US denies it’s targeting Venezuela candidate

The Chavista government is insane!

US denies it’s targeting Venezuela candidate

Hugo Chavez is Dead

So what can you say about this?  Tragic, yes, but his legacy casts a shadow over Venezuela and Latin America.

Chavez was very popular with common people and spent a lot of money on projects to help them. But with little transparency, lack of political checks and balances and no accountability, hundreds of billions of dollars were wasted and stolen. First that means many projects were never completed - casting doubt on official poverty-reduction figures. if a clinic or hospital is never completed you can't count those hospital beds; the same goes for tons of containers of food that rotted in warehouses. Also it created a new class of multi-millionaires and further enriching Venezuela's traditional oligarchs. Chavez' State Capitalism enriched a lot of people at the very top.

Remember in a decade of historically high oil prices Chavez presided over a country with the biggest oil reserves in the world. He came into power with a barrel of oil at $10 dollars it climbed to $150 With this unprecedented bounty poverty SHOULD HAVE been reduced. You could hand out cash to poor people. Indeed, in previous governments during oil booms social spending was about the same percentage of GDP. People forget Venezuela had Social-Democratic governments that subsidized housing, education and health, well before Chavez.  Chavez spent a lot of money and poverty did go down, but with the kind of money available and spent you would expect a stronger overall picture, which still is not true, due to waste, corruption and inefficiency. He has plowed through a trillion dollars in oil revenue and somehow left a country with the regions highest inflation, food scarcities, weak currency, indebted, infrastructure collapsing

Corruption in Chavez Venezuela - The Caracas Consensus Part 1 - Capital Flight

Some see the Chavez regime as a benign entity that shares the oil wealth of the country with the poor for the first time in Venezuelan history.  Amazing how some will excuse away authoritarian tendencies or wasteful incompetence with an argument that seems to boil down to what I would call "but..it has its heart in the right place."

Truth of the matter is that the Chavez government has become one of the most corrupt governments in Latin America in recent times.   It has also enjoyed a windfall of one trillion dollars in oil revenue, since the price of a barrel of oil has gone from 8 bucks a barrel to 100+ while Chavez is in office.   Sure, it claims it has directed 300 billion dollars to social programs, which on paper might be true, but its hard to see where all that money goes.   With  little oversight or accountability  hundreds of billions of dollars are not accounted for, and are prime candidates for corruption by government officials and friendly businessmen.

Which Brings Us To Capital Flight - And Hugo's Big Mouth.

Opposition  newspaper Tal Cual, editorial called  El Saqueo "The Plunder", by Carlos Diaz,  reported on statements President Hugo Chavez on September 11, 2012.   President Chavez stated there was more than 400 Billions of Venezuelan dollars in foreign fiscal paradises.

 President Hugo Chavez was citing statistics from the Tax Justice Network, an English NGO whose issue is concern with unrecorded, untaxed private wealth being squirreled away in offshore havens.   The latest and very publicized TJN report in 2012 was The Price Of Offshore Revisited. by James S. Henry, which used new criteria to measure the amount of untaxed private wealth that has accumulated in offshore tax havens and the largest 50 banks in the world the past 40 years.     The reports appendix had statistics on estimated "private Venezuelan funds directed to fiscal paradises during the period 1970-2010.' according to Diaz. TJN measures pre-tax private wealth that flows to tax havens including First World banks.

When Chavez was probably referring to was the sum of 400 Billion dollars which is estimated to be the dollar amount of  the value of off-the-books private capital that has fled Venezuela the past 40 years plus what this capital it has earned in returns.   Diaz correctly notes that while Chavez uses the data to "demonize" prior governments, the reports findings are especially damning to his government.

Chávez se agarró de esta cifra para demonizar el esquema institucional previo a su gobierno que mantenía un cambio libre y obligaba a Pdvsa a entregar al Banco Central de Venezuela (BCV) todos sus ingresos en moneda extranjera. Según el mandatario, estos mecanismos sólo facilitaban que los venezolanos sacaran dinero del país. Pero como suele ocurrir, a Chávez le echaron mal el cuento.

De la lectura del reporte se concluye que Venezuela no está sola en la problemática de la fuga de divisas. En términos nominales nuestro país ocupa el tercer lugar detrás de Brasil y México, y apenas por encima de Argentina; mientras que en términos reales sólo nos supera Brasil. Ahora bien, el aspecto importante a considerar es cuándo se produjeron esas fugas.

Basically, if you look at the report, most of the Capital Flight has been continuous under Chavez. Not only is Chavez off-base, he is damned by the report.   He is responsible for 55% of the total capital flight for the period 1970-2010.   Venezuela government corruption and economic mismanagement were notorious before Chavez, and the charts reflect that fact.  There was massive plunder of oil revenues in the 70's, during the 90's bank crisis' billions left the country, which is what Chavez supporters often point to (correctly).  But still during 1999-2010 period, more pre-tax dollars ended up abroad than during the "Venezuelan Saudi" period of the 70's and 80's and the "Neo-Liberal" 90's combined.

   the chart on page 23 of Appendix 3 of the report shows this well:

  In absolute numbers, Venezuela is second to Brazil in Capital Flight, the past 40 years.   For the period of Chavez rule Venezuela is #1 in absolute numbers in Unrecorded Capital Outflows.  This estimate is $153 Billion Dollars in the time period 2001 to 2010, which coincides with the single largest oil boom in history, with a trillion dollars in revenue.    And a good chunk of it can not be explained by anti-Chavez Wealthy Venezuelans pulling money out between 99 and say the PDVSA strike of 2003 - though that did happen.  But, unrecorded private capital outflows spiked after oil prices increased after 2005

What does this say about corruption? 

Venezuelas economy and revenues mostly come from extracting oil, and from the national oil company PDSVA.  This capital flight happened under a government with strict capital and currency controls, and where the government controls a substantial part of the economy. Private Sector activities in the traditional agricultural and manufacturing sector have suffered, due to government policies of expropriations, price controls and currency controls,  That also dries them up as potential sources of capital flight..  The government is flush with cash, and spends a lot of it which ends up being filtered out to a parasitic Private Sector that acts as subcontractors and bankers for the inefficient and wasteful state.  The government has also been directly involved by selling  billions of dollar denominated bonds at artificially low exchange rates, so private buyers can deposit them in foreign accounts and the government can spend more money to buy votes.

Brazil and Mexico have large and more diversified economies with actual multi-nationals.   Together with Argentina, over the past 40 years have well-documented histories of economic collapses and debt. We just need to look at the financial crisis that bookended the 90's in Brazil to find some explanations for capital flight.   Mexico went through a horrible crisis in the early 80's, the Tequila crisis in the 90's and this decade has the U.S. Great Recession and drug violence and money laundering. 
All 3 of these countries have a long history of government corruption that also explains their capital flight.  Mexico under the PRI in the 70's and 80's produced multi-millionaires (Lopez Portillo or Salinas De Gortari anyone?) 
Yet in Chavez' Venezuela is a bigger exporter of unreported dollars to private bank accounts than trillion dollar economies like Brazil or Mexico.   Private individuals in a revolutionary government, somehow end up exporting billions in capital beating out legendary oil-flush thieveocracies like the PRI of the 70's and their own homegrown ADN/Copei.  That says a lot about the rot at the core of Chavez supposed Boliviarian Revolution.

Cry for Yourself Argentina

Wacky!!

Cristina Kirchner expropriating Repsol's holding in YPF is just about the boldest and dumbest thing you can do.   Bold in the sense that she herself and her hubby were major backers of YPF being privatized in the early 90's and as of 2010 praised Repsol for its work in Argentina.

As for helping Argentina, it is just a short term desperate measure.   She claims that Repsol did not invest, and that the country had to achieve energy self-sufficiency.

The reason production and investment is down is pretty much due to the complex Kirchnerian web of regulations, price controls  and subsidies in the hydrocarbons sector.

Gasoline prices are kept under international prices, while exports of crude are tightly controlled by the State.   Natural Gas - a cornerstone of the energy and heating needs of Argentinians - is subject to price controls and heavy regulation.  This means less money for exploration in oil and gas since you can't sell at market prices domestically and even abroad.     Less production meant the Argentine State went abroad to buy things like natural gas at market rates - selling them domestically at subsidized rates at a price of billions a year. Perversely, this lower prices also meant increased demand for oil and gas.

In the end it looks like another disastrous decision to remedy a situation the Kirchners themselves are responsible for in large parts.

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.

Brazil's Bolsa Familia - The Economist Article

Brazil's Bolsa Familia has been a great success in reducing poverty in Brazil thru payments to poor families, based on whether their children stay in school. The Economist finds that it is a rousing success in rural areas, and succesful though slightly problematic in urban areas


http://www.economist.com/node/16690887?story_id=16690887

Great Ayrton Senna Tribute From Top Gear

The excellent BBC Car Program Top Gear has a great tribute to Ayrton Senna.  What makes it stand out is how it focuses on Senna's technical abilities and talents as a driver, which sometimes gets overlooked in the mythology.   The Brazilian is presented warts and all. 




PART 2

Evo's Witch Doctor Gets Busted!!!

The so-called Aymara "Priest" who presided over Evo Morales' Presidential Inauguration  in Bolivia was found red handed with many kilos of some sort of cocaine derivative at his house.  Allegedly he was wearing his ceremonial robes.  The sorcerer apparently was casting an ancient Chapare spell of purification over about 500 pounds of cocaine base, when the police rudely interrupted the Amauta..

Valentín Mejillones, 55 años, fue quien entregó el bastón de mando a Morales cuando éste juró a su segundo mandado en enero en un rito andino celebrado en el mayor templo arqueológico del país.
Ostenta el título de amauta que en la religiosidad andina es el máximo líder espiritual. El martes en la noche, la policía allanó su domicilio en una barriada de la ciudad de El Alto, vecina a La Paz y lo sorprendió elaborando cocaína.
Llevaba su poncho ceremonial el momento de la detención. Fue detenido junto a su hijo y a una pareja de colombianos que no fueron identificados por la policía, según el informe del director de la fuerza antidroga, coronel Félix Molina.

Read more: http://www.elnuevoherald.com/2010/07/29/774163/capturan-con-cocaina-a-sacerdote.html#ixzz0vBX1LXeu

New York Times - Economies in Latin America Race Ahead

The New York Times, article discusses strong economic growth in several Latin American countries, despite the global recession. 

Strong demand in Asia for commodities like iron ore, tin and gold, combined with policies in several Latin American economies that help control deficits and keep inflation low, are encouraging investment and fueling much of the growth. The World Bank forecasts that the region’s economy will grow 4.5 percent this year.
Recent growth spurts around Latin America have surpassed the expectations of many governments themselves. Brazil, the region’s rising power, is leading the regional recovery from the downturn of 2009, growing 9 percent in the first quarter from the same period last year. Brazil’s central bank said Wednesday that growth for 2010 could reach 7.3 percent, the nation’s fastest expansion in 24 years.
After a sharp contraction last year, Mexico’s economy grew 4.3 percent in the first quarter and may reach 5 percent this year, the Mexican government has said, possibly outpacing the economy in the United States.
Smaller countries are also growing fast. Here in Peru, where memories are still raw of an economy in tatters from hyperinflation and a brutal, two-decade war against Maoist rebels that left almost 70,000 people dead, gross domestic product surged 9.3 percent in April from the same month of last year. 

And, then there is the obvious failure -

In Venezuela, electricity shortages and fears of expropriations caused gross domestic product to shrink 5.8 percent in the first quarter. But Venezuela, and to a lesser extent Ecuador, another oil-dependent country that lags behind its neighbors in growth, seem to be exceptions to a broader trend.

Bolivia- Indigenous Challenges to Evo Morales

Miguel Centellas at Pronto has a post Bolivia: the indigenous/environmentalist challenge to Evo’s government

 Centellas is referring to the new controversies in Bolivia that have arosen from both indigenous and environmental groups using the language in the new constitution to challenge certain development projects (mostly hydrocarbons) that the Morales government wants.    

 

The bottom line is that the government is losing its grip on the indigenous movement. Attacking its leaders as agents of USAID (or US imperialism more broadly) and/or acting in line w/ the “extreme right” seems odd. During the 2005 campaign—and for several months later—Evo & MAS clearly raised the banner of indigenous political autonomy. By doing so, it raised expectations that indigenous groups have patiently waited for & now expect fulfilled. Similarly, the People’s Conference on Climate Change raised the banner of a pro-environmental policy agenda. Indigenous peoples & environmental activists took this as a green light to begin pressing their demands to protect Bolivia’s fragile ecosystems (which happen to be in oil-rich areas).
These last weeks may have irrevocably changed perceptions of Evo’s government. The country has a long experience w/ populist figures who use symbolic rhetoric, but never really “mean it” beyond as a way to strengthen their grip on power.

Of Tickets And US Soccer Fans At The World Cup

People have commented that the US is the single largest source of ticket buyers for the World Cup.

You don’t see many foreign fans here in Johannesburg, but the largest single group of them are Americans. People in the US bought more tickets for this World Cup than any other visiting country. “In the public sale, it’s more than the next two countries combined,” notes a proud Sunil Gulati, president of the US Soccer Federation.

The figure is more or less 164,000 tickets.

This article, and other commentary on the web sees this as evidence that U.S. soccer is gaining popularity. The New Republic blog even  proclaims that the Soccer Wars are over  And I do not dispute that as the numbers from the U.S. England match on ABC/Univision show - a total viewing audience of 17 million, several times bigger than the Indy 500 to use an example..

Now what I am curious about is finding out how many of those 164,000 tickets were from from U.S residents of .Mexican,  Argentinian, Chilean, Brazilian,  Honduran, South Korean, Nigerian, et. al. birth or origin, who travelled to South Africa to cheer on a specific national team.   Or for that matter European expats.  Univision seems to have no problem finding them in the crowds at many matches. 

The FT blogger himself talks about the constituency that soccer has in the United States

Since then, the US has globalised fast. Significantly, it’s the two most globalised groups of Americans who follow soccer most keenly. The first group consists of immigrants: about 45m Hispanics now live in the US, mostly from soccer-mad Mexico. The second group is the educated elite. David Downs, executive director of the US bid committee to host the World Cup in 2018 or (more likely) 2022, says of America’s soccer hotbeds: “It’s not necessarily the dusty farms of the heartland, as it is the suburbs of Washington DC or San Francisco.”

And no doubt many of those ticket-buyers from the U.S. fall into either categories (or even both).  But it is many immigrants in the U.S. who have the means to spend the high dollar amounts needed to get to South Africa and watch Argentina, Mexico,. or Nigeria play.    They might go root for the U.S. with their children - again something you see in Univision.

In the end the U.S. ticket buyers and U.S. viewing public on TV is important to the World Cup whoever they are rooting for. It is the sheer numbers of people watching, in what the New Republic correctly notes is a fragmented media market of different "niches".  And that weight already shows worldwide.

All these folks will be watching the World Cup. American TV companies shelled out $425m for the rights to the 2010 and 2014 tournaments, then the biggest such deal done in any country. The US was only the 13th biggest TV market for the tournament in 2002, in absolute numbers of viewers. By 2006, it had jumped to eighth, notes Kevin Alavy of futures sport + entertainment, the agency that monitors these things. This year the US should rank higher still.

Afghanistan Might Have Massive Lithium Reserves - Potential Mineral Riches

While Bolivia is known to have a significant part of the lithium reserves in the world, this might change drastically.  The Afghan government recently announced that American geologists found "huge lithium deposits amounts" in Afghanistan's Ghazni province.  These new discoveries are part of a survey that has found large deposits of key exportable minerals including zinc, gold, and copper in the country.  Large parts of it are in conflicted areas.     Apparently decades of conflict prevented this kind of wide-ranging survey, though many Afghan geologists have known of mineral riches and kept it quiet due to the political situation.

The New York Times reported the $1 trillion figure in Monday's edition and quoted senior American officials as saying untapped mineral deposits in Afghanistan are far beyond any previously known reserves and were enough to fundamentally alter the Afghan economy and perhaps the Afghan war itself.
Americans discovered nearly $1 trillion in untapped mineral deposits in Afghanistan, including iron, copper, cobalt, gold and critical industrial metals like lithium, according to the report. The Times quoted a Pentagon memo as saying Afghanistan could become the "Saudi Arabia of lithium," a key raw material in the manufacture of batteries for laptops and cell phones.

 Then there is this quote from the New York Times article specifically talking about the Lithium

Just this month, American geologists working with the Pentagon team have been conducting ground surveys on dry salt lakes in western Afghanistan where they believe there are large deposits of lithium. Pentagon officials said that their initial analysis at one location in Ghazni Province showed the potential for lithium deposits as large of those of Bolivia, which now has the world’s largest known lithium reserves.

The Lithium part should wake up not only Bolivia, but also Chile and Argentina, because a sizeable deposit of Lithium in Afghanistan, could mean rapid exploitation and export of an alternative to South American lithium.   The weight of the U.S. and the Afghan desire for revenue and development, can mean that even in a conflicted area, resources could be brought to bear in developing the industry.  

EDIT -

Bolivia's government has said its plans for lithium development are "not affected" by news of the Afghan lithium.   The Presidency's official spokesman said, "Afghanistan is a country practically at war" - actually an understatement.   With atypical restraint the official continued that he was not sure how easy it would be to "resolve" the conflict issue in Afghanistan, implying it is not a problem for Bolivia.  

EH VUVUZELA! Vuvuzela Might Get Banned!!!

The loud,  sometimes obnoxious sometimes awesome Vuvuzela's might get banned from matches.. 

Could vuvuzelas fall silent? Ban possible

By Liz Clarke
Acknowledging a rising tide of complaints about the deafening din of vuvuzelas during World Cup matches, Danny Jordaan, chief executive of the tournament's local organizing committee, warned Sunday that the plastic horns could be banned if fans don't show more respect in their bugling.
In an interview with the BBC, Jordaan reiterated calls for fans not to blow vuvuzelas during the playing of a country's national anthem or during announcements over the soccer venues' public-address system. Asked if the horns could be banned, Jordaan said: "If there are grounds to do so, yes."
A ban on vuvuzelas was considered in the months leading up to the 2010 World Cup, but officials chose to allow them, with FIFA President Sepp Blatter arguing against efforts "to Europeanize" the first World Cup contested on African soil.

REST HERE

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