We’ll head Down The Rabbit Hole in a sec but first…We say all the time that 21st Century Bolivarian Socialism has destroyed every aspect of life and society in Venezuela. Yesterday we talked about it’s destruction of the education system and in the past we’ve even touched on things like the Chavistas wiping out zinc production, the product needed for coffin liners, causing a big problem with people not being able to bury their dead…but I didn’t see this one coming (INCOMING!). Reuters reports that deaths related to explosions from old gas canisters are on the rise. People are just sitting in their houses and BOOM!
Over 75% of Venezuelans cook with gas from cylinders and analysts say only 20% are fit for use with many as old as 20 years. I guess I just never thought about it but it shouldn’t come as a big surprise that people that can’t afford to buy food have no money to purchase new cylinders for their cooking gas, but it’s worse than just that. The gas is supposed to contain an additive, methanethiol, a foul-smelling compound that makes it easy to identify gas leaks.Well, that additive hasn’t been available in Venezuela in over a year and there is no regulation of maintenance and testing of old cylinders. We’ll just add this to the long list of Chavismo failures that kill people.
And in what is the most widely reported story of the day, AP reports that the US is easing a few sanctions on Venezuela (can we say “I told you…?). It’s very limited. Chevron will be allowed to negotiate it’s license with PDVSA (government-owned oil company) but they can’t drill or export oil. (remember, Chevron is the last oil major still operating in Venezuela) They also removed two people from the sanctions list including First Lady, Cilia Flores.
The easing of these sanctions will not have any real impact. It’s more or less a gesture to (and in the case of Cilia, a favor for) Maduro. The big question is… are there more coming? Don’t forget that when Biden was VP under Obama they presided over what may be the worst negotiated “deal” in history. The Iran nuclear “deal” began with the US having a long list of demands that “must be met” and in the end signed a deal that contained none of them!
On that note the US Senate Foreign Relations Committee chairman, Bob Menendez, is not happy about this sanctions relief.He, and others, have been calling for Biden to stand fast until Maduro shows a real willingness to negotiate on the subject of free and fair elections, etc. The senator contends that we are sending the wrong message. He says that the Biden administration’s easing of sanctions just so Maduro will talk to the opposition is a “strategy doomed to fail”.
I’m afraid I have to agree with Senator Menendez on this one. If we look at the Maduro regime’s history of failed negotiations with the opposition (what is it, four or five times now?) we see a pattern. They will pay a lot of lip service and will make empty gestures as they drag out the talks until they can find some excuse to throw up their hand and walk away from the table…but not until they have gotten at least some of what they wanted and the opposition (and the world) has achieved nothing.
And on that note we have Telesur (government media) reporting that the head of Maduro’s National Assembly and the head of the opposition’s negotiation delegation held a working meeting to resume talks. It’s a totally transparent (at least to me) gesture by Maduro to signal to the Biden administration “See, your sanctions lifting strategy works! Give me more.”
Moving on…BNN Bloomberg reports that Iranian oil shipments to Venezuela are up 48% this year (various oil products).
We also have IRNA reporting that the Engineering and Construction Division of NIORDC (Iranian National OIL company) signed a contract to repair Venezuela’s El Palito refinery for $114 million. The refinery is currently operating at 50% capacity (if that). So what are the odds this will work out? Well, all contracts like this require participation and cooperation by the owner, PDVSA. The Maduro regime has basically failed in all it’s joint ventures in the past. Just ask the Chinese. I guess we’ll see.
Then we have NGO Defiende Venezuela denouncing the pattern by Venezuela security forces and special operations. They illegally raid, extort, repress, and arbitrarily detain citizens. This is not exactly a revelation.
And Caracas Chronicles reports the EU (European Union) Chief for the Americas says no progress has been made on the reforms suggested by the EU- FFM (Fact Finding Mission). TSJ (Venezuela Supreme Court) reforms are just irregular reshuffling. There is economic progress for some but a dire situation for most. They also say they support the Mexico process. Hmm… That would be the one where the Chief of the Opposition Delegation to negotiations with the Maduro regime says they will ask for minimum electoral conditions allowing Venezuelans abroad to vote and solutions to humanitarian and social problems…just more of the same.
But we do have this…Guinness World Records tells us the world’s oldest living man, Juan Vicente Perez, is a Venezuelan. Unreal…people are starving and dying under the Maduro regime every day and this guy is 112 years old!
Let’s go Down The Rabbit Hole….
The one area thriving financially is narco-trafficking, also controlled by the military and headed by,Diosdado Cabello who many think is the most powerful man in Venezuela.It will be a delicate balancing act for the government to try to siphon off revenue from the drug trade as it’s, more or less, the last financial bastion of the military.
It should be no surprise to anyone that the more centralized the government the less efficient, less productive, and more cumbersome it becomes. In my former life I handled major accounts for an equipment company. Besides all my private sector responsibilities I handled all government bidding and contracts. What an eye opener! If you think giving central government more control over anything currently run by the private sector check this out. I could do business with a private entity with a one page contract. A village might require 5-7 pages, a city depending on the size, 20-25 pages, a state would usually be 50-75 pages, and the federal government about 150 pages or more. The equation is simple, more pages equals more requirements for compliance equals more cost equals a higher price for the particular product or service. Conclusion : The private sector can, in most cases, supply goods and services faster and cheaper than the government.
So how does this apply to Venezuela? Well, everything in Venezuela is run by the Chavistas in Caracas…everything! To do anything in Venezuela requires a byzantine process of approvals by various people, departments, and ministries. What can be accomplished relatively inexpensively in a day or so in the real world will be very costly in Venezuela and will take weeks or months (years?). It’s the perfect set up for corrupt bureaucrats and in Venezuela they are everywhere. Permits, documents, approvals, etc. are required for everything so if you want to get what you need you can either go through the interminable process or pay a fixer. There was an actual “menu” posted online with prices for passports, cedulas (government ID), drivers licenses etc. A quick aside, when I bought a used car in Venezuela, after we agreed on everything it still took a week to finalize the sale due to a whole lot of government red tape.
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