Caracas Chronicles

Press reports about Nicolás Maduro’s new powers on economic issues don’t really do justice to what is going on. When you scratch beneath the surface and actually read the text, you realize chavismo is getting ready for an election. The timing of the decree – and its announcement – suggests the President’s health is worsening.

The first thing to note is that this is not the first decree giving Maduro sweeping powers, but actually the second one.

The first, issued in October, gave Maduro a few of the powers mentioned: expropriating companies, shifting budget items from one part of the government to another, and the like. In short, he already had the power to do that stuff, so there is no news on that front.

I read this new decree and compared it to the old, and found three significant differences. The new decree:

1. Gives Maduro power to issue debt (which the old decree did not do) … without having to go through the National Assembly.

2. Gives Maduro power to issue credits to the Federal Budget. What this means is that not only can he issue debt, he can send the money to the appropriate Ministries. This was not in the previous decree.

3. Gives Maduro the power to give tax breaks to certain sectors, as well as take money away from certain Ministries and programs. This goes hand in hand with the previous point. Most curiously, these powers were given to the Minister of Finance in the previous decree. Now, it’s all in Maduro’s hands.

You may think this is all related to a possible devaluation that is coming down the pipes. I disagree.

I think this is related to an upcoming election. As we know, chavismo builds electoral power based on public spending. It borrows money from China so that it can spend the money on Chinese washers that will translate into votes. Future generations of Venezuelans are left with the tab. The Chinese cobran y se quedan con el vuelto.

This decree basically gives Maduro full power to wash, rinse, and repeat (in a Haier, no less!) the exact same strategy they employed in October.

The other curious thing is that the decree is dated December 9th. However, it was only made public December 21st, although the press got hold of it only yesterday.

This is not typical. The previous decree, just to give an example, was dated October 16th, and was published two days later.

Why the delay in publishing a decree that is almost exactly the same as the previous one, with the three items mentioned above being the only changes?

The powers given to Maduro are purely electoral in nature, so this can only mean that elections are now more certain than on December 9th. The plan must have been to hold on to the decree encaletao … until Maduro needed it.

It doesn’t take a master strategist to conclude the obvious: Chávez’s prognosis is not good.