Say It Ain't So..Again
We’ll get to our Down The Rabbit Hole segment in just a bit but first…Newsweek had the headline, “Potential Venezuela Swap Emerges To Free US Citizens For Alex Saab”. The article is based on a plea from a Los Angeles Public Defender, detained in Venezuela for about 11 months now, to exchange him for Alex Saab, the architect of Nicolas Maduro’s fraudulent CLAP government food program, currently charged with money laundering in the US.
We all know the Biden administration is amenable to prisoner swaps. Biden already did a swap with Venezuela that saw 7 American detainees freed and, of course, he traded the infamous “Merchant of Death” to Russia in return for WNBA star Britney Griner…he’s probably making arms deals with America’s enemies as we speak.
While I’m totally sympathetic to the plight of anyone detained in Venezuela I don’t want to see Alex Saab, and by extension Nicolas Maduro, get off the hook for all the suffering they have caused the Venezuelan people. The last deal saw Maduro’s wife’s nephews, the “narco- nephews” get off. I hope the Biden administration can find another way. Say it ain’t so…Joe.
Then we have gCaptain telling us that a 655,000 barrel cargo of Venezuela heavy crude is on it’s way to Europe in a Greek tanker chartered by Eni (Italian oil company).
This comes after a three month pause in shipments by PDVSA (Venezuela government-owned oil company) due to a sweeping audit of contracts ordered by new company president, Pedro Tellechea, to avoid failed payments.
At this point it’s unclear if this shipment is being paid for through debt reduction, as required by the sanctions-easing agreement, or for cash, which the Chavistas have previously demanded and would be a sanctions violation. We still don’t have clarification on the last Eni shipment, which occurred after a four month pause in shipments by PDVSA when they demanded cash payment. Both PDVSA and ENI didn’t reply to requests for comment.
Then we have The Jerusalem Post telling us that the NBCTF (National Bureau For Counter Terrorism Financing of Israel) revealed that last May dozens of kilos of gold were smuggled on an Iranian Mahan Air flight, which is subject to US sanctions, from Venezuela to Tehran to fund Hezbollah terror activity.
Involved in the smuggling operation are (note : I did not say “was” or “were”) an Iranian businessman, Iranian Quds Force (The foreign operations arm of the Iran Revolutionary Guard), Hezbollah’s Economic Affairs Minister (I didn’t know they had ministers), the head of Hezbollah’s logistics unit, and the CEO of Mahan Air is associated with all these guys. Is anybody surprised?
And we have CGTN telling us that Venezuela is struggling with a teacher shortage. Uh…OK…with salaries around the $8 – $10 A MONTH range, constant blackouts and lack of reliable access to fresh water in the schools, is anybody surprised? That must be why teachers in Venezuela are protesting almost every day and have been for the last year.
Then we have this from rfi…In another teacher-related article…at the Manuel Aguirre primary and secondary school in Petare, the largest slum in Caracas, they are teaching kids to hide from bullets.
The shootout drill takes about 20 minutes. When they hear the banging on a sheet of metal to simulate gunfire students drop to the floor and crawl to their designated safe spaces along the wall. The new drill, conducted by the Red Cross, will be repeated every two months.
So, how violent is Petare? Here’s a little perspective…The Venezuela national figure of 353 violent deaths per 100,000 people is 6 times the world average. The number in Petare alone for 2022 accounted for 80 of those. Oh, FYI, before the war in Afghanistan ended, year in and year out, it was safer to be in Kabul, Afghanistan than to be in Caracas, Venezuela.
Let’s head Down The Rabbit Hole…
Chapter 18 continued…
…Another major problem for Venezuela (Nicolas Maduro), which became evident when the money ran out, is the cost of keeping the military happy. Authoritarian regimes maintain power through control of the military. When oil revenues nosedived and they had already squandered or stolen all the borrowed money Maduro began ceding control of various sectors of the Venezuelan economy to the military since he couldn’t just pay them outright. First he put them in control of the oil business which is responsible for almost all of the Venezuela government’s revenue (legal revenue, that is). He also turned over control of the distribution of food, medicine, gasoline, and other important items, even water. Another bone thrown the military’s way was control of Maduro’s “Mining Arc”. They are pretty much in charge of everything of consequence in Venezuela and to make it pay off for them that meant there had to be corruption of pretty much everything of consequence in Venezuela. The problem for Maduro is that all those things have basically collapsed so the corrupt distribution isn’t nearly as lucrative as you might think.
The extra food and healthcare benefits previously enjoyed by the military have also been severely degraded so the only ones really benefiting are those at the top. Now you know why an army of 150,000 soldiers has 2,000 generals. Many of the rank and file are unhappy and view their commanders with contempt. A journalist in the Caracas airport saw a general walk past a small group of soldiers and they didn’t even salute! They may not voice their displeasure for fear of retribution but it’s clearly out there.
The one area thriving financially is narco-trafficking, also controlled by the military, and headed by Chavismo’s 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 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 is a good idea check this out. I could do business with a private entity with a one page contract. A village might require a 5-7 page contract, a city (depending on size) 20-25 pages, a state would usually be 50-75 pages, and the federal government a whopping 150 pages or more! The equation is simple, more pages equals more requirements for compliance which equals more cost which equals a higher price for the particular product or service. Conclusion : The private sector can, in almost all cases, supply goods and services faster and cheaper than the government.
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