in April, that they are able to rule and do as they please, they are willing to put the country in starvation......

Massive shortages of corn flour in Venezuela

Line at a La32, a Chinese everything joint

This week we have seen dramatic shortages of the Venezuelan basic staple, at least outside of Caracas and in low income social classes: corn flour.  Newspapers in Caracas are strangely silent about it but other papers like El Impulso of Barquisimeto are more vocal.  Yesterday and today driving around San Felipe I saw long lines of people. But today was top: in a single short errand I saw three, 3, long lines of people waiting for a single thing: Harina P.A.N., the most basic, well known staple of the Venezuelan kitchen, now available world wide except in Venezuela. I managed to take two pics for you, but that is not all.

El Impulso earlier this week was showing front page the ridiculous long line in a Barquisimeto location, but also, way more damming, how people were branded for their turn in line!!!  I am also putting these pictures at the end of this entry.

Line at MAKRO San Felipe, coming from INSIDE the store out.

What can we make out of this?

First, that ration cards are not far in the future. Though in Venezuela it may be easier for the regime to be highly unjust and limit itself to branding people as an easier way to "manage" the food shortage.

Branding people, El Pueblo, in line.

Second, it is clear, crudely clear, that the regime has been so focused on its political survival since last year opposition primaries that it has simply neglected to attend to economic matters, has not taken previsions for a diminished corn crop, has no money to buy corn at world price, not to mention that corn meal for Venezuelan Arepa is different than the one used for Tacos and Tamales in Mexico. Venezuelan Corn meal is pre cooked in a process that allows for preparation of an arepa. Thus you cannot make tacos with Harina PAN just as you cannot make arepas with any brand of Mexican corn flour you may find.

And to make this even worse, Venezuelans like their corn meal from white corn, not yellow corn. So finding white corn overseas is not easy because Venezuela is the main consumer of white corn, and used to be the biggest producer probably  But even the few eccentrics like yours truly who much prefer yellow corn meal for their arepas cannot find it anyway. In San Felipe or Caracas it has been more than one year since last time I saw yellow corn meal. I have been told that it can be found only in Oriente where people have a liking for that more flavored variety of corn but even there it is in short supply so the regime does not allow it to be sent to other states. Or something like that since no one in the government is willing to fess up to their incompetence and Polar is certainly not going to make a fuss about it, so harassed it is already by governmental abuse.

Line for Harina PAN in Barquisimeto, across the highway through the on foot pass.

Speaking of Polar. This food manufacturing giant of Venezuela is always under threat but produces more than ever the bulk of corn flour in Venezuela. All the attempts by the government at producing their own brand of corn flour have failed because of its inherent incompetence or simply because they produce a sub par product and lower classes are willing, if allowed to, to pay a surplus for Harina PAN. Meanwhile long ago Polar has set shop in Colombia from where it can export to the world Harina PAN, found in specialty stores from Sidney to Paris.  This, of course  underlines that if Polar were left to work on its own in Venezuela and were not harassed by the regime as it is, there would not be a corn meal crisis today. Period.

Fascist branding? Or is that Commie branding? I get confused sometimes....

I invite you to read the post before this one on why Venezuela's agribusiness is under such stress, to help you to understand better why do we have to brand people in line in the hope of avoiding a riot....

Maduro is looking for food.... A primer on food crisis in Venezuela

I am not making this up: Maduro, the pseudo-president of Venezuela has justified his trip to Uruguay with this excuse among others:

“Parte clave de la gira que yo arranco mañana (...) es para garantizar fortalecer nuevamente la reserva alimentaria de productos básicos de nuestro país a tres meses"
A key part of the tour I am starting tomorrow (...) is to guarantee to strengthen [sic] again the food reserve of basic products of our country for three months. (I am sorry, I cannot translate it any better, the guy cannot speak properly).

So many things wrong already there, not to mention that he also accused the private agricultural sector of hoarding and sabotaging the transition to socialism. Thus I suppose that I need to write a primer on food shortages in Venezuela as the one I did a few days ago for media.

Is the food crisis real? Yes, we do not produce enough to feed half of the population and there is no sign of the crisis being resolved.

Why can't Venezuela produce enough food when its neighbors, Colombia, Brazil and Guyana, with similar climates and soils produce enough to export to Venezuela? The dependence on oil has induced ALL governments of Venezuela, since at least 1958, to consider agriculture as a secondary issue, only used for political purposes. Price controls, subsidies and quotas have been all invented BEFORE 1999. Chavismo merely exacerbated the situation through excessive use of these control tools combined with its chronic incompetence and its insatiable corruption. Without forgetting that chavismo got more money than all previous governments since 1958 combined to spend on food imports.

Why are chavismo controls on agriculture excessive? I will give you a simple example. Any person producing supplies that are directly included in any form of food, from livestock feed to a jar of margarine in your refrigerator needs to declare its production and where that one is sent. I know that because I have to fill such forms weekly. It works this way: through Internet I must declare everything, from the nature of the load to the specific ID of the driver and truck. Not forgetting the date at which the transport HAS to take place. Then the government will decide whether to approve that shipment. When it is raw materials it is usually approved without a hitch but when it is food for human consumption sometimes you are refused to serve a given district because for some unexplained reason the government considers it as already served in full and demands you to send it elsewhere. Like this complex procedure, prone to errors, I can list a score more of such regulations that do not exist in free market countries where store shelves cringe under the weight of goods.

Is hoarding a reality in Venezuela? Hoarding is a reality in ANY economy of the world, but it only happens with items of high value, small volumes, and usually under special economic circumstances. Hoarding almost never happens with commodities because not only the margin of profit there is not worth the trouble,  but also their sheer volume makes its difficult to accomplish (except, note, for cartels like OPEC which hoards its oil under ground as it pleases). And hoarding never happens with perishables unless your war economy market ensures that customers will eat rotten food. Simply said, in a global economy hoarding is difficult, does not bring high dividends and can result in you losing your market share. Venezuela does not escape from these general considerations. Even if people were trying to hoard stuff you can realize yourself that with the controls I described above, hoarding can only be successful if the people in charge of the controls are cooperating with you for kickbacks. For all practical purpose, hoarding can take place in Venezuela only at the level of local groceries, not at the level of production facilities as the regime would like you to believe.

Why the regime uses the hoarding card again and again? In an exacerbated populist regime that goes from one economic error to another one, accusing the private sector is a good way to use the ignorance of the masses to focus the blame elsewhere. The fact of the matter is that it has been years since anyone got a solid sentence for any case of hoarding even if the regime was prompt in sending them to jail for a few days based on a superficial inspection of production and storage facilities.  When details come clear, once the regime journalists shut up and the producer can finally speak, we discover that any "hoarder" that was inspected never had much in store, at most a week of inventories which is below what any serious business has in serious countries under normal conditions. But certainly, the picture of a week inventory of a depot in Valencia makes for a nice political picture for people who think the shelves content in local bodega is "a lot".

Surely the renewed accusation of Maduro about hoarding cannot be the whole story as to him looking for food in tiny Uruguay? Certainly not. Maduro is paying for 14 years of agricultural mismanagement that started as soon as Chavez assumed office. By 2000-2001 expropriations of productive lands started with the expected consequences. The regime, for all its efforts, cannot show an expropriated property that produces MORE than what it produced before expropriation. When Agroisleña, the main agricultural supplier, was expropriated in 2010, it created a void that has not been filled and that has hit productivity hard. And to lower confidence of the agricultural sector, Ivan Gil, who has failed at the head of Agroisleña/Agropatria is now the new sector minister.

Can we blame expropriation alone? No, even if in my opinion expropriation are the main cause of the agricultural failure of the regime, at least psychologically, there are other reasons that weigh heavily.  Currency exchange controls have been a major problem because the deficit in currency to import supplies has created havoc with production plans. As a consequence, import deficiencies and minimum investment by the private producers still at work has created an agricultural sector at least a technological decade behind other agricultural giants like Brazil in Mercosur. One pathetic example is how Venezuela was still producing enough coffee in 1999 for its consumption and now has to import half of what it needs while coffee plantations are increasingly abandoned. Even Yvan Gil has been forced into recognizing the critical state of that sector! A sector unable to compete today with international standards of quality and yields.... while the regime happily props Nicaragua by buying all of its low quality coffee.

Surely, with such scarcity those who are still working must be minting coins? Of course not. The most pernicious governmental action is the preservation over a decade now of price controls which are not adjusted according to inflation to preserve at least a balance. Subsidies also are not enough when inflation goes faster than any subsidy adjustment. Apparently the chavista bureaucrats in Caracas, from their AC offices, since they know better what the price of the crops should be than the guys in the field, fighting back insects, sun and heat. The political necessity of slowing down inflation (which has failed miserably) has made the government to force producer to sell below cost certain goods. How can the regime expect people to work hard, to invest in technology to increase productivity when they cannot be rewarded, or pay for technology and supplies?

So, in the end, what is the truth about production?  Impossible to say. Ivan Gil has the gumption to state that Venezuela produces more than in 1999 when Fedeagro says we are 30% down in recent years. The truth is that it is impossible to know exactly what is truly produced in Venezuela. The regime statistics cannot be audited (like the electoral numbers!). In addition, there are numerous reports of the regime importing stuff and labeling it Hecho en Venezuela. I personally know about imported raw sugar, finished to white here and thus claimed to be fully produced in Venezuela. Also, live cattle arriving at Puerto Cabello to be slaughtered in Venezuela leaves as carcasses Hecho en Venezuela. On the other hand Fedeagro has only access to what private producers tell them so they may be more negative than necessary. In short, for the last half decade it is impossible to know how bad the agricultural sector numbers are.

The crude reality. Agricultural production in Venezuela cannot properly grow for a variety of reasons that the regime is unwilling to tackle for political reasons and for corruption. In addition to adverse conditions (deficient road infrastructure, difficultly to find supplies, unruly workers no matter how much you pay them, if you can find them, problems with electricity supply, questioned property rights) the courageous producer has to face costs that do not exist in other countries (personal insecurity, unyielding bureaucracy, inflation now three years in a row above 20%) without the means to counter these costs and conditions (price control, interdiction to export any food item out of Venezuela). The only thing that has allowed some agricultural production to remain alive is that banks are forced to loan at preferential interests a portion of their portfolio to agribusiness  Those loans whose interest rates are below inflation are the last life line left for the country side. And they benefit much more the larger concerns than the small producers which are squeezed out of the field inexorably.