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June 28, 2007
Venezuela's Anaconda
Hugo Chavez has stolen $4.5 billion in assets from the American firms ConocoPhillips and Exxon Mobil, but as Investor's Business Daily observes, they seem to be taking the hit quite well. Not so Venezuela:
Standard & Poor's, for instance, downgraded the country's outlook, citing "a highly negative climate for investment, which results in virtually no foreign and private investment."
Venezuela has strict capital controls on its currency, so the bolivar trades only in the local black market. Its value to the dollar fell from 4,050 to 4,180 yesterday as dollar demand for capital flight rose, Bloomberg reported.
Even the "official" rate of 2,150 bolivars to the dollar signals ruinous inflation, likely well above the most recent inflation rate of 19%. A lack of dollars has emptied store shelves of imported goods, causing food prices to shoot up.
The methodical strangulation of the economy is progressing in tandem with Chavez's destruction of democratic institutions:
This year, Chavez turned what was once a democracy into one-man rule by legislating for himself the right to rule by decree. […This] puts to rest Chavez apologists' claims that Venezuela is a democracy because he was "elected" democratically. Protests continue to convulse the streets of the capital over his destruction of free speech with the shutdown of the RCTV TV station.
Chavez is a case study in how a determined political criminal turns a democracy into a tyranny. He used the same means of securing total power as Adolf Hitler did, even using Hitler's "enabling law" term for it.
As he tightens his grip, Chavez has not only driven foreign investment out of the country, he's driving out home-grown entrepreneurs as well, convincing them that you simply cannot do business in a socialist police state as he squeezes them ever more tightly.
Like the country's fabled anaconda, Chavez is choking this once-prosperous economy to death, leaving what's left only a ruin.
The only question remaining is what happens when he runs out of things of value to destroy. It can take decades for such a severely mismanaged economy to recover. And there's no sign he's going to stop.
What could be a prosperous country is being reduced to the Western Hemisphere's answer to North Korea. The road of moonbattery leads straight to hell.
Posted by Van Helsing at June 28, 2007 11:06 AM
Comments
Said it before, and I'll say it again: Venezuelan military -- do the words "coup d'etat" mean anything to you? Anything at all?
Posted by: jc14 at June 28, 2007 6:12 PM
They tried coup d'etat and failed. Chavez has since purged the military. There will be no coup. The "white hands" student protest movement will probably become visible again once the soccer tournament begins, and the South American press focuses on Venezuela.
Posted by: Farmer John at June 29, 2007 4:16 AM
And there's this Venezuelan version of Pravda. Your one stop shop for everything Chevez and his lackeys want you to believe:
http://www.venezuelanalysis.com/
Posted by: Kevin at June 29, 2007 4:45 AM
