Venezuela devalues currency for 1st time since '05

Source: Associated Press

CARACAS, Venezuela (AP) -- President Hugo Chavez announced a currency devaluation on Friday for the first time since 2005, setting a two-tiered exchange rate designed to help Venezuela's oil earnings go farther domestically while holding down prices of priority imports like food to counter soaring inflation.

Chavez said the bolivar will now have two government-set rates: 2.60 to the dollar for transactions deemed priorities by the government, and 4.30 to the dollar for other transactions. The devaluation dropped the currency's value by 17 percent or 50 percent, depending on the tier.

The higher rate, which he called the "oil dollar," will double the paper value of Venezuela's petroleum earnings when converted to local currency. Oil accounts for about half the government budget, but that income has been squeezed by lower world oil prices and declines in output in the last year.

Chavez said the priority exchange rate will be allotted for food, health care products, school supplies, machinery and equipment for economic development, among other things.

Read more: http://finance.yahoo.com/news/Venezuela-devalues-currency-apf-1126974799.html?x=0&.v=3

That is proof of how much better of a leader Chavez is than Obama.

The insider politicians loot the economy by buying bolivars at the black market exchange rate and selling them at the official exchange rate. There are many high and mid level government functionaries who are now millionaires from this.

What I think they're probably doing is buying DOLLARS at the offical rate and selling them at the blackmarket rate.

Here's what most folks in Venezuela use to determine the value of transactions when exchanging bolivares for dollars or vice versa:

http://bonosvenezuela.blogspot.com/

Where people with dollars are able to move them freely in and out of the US, and into and out of other currencies. In this free system, the dollar has been going down over a long, long time (but signficantly recently) due to the US government spending lots more money than it takes in.

In Venezuela, there was a currency crises in 2002, and Chavez being the liberal dreamboat that so many thinks he is decided "you know, maybe we should just pass a law so that people can't move their money out of venezuela". Of course, the rich still get their money out, meanwhile, with the phony official exchange rate, Chavez's cronies are getting rich on the backs of everyone else by buying bolivars at the official rate (~2 per dollar) and selling them on the black market (3 or 4 per dollar).

/but he wears a red cap so he can't possible be stealing from the poor

"but he wears a red cap so he can't possible be stealing from the poor"

Did you know that the US also has implemented foreign exchange controls?

Actually the right-wingers made FDR out to be America's Lenin because of these very policies. One can certainly take their side.

The venezuelan currency must be one of the few currencies that saw its value in US$ drop constantly over the last 10 years.

in the fact we haven,t tried to overthrow China,s elected leader for one!

:eyes:

...it would likely be worth twice what it is. Even so, it has appreciated relative to dollar since the peg to the dollar was removed in 2005.

Over the past few years, most currencies have appreciated relative to the dollar (whether that be formal or black market rates). Which have not? The DPRK Won and the Zimbabwean Dollar are the two biggest losers. The Venezuelan decline is not nearly so great, so one can say with great confidence that the economic policies of Chavez are superior to those of Kim and Mugabe!

But let's ignore that and talk about two leaders I wasn't describing.

:eyes:

is from 0.6 per dollar to 4.3... more than 600% devaluation in 11 years (Chavez time). 333% for the subsidized first necessity products' exchange rate. And this devaluation is being counted in a currency ($) that has been loosing its value too, as you noted.

The truth is, he was elected and they were not. He has been elected with increasing margins of the vote in transparent, fair, internationally certified elections; not them. He has enjoyed 55% to 60% approval ratings throughout his tenure; who do the rightwingers represent? His government oversaw sizzling economic growth of 10% over the previous five years (2003 to 2008), with the most growth in the private sector (not including oil). Neither the rightwing at DU, nor the rightwing in Venezuela, nor the U.S. rightwing can say the same.

While overseeing spectacular growth, and fully funding many new social programs, the Chavez government socked away $43 billion in international cash reserves for a "rainy day" (such as the Bushwhack Financial 9/11 in Sept. 2008). This gives the Venezuelan government good flexibility in riding out the Bushwhack worldwide depression. They are doing well (in contrast to the U.S. and many other countries)--that is, not only is the Venezuelan economy doing well, under the circumstances; the people are doing well. Venezuela met all of its Millennium goals, for instance (greatly reducing extreme poverty; wiping out illiteracy, etc.). They have projected a conservative budget for this year, based on a mere $40/barrel oil price (it's already higher), and their improved and fairer tax collection system (more than half their revenue), with fully funded social programs. They have had one problem--the result of hot growth--inflation. Inflation points to an economy that has been creating lots of decent-paying jobs--a worker-friendly economy--with lots of business-creation and trade. (The Chavez government encourages small business creation with grants and loans, and is doing the same with land reform--stimulating food production, in a program that requires solid, long-term commitments from farmers, supports and trains farmers for that commitment and is aimed at permanent improvements in Venezuela's food security.)

Now they are dealing with inflation, and we can be sure that their first consideration is impacts on the poor, because that has been their first consideration all along.

The rightwing advice-givers would have it otherwise. They would have the poor starve and wallow in ignorance, while the rich stuff their pockets. They would have Exxon Mobil ripping off most of the oil revenues, with Gucci bags and Jaguars for the country's rich oil elite and nothing for anybody else. They would have Exxon Mobil and themselves rich, and children's growth stunted by malnutrition, their feet unshod so they can't go to school, their parents in despair, with no hope of improvement of their lot, barred from educational opportunities by the cost, barred from health care by cost and unavailability, their neighborhoods without street lights, medical clinics, baseball fields, their communities never served by government, and, when people rebel against these conditions, they would have the police and military shoot them down like dogs.

Yes, they rag on Chavez no matter what he and his government do. They keep up a steady stream of negative 'news' and internet posts about Venezuela and never acknowledge the Chavez government's significant accomplishments, because they want government "of, by and for the people" to fail. Their goals are the CIA's goals, are Exxon Mobil's goals, are the Wall Street Urinal's goals. The rightwing, when they're in charge, destroy economies, harm their countries, deny decent jobs, wages and lives to most people, and loot and plunder the "commons."

We've seen this in Venezuela, prior to the Chavez government. We've seen it all over Latin America, prior to the leftist democracy movement that the people of Venezuela inspired. And now we're seeing it here, in the U.S.: what the "advice" of the rightwing is worth.

He was in power for 5 years before the oil shock. Check how the country did economically.

Btw, remember: oil shock = growth in the non oil private sector.

the elected government and Venezuelan democracy with the a rightwing military coup, whose first action was to suspend the Constitution, the courts, the National Assembly and all civil rights, and while Exxon Mobil and Venezuela's rich oil elite were instigating a bosses' lockout, trying to crash the Venezuelan economy to topple the elected Chavez government, and while the USAID was funding a recall election and 'training' rightwing students to disrupt the country with violent protests, and while the U.S.-funded Colombian military was hatching assassination plots against Chavez, and a U.S.-based polling group was promulgating a false poll to be used in another coup attempt after the 2006 election (another Chavez win)?

Yeah, look at "how the country did economically" during all that rightwing/Bushwhack bullshit! It remained stable and recovered, spectacularly.

You attribute the spectacular economic growth of the Venezuelan economy to "oil shock"--i.e., rise in oil prices--as if to say, 'that's nothing.' But what would have happened if the Chavez government had not, courageously, renegotiated the oil contracts with the multinationals, and faced down Exxon Mobil's bullying? Prior governments were giving away the oil, in 10/90 split, favoring the multinationals (while taking a cut for the rich elite). The Chavez government negotiated a 60/40 split, favoring Venezuela and its social and development projects. Oil is real, you know. It IS a product. It is Venezuela's chief natural resource. And it is now being used to benefit the many and not just the few. The bigger share of oil profits is now going to education, health care, grants and loans to small business, land reform and local and regional development--instead of into third yachts, private jets and mansions for big private oil execs and into Gucci bags and Jaguars for lesser mortals (Venezuela's rich oil elite).

If Venezuela were selling wheat, or lithium, or hydroelectric power--and those items had a boom--would you say, 'oh, that's just wheat shock,' or 'lithium shock'? The Chavez government has been an excellent manager of Venezuela's main resource, insuring that, when the boom came, it benefited everyone, and looked to the future of the country (with education and health care programs, for instance), and didn't just get pissed away on luxury items for the rich as they sold their country down the river. And don't tell me about low production--yet another Exxon Mobil "talking point." Venezuela is a member of OPEC. Production is a collective decision of oil-producing countries, based on how best to manage this major national resource. They have naturally lowered production to drive the price back up, post-Bushwhack depression. (And that is what is happening.)

Venezuela can take a hit of no growth--after five straight years of 10+% growth--and it can take hits of inflation (to a certain point), BECAUSE it has, for once in Venezuela's history, been well-managed for the benefit of all. As Chavez has repeatedly stated, his government is committed to lessening and cushioning the impacts of the U.S.-induced worldwide depression on those least able to absorb those impacts--the poor, the workers, small business, the elderly, children. Who would the rightwing in Venezuela have cushioned? Who did the corpo-fascists running the U.S. government cushion?

And where was the Venezuelan rightwing's program for using "oil shock" to do anything but enrich themselves again, at the expense of everyone else?

...of making things personal when you have no argument to discuss. You can't hide the impressive amount of false information you pretend to "provide" to people from anyone who knows at least a bit of venezuelan history, economics and society. Starting from your second line, I know you're just talking more nonsense. Nothing but useful clichés from the Venezuelan Ministry of Information.

First of all, I have no "lot". In those years, 1998-2003, I was voting for Chavez, as I've already told you. I know you're used to think in "lots" as any regular worshiper, but I'm not. I find it idiotic. Secondly, if you had bothered collecting at least some basic information about growth, you'd understand that from 1998 to 2003, Venezuela didn't "remain stable" at all. Actually, in real terms and per capita, the GDP fell by an astronomical 22% in 5 years*. Do your homework and come back.

22% fall of real per capita GDP in 5 years?! That's a HUGE fall, by any economical standard. So, please cut the BS.

The growth that came after that WAS the result of the oil shock. It's so obvious. When the oil shock ended last year, the growth ended as well. Why? Because the venezuelan economic growth comes structurally from the growth of the public spending, which is directly determined by the amount of oil income. It's simple. The 2008-2009 numbers are there, check them. But this time, stop inventing them.

Finally, during the previous 1973-1980 oil shock (which was way smaller than the 2003-2008 oil shock), when the socialist democratic party you call "right-wing"** was in charge and nationalized the ENTIRE oil industry, poverty and income inequality were considerably lower than today, while per capita real product was higher. These are simple FACTS. But, hey, don't get me wrong on that, those people were corrupted, mediocre and I never liked them. They just did better than Chavez for poor people AT THAT TIME with the oil shock. Lower poverty, lower inequality, higher income and food security... 30 years ago. Simple and clear.

Peace Patriot, cut the bullshit, you're too ignorant about Venezuela.


*You can argue the big strike in dec 2002-jan 2003 affected the economy exogenously, which is true. But before the strike, the fall of real GDP per capita was already 14-15%. Huge too.
** That's funny. It would mean that, in your scale, Obama would be extreme right-wing.

is definitely among the more specious. The premise, I believe, is that the improvements to civil society for the Venezuelan working class is just a bribery scheme that enables Chavez to stay in power. It's an odd way of looking at the dramatic improvements in Venezuela - lower infant mortality rate, more schools, less poverty, improved housing, better access to health care, dramatic economic growth etc - all recorded in the social indicators of a number of international monitors like UNICEF and CEPR. As usual, the critics' arguments rest on a presupposition that no thinking person could ever regard as logical.

possibilities of public spending. No increase, no more growth, no more "dramatic*" improvements.

* Way less "dramatic" than the ones made during the previous 1970's oil shock, by the way.

You have simply supplied a disjointed fact with a little bit of ideological spin, and then I'm supposed to assume that it somehow reflects poorly on Hugo Chavez. The problem is, I don't subscribe to the same ideological assumptions about the world as you, so I don't see the connection. You'll have to explain to me how saying "Oil Shock!" supports your obvious dislike of President Chavez.

In the meantime, other posters might find some real information of interest:



I'll bet the "oil shock" of the 1970s did NOT translate into lower infant mortality, the elimination of extreme poverty and universal access to health care.

I didn't say "oil shock. Period". Try reading again. Where's the "ideological assumption"?

Poverty was lower at the end of the 70's, illiteracy, under-nutrition dropped a lot faster in that decade than in 2003-2008. By the way, what you posted contradicted your own point: after 5 years of Chavez, before the oil shock, poverty had reached its "peak of 55.1%" (quoting your own quote). What does it mean to me? That the 2003-2008 social success in Venezuela was a result of the financial possibilities provided by the oil shock. Got it this time?

What else did change besides the price of oil?

Let's see, I'll quote your quote again... "If we compare the pre-Chávez poverty rate (43.9 percent)" with the 2003 poverty rate (55.1%), 5 years after Chavez had reached power but before the oil shock, we just see that poverty was growing quickly in the first half of Chavez's period. Doesn't this FACT bother you? What makes you think that this tendency would have been reversed without the oil shock? Did Chavez become pro-poor Chavez just after the price of oil started increasing, by coincidence or because he had a huge windfall effect?

Without the oil shock, Chavez was doing poorly from a social point of view. You pointed out that fact. That was my point. Before the oil shock = no miracle, no reduction of poverty. This is no assumption, just checking the numbers you provided.

The 2003-2008 miracle was kind of normal for an oil producer, don't you think? Let's see how the country does now, when the oil shock has ended. Then we can speak again. Simple facts, no ideology in this. I'm asking for long term social efficiency. Long term, oil price independent, reduction of poverty. I just don't subscribe to the same cult of personality you do. Being "chavista" is no ideology. It's just worshiping.

resulting from the attempted coup d'etat and the "oil strike", as the causes of the severe recession of 2002-2003. I think your 'theory' is hogwash.

But I'm not interested in "oil shock". It's fool's distraction. I'm more impressed by a transparent democratic process and spending public money on social services. Publicly funded education and health care; lower infant mortality; eliminating severe poverty; these are things I can get behind.

Changoloa continues to ignore the most obvious questions about "oil shock": Is oil not a product? Is it not sold? Is it not an export? Does the oil not belong to the people of Venezuela? Did the Chavez government not obtain a far, FAR better deal for the Venezuelan people, vs the multinationals, by tough bargaining, persistence and strong assertion of Venezuela's sovereignty?

Thus, the Chavez government achieved a much larger portion of the profits of Venezuela's major resource and major export to benefit the people who own the oil.

In considering this matter--the use of the oil--it doesn't really matter where Venezuela's economy began--how much damage the "neo-liberals" and the fascists before them had done to it, and how grave the problems of poverty, education and development were, when the Chavez government was first elected. The Chavez government, against great odds--including a rightwing coup attempt and a crippling oil professionals' strike, and seething hostility from the oil men in the White House--greatly improved Venezuelans' cut of their oil profits.

They could have misused those profits in any number of ways. Instead, they did the right thing, and used them to benefit the people to whom the oil belongs. The statistics that you provide bear this out. These improvements are especially relevant to the needs of the vast poor majority.

A 15 to 1 increase in the number of doctors (primary care).

An 8 to 1 increase in primary care centers.

A 30% to 40% reduction in food prices for the poor.

School food programs for 1.8 million children by 2006 (compared to 250,000 in 1999).

45% increases in secondary and higher education enrollment (from 1999 to 2006).

Near quadrupling of growth in the number of public schools (1999 vs 2005)

A 314% increase in social spending overall (since 1998; now 20% of GDP).

The poverty rate cut in half (as to cash income). (Plus new access to education, health care, etc.)

Unemployment cut by 1/3 to 1/2. (Now down to 7%, despite the Bushwhack's worldwide depression).

Employment as a percentage of the labor force increased by 6% to 10%.

An increase of 1.8 million jobs in the private sector (since 1999).

Venezuela's GDP grew nearly 90% between 2003-2007 (vs 30% in the 1970s expansion).

Venezuela went into the Bushwhack Depression with low levels of public debt (total interest only 2.1% of GDP), and very high international cash reserves (total $50 billion), despite massive increases in social spending.

Two more interesting facts:

"Venezuela is one of the only major oil-producing states in the developing world that allows foreign investment in oil production – even US allies such as Mexico and Saudi Arabia, for example, do not. Venezuela's reserves of heavy crude in the Orinoco region are now estimated to be among the largest in the world, so foreign companies have strong incentives to stay involved."

"...the (Venezuelan) government has not even increased the public sector's share of the economy. The central government's spending, at 30 percent of GDP, is far below such European capitalist countries as France (49 percent) or Sweden (52 percent)." (!)

http://www.rethinkvenezuela.com/downloads/cepr%20report.htm

-------------------------------------

Mark Weisbrot (who wrote this analysis with Luis Sandoval), brilliant economic and political analyst though he is, did not anticipate the Bushwhack Financial 9/11 of September 2008. (This article is dated Feb '08.) But he does include possible scenarios of recession and falls in oil prices in evaluating Venezuela's economy under the Chavez government, to 2008. He is impressed with Venezuela's strengths as to absorbing various potential shocks--its sustained economic growth (after the rightwing-instigated political/economic instability of the 2002-2003 period), its low debt, its high cash reserves, its dramatic increases in social spending, while basically operating in the black, and its dramatic social achievements. He is not very concerned about inflation nor about the over-valued bolivar, and says that the government will need to deal with both, and has the wherewithal to do so. He points out that inflation under previous governments got as high as 100%. And he also states that inflation in a developing country is not the same thing as inflation in a developed country, such as the U.S. It is a consequence of rapid growth. What is more important is job creation, poverty reduction, educational opportunities, the health of the work force and other forward-looking policies. But he does warn that 20% inflation is a generally recognized benchmark and that the government needs to beware of "hyper-inflation." All in all, he is confident that they can handle both inflation and devaluation.

One thing he stresses, and that is the profound impacts of the right-wing coup attempt and the oil bosses' lockout, during the 2002 to 2003 period, which sent Venezuela's economy into a tailspin. What these rightwing jerks did--just like the Bushwhacks here--is to sacrifice their country to their greed and to their egos. The Chavez government has been working under this handicap ever since--both the severe blow to the economy and the failure to have a trustworthy "loyal opposition" to provide reasonable criticism, policy alternatives and decent advocacy for their constituents. Everybody has a right to representation. These idiots boycotted the congressional elections, promoting the utter falsehood that the elections were not fair. In any case, their behavior (and that of the U.S.) makes the accomplishments of the Chavez government all the more remarkable. Five years of sustained growth and private sector job creation, low inflation, low debt, the setting aside of large cash reserves, large increases in social spending and tremendous social progress.

Our corpo-fascist press--and some DU posters--do nothing but tear this government down. If the Chavez government uses the oil revenues in the best way possible, that somehow becomes a negative. It's just the "oil shock." "Hugo" is "just buying votes." If Chavez keeps getting elected, it's only because of the oil money. And on top of everything else, "Chavez is a dictator." (Um, then why does he have to 'buy' votes?) If all social indicators are up, the statistics are all wrong. If street crime is up, Chavez can't do anything right. If the Chavez government creates 1.8 million jobs, inflation becomes the 'meme.' The level of unreality in these "talking points" is amazing. But I guess that the Chavez government's very successes in some way prompt this total denial of reality. The facts don't matter. A 45% increase in high school and college enrollment doesn't matter. Cutting poverty by half doesn't matter. All that matters is that we agree--against all reason--that either it is not true, or that it doesn't matter, because something else has now become the negative focus and the omen of doom.

As with the extremists in Venezuela's benighted opposition, and the rightwing extremists here, for that matter, a reasonable discussion does not seem possible.

And we need reasonable discussion. We're all in a lot of trouble, with climate destabilization and this Great Looting by the super-rich (Great Depression for the rest of us). If Chavez, Morales and the Bolivarians are right, socialism is the answer. We have to deconstruct capitalism. Are they right? Both have been fabulously popular with their people and have obviously done a lot of good for their countries. Should we advocate those models? Or maybe they are not applicable here, but there are some things we can learn from them. How to change our very troubled democracy-- to save the planet, alleviate poverty and create a sustainable, just and peaceful world? It's refreshing to see other governments addressing these critical issues in a real way. How do we make that happen here?

Never fails.

If he doesn't fight inflation, he's wrong. If he does, he's also wrong.

And the accusation that he is a "dictator" is not true. It is based on bogus 'news' items and distortions. For instance, when the Chavez government denied a license renewal to RCTV, a corporate media monopoly whose executives had actively participated in a violent rightwing military coup against the elected government, they were getting their just deserts--loss of their license to use the PUBLIC airwaves. Any other government in the world would have done the same. And many governments around the world have pulled broadcast licenses for far less cause. Peru and Colombia both pulled broadcast licenses around the same time. But that context was never provided in the 'news' articles about Chavez and RCTV.

Or another for instance: Chavez occasionally rules by decree. This sounds authoritarian to our ears, but it is in fact a common practice in Latin America. The ELECTED legislature grants time-limited and issue-limited powers of decree to the ELECTED executive to solve some particular problem. Chavez did not "take" powers that weren't his. He was GIVEN powers by a body of representatives who are beholden to the voters, as he is, and both were empowered by the Constitution to do this. This is NOT considered "authoritarian" in Latin America. Lula da Silva, president of Brazil, used decree powers to protect a swath of the Amazon for uncontacted primitive tribes, around the same time. That was not mentioned as context in the articles about Chavez.

The list goes on and on. Every negative story about Chavez that has been published in the corpo-fascist press, that paints him as a "dictator," has failed to contain relevant context. The result is to create this vague, unfactual, subliminal, bogeyman impression that Chavez is a "dictator." But if you bother to consult other sources and read many sources and seek out the facts, you find that the charge is not true, in context, and furthermore, that Venezuela has a vibrant democracy, where the media rails against Chavez, 24/7, without restraint. Some of the stuff they say would bring the FBI to their door in this country. Freedom of speech is alive and well in Venezuela. They also have transparent, fair, honest and internationally certified elections, with a government that encourages maximum citizen participation.

It is NOT true that Chavez is a "dictator"--"popullist" or otherwise. He is popular and a strong leader. So was FDR. And he, too, was called a "dictator" by the rightwing press of that era. Strong, popular, leftist leaders are always called "dictators" by the rightwing. But if who they are "dictating" to is Exxon Mobile, or, in FDR's case, "organized money," the charge is false. Some private entities that behave like "dictators" themselves need to be curtailed when their power gets of hand. That is not "dictation." That is good government.

Fighting inflation is good. Lopping off zeroes to fight inflation is bad. See Zimbabwe for reference.

so he can potentially stay in power longer, then I'd say he's doing a great job. But he's not following that model.

The Chavez government and the National Assembly put the issue of term limits to a VOTE OF THE PEOPLE. The VOTERS OF VENEZUELA overwhelmingly voted in favor of lifting the term limits on the president and a number of other offices (including for several rightwing governors).

How is this "tinkering"? This is the LEGITIMATE, CONSTITUTIONAL and imminently DEMOCRATIC process in Venezuela for changing term limits.

And if the Venezuelan VOTERS approve of Chavez and others running for office more than twice, what is wrong with that?

Our own FDR ran for and won FOUR terms as president, and died in his fourth term. (He was "president for life"!) What is wrong with that, if the voters approve?

Most of our Founders opposed term limits on the president. They considered it UNDEMOCRATIC. They felt that the people should be able to vote for whomever they want and need as president. They did NOT include a term limit on the president in the U.S. Constitution. The two term limit was rammed through by the Pukes in the mid-1950s, after FDR's long run as the most popular U.S. president ever, in order to prevent a "New Deal" from ever happening in the U.S. again, and to begin dismantling the one we had, which they have very nearly accomplished.

The situation in Venezuela is very similar. After decades of misrule by the rightwing oil elite, and a ruined economy, and vast and unnecessary poverty, the people of Venezuela--after long hard work on their democratic institutions--were finally able to elect a government who acts in their interest--who, for instance, renegotiated the oil contracts with the multinationals in Venezuela's favor, and who has been using those revenues to bootstrap the poor, with education, health care and other programs. What is wrong with them re-electing this president and his government as many times as they wish?

Democracy does not require term limits. In fact, given the history of term limits as a corpo-fascist idea for limiting the power of governments over corporations--you could certainly argue that term limits are anti-democratic, as our Founders believed. The reason is this: The rich have money and entrenched power. The poor have time. With time, a good government can begin to erode the power of the entrenched rich and begin to equalize power in the society among all citizens. That is what FDR did. That is what Chavez is doing. That is why BOTH have been called "dictators"--by the very rich, because they "dictate" to the very rich--with fair taxation, with fair wages and working conditions, with regulation of the banksters and industry, with public works that everybody owns, not just the rich, with resistance to privatization, with development of "the commons" (schools, libraries, parks), with bottom-line supports for the poor (to prevent exploitation of the working class and for humanitarian reasons), with free universities (we once had those here, pre-Reagan), with democracy and equal rights, bolstering the power of ordinary citizens and the poor against the entrenched power and advantages of the rich.

The rich do not give up a dime of their wealth nor an iota of their untoward power willingly. They must be forced to do it by a democratic government. And democratic government is the best way ever devised by humankind to prevent exploitation of the poor by the rich without bloody revolution. Democracy is a corrective--a means of peaceful change. And when democracy is applied to a situation like that in the U.S. at the beginning of the Great Depression, or that in Venezuela, after a decade of "neo-liberal" misrule ("free trade for the rich") following a half century of other kinds of misrule, the rich are of course going to scream "dictator" at a leftist president who is applying the corrective at the behest of the vast poor majority.

There are obvious perils in being a fabulously popular president. Politicians must always be watched--scrutinized, criticized, held to account. Chavez has been more scrutinized and criticized than any public figure in the history of democracy, and he has been repeatedly held to account in transparent elections--including even a U.S.-funded recall election (which Chavez won, hands down) (--yes, Venezuelans have the power to recall their president). He has been repeatedly endorsed by the voters by big margins--and the criticism continues, mostly frothing-at-the-mouth rightwing criticism motivated by the greed of the rich, here and there. Of course they hate Chavez. Of course they call him a "dictator." He doesn't let them--the rich and the corporate--get away with being dictators over everybody else!

And here is what Lula da Silva, president of Brazil, said about this. He said, of Chavez: "They can invent many things to criticize Chavez, but not on democracy!" That's from Brazil--chief rival of Venezuela for power in the region. THEIR president endorses Chavez as a democrat with a small d. That is the view of most of the leaders in the region, and of the great majority of Venezuelans.

You really, REALLY need to question this corporate bullshit that Chavez is a "dictator." It is, for one thing, a total insult to the people of Venezuela and their huge accomplishment in establishing, and protecting (in 2002, at peril of their lives), a real democracy, such as we had in the U.S. during the "New Deal."

By the way, imagine if any Republican president attempted to float measures through a Congress dominated by the GOP by a very wide margin, in an effort to remove term limits and also increase the power of the executive branch...

I think anyone with a brain would be furious over such attempts here in the US. But if it's some guy in S. America calling himself a "socialist", it's ok.

If you think no term limits is a good thing, all I have to say is "career Senator". Most of those people are corrupt, because they have remained in their position too long. We can only consider ourselves lucky that FDR was a decent man and a decent president. Imagine if the voters elected G.W. to four terms...but hey, it's the "voter's will", right?

"Finance Minister Ali Rodriguez said the devaluation will add 3 percent to 5 percent to inflation, already the highest in the Americas at 25 percent last year."

http://www.reuters.com/article/idUSN096521320100109

On the one hand, it says that the Chavez government is devaluing the bolivar "ahead of an election"--i.e., to retain Chavez's big majority in the National Assembly. On the other hand, it says that, by the devaluation, "Chavez risks taking a blow to his popularity ratings...", and quotes an economist as saying, "The popularity of the government is obviously going to be sharply and negatively affected."

That does not make any sense. Chavez is devaluing the bolivar to win votes yet devaluing the bolivar will be a "blow to his popularity rating"????

Way down in the article, there is a comment that makes sense, as follows: "'Venezuela's decision to devalue the Bolivar culminates an event that the market has been anticipating for a long time,' said Walter Molano, an analyst at BCP Securities. 'It helps alleviate the country's fiscal woes and puts it on a sounder macroeconomic footing.'"

To devalue the bolivar is to do the right thing--elections or no elections. And it limits the impact of inflation--with the two-tiered devaluation--in taking a measure that was long needed, and long anticipated.

Just before this quote, the article asserts that Chavez "resisted calls from economists and many government allies to make the move last year when oil prices were at their lowest and elections a long way off." They don't mention that this was also the advice of rightwing critics who are now, of course, criticizing Chavez no matter what he does.

Here are a number of articles--more reflective of the government's point of view, and, in my opinion, more objective than Rotters (which is part of a corpo-fascist propaganda machine bent on dissing Chavez, socialism and democracy, and re-installing corpo-fascist rule wherever it has been dislodged by the voters). And I want to point out just one statistic, at the end of the first article, in a quote by Chavez:

“'We'll do everything so that this global crisis does not affect Venezuela,' (Chavez) said, recalling that in 2009, while the economies of northern Europe and the U.S. lost millions of jobs, in Venezuela the unemployment rate remained stable at around 7 percent.'" (my emphasis)

I would say: Don't take "hit and run" 'news' articles by Rotters or any corpo-fascist 'news' monopoly as the truth. Their purpose is not to inform you, but rather to give you impressions that, a) keep you stupid about their real purpose, which is, b) to fleece you of every dime you earn and every tax dollar you pay to stuff the pockets of global corporate predators, war profiteers and the super-rich. And do notice that Rotters--after laying out that their contradictory thesis that devaluing the bolivar will both increase and decrease Chavez's popularity "ahead of an election"--throws in "blackouts" and "water shortages" to make you think that things are really bad in Venezuela, when, in truth, Venezuela now has the best government they have ever had in their entire history.

Venezuela’s Chavez Announces Currency Devaluation, Two-Tiered Exchange Rate
http://www.venezuelanalysis.com/news/5057

2009 a “Tough” Year Says Venezuelan President Chavez
http://www.venezuelanalysis.com/news/5046

Towards Correctly Measuring the Role of the Oil Sector in Economic Growth
http://www.venezuelanalysis.com/analysis/5011

The Chávez Administration at 10 Years: The Economy and Social Indicators
http://www.venezuelanalysis.com/analysis/4182

the key word is "risk" - he needs to generate more money to pump into social programs to prop up his flagging popularity. Devaluation increases government revenues. The risk he takes is that he in fact increases inflation and inflicts economic injury on his people. He is gambling with his country's economy to win an election.

But unfortunately, the additional inflation will probably be considerably more than 2 or 3 % points, since the venezuelan industrial and agricultural sectors almost can't replace imports. He's financing public spending by diminishing the value of the people's money. Moreover, the biggest portion of the venezuelan state's money is acquired in US $ (oil). From the state's perspective, devaluation has a double effect.

But, unfortunately, he's counting on our industrial/agricultural sectors' legendary ability to replace imports. Or, should I say, legendary inability. Sad.

This is the talking point of the extreme right-wingers being parroted by people in a different guise.

Get a clue.

He was elected four times. Essentially, Chavez has been too. In any case, I say this not for the sake of debate, but rather for the information of the casual reader.

they amended the Constitution to ensure it could never happen again.

when the American people weren't looking.

In Venezuela, they put it to a VOTE OF THE PEOPLE.

FDR would have won a FIFTH term, if he had lived. He had not only just finished creating the most powerful economy in the world--and the most democratic, with the wealth spread around--he had just won WW II.

And if he were alive and well, and running for office today, he would still be winning election as president--but for the term limit and Diebold & brethren. There is, in truth, no way we could elect an FDR today, not because the American people hated the "New Deal" (LOL!), but because the global corporate predators and war profiteers have taken over the government, and turned it into a cauldron of corruption, including their goddamn 'TRADE SECRET' voting machines.

The election system in Venezuela is fair, honest, transparent and heavily monitored by, and certified by, international election groups. That's why they have an "FDR" for president, and we don't.

And it has been their choice to keep him, if he wins his next election, as it was once our choice to keep electing FDR.

The 22nd amendment was thought up and pushed through by the man whom FDR initially defeated--Herbert Hoover! Hoover headed the "Hoover Commission" which was packed with a bunch of other rightwing Pukes. I don't know why Truman let this happen, but, interestingly, Eisenhower opposed the idea and said that it turned him into a "lame duck" in his second term. And maybe that's why he blasted the "military-industrial complex" as a threat to democracy at the end of his second term. They had stripped the presidency of a big chunk of its power to control the war profiteers and the global corporate corporate predators who were plotting the end of the "New Deal"--a plot that continues to this day, with the attempted assault on Social Security and hundreds of other, more successful, very bad developments--and who furthermore were plotting the Forever War, beginning with Vietnam. They run things now, and we are fucked, and that is the truth.

you do understand how the Constitution is amended, don't you?

Those were the years during which he was elected to his third and fourth terms. I wish only that he lived longer for a fifth, sixth, and seventh term...

There is simply a limit at which people start to think "this is not right." There is a reason the 23 amendment passed so quickly and with bipartisan support.

Any of our resident economics folks recall similar scenarios, and what their outcomes were?

...the outcome will be lots of opportunity for corruption as the politically well connected somehow manage to covert one currency into the other.

For instance...

"'The popularity of the government is obviously going to be sharply and negatively affected,' said economist Pedro Palma." ??

This article is a concoction, designed by a very hostile, anti-Chavez 'news' monopoly, to paint a negative picture of a government that they detest--a government that has limited the profiteering of European, U.S. and transnational investors, by tough oil contract negotiations, anti-World Bank/IMF organizing of smaller countries and defense of the poor, the working class and small business. Thus, they begin the article with a series of anti-Chavez comments using overwrought language, like "Black Friday" (cuz well-off people are lining up to buy things at glitzy stores? jeez.), and a frothing-at-the-mouth exaggeration from one of Chavez's biggest political enemies ("the quality of life for Venezuelans is automatically devalued since we now have half the money we had before.").

Do you notice that no worker is consulted? No poor mother who is getting a subsidy to return to school is consulted? Do you notice WHO is consulted, to set the tone of the article?

Thus grossly colored by Chavez's political opponents--the rightwing elite--from the outset, the article proceeds to "blackouts" and "water shortages" to pile on the negative images, in the interest of the rightwing political agenda, and buries the most sensible comment in the article, under the subtitle, "Blackouts, water shortages" ....

"'Venezuela's decision to devalue the Bolivar culminates an event that the market has been anticipating for a long time,' said Walter Molano, an analyst at BCP Securities. 'It helps alleviate the country's fiscal woes and puts it on a sounder macroeconomic footing." (my emphasis)

"Blackouts, water shortages"??? The devaluation puts the economy "on a sounder economic footing." "Blackouts?" "Water shortages"? "Black Friday"?

Get it? The article is BIASED. It is writing a narrative of doom based on a sensible and expected financial move by the government that has nothing to do with the drought that has hit northern South America (Colombia, Venezuela and others are all hurting from it; Colombia is having many big fires, Venezuela's hydroelectric power has been affected), and has everything to do with FIRST WORLD and U.S. banksterism, inducing a worldwide economic crash.

Rotters represents the banksters!

Please re-read the article and ask yourself why Rotters consults a "sales executive" and a Chavez political enemy, in the opening section, and fails to consult any blue-collar workers or street vendors or poor mothers.

Ask yourself why the article is so contradictory on the issue of whether the devaluation will increase or decrease Chavez's popularity.

What I see is a concoction--bits and pieces pulled together (whether contradictory or not)--highlighting and grossly exaggerating the negative, in what appears to be an effort to cause panic, and to create an impression of mismanagement that is not real. The Chavez government takes an expected, sensible measure, and people (with the wherewithal) are lining up in a panic to buy cheap cell phones and HD TV screens? They have money to do that in a socialist economy? And the Chavez government takes an expected, sensible financial measure--just to 'buy votes,' while yet his popularity "is obviously going to be sharply and negatively affected"?

Poor journalism. Poor writing. Biased. Manipulative. Up to no good.