Depth And Breadth
First up today we have Reuters reporting that the head of the opposition delegation in Mexico for the negotiations with the Maduro regime, Gerardo Blyde, said “Now is when the negotiations get tough.” Although there is no fixed schedule yet, Blyde hopes to meet with the Maduro regime’s delegation again before the end of the year to discuss Human Rights, political prisoners, and electoral conditions.
He also said the plan for the $3 billion fund to be managed by the UN for humanitarian aid, education, and electrical grid improvements is for the cash to be doled out over three years. With that in mind, that would bring our “do the math” aid number to under $77 per person per year (1/2 the population = 13 million..so 13 million into $3 billion comes out to $230 per person divided by 3 years = $77) and that’s if nothing is spent on electricity generation, which both sides keep talking about.
Has anybody consulted a power generation professional (there are none left at state-owned utility, Corpolec, just like there are no oil business professionals left at PDVSA, the government-owned oil company) about improvements to the electric power grid? Methinks not. I’m no power generation professional but when I did my research after the catastrophic blackouts of 2019 I can tell you that if they took the entire $3 billion for the fund and did nothing as far as humanitarian aid for the Venezuelan people it wouldn’t even begin to address Venezuela’s power generation needs.
Most people have no idea of the magnitude of the challenges facing Venezuela after the devastation caused by 21st Century Bolivarian Socialism (Nicolas Maduro and Hugo Chavez) and the Chavistas. The depth and breadth of the destruction is almost incomprehensible. Every sector of life and society in Venezuela including fresh water access, electric power generation, agricultural production, oil and gas production (responsible for 96% of the government’s ‘legal revenue’, these days they make more from narco-trafficking than oil),the healthcare system, and basically all manufacturing and industry have to be rebuilt…like starting from scratch…like having had zero progress in a hundred years kinda’ deal…And I haven’t even mentioned tourism.
Here’s a good example of what 21st Century Bolivarian Socialism did to tourism on Margarita Island, the top tourist destination. The number one tourist beach on Margarita was Playa el Agua. It was the kinda’ place you see in movies where tourists could pass the day enjoying the sea, sun, and sand and have drinks and food (and I mean anything you wanted…like a lobster dinner) brought to you without leaving your lounge chair on the beach. People flocked there by the thousands daily and the various restaurants and other enterprises employed thousands of workers.
Without getting into the specifics of why it was done (it was the usual corruption involving the Chavistas) in a period of a few weeks all those restaurants on the beach were gone, and I don’t mean empty, they were leveled by the government and all those people that worked there and provided for their families were out of luck… as were those thousands of tourists, daily.
Here’s a “big picture” view of the scale of what Venezuela is facing and believe me I know what I’m talking about. If you eradicated all the inept, corrupt, criminal Chavistas (that’s virtually all of them), replaced them with a task force of experienced, knowledgeable professionals in all the areas I previously mentioned and gave them a trillion dollars (yes that’s $1 trillion…with a T) it would still take more than a decade to restore Venezuela to what life was like before Hugo Chavez and his band of Marxist Marauders destroyed Venezuela. How’s that $3 billion fund looking now?
Then we have Caracas Chronicles telling us that Chevron’s new operational license will allow it to increase oil production by possibly 200,000 bpd (barrels per day) but analysts say any significant increase is 6 months to two years away or longer. The new license was issued immediately after the Maduro regime and the Venezuela opposition announced the fund of $3 billion in potentially unfrozen assets would be managed by the UN.
The consensus is that Maduro seeks “normalization” among the international community but the reality is that Maduro will follow the “normalization” path only as long as the offered incentives allow the Chavistas to remain safely in power and in control of Venezuela’s sources of wealth.
The real question is…What will happen once “normalization” and the government’s incentives are not aligned anymore? It is not a question of “if” but “when” will the Maduro regime start blocking or sabotaging the programs funded by the UN trust for humanitarian aid? It is also not a question of “if” but “when” will the Chavistas meddle in the opposition primary for the 2024 presidential election? And how about when it becomes clear that the 2024 election is neither free nor fair?
Maduro and the Chavistas will certainly engage in this unacceptable behavior simply because it’s who they are, a group of morally and ethically bankrupt individuals who are in charge of the most corrupt government on the planet. What will all those in favor of “normalization” do then? (With global leadership being what it is I would expect a strongly worded “statement of condemnation”)
Then we have Bitcoin.com reporting that the Venezuelan bolivar (local currency) has lost 40% of it’s value in about a month. It is now trading at 12.63 bolivares/dollar, up from 9.05 bolivares/dollar on October 25th.
The Mauro regime had been buying bolivares with dollars to create artificial demand for the local currency but the buying had to stop eventually due to low cash reserves and when it did the devaluation began but it was subdued until last month.
Some of the devaluation was expected as it is seasonal. The government pays all of it’s worker’s Christmas Bonuses and “Special Holiday Bonuses” to holders of the “Carnet de la Patria” (The Homeland Card…don’t get me started) by creating them digitally (out of thin air) so, more bolivares equals less value per bolivar but there may be an aggravating factor.
Many Venezuelans use(d) cryptocurrency as an alternative to the historically unstable bolivar and would convert their cryptocurrency into dollars as needed. With the implosion of FTX, one of the largest cryptocurrency exchanges in the world, there is now a scarcity of dollars in Venezuela. More bolivares and less dollars equals devaluation in dollar terms (real money) however, as we always say regarding just about everything in Venezuela, Venezuelans have seen a whole lot worse having endured over four years of hyperinflation.
That will do it for this week. We’ll be back Monday to resume our Venezuela : Down The Rabbit Hole segment and bring you the latest from the disaster that is 21st Century Bolivarian Socialism. Until then…Have a great weekend everybody!!!
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