And give us our everyday chaos

This could well be the chavista prayer because these people truly thrive in chaotic conditions. Well, not always but they certainly manage better than most.

As expected it was pandemonium today. Banks were closed Monday as per legal banking holiday several Mondays a year. So we had to wait for this morning to appreciate fully the effect of the crazy measure of last Sunday when Maduro annulled the 100 Bs, banknote, the highest denomination of a country deep in inflation.  Let me put it this way: the bank next to our office had a long line outside all day long, and that line was almost as long as the line for toilet paper that happened to arrive at the grocery store next door.

Let's not get into the minutiae. The regime already backpedaled some by extending the time at which people will be able to deposit their bills, though not wanting to put Maduro into further ridicule the fiction of the 72 hours validity of the bill was kept. Yet many as of yesterday refuses to accept 100 bills. Though I suspect that at least some will keep accepting bills until Thursday now that they know they will be able to deposit these next week without having to trek downtown Caracas to the Central Bank offices.

What has not happened is a coherent explanation for the measure. If you take individually any of the excuses presented by the intense propaganda machine, each and everyone can be taken down with ease. At this point my initial supposition written last Sunday is that this craziness originates into some intra-chavista gang dispute. Since they are all narko-crooks, they have no qualm in taking down the country with them if they can get their loot back, or avenge themselves, or ruin the guys that conned them. This is the way mafia wars work out.

If you need proof you just need to observe that in spite of the calamitous situation of the country the high Court TSJ managed once again today to flout the constitution by naming the new Electoral Board above the will of the National Assembly. This story would deserve a full post so let's not get bogged down in that issue. My point here is that the country is falling appart, literally, and these people can only think about political treachery to keep their hold on power. That is their lone obsession. This example illustrates the issue the more so that elections are not even a solution to the problem anymore. Who truly cares who leads the CNE at this point?

That deconnexion of the regime with the country reality is becoming an embarrassing gap for a regime that was born out of their alleged love of the lumpen. A deconnexion that is shared, by the way, with many of the opposition elites. One of the things I wrote Sunday night was the impact of the measure on the large portion of Venezuelan society that lives on cash, the lower economic classes that will suffer the most from the withdrawal of the 100 bills. But you had to wait for Monday to have this considered by opposition writers, most focusing first on money loads, reserves, amount of banknotes and other brainy issues that do not make an arepa appear on your plate this week.  In that way bizarrely rejoining the regime equally disconnected claims of economic agression and contraband of paper notes to Switzerland.......

At least the regime today started realizing its gross political mistake among its followers, For example they have decided to force banks to open accounts with a mere ID card so people can deposit.  And they of course decided to extend the exchange period though not doing the real measure that would have helped them the most with their natural electorate, to disown Maduro 72 days death certificate of the 100 bill.  But the regime has a bigger problem on its hand. Among the news and videos circulating today on twitter we saw the looting downtown Caracas of a corn flour truck. From Barquisimeto we saw a furious crowd in line at a bank forcing the Nazional Guard to withdraw the protection they offered to some people trying to bring inside for deposit boxes of bills, and of course trying to pass in front of the line under the cover of the Guard.  They had to retreat. These are sure signs of the chaos ahead. And the regime, I am afraid, may not be able to control it to its advantage this time around.

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Bank protest of the day

The Nazional Guard tries to exchange its own boxes of banknotes (how come they have such?). The people block access to the bank! https://t.co/k1Qb67t6RF

— daniel duquenal (@danielduquenal) 13 de diciembre de 2016

Truck looting of the day

Meanwhile back at the 100 Downtown Plaza Venezuela Ranch, let's loot a truck just in case my banknotes are worthless https://t.co/bdEPXU0YuE

— daniel duquenal (@danielduquenal) 13 de diciembre de 2016

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Deliberate chaos: the first post modern cashless society. Not!

There are so many things that need to be discussed but my lifestyle, so to speak, forbids me to find the time for the blog. Yet tonight I must write to describe what is probably the most unjust, craziest, measure the regime has taken to date. And they did take a lot of those in the past.  But this one will hurt so many poor people that the mind reels at the idea on how a regime intentionally for the people has become now a regime against the people.

Today's bomb shell is the demonetization of the 100 tender in Venezuela.  Why, oh why?

The governor of Aragua, famed drug trafficker suspect cum links to Hezbollah and what not says it is a conspiracy from the US treasury to steal all of our 100 Bs, bills to provoke economic chaos.

Presidente @NicolasMaduro denuncia operación mafiosa dirigida por el departamento del tesoro de EEUU para robarnos los billetes de 100bs.

— Tareck El Aissami (@TareckPSUV) 11 de diciembre de 2016

I, for one, think that the US has much easier ways to achieve this. Actually, the US does not need to do anything, just sitting and watching is enough to implode the regime.

This being said, it is quite possible that there are hoards of 100 bills here and there. After all, not all drug traffic receipts can be stored in USD crisp greenbacks. Black market also takes its share of the 100 notes.  But in both cases any hoarding is temporal: drug traffickers, black marketers and Colombian mafias are business people, admittedly in their own sick way. For them it makes no sense to hoard a currency that loses a couple of  %  value points A DAY!

And then there is that:

Remember the $100s of millions #Venezuela spent importing 100-bolo bills? They're all being taken outa circulation. https://t.co/0p1Ji4xUHp

— Kejal પ્રવીણ Vyas (@kejalvyas) 11 de diciembre de 2016

With the amounts of bills the regime has printed how many tons of paper money do you need to hoard to shoot a hit at the Venezuelan economy?  Corruption and mafia traffic cannot be an excuse. Unless....  this is being used for some inside chavismo to hit others inside chavismo since chavismo is by itself now no more than a mafia.

Since there is no logical explanation and that the truth will eventually emerge, let's focus on the consequences, dires according to serious economists already on record.

As of tomorrow and as long as the replacing currency is not provided these are the things that will be very difficult to do, because there is not enough low denomination bills (2, 5, 10, 20 and 50 which itself is worth barely a penny) to pay for routine cash stuff. You will need to carry wads of bills, if you can find them, for the following:

• Gas for your car, newspaper, candies, anything that is not attached to a ATM or cash point or whatever accepts your debit card (never mind that these devices have been collapsing recently due to the lack of paper money, by the way).
• Services like the grocery bag boy, your cleaning lady, parking, small tips, etc. are not possible as of tomorrow. Note that the recipients of these cash payments are in the lower economical ranks of the population and are taking a direct hit in their ability to purchase their food....
• You cannot buy in the informal market food items that you cannot buy at the store because either it is out of such sundries, or you were at work and could not take the time for the 1 to 2 hours requirement of standing on line at the grocery store. "bachaqueros" or small time black marketeers sell for cash.
• Never mind that the re-sellers, who make a living out of it, will not be making a living. They will simply hoard whatever they have until the new banknotes arrive. More scarcity, and of course higher prices to compensate their losses when they start selling again.
• You cannot buy bread if you do not have an ATM card, for whatever reason you do not have it. Then again bread is getting scarce these days so the problem may actually be worse than the lack of cash.
• Some businesses will take a direct hit, the more so we are in  the holidays season. Folks like the newsstand guy will see sales near zero for days.
• Whole classes of people will be affected and stand to lose money outright. The most vulnerable are retirees that only hold a savings account and who work on cash withdrawals from the bank. Many do not have or cannot operate or are afraid of debit cards that in some case only work for their bank ATM machines I understand (mine works for all but I understand that this is not the case for everyone). 
• Never mind the ill informed that will not think about exchanging their 100 bills on time. Outright robbery by the state out of the most vulnerable people.
• Purchasing cheap medicine will become difficult for many people.
• Etc. you get the picture.

In short, the measure to suppress the 100 bill without a mechanism for speedy exchange in an impossible to fulfill timetable is, well, a truly inhumane measure, a gross attack on the human rights of the Venezuelan people. Of course, boligarchs may be somewhat inconvenienced but not affected. El Pueblo? Fuck El Pueblo!

Yours truly is not one for conspiracy theories, but I am starting to think that maybe the regime is seeding chaos on purpose. Let's count: the killing of the recall election, the killing of the dialogue, the inability to replenish shelves for the holiday season, the removal of cash from the hand of people, etc....  The combination of all of this is already turning the country into an administrative chaos. Can this be truly done on purpose? After all chaos is a good excuse for people not to talk about the real issues, and then if they do talk about that chaos may justify repression.

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So? Can we all agree on the D word?

This is kind of a melancholy post. For years now I have been calling this a dictatorship. It took sometime to start seeing it expressed in the foreign press. And even as I type there are some in Venezuela or overseas (I am looking at you, Zapatero just for today's denialist) that still refuse to use the D word, expecting who knows what leniency from who knows where.


For me the D word applies since Chavez closed Radio Caracas in 2007. Or if you want a more material date you can use early 2013 when the constitutional coup of the moment allowed Maduro to become Chavez successor. And many other moments you may prefer. It really does not matter much, the dictatorial nature of the regime has been obvious from the start, from the very first social program of Chavez "Plan Bolivar 2000" that established the Venezuelan army as a discretionary manager of public money, and thus corruption.

I remember it all. Try me.

This year the dictatorship has been forced to become more frontal, more classical. Until this year the excuse that Venezuela was an autocratic regime and not a dictatorship was that the opposition did manage some electoral victories, that there were still an opposition paper here and there, albeit on trial. Etc. But all those were mere excuses. For the left there was no way that the beloved populist could have generated such a monstrously corrupt and inefficient system.  For the right it was that declaring Venezuela to be a dictatorship would mean taking action for which democrats seem to have lost the taste for, and for quite a while now. The last outrage and successful international take, if I remember well, was against Fujimori who in my book is not any worse than Chavez, and certainly less calamitous for the general welfare of the people. Honduras and Paraguay were mere side shows where the changes eventually prevailed because, well, these changes had a true legal foundation.

But never was Chavez to be sternly criticized until Argentina's Macri made it to office. And yet, with more bark than bite so far.

But now things have become unacceptable and Venezuela is preparing to be suspended from Mercosur in a little bit more than a month while the OAS may suddenly decided to make a concrete Democratic Chart application. Only Erdogan receives Maduro.

Since last December the regime has proceded to the following:
*Using the judicial power to block almost all actions from the National Assembly
*Rule through a state of emergency system bypassing any legal control
*Go through a wave of arrestations and creation of political prisoners without any legal supervision, with "evidence" planted directly by the people performing the arrest
*Sue the last two remaining national daily papers
*Block any control activity that the National Assembly has in the constitution
*Suspend any election, going as far as saying that elections were not an important right
*Dispose of national assets to find fresh cash
*Decree that all remaining private companies must sell 50% of their production to the government
*Etc...... including heavy intelligence insulting propaganda to pretend that all is fine and dandy in Venezuela

But the latest was in my opinion a fatal mistake for the regime. Maduro decided that the National Budget would be approved by decree law, with the support of course of the Judicial Constitutional Court. Now, I am not going to go into the unconstitutional and illegal ways in which the regime decides taxation and how it disposes of the funds through appointed folks.Trust me, the case is clear against the regime.

Since "No taxation without representation", and we know how that ended, it has been the rule in any and every democracy that the budget must be validated by a parliament. Even if that parliament is elected under fraud, but there must be a Parliament Act. Why is such a parliamentary act a requirement? Because it is the contract symbol that the state is the guarantor of the money lent or borrowed. Failure to do such an act means simply that the only responsible party is the guy in charge and that his mere death slipping at night in the bathtub is enough to question whether his successor has any obligation in fulfilling previous commitments.

In short, if you lend money to the Venezuelan government as of today, you have zero guarantee, LEGAL guarantee, that you will ever be paid back (that we are broke and unable to pay our debt is another story, but I digress). And considering that the guy in charge, Maduro, is an ass, with a shaky hold at best, I wonder who will bail the country out...

There are two implications here.

First, obviously, that taking over discretionary disposition of all the nation's income is the most naked act of dictatorship a regime can do. Never mind that in the same ceremony where the "budget" was signed Maduro already decided that he would not give money to any opposition district which by law he is forced to do, even if he has way to deliver less than the survival requirements of such districts. Thus now we are free from having to discuss over and over the dictatorial nature of the regime. All understand money, all understand that Maduro has officially privatized the budget. Even commies understand that.

The second consideration is that we are in big trouble. If the regime has resorted to such an extreme move it is because it feels that its end is near, that too many inside the regime are about to meet their legal destiny in some court. Since it has been proven amply that the regime could not care less about the welfare of the people (starvation cases, distressing lack of heath care for which I can personally vouch for as my SO has been left without chemotherapeutic without the possibility of legally buy it overseas) then it has been easy for them to take the final decision.

By privatizing the national budget the regime grabs directly whatever is left of the country resources to use them to support Cuba and the repression machinery needed to remain in office. That is right, there is not enough money for the rest, it will all be used to sustain the repression and ensuring a minimum of popular support to be able to recruit enough of those that will do that repression. I will note that the forced sale of 50% of production (that will probably not be paid on time, if at all, and after having lost all relevant value due to inflation) represents about what the regime can physically manage in that legal robbery handling, and what it needs roughly for its CLAP distribution system (who not surprisingly in the beggarly nature of chavismo support has allowed Maduro to get back to 30% in polls). Never mind that by forcing such sale the regime acknowledges that all the expropriations made under Chavez have only yielded a cemetery of once food producing businesses.

So there it is, the regime has played its last card.

The regime could not possibly care less about what the fate of the country and its people may be. There is no other card to be played, there is no expropriation that can be done which can satisfy the needs of the people, unless looting of homes is next. Expropriation of banks is useless when inflation is scheduled to be 4 digits next year. Nothing left for populism, not even borrowing as no one will be foolish enough to lend a penny to the the regime now. All has been wasted. There is only the little bit of food produced by the private sector and a worthless budget which can at least pay for the criminals that are needed for public order.

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