Tens of Thousands of Venezuelans Protest Hugo Chavez

CARACAS, Venezuela —  Tens of thousands of Venezuelans opposed to President Hugo Chavez took to the streets Saturday, blaming him for rolling blackouts, water rationing, widespread crime and other problems they say are making daily life increasingly difficult.

Chavez backers flooded the capital's avenues with an equally impressive demonstration as the socialist leader confronts mounting criticism and an emboldened opposition ahead of upcoming congressional elections.

Waving Venezuelan flags, protesters accused Chavez of dragging the politically divided South American country into a severe crisis as he accelerates his drive to transform it into a socialist state.

"Chavez is leading the country to ruin," said 79-year-old Olga Damjanovich at the opposition protest. "He's controlled all the country's institutions for more than a decade, so how could it be possible that he's not responsible for the problems weighing down on us?"

Many wore T-shirts that read: "3 Strikes: Blackouts, Water Rationing and Crime. Chavez, You've Struck Out!"

Chavez backers rebutted the criticism, accusing opponents of exaggeration.

"Things aren't all as we would like them to be, but we know that El Comandante (Chavez) is doing what he can to help us, the poor," said Yorbert Rodriguez, a 39-year-old bricklayer.

Political rivals organized Saturday's demonstrations to coincide with the 52nd anniversary of an uprising that toppled Venezuela's last dictator, Gen. Marcos Perez Jimenez. Chavez allies argued that democracy is growing stronger, while government foes said their liberties are slipping away.

Opposition parties hope to make a strong showing in September's elections by holding Chavez responsible for rampant crime, a recent currency devaluation widely expected to boost inflation — which ended 2009 at 25 percent — and electricity rationing.

Chavez, a tireless campaigner who remains popular, has overcome bigger obstacles during his 11-year presidency. The former paratroop commander emerged unscathed from a botched 2002 coup and devastating two-month strike the following year.

Margarita Lopez Maya, a political science professor at the Central University of Venezuela, believes increasing numbers of Venezuelans are "putting the president's capacity to resolve problems in doubt," but they haven't embraced the opposition as a result.

"There may be doubts — even disapproval, but there's no alternative these people believe in," she said.

Source: AP / Saturday, Jan 23 2010

America Rising: An Open Letter

Dear President Obama,

You promised us. We believed you. We voted for you. Now look what you have done.

After Devaluing Venezuela's Currency, Hugo Chavez Demands Socialist Soap Operas

Jan 12th 2010 (Habledash)

The mentally ill dictator of Venezuela has called for something incredible - Hugo Chavez has ordered film producers to make socialist soap operas.  This revelation came after a trip to Cuba, where Chavez noticed their soap operas have more of a socialist theme, rather than an evil capitalist undertone.  This is actually an amazing idea.  While Chavez destroys ...READ MORE



the country by rationing utilities and devaluing the country's currency, at least the people will be entertained!

Chavez, a dictator who has changed the rules enough that he's on his way to being a lifetime president, cannot stand capitalism and he wants to make sure that Venezuelans take notice.

"We can also make good movies.  Not capitalist movies that are poison and incite our children to take drugs and even push them into crime, but good socialist ones."

He's right.  Being the product of a capitalist upbringing, I'm currently tripping on acid and stole the laptop I'm working on.

The country saw the cost of their goods nearly double overnight after Chavez devalued the currency.  He stated that any business that raised prices to compensate for the loss of income would be confiscated by the government.  Predictions are that inflation could reach 60% in the country.  Chavez has sent out 200 National Guard troops to inspect and make sure stores aren't raising prices.

The winners in this?  Anybody that lives in Venezuela - because after they have no money to purchase anything, they'll still be able to watch their socialist soap operas.

The Loyal Opposition is a contributing editor for Habledash

Venezuela Power-Rationing Plan. Chavez, caused by “capitalist waste.”

CARACAS – The Venezuelan government will kick off a nationwide power-rationing plan, the nation’s electricity minister said.





Official news agency ABN cited Angel Rodriguez as saying that directors of the state-owned National Electric Corporation will explain to the public how the measure will be applied in each region so that people can take the necessary precautions.



“We expect that the information provided will allow the kind of problems ... READ MORE



that can be caused by this kind of action to be minimized,” the minister said.





Rodriguez said that the measures, set to take effect Tuesday, seek to promote a level of energy savings that will keep the country active.



The minister warned that, if these measures are not observed, the descent in the water level at Guri Dam, which powers plants that generate 70 percent of Venezuela’s electricity, will put the country in a “critical” situation by the end of February.



“We’re trying to avoid Guri putting us in a very critical situation by the end of February. A general blackout in the country,” Rodriguez said.



If the measures for saving energy are applied adequately, the country can manage until the start of the rainy season and the dam fills up again, he said.





President Hugo Chavez said last Friday that civil servants will work just five hours a day starting this week, from 8:00 a.m. to 1:00 p.m., to help save on electricity.



“In Caracas alone we were able to save close to 187 MW – that is one of the various measures we have approved” to deal with the crisis, which also include creating an incentive for families to use less electricity, which in some cases would mean discounting a large part of their monthly bill, the president said.



“For those who lower their consumption by a significant percentage, we will eliminate a good part of their electric bill,” he said, adding that “irresponsible consumption,” drought and other factors have placed the supply of hydroelectric power in an “alarm zone.”



Hydroelectric power plants that supply almost 90 percent of Venezuela’s national consumption operate with water from the Caroni River, whose dams at present are almost 10 meters (33 feet) below normal levels.



The Chavez administration has ordered manufacturers, shopping malls and apartment complexes to work up a plan to reduce electricity consumption by 20 percent from 2009 levels.



The Venezuelan opposition says that the electricity crisis is an example of the inefficiency of a government that in 11 years has not carried out the plans and investments necessary in the sector, which Chavez partly acknowledged, while insisting on the effects of the drought and “capitalist waste.”



Since November, the government has also put into effect plans to ration water in the Venezuelan capital. EFE

Venezuela soldiers shut shops accused of profiteering

Government inspectors backed by soldiers have shut more than 70 shops in Venezuela accused of trying to cash in on last week's currency devaluation.

Soldiers have been on the streets to check prices as people queue to buy imports, fearing prices could rise.

Devaluing the bolivar by at least 17% will aid competition and cut reliance on imports, President Hugo Chavez says.

On Sunday he warned that businesses engaging in what he called ... READ MORE

speculation would be shut down or taken over.

As soon as trading started again after the president's comments a series of supermarkets and other businesses across Venezuela were taken over by government tax inspectors.

State-run news agency ABN said food, car parts and other businesses were temporarily closed "for changing the price of products and for speculation".

The National Guard stepped in at three superstores belonging to the Exito supermarket chain.

State television showed the alleged rises in prices on everything from plasma television screens to packets of cereal.

The bolivar's official exchange rate, which is set by government decree, had been held steady at 2.45 to the US dollar since the last devaluation in March 2005.

But on Friday, President Chavez announced that it would now have two rates - 2.60 to dollar for "priority" imports, and 4.30 to the dollar for other items considered non-essential - a 50% devaluation.

The BBC's Will Grant, in Venezuela, says that since the devaluation was announced long queues have formed outside outlets selling electronic goods and technology.

Customers fear that significant price rises are on their way.

Venezuela already has the highest rate of inflation in Latin America - currently at about 25%.

President Chavez says that these measures will rein it in but many economic analysts predict that it will only get worse in the short term.

Oscar Meza, director of a Venezuelan economic think tank, Cendas, predicted the move would push annual inflation above 33%.

'Irresponsible policy'

"It's impossible for prices not to be adjusted," he told the Associated Press. "If they aren't adjusted, they'll disappear."

President Chavez dismissed the criticism on Sunday on his weekly television and radio programme, Alo Presidente, saying there was "no reason for anybody to be raising prices".

He urged his supporters to "publicly denounce the speculator" and warned business owners that he had asked the military to formulate an "offensive plan" that would see them "take over any business, of any size, that plays the bourgeois speculation game".

Luis Ignacio Planas of the opposition Copei party said the government was "acting like a pickpocket, sticking its hands in the pockets of Venezuelans, taking their money to continue financing and paying for an irresponsible economic policy".

Some Prices Rise In Venezuela Despite Chavez Seizure Threats

By Darcy Crowe 
    Of DOW JONES NEWSWIRES 
 

CARACAS (Dow Jones)--Some businesses in Venezuela have started to raise prices after President Hugo Chavez devalued the currency by half, setting the stage for confrontations with authorities following presidential orders to shut down retailers that hike prices.

Airlines doubled airfares as early as Monday while there were official reports of large retail chains hiking their prices after Chavez cut in half the official currency peg to 4.3 bolivars per dollar from the previous rate of VEF2.15. Importers of essential goods such as food and medicine will buy currency at a subsidized rate of VEF2.6.

A shopping spree that started after Chavez unveiled the devaluation late Friday has given few signs of waning. Venezuelans continued to swarm shopping malls and lined up to buy ... READ MORE

 home appliances and electronics, which are seen as a hedge against expected price increases.

Travel agencies reported a surge in calls from costumers trying to buy plane tickets just to learn that prices had already doubled. Shoppers are also snapping up personal-care products, from toothpaste to soap, on fears that prices will jump as so-called non-essential imports will now pay the VEF4.3 rate.

"People are right to be afraid and there's still a lot of uncertainty right now," said Roberto Leon Parilli, head of the consumer protection association Anauco.

This sentiment was echoed by Amelia Soto, a 52-year-old housewife, who bought 23 toothpaste tubes in a drugstore in a middle-class Caracas neighborhood. "Everywhere I hear that prices are going to skyrocket, so I want to buy as much as I can now," she said.

The price hikes represent a tremendous liability for a country in which the economy is on the skids and annual inflation is now running at 27%, one of the highest official rates in the world. Finance Minister Ali Rodriguez said the devaluation could add as much as five percentage points to the current 2010 inflation forecast of 20%.

Rodriguez's estimate was dismissed by former central bank director Domingo Maza Zavala, an economist respected by the opposition and Chavez loyalists alike. Inflation, he said, could top 60%. "There's no doubt that inflation will double," he said.

Trying to quash the price increases, which could jeopardize his popularity ahead of September Congressional elections, Chavez threatened on Sunday to shut down and seize any businesses raising prices. He also ordered the National Guard to be deployed on the streets and be on the look out for price gougers.

Following his orders, the state consumer protection agency, Indepabis, along with national guard troops, closed 70 stores on Monday. Almacenes Exito, a hypermarket chain headquartered in Colombia, saw some of its stores temporarily closed on accusations of price gouging. Exito is controlled by French retailer Casino Guichard-Perrachon S.A. (CO.FR).

"They are trying to sell old products at new prices," said Valentina Querales, inspections director with Indepabis.

It was unclear whether the shutdowns were meant to make an example of Almacenes Exito in a bid to dissuade other companies from raising prices, or if the government will be truly aggressive in "hunting down," as Chavez put it, firms that increase their prices.

A report from the state news agency that 200 national guard troops were deployed for the inspections doesn't suggest that a nationwide sweep is underway.

By publicizing its inspections of large retail chains, the government carried out "a communications operation," said Laurent Zecri, vice president of Finance for Almacenes Exito in Colombia, told Dow Jones Newswires. Zecri denied that the stores had increased their prices.

On Sunday, Chavez said that "at this moment there isn't any reason for anyone to increase their prices." Retailers haven't been setting prices at the previous fixed VEF2.15 rate for a long time, he noted.

Instead, they have used a black-market rate, where a dollar fetched VEF6.4 on Tuesday, to set their prices. So the devaluation shouldn't lead to price increases across the board, he explained.

That opinion is shared by some economists.

Last year, as Venezuela's oil revenue plunged, the government forced as much as $22 billion in imports to be brought in using black-market dollars. So the prices on those imported electronics and consumer goods reflected black-market exchange rates.

Some consumers "may be acting irrationally," but they do have something right, said Maikel Bello, an economist at Caracas-based research firm Econanalitica. "In Venezuela, prices are always adjusted upwards."

-By Darcy Crowe, Dow Jones Newswires; (58) 212 905 6304; darcy.crowe@dowjones.com

(Matthew Bristow in Bogota contributed to this article)

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Venezuela Deepens Energy Rationing as Blackouts Loom

By Heather Walsh and Daniel Cancel

Jan. 12 (Bloomberg) -- Venezuela said it will cut electricity on a rotating basis to sections of the South American country’s capital and major cities as the government deepens energy rationing amid a drought.

Power will be cut for four-hour intervals in parts of Caracas starting tomorrow as dry weather reduces generating capacity at the nation’s largest utility, Javier Alvarado, president of government-run Electricidad de Caracas, said today on state television.

Venezuelan President Hugo Chavez is increasing energy rationing ... READ MORE

amid an economic slump and falling oil revenue that prompted his government to devalue the nation’s currency on Jan. 8 for the first time in five years. Venezuela is at risk for forced nationwide blackouts unless it stems declines in water levels at the reservoir supplying the nation’s largest utility, Electricity Minister Angel Rodriguez said yesterday.

“We could be entering a situation with no return” if the nation fails to save energy, he said.

Chavez cut working hours for government employees last week and urged Venezuelans to save water and energy amid the country’s worst drought in about 50 years. The drought may last another five months, Rodriguez said.

Output and refining at state-run oil company Petroleos de Venezuela SA won’t be affected by the rationing, a PDVSA spokesman who can’t be named because of company policy, said today in an interview.

In December, Venezuela halted several production lines at state-run aluminum companies Alcasa and Venalum as well as two units at Siderurgica del Orinoco’s steel mill known as Sidor to save electricity.

To contact the reporters on this story: Heather Walsh athlwalsh@bloomberg.net; Daniel Cancel in New York atdcancel@bloomberg.net

Last Updated: January 12, 2010 16:48 EST