Evo's Gasolinazo - Morales Finally Does Something Right Then Cancels

From the Economist, 

Fuel on the fire Evo Morales is hoist with his own petard

The logic behind the increase was impeccable. Fuel prices in Bolivia have been frozen since before Mr Morales came to power in 2006, even as the world price of oil has surged. The result has been rising demand, falling oil output and a mounting bill for fuel imports and subsidies. The price freeze cost the government $380m last year, a bill that would rise to $660m this year, according to Álvaro García Linera, the vice-president.

Words of Wisdom

Mario Vargas Llosa on his Nobel acceptance speech making the claim for Liberal Democracy

No debemos dejarnos intimidar por quienes quisieran arrebatarnos la libertad que hemos ido conquistando en la larga hazaña de la civilización. Defendamos la democracia liberal, que, con todas sus limitaciones, sigue significando el pluralismo político, la convivencia, la tolerancia, los derechos humanos, el respeto a la crítica, la legalidad, las elecciones libres, la alternancia en el poder, todo aquello que nos ha ido sacando de la vida feral y acercándonos -aunque nunca llegaremos a alcanzarla- a la hermosa y perfecta vida que finge la literatura, aquella que sólo inventándola, escribiéndola y leyéndola podemos merecer. Enfrentándonos a los fanáticos homicidas defendemos nuestro derecho a soñar y a hacer nuestros sueños realidad.

WIKILEAKS - BOLIVIA'S REFERENDUM: MARGIN OF VICTORY MATTERS

Interesting cables from around election time

Did Evo steals votes?   when he clearly did not need to, in order to win the constitutional referendum, the US Embassy has some interesting thoughts on that.

Summary: With the January 25 constitutional
referendum rapidly approaching, all signs point to victory
for President Morales and his ruling Movement Toward
Socialism (MAS) party. Although the opposition has made

inroads into the MAS lead, most national polls point to
between 54 and 60 percent support for the proposed
constitution (with one government poll showing 66 percent),
and the MAS appears set to leverage its considerable rural
base to victory. After a series of national news articles
raised questions about significant fraud in the August 2008
recall referendum, the National Electoral Court has taken
pains to advertise the electoral rolls as secure. However, a
recent poll shows less than half of the public shares the

court's confidence, and the opposition believes significant
electoral fraud is likely. While cheating seems unnecessary
to secure victory for the MAS, padding their lead would give
the party leverage in congressional negotiations regarding
legislation implementing hundreds of vague constitutional
clauses. Opposition leaders continue to fear the MAS will
use any stalemate in these negotiations to close congress and
institute rule by decree. At both the national and regional
levels, the margin of victory matters. A landslide for the

MAS nationally, or large victories for the opposition in the
eastern departments, could spark more conflict. End summary.

http://cablesearch.org/cable/view.php?id=09LAPAZ96&hl=BOLIVIA

The State Department Cables - Evo is Difficult Says Christina

Revelations about US-Bolivian relations from the infamous State Department Cables


Christina and Nestor Kirchner had good relations with Thomas Shannon Undersecretary of State during the Bush administration.  acting as a secret go-between for the US Government with Evo.

Colaboración en Bolivia
Los telegramas intercambiados entre la Embajada en Buenos Aires y la Secretaría de Estado muestran las buenas relaciones que llegaron a mantener Néstor Kirchner y la presidenta con la Administración de George Bush y su secretario de Estado adjunto para Asuntos de América, Thomas Shannon, y la difícil comunicación que existió, al menos hasta marzo-abril de este año, con la Administración de Obama y, sobre todo, con Arturo Valenzuela.
La confianza con Shannon llegó hasta el punto de que la presidenta aceptó "cooperar con el Gobierno de Estados Unidos en Bolivia". "CFK afirma que Argentina cooperará con el USG [Gobierno de Estados Unidos] en Bolivia, pero que tenemos que ser cuidadosos para que no parezca que existe una 'operación política' contra el Gobierno, dadas las sospechas de Evo", asegura el telegrama norteamericano. Shannon ya había dado seguridades a la presidenta argentina de que Estados Unidos garantizaba la integridad territorial de Bolivia e intentaba, con muy poco éxito, convencer a Evo Morales de que Washington no tenía nada contra él. "Evo no es una persona fácil, nos confía CFK, haciéndonos notar que Argentina tiene problemas para conseguir que Bolivia le abastezca de gas natural. Todos necesitamos paciencia, nos dijo", relata el entonces embajador Wayne. Poco antes, un telegrama informa de las gestiones que ha hecho el ministro de Exteriores argentino, a solicitud del embajador de Estados Unidos, para bajar la tensión en Bolivia respecto a Washington y garantizar la seguridad de su Embajada en La Paz. "Taiana nos informa de que ha llamado tres veces al viceministro boliviano para insistir en esos dos puntos".
Un despacho enviado por la Embajada en Buenos Aires antes de la visita de Shannon en agosto de 2008 expone claramente cuáles son las demandas de Estados Unidos al Gobierno argentino: "Esperamos que Argentina desempeñe un papel positivo en evitar un conflicto y llevar a buen puerto la democracia en Bolivia; que influya en el presidente ecuatoriano, Rafael Correa, para que se comporte con más moderación; que tome una posición más constructiva, madura y equilibrada en el conflicto colombiano y que influya positivamente en su contraparte venezolana".

 So much for Evo being threatened by the US:

* Shannon asked the Kirchners to reassure Evo that the US guaranteed Bolivia's territorial integrity (this was during the time that Evo was accusing the US of supporting the regional opposition in Santa Cruz which he claimed wanted to split the country)


* Shannon asked the Kirchners to try to convince Evo that the "US didn't have anything against him". trying to lower tensions
* The American Embassador in Buenos Aires asked Argentinian Foreign Minister Taina to intercede with Bolivian authorities to  "lower the tension in Bolivia" vis a vis the U.S. and to guarantee the "safety" of the American Embassy in La Paz. (This coming after mobs of Evo-supporters - with at least some officialist connivance- attacked the U.S. Embassy and nearly set it ablaze). 
* Christina Kirchner describes Evo as "not an easy person"

What emerges at least from this series of cables is a State Department from the past couple of years actually using diplomacy to deal with and get along with a rather prickly ideologue like Evo.    Far cry from trying to destabilize him as he claims.

The Kirchners also come across as having much better relations in private with the Bush Administration than they let on in public.

Bolivias Shrinking Gas Reserves - The Price of Evo's Nationalization Part 1

 

Bolivia's government has finally confirmed what Bolivian analyst Hugo Del Granado reported a month ago,  tthat the country's natural gas reserves have dropped precipituously.


From Merco Press

According to a recent audit commissioned by the Bolivian government and conducted by US-based consulting firm Ryder Scott allegedly shows that the country has only 8.3 trillion cubic feet of proven gas reserves, sharply lower than the range of 12.8 trillion to 26.7 trillion that has appeared in contradictory official versions.

“It's a blow to the expectations that have been built up since the start of the decade concerning ... (factors) that gave Bolivia an economic advantage in the regional context,” energy sector analyst Hugo del Granado is quoted in La Paz press.

Del Granado caused a stir days ago when he published an article about a preliminary yet reliable report he had seen concerning a sharp drop in proven gas reserves, noting the government has been keeping the information secret since June.

Apparently the recent audit commissioned by the government and conducted by U.S.-based consulting firm Ryder Scott shows that Bolivia has only 8.3 trillion cubic feet of proven gas reserves, sharply lower than the range of 12.8 trillion to 26.7 trillion that has appeared in contradictory official versions.

Bolivia is “resisting the truth” because acknowledging the reality would mean losing its status as the second-leading natural gas power in South America, Del Granado said, adding that the country currently ranks fourth in the region in terms of proven reserves.

Venezuela has 200 trillion cubic feet of gas reserves, followed by Argentina, with 13.2 trillion; Brazil, 12.7 trillion; Peru, 11.2 trillion cubic feet; and Colombia, 4.4 trillion, according to figures cited by the expert.

Bolivia's former superintendent of oil and gas, Carlos Miranda, told the media that, if the drop in reserves is officially confirmed, Bolivia would be faced with “the nation's biggest-ever natural resources disaster.”

 Its A Gas --

Bolivian law requires an annual certification of its proved natural gas and oil reserves for the previous year ending December 31st, by an independent certification firm.   Proved reserves of natural gas are "estimated on the basis of geological and engineering data that make it possible to determine with reasonable certainty if the oil and gas found in known fields could be recovered in current economic and operating conditions", to use the widely accepted SEC definition.    In order to perform the certification,  certifiying company would send personnel to the country, go on-site to the gas fields and headquarters of everyone involved in oil and gas, and pore over seismic, production and financial data and present a certification report.

But Who's Counting?
 Carlos Villegas - President of YPFB, very recently Morales' Hyrocarbons Minister, a main architect of Evo's nationalization strategy, finally admitted that the gas reserves were at 12.8 Trillion Cubic Feet, after months of dodging the question of what the results of the 2009 certification were. 

Amazingly enough during his tenure running the nationalized hydrocarbons sector there has been no certifcation of reserves.  Ironically, the same "neo-liberal" governments Villegas made a career out of vilifying complied with this certification rather scrupulously.
.   
 Bolivia previously used,  De Goyler & MacNaughton,  until 2006 when  Evo's government fired them.  Using a new methodology D & M had given a report lowering reserve estimates in some of Bolivia's major gas fields from 22,48 TCF in 2004 to 12,86 TCF for 2005 - leaving around 15TCF total.    Evo's government was angered with this report, saying it was "politically motivated" to harm Bolivia's nationalization process.   This argument is being used again, but without mentioning that Bolivia's largest gas producer Petrobras (and the multi-national that would be behind any of  D&M's dastardaly "plots") was vociferously against this report.    And alienating a State company like YFPB would not seem in character for a company whose client list includes many large State Oil Companies of countries with prickly rulers like Libya and Russia.  That also brings up the point that if the 2005 report if accurate could mean that D&M over-estimated gas reserves in the preceding 8 years to inflate corporate filings.   Then again, part of that downward estimate could have involved  the change in hydrocarbon laws and taxation regime in 2004 and 2005, that made recovering a certain percentage of that gas economically inviable and/or resulted in lower spending on exploration, maintenance, and drilling which would also affect the numbers down.   Problem with all of this is that the report and certification was not accepted by the government, and its contents are privileged information that can only be revealed by the government. 

 Whatever the real figures were for 2005, there was nothing to compare them to.  Morales' MAS administration violated existing (and current) laws requiring annual certification of reserves.  Any doubts from D&M's report, could have been resolved by simply hiring another auditing firm.   Despite a public licitation no one was hired to audit the 2005 year, and for that matter 2006, 2007 and 2008.  Finally another certification company Ryder Scott was hired to do the work

This goes to very basic transparency in resource management.   Evo's government has resolutely failed to show where reserves are at.  According to the 2010 report from Revenue Watch  Index of Transparency: Governments and the oil, gas and mining industries  Bolivia's State hydrocarbon sector ranks among the least transparent in the region.  below countries like Chile, Peru, Brazil, and Colombia whose state companies publish regular information on reserves, volumes of sales, etc.

As Revenue Watch points out the success of Chile and Peru:

According to this model, fisca lpolicy and tax collection is the finance ministry’s domain, an autonomous agency regulates and sets policy for the extractive sector, and a state-owned company is in charge of purely commercial activities. The existence of autonomous regulatory agencies overseeing exploration and production of hydrocarbons with relatively strong tax systems and publicly listed yet state-controlled companies creates multiple sources of information on these countries’ extractive sectors, which reflects strong
disclosure of information. They therefore provide examples of strong legal and regulatory structures
that, when implemented effectively, can enhance extractive sector transparency.

During the much pilloried "Neoliberal" administrations after 1997 there was actually a somewhat clear-cut division of responsibilities and independent regulation of the sector.   An independent Hydrocarbons Superintendency regulated all the players in the industry, and acted as a consumer watchdog in such areas as gas stations.  The Hydrocarbons Ministry set policy, and YFBP and its 00 employees were charged with supervising and enforcing the contracts with the private-party partners in exploration, production and refining.
These three public sector entities also provided detailed information on contracts, public licensing rounds, daily gas and oil production volumes, and annual reserves. 


Paradoxically "nationalizing" the hydrocarbons industry and centralizing its operations, has "deregulated" and de-institutionalized the entire sector.  Morales government folded the Superintendency transferring some of its functions into the Ministry of Hydrocarbons, in effect making the Ministry responsible for regulating itself.   YFPB is now theoretically in charge of the entire downstream and upstream sectors of the oil industry, with no real oversight.   The MAS has also De-professionalized and politicized the running of State entities placing political hacks and industry neophytes The ideologically charged and rather confusing MAS constitution has also further muddled the entire industry.    Meanwhile there is little real public information from the authorities, including something as basic as daily gas production which is released not by the State but by a third party company.


It is this ideological backwardness, lack of transparency, and downright technical ignorance that has set the stage for this gas catastrophe.  These conditions have created an environment where the companies with the know-how and money have stopped investing in the sector, which is why reserves are where they are at

How FDR Banning Sales of Airplanes To Bolivia Led To Landmark Supreme Court Decision And To Bolivian mythology

At issue

On April 1934 a joint resolution of Congress was passed giving President Roosevelt the power to forbid the sales of arms to Boliva or Paraguay in the Chaco War.

Resolved by the Senate and House of Representatives of the United States of America in Congress assembled, That if the President finds that the prohibition of the sale of arms and munitions of war in the United States to those countries now engaged in armed conflict in the Chaco may contribute to the reestablishment of peace between those countries, and if after consultation with the governments of other American Republics and with their cooperation, as well as that of such other governments as he may deem necessary, he makes proclamation to that effect, it shall be unlawful to sell, except under such limitations and exceptions as the President prescribes, any arms or munitions of war in any place in the United States to the countries now engaged in that armed conflict, or to any person, company, or association acting in the interest of either country, until otherwise ordered by the President or by Congress.

Sec. 2. Whoever sells any arms or munitions of war in violation of section 1 shall, on conviction, be punished by a fine not exceeding $10,000 or by imprisonment not exceeding two years, or both. 

President Roosevelt then issued an executive order

Now, therefore, I, Franklin D. Roosevelt, President of the United States of America, acting under and by virtue of the authority conferred in me by the said joint resolution of Congress, do hereby declare and proclaim that I have found that the prohibition of the sale of arms and munitions of war in the United States to those countries now engaged in armed conflict in the Chaco may contribute to the reestablishment of peace between those countries, and that I have consulted with the governments of other American Republics and have been assured of the cooperation of such governments as I have deemed necessary as contemplated by the said joint resolution, and I do hereby admonish all citizens of the [p313] United States and every person to abstain from every violation of the provisions of the joint resolution above set forth, hereby made applicable to Bolivia and Paraguay, and I do hereby warn them that all violations of such provisions will be rigorously prosecuted.

And I do hereby enjoin upon all officers of the United States charged with the execution of the laws thereof the utmost diligence in preventing violations of the said joint resolution and this my proclamation issued thereunder, and in bringing to trial and punishment any offenders against the same.

And I do hereby delegate to the Secretary of State the power of prescribing exceptions and limitations to the application of the said joint resolution of May 28, 1934, as made effective by this my proclamation issued thereunder.

Curtis Wright Corporation, sold machine guns and airplanes to Bolivia, and was charged with a violation of the act.   It defended itself in Court arguing that Congress' resolution and President Roosevelts order were unconstitutional granting of power to the Executive and an overextension of power in commerce.

After the lower Court ruled against the government, the issue was brought before the U.S. Supreme Court.  In the landmark case, U.S. v. Curtis Wright  the Supreme Court ruled in its full decision that the President had supremacy in national security and foreign affairs  This case is required reading in Civil Procedure and Constitutional Law classes in U.S. Law Schools.    This doctrine of executive supremacy has also led to furious debates the past 80 years, and been used as a justification by FDR in WWII, LBJ in Vietnam, Bush's 1 and 2 in Iraq, etc.
 
  As this summary states

The Court, in an opinion written by Justice George Sutherland, ruled that the joint resolution was constitutional and that the charges against Curtiss-Wright would stand. The Court held that the Constitution's text constrains only the domestic activities of the federal government, but does not constrain the activities of the government abroad. The Court argued further that, like any other country, the United States has "external sovereignty" by which it may liberally assert or defend itself on the world stage as a free and independent nation. As Sutherland put it, "as a member of the family of nations, the right and power of the United States [in foreign affairs] are equal to the right and power of the other members of the international family. Otherwise, the United States is not completely sovereign." The federal government thus has unlimited power to conduct foreign affairs on the nation's behalf.

The Court also ruled that this unlimited power lies exclusively with the president. Quoting former Chief Justice John Marshall (in his role as a member of the House of Representatives, before his appointment to the Court), the Court maintained that "The President is the sole organ of the nation in its external relations, and its sole representative with foreign nations." The president's exclusive power to negotiate treaties and conduct warfare proves that the Constitution's drafters intended the document to give the executive significant powers to conduct foreign affairs. In sum, even though the Constitution is silent as to the president's power to impose embargos, such a power is implied within the executive's constitutional authority to manage foreign affairs. The government's charges against the Curtiss-Wright company would stand.  

Bolivia Wrights and Standard

Going back to Bolivia, the Chaco War,and in particular back to the original Resolution and Executive order, it has also had long term effects.


While Curtis-Wright fought F.D.R.'s executive order in order to continue its war-profiteering, other American companies were not so eager to challenge an assertive Roosevelt Administration. Standard Oil Company found itself in a situation where selling aviation fuel to Bolivia's Air Force (as in to fill-up said Curtis-Wright warplanes), could be construed as violatiing the arms and ammunition embargo. Rather than face potential administration sanction (money and potential jail time), the New Jersey company refused to sell aviation fuel to Bolivia's Military.


This failure to sell fuel has been used to justify the Bolivian governments decision to nationalize all Standard Oil  holdings after the War.  Diplomatic cables from that time show the many excuses the Bolivian government used to justify this decision.   And from the tone of the communications, it also appears that it was not a priority of the Roosevelt administration from Secretary of State Cordell Hull down to punish Bolivia for expropriating the assets of the company.  

However none of this has done anything to dissuade Bolivians from the national myth that Standard Oil was sabotaging Bolivia's war efforts and that Bolivia rightfully expropriated this companies holdings facing huge opposition from U.S. Imperialism..  For all its many misdeeds worldwide - as befitting a Rockefeller monopoly-  there is little real evidence of Standard Oil misbehaving in Bolivia in the latter part of the Chaco War years..  It must be remembered that any spoils in the Chaco were: merely "potential." in the 1920's and 30's.  Standard Oil in the 1930's was focused on an intense fight for the very lucrative Argentine oil fields and market.  

In the end, feuding over some Bolivian airplanes contributed to expanded Presidential powers in the United States and fueled (no pun intended) Bolivian resource nationalism.   

Mono Jojoy Meets His Maker

Top FARC military commander and member of the directorate whose nom de guerre was Mono Jojoy a/k/a Jorge Brice~o, was killed in Colombia by the military after a concerted effort of several years to contain and isolate his command.

He literally grew up with the FARC. He was raised among the backwoods Stalinist bands that split from the Liberal Party rural guerillas of the Violencia period. Jacobo Arenas, the FARC's top ideologue and strategist, knew him from childhood, and became a life-long mentor and booster. Besides Communist indoctrination, a teenaged Mono Jojoy received plenty of on-the-job training as a guerilla fighter. By the 80's he had risen through the ranks to commmand large formations. Eventually he led the powerful East Front (Bloque Oriental) for years, Mono Jojoy was known as a top battlefield commander who in the 90's delivered strong blows to Colombia's military.

 

 

During the Zona De Despeje/Cease Fire period, he was all over the press and television, roaming around in a 4x4 with a posse that included many female guerillas.

In a country that has produced legendary (and telegenic) sociopaths like Pablo Escobar and Carlos Castano, Jojoy is right up there. He was a ruthless killer who ordered terror killings and kidnappings of thousands of Colombians. He was up to his neck in the drug racket the FARC ran, as well as their policy of keeping military and civilian hostages. Basically, he bears a lot of blame in the FARC's crimes of the past 30 years that have extended the conflict and ungovernability in Colombia

His death is a blow to the FARC. Directorate members - once considered invulnerable- have died like flies since 2007. Jojoy's reputation of a top commander leading the strongest guerilla columns will be extremely demoralizing to rank and file guerillas as well as middle and top leaders.

The noose also tightens on Cano, and the other directorate members. They have nothing to bargain with.

Daniel Ortega Places Himself All Over the Sandinista Revolution

via Two Weeks Notice: A Latin American Politics Blog
: Quote of the day: Nicaragua this story from the LA TIMES

At museum, Nicaragua president's favorite masterpiece is himself

Go to the Museum of the Sandinista Victory, and Nicaraguan President Daniel Ortega is everywhere. There he is on the northern front of the revolutionary war — and the southern front, and the western front.

Ortega has Forrest Gumped himself onto all the major battle lines of the struggle that dethroned dictator Anastasio Somoza in 1979, carried the Sandinista movement to power and radically changed Nicaraguan history.

As for all the other comandantes and major figures who shared in those events with similar or even more important roles?

"We have been erased," said Sergio Ramirez, the renowned writer and a member of the Sandinista government who served as vice president during Ortega's first term as president, from 1985 to 1990.

Ortega lost in 1990 — the first post-revolution democratic election — and lost three more times before finally returning to power by winning the presidential election in 2006.

The museum, a government-run project about a year old, is an open-air display that purports to illustrate the historic fight of the Nicaraguan people to rid their nation of decades of "gringo invasions" and other onerous shackles (as the young tour guide put it).

It is also but one example more of what many here see as the cult of personality surrounding Ortega.

In the age-old tradition of dictators including Kim Jong Il and Saddam Hussein (not to mention Somoza, whom Ortega did help depose), the Nicaraguan president has built a national homage to himself. Billboards dot this sprawling, haphazard capital with a larger-than-life picture of him alongside national heroes Ruben Dario and Augusto Sandino. Nicaraguans speak less of Sandinismo and more of Danielismo.

This reminds me of Stalin's image appearing in official pictures denoting October Revolution moments, where he had never been, or closer to Lenin.

Fact is, Daniel was the Sandinista's main polical tactician, his brother Humberto one of the main military tactician.

But, he was hardly a top battlefield commander during the main phases of the war which were the insurrection in 78 and the final offensive in 79, in any of the main fronts - Frente Norte, Frente Sur or Frente Interno.

And as a matter of policy after the triumph of the revolution the 9 commanders of the Sandinista National Directorate including Humberto and Daniel were co-equal in directing the affairs of the party, the army and the state. That was the result of a power sharing agreement, brokered by Fidel Castro, where the 3 main factions or "tendencias" within the FSLN would be represented at the top and theoretically co-govern equally. Even as president later in the mid-80's Daniel was still in theory accountable to the other 9 commanders.

Having spent years watching and seeing Sandinista propaganda on a daily basis, I can say that their message always focused on the party directorate and less on indviduals.

One of the main slogans of the FSLN, chanted by its cadres at rally's and propaganda was:
"Direcion Nacional Ordene!"

The only individuals they propped up in propaganda were dead - "martyrs".

The bottom line is that there was in the FSLN a tendency to not elevate individual commanders or politicians. Some of that due to them wanting to keep the peace internally, after the sectarian conflicts in the FSLN in the 70's. The other political one, was to avoid creation of a cult of personality that would bring back terrible memories by the Nicaraguan people. After all they had just risen up against Somoza 3.0 who ruled Nicaragua like the family farm for decades, continuing the dynasty started by 1.0 in the 30's.

Daniel Ortega placing himself everywhere in official memory is on the one hand misleading if not untrue. He was not in the main battle fronts when the fighting was going on -annoying former comrades who were there. Also annoying some other former Sandinistas because it is against their policy of subordinating individual personalities, and a dislike of personalism inherited from Somocismo.