Monday, September 30, 2013

Standard operating procedure for leftists and our own Democrats


Nicolás Maduro seeks to deflect blame as Venezuela’s woes mount

Venezuela President Nicolas Maduro©AFP
Venezuela President Nicolas Maduro has suffered negative news since he won elections in April
What to do if your country’s economy is on the ropes, inflation is soaring, shortages are rampant, political support is fragile and violence is flaring? For critics of Nicolás Maduro, the president of Venezuela, the answer is that you wrap yourself in the national flag and blame somebody else, anybody else, even Spiderman.
Since becoming president five months ago, Mr Maduro has routinely cited vague international conspiracies by capitalist plotters, or even cartoon superheroes, for Venezuela’s mounting problems that range from a lack of toilet paper and national electricity blackouts to one of the highest murder rates in the world.

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Most recently, he has set up a hotline 0-800-SABOTAGE, for Venezuelans to file reports on illegal economic activity, part of new measures aimed at countering economic “sabotage”; said he would sue Airbus with “the help of an international law firm” after his presidential aircraft suffered a fault; and identified what he calls US “factories of anti-values” such as Hollywood.
“Take a 14-year-old youngster who has a 9mm pistol in his hand and is carrying in his head thousands of hours of violent programming,” mused the 50-year-old president this month, after watching Spiderman III with his wife. “Stimulated by such consumerism and violence, no wonder he goes out and kills.”
Deflecting blame for domestic problems on external forces is a time-honoured tradition in Venezuela’s so-called 21st century socialist revolution that routinely thumbs its nose at the US.
But that is especially so now that Mr Maduro has made little headway in correcting the economic distortions bequeathed by Hugo Chávez, his charismatic predecessor, a failure that has also left many wondering how much longer the situation can go on.
“The breaking point in Venezuela is very moveable because the country always has oil revenues,” says Luis Vicente León, a pollster and economist at Datanálisis in Caracas. “Whatever a government misspent yesterday, huge cash flows come again tomorrow.”
Still, although the Opec nation receives about $100bn in oil revenues every year, mismanagement and policy incoherence mean its economic problems, such as an annual inflation rate of above 45 per cent, continue to mount – especially when it comes to the exchange rate.
Fixed at 6.3 bolívars to the dollar at the official rate, and trading on the black market at seven times that, the distortion has cut the supply of dollars to Venezuelan importers, thereby exacerbating shortages of basic goods but providing quick winnings for anyone who can access dollars at the overvalued official rate.
One widespread scam called el raspao, or the swipe, allows Venezuelans with a valid flight ticket to swipe their credit card and get up to $3,000 at the official rate, thanks to special currency provisions for travellers. The result has been international flights booked-out for months, even if many travellers never turn up for the journey.
“The macroeconomic distortions that currently plague Venezuela result from foreign exchange mispricing,” wrote Francisco Rodríguez, economist at Bank of America, in a recent note, called “Fear of floating”. But “delays in the announcement of a . . . new forex system appear to reflect internal disagreements within the administration”.
Indeed, the currency market goes to the heart of Mr Maduro’s economic problems. Devaluing would correct the mispricing but also boost inflation and cut Venezuelans’ purchasing power, thereby hurting Mr Maduro’s already tenuous popularity ahead of December’s municipal elections, widely seen as a plebiscite on his rule.
“Maduro is not only conscious, but also absolutely informed of the economic difficulties he has to face,” says Nicmer Evans, a political scientist at a left-leaning think-tank in Caracas, the Miranda International Centre. He adds that “Maduro is still sorting out the dilemma between a technocratic and political solution to the crisis”.
A further complication stems from ideological divisions within his cabinet. Ideological stalwarts, such as Jorge Giordani, the state planning minister, applaud Mr Maduro’s efforts to maintain popular social programmes and bear down on private businesses, so deepening the revolution. But they also dislike the even timid reforms proposed by pragmatists, such as Nelson Merentes, the finance minister.
“Maduro has to pay attention to the radicals,” says Mr León. “If they suggest that Maduro is betraying Chávez’s legacy in the midst of a crisis, people will think the crisis was sparked by him, even it is due to problems inherited from not taking actions in the past.”
Amid such policy paralysis, it is no wonder then that Mr Maduro has sought to deflect the blame on to others. How much longer this tactic can work is another matter, especially given repeated verbal gaffes such as when he exhorted Venezuelan workers to produce more, “and multiply, just like Christ multiplied the penises” (penes in Spanish, instead of peces, or fish.)
“There are powerful people within the official party and the National Assembly that cannot stand Maduro and his proposals, that’s clear,” says Ramón Muchacho, an opposition politician. “His own ‘friends’ are playing him behind his back. The only thing left is to blame the opposition, and Spiderman, for everything.”

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