Caracas Chronicles

Photo: Noticias de Nueva Esparta

PSUV started as a political party with serious internal tensions because its authorities, which haven’t really changed much over time, were handpicked. Chávez did all he could to shatter decentralization and took over the management of the country’s roads, ports and airports, scrapping inter-state checkpoints because there were enough resources to guarantee the roads’ maintenance. Chávez created a new strategy to protect his popularity: revoking his cabinet’s measures when people’s dissatisfaction surpassed the benefits of propaganda. Some notable examples were the imposition of the Bolivarian Curriculum in the education system, the removal of admission tests for universities and the enactment of the Law of Intelligence and Counterintelligence, known as “Ley Sapo.” Power outages became more frequent; the first Venezuelan satellite, named Simón Bolívar, was launched to outer space from China; Dayana Mendoza won the Miss Universe and the National Anti-Drugs Office reported the confiscation of 54 tons of drugs throughout the year.

That (not so) strong bolívar

The monetary reconversion materialized on January 1st, 2008. Back then, a Bs. 2 banknote got you a full gas tank; with Bs. 5 you could buy any chocolate; with Bs. 10, you paid for 30 eggs and with Bs. 20, you got a ticket to the movies. The Bs. 50 bill was enough to buy a basic phone and with Bs. 100, you could get new trousers. The BCV’s stats revealed that, after six months of circulation, the bolívar fuerte had lost an average of 15% of its purchasing power.

Photo: World Coin Gallery

Additionally, scarcity was obvious and the country’s production was dwindling. The famous “war on large estates” only increased agricultural production by 3.4%, but the Administration chose to create Petróleos de Venezuela Alimentos (PDVAL) and establish agricultural battalions in the Armed Forces to reduce import rates.

All for me

Nationalizations started with the official takeover of 32 oil fields in the Orinoco Oil Strip; a chain of supermarkets and the company Lácteos Los Andes to guarantee “food sovereignty.” Shortly afterwards, Chávez ordered the nationalization of Sidor, which belonged to the Ternium Techint group at the time; he later came to an agreement to purchase the French and Swiss cement companies Lafarge and Holcim (for $552 million and $267 million, respectively) and expropriated Mexican affiliate Cemex. In August, a law was approved to nationalize domestic fuel transport and in November, it was also used to nationalize the gold mine Las Cristinas, exploited since 2002 by Canadian company Crystallex. El Frío estate in Apure was expropriated, although they were carrying out conservation projects for endangered animal species. Sugar cane fields in Lara and dozens of other private properties were also expropriated.

Cuba’s price

A new contingent of over 1,000 Cuban doctors arrived to reinforce the Barrio Adentro program, after Chávez admitted that there was a healthcare emergency, with outbreaks of dengue, malaria and mumps, which minister Jesús Mantilla blamed on “the incapacity of previous governments,” although chavismo had been in power for 10 years by then. With figures from Cepal and Cuba, it was revealed that Venezuela paid $5.6 billion for doctors, nurses and other professionals, but the amount rose to $9.4 billion when taking into account the $2 billion in oil subsidies and over $1.37 billion of financing for projects in Cuba.

From power

Cilia Flores is again named as the National Assembly Speaker, Luisa Ortega Díaz is appointed prosecutor general; Gabriela Ramírez is the new Ombudswoman; Ramón Rodríguez Chacín and Rafael Isea become Interior and Finance ministers respectively. General Comptroller Clodosbaldo Russián imposes administrative sanctions on more than 400 citizens, barring them from running for office. The Metropolitan Police (PM) was put under the Interior Ministry’s management, while Defense minister Gustavo Rangel Briceño urged institutionalist soldiers to leave the Armed Forces because “soldiers are politicians.” His predecessor Raúl Isaías Baduel criticizes Chávez for his egotistic, totalitarian and dictatorial style and that’s how his trial for allegedly embezzling resources during his tender started. The last day of the Enabling Law, Chávez launches “El paquetazo”, 26 laws he claimed were studied and discussed before their approval “for Venezuela’s liberation and development,” but nobody knew their content because they were never consulted.

Regional elections

Chávez used his influence and his funds for the electoral campaign, violating every law, with the absolute support of the AN and the CNE. He urged his candidates to win because he couldn’t give money to an opposition that would steal it or use it for its conspiracies. He restated that he wouldn’t leave power until 2021 and then governor Tarek William Saab said that Chávez had to remain in power for a quarter century to guarantee the Revolution’s continuity. The opposition won in Zulia, Miranda, Carabobo, Táchira, Nueva Esparta and the Metropolitan Mayorship. Chavismo won 17 governorships and 263 mayorships, losing Sucre municipality in Miranda state.

Abroad

Colombian soldiers entered Ecuador while chasing insurgents. The operation ended with the death of FARC’s second in command, Raúl Reyes. The process between Uribe Vélez and Chávez was lengthy, including a threat of war, the sending of Venezuelan soldiers to Ecuador, the expulsion of the entire Colombian diplomatic body in Venezuela and the shutdown of our embassy there. Later, the evidence found in Raúl Reyes’ computer linking Chávez with FARC reignited the conflict. The U.S. top anti-drug authority criticized Chávez, deeming him too permissive with drug trafficking and incapable of fighting against it. Human Rights Watch Director José Miguel Vivanco was expelled from the country for the report: “A decade of Chávez. Political intolerance and lost opportunities for the progress of human rights in Venezuela.” Chávez forgave Honduras’ $30 million debt with Venezuela.

Indicators

Despite the serious economic crisis in the world, oil revenues allowed international reserves to increase to $43,1 billion. The GDP grew by 4.8%, and so did food imports and inflation, which reached 30.9%, the highest in the region for a third year in a row and the fifth highest worldwide. The minimum wage rose by 30%, but this was merely and adjustment, considering inflation. The budget for social programs increased to Bs. 5.56 billion, while the allowance for online purchases dropped from $3,000 to $400. Only between January and July, the AN approved Bs.F 31 billion in extraordinary operations and PDVSA’s payroll increased by 21% compared to 2007. The national automotive industry closed with a sharp drop in production, sales and exports. The black market dollar, which opened the year at Bs.F 5.35, closed at Bs.F 5.97.