The Devil's Excrement





  The Devil's Excrement
Observations focused on the problems of an underdeveloped country, Venezuela, with some serendipity about the world (orchids, techs, science, investments, politics) at large. A famous Venezuelan, Juan Pablo Perez Alfonzo, referred to oil as the devil's excrement. For countries, easy wealth appears indeed to be the sure path to failure. Venezuela might be a clear example of that.
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4/2/2007; 9:21:28 PM

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Sunday, July 24, 2005



While I was away Jorge posted the translation I left of Arturo Uslar Pietri’s 1936 article “To sow the oil”, 25 years later Uslar himself revisited his original article in an article entitled “To sow the oil 1961 (Validity of a watch word)”, which I translated below and which seems to be as valid today as then:

To sow the oil 1961 (Validity of a slogan) by Arturo Uslar Pietri

In the first semester of 1936 I was collaborating with the daily newspaper “Ahora” and I would frequently write its Editorials. It was a full time for opinion journalism and publications would make an effort to direct and enlighten the criteria of the readers. It was a feverish time for analysis, a time for examining our conscience, of looking for a direction for a country that had just left the longest dictatorship of its history and which, full of hope and doubts, of impatience and fears, of ignorance and faith, wanted to heal itself of its ills and establish a democracy where there would be an abundance of goods.

We began to discover the true physiognomy of the country. A physiognomy which was not the beautiful and conventional one that had been the legacy of the old literary geographers, of a land full of abundance, copious and generous, full of accessible richness which, like a sleeping beauty, had been separated from its true destiny by the spell of the Governments of strength, but that would wake up more splendorous than ever with the exorcism of freedom. The physiognomy that was beginning to reveal itself, as a result of the first serious investigations, was that of a poor country, backwards and full of obstacles for progress. The so called “necessity census” became fashionable, which were unending catalogs of all of those things that we had lacked: hospitals, school, aqueducts, roads, sewers, parks, silos. Without forgetting the bust of Bolivar for the square and the renovation of the ruinous temple of each town. The country was beginning to realize that it lacked almost everything, that what it had was insufficient or inadequate and that the resources which it had were out of proportion with the magnitude of the requirements and the sciences.

The only talk was about problems. The word problem became fashionable. There were education problems, there was a health problem, there was a transportation problem, that of agriculture, of the currency, of the organization of labor, of municipal autonomy, of the federal system.

We were three million Venezuelans, in large majority badly fed, badly dressed, badly housed, a large fraction of which had its capacity for a useful life diminished by ignorance, by malaria, by parasites, by isolation. Confronting these needs we counted on resources which were disproportionably limited. It was estimated that it was thousands of million what was needed to invest in order to radically modify that unfavorable state of things and the more the census of needs grew, the more pitiful, by contrast, that the credit account appeared. A million sacks of coffee and some ten thousand tons of cocoa per year were the traditional products for export. We also had oil and its production had reached the volume, which appeared then to be large, of 154 thousand barrels of oil a day. We had imports that amounted to 211 million bolivars and an effective national budget of roughly some 180 million bolivars.

Facing that small budget the estimates of what was needed for schools, hospitals and roads that the country needed, grew like the silhouettes of giants. It was a David-like enterprise to try to win over with those weapons that Goliath of problems that rose threatenly in the path to our progress.

There appeared then the “arbitristas”. People with more imagination than science, enthused like the Quixote by some simple idea which, according to them, needed to be applied to magically achieve the transformation of the country. There were thoughts of loans, of monetary manipulations, of obscure financial formulas and even of a semi secret plan by which we could end up making use of unlimited amounts of money.

There was not yet any school of economic sciences and there were very few Venezuelans that had devoted themselves with some seriousness to the study of economics.

Facing that confusing anguished panorama I wrote an editorial that was published on July 14th. 1936 in the daily “Ahora” (Year I, # 183)

In it, in an effort to see it in the most objective and simple manner I pointed out some fundamental facts. That the traditional agricultural and cattle production of our soils had not only not increased, but was showing a trend towards diminishing and that a large part of the resources that we could make use of, originated from destructive and non reproductive ideas. The destructive activity of mining and oil, the destructive activity of beefwood or other wood exploitation.

From this simple fact, one derives a very simple consequence. We had to develop in Venezuela a simple economy. We had to develop in Venezuela a productive and renewable economy that could grow and advance with the country, instead of shrinking and in that way develop the transient wealth of mining activities: “It is necessary to get out the most income from the mines to totally invest it in aid, facilities and stimulus to agriculture, breeding and national industries.” That is, take to the maximum mining income and devote the totality of its provenance to the creation of our own economy in a “true act of national construction”.

To put it in more simple language and make it dramatically attractive it occurred to me to synthesize that in one single phrase that could be converted into a watchword for a national crusade, in the slogan and creed of the Venezuelan action. It was then that I proposed “as watchword for our economic policy: to sow the oil”. That same phrase became the title of the editorial.

It was launched as a warning shout and as a call to reason. I thought that if people could penetrate the sense of that simple and almost paradoxical phrase, it could turn itself into the starting point of a great transformation of the country. “What do we need to do? Everyone seemed to ask. The simple and concrete answer that it occurred to me was “To sow the oil”. It had the obscurity and peptic contradiction of a sibilic oracle. The Sibila of the Venezuelan destiny could tell all of us one day the same thing “Sow the oil”. In the most literal of senses it could appear to be a magic ritual” take the dark and foul smelling substance that sprouts from the drilling towers and that flows heavily and viscously through the oil pipelines, to turn it into furrows and convert them into harvest. In this way the black and inert oil could be turned into millions of irrigated and sowed hectares, into fat herds, into chimneys of factories, into rotation of axles of transmission into the happy crackle of motors.

It seemed like a magical formula, but it was the most precise synthesis of a realistic economic policy. We were not going to sow the black oil in the furrows of the farmland, like witches in a Walpurgis Night, but we were going to turn oil into money and invest the money in a healthy and growing economy.

I wrote that phrase and stayed, with quiet emotion, waiting for the launching of the call. I thought it would have the virtue of waking and shaking everyone up. Among the uproar of the voices that raise themselves with contradictory offers and claims, it did not seem but one more voice lost in the clamoring without truce. There were some spoken comments and very few written ones.

Everything could have remained there, without other consequences, but words also have their destiny. They don’t die with the sound that enunciates them, but acquire their own life and begin their adventure and their action. There are no truly useless words nor can anyone be sure that what one has said will die.

The phrase “To sow the oil” was born and as much of a meaning it had a destiny. From the page of the newspaper it had already jumped to minds and opinions. It began to be repeated. It later appeared in papers. It broke out in the oratory of popular meetings. When, in 1938, the Free School of Economic and social sciences was founded, it had turned itself almost into a proverb. When, in 1946, the Venezuelan Development Corporation was founded, it was adopted as its slogan.

It had already entirely escaped me by then. Many of the people who repeated and invoked it, had no idea of who may have created it. I, on the other hand, felt that in this way, the notion that it had turned itself into an anonymous and collective expression, allowed it to fulfill better its own destiny. It had been forged to awaken the collective conscience and insofar as it was becoming a popular phrase, it was on its safest way of reaching its goal.

There were those that attributed it to someone else. Few wanted to recognize it as mine. Venezuela, which has demonstrated, in general, to be generous in recognizing its intellectuals, has been, sometimes, somewhat parsimonious and reticent with me. I don’t want to elucidate the causes now, juts point it out. Either they did not recognize me as the author of the phrase or they tried to find a different one that was not me. Its paternity has been attributed most frequently to Alberto Adriani. It was an intelligent attribution. Adriani, dead in the prime of his capacity to serve, was a man of clear mind and practical sense that had the passion to get Venezuela moving in a heroic fight against backwardness. The idea that the phrase expressed coincided in many points with his way of understanding the paths to the economic development of Venezuela. However, the phrase was not his, nor does it appear in any of his writings or statements, nor any person has attributed it to him that heard him say it, and if, for the good of the country, his fertile life had been extended, he would have been the first one to deny the attribution.

This is all for the anecdote. An anecdote that, the truth be said does not lack interest and significance. The fact that matters to point out for me, for now, is that the slogan “To sow the oil” is having its first quarter of a century birthday.

We could ask now if it has been useful and if it still preserves its validity for today’s Venezuela.

The current country is much different from that one that saw the appearance of the editorial in the “Ahora” daily on June 1st. 1936. The population has doubled since then, Malaria has disappeared, the rate of illiteracy has been reduced, a large number of roads, buildings and public services have been built, infant mortality has decreased, the average life of a Venezuelan has increased, there has been industrial development, the budget has grown 35 times and what the state used to spend in one year, is now spent in ten days.

All of this means that the economic capability of the country has grown and this has been possible, fundamentally, by virtue of the development of oil activity. The 154,000 daily barrels of production of 1936 have reached, in a continuous ascent, the three million barrels a day, approximately, that we have reached at present. From this source, and not from any other, has originated the move up of all the other indices in our economy.

However, the basic terms of the problem have not changed substantially since 1936. If oil activity represented then one third of national income, today, directly or indirectly, it represents more. It ahs grown, instead of diminishing our oil dependency, and the proportion of destructive activity in our economic complex has not diminished.

If the advise ‘To sow the oil”, launched in 1936, had been efficiently converted in a true national policy, we would have today a Venezuela which would be much richer and much more independent of oil. If we had invested directly in economic development, loans for production, equipment and supplies, technical education and colonization, the dozens of thousands of millions of bolivars that oil income have produced in these twenty five years, we would be today one of the most prosperous, rich and independent countries of the world.

However, it was not done that way, or only a small part was it done. From 1936 to 1939, the increase in oil income was scant. In 1939, the Second World War created obstacles and deviations for the economic development of Venezuela. Nevertheless, the time of waiting and tension was taken advantage of to make a profound review of oil policy which culminated with the reform of 1943, In this way, Venezuela insured for itself, after the war, the largest oil income it had ever known in its history and one of the largest that any country has ever derived from a single activity.

Thus the bases were laid to undertake, in a scale that would have seemed a fable to the Venezuela of 1936, a gigantic program of sowing the oil. At the end of the war the National Budget did not even reach five hundred million bolivars. If we had then planned the investment of the increase in income that was going to take place because of the oil reform, it would have been possible, almost without increasing bureaucracy or political expenses, to achieve a complete transformation of the national economy.

To this end we counted on instruments which were ready and prepared for it, such as the tax reform of 1942 that allowed a more just redistribution of the national income via taxes and the agrarian reform that allowed, in a reasonable time, the end of the large estates and the backwardness of the rural areas.

The political events of 1945 blocked this possibility and opened a long period of political instability and administrative discontinuity.

Between 1946 and 1960 a large part of the oil income was destined to non reproductive ends, for ornate public works, sumptuous or unjustified investments and to the excessive growth of the bureaucracy.

Certainly, the oil wealth was made use of to a certain extent, but in a random way, incomplete and unplanned The avalanche of money that has gone through this country brought many transformations and not few advances, but it did not become the instrument for a coordinated and solid transformation of our economic and social conditions.

It would have been necessary to have a clear and well defined concept of what oil should be in national life. Neither an isolated economic prodigy, nor ordinary income, neither a field of independent activity propitious to rehearse theories and techniques.

That is, to waste the wealth in investments that are not development, nor consider it as an industry isolated from the national complex.

A coherent conception of oil within the framework of Venezuelan life was needed. To consider oil not as a specific and isolated activity to which one can apply systems appropriate for exploration and conservation which are ideally perfect, but more like and instrument for development.

Providence has given Venezuela an immense wealth underground. Venezuela is an undeveloped country. Logic would indicate that what we have to do is to make use of the wealth underground to develop Venezuela in all aspects.

This conception of oil as a fundamental and irreplaceable instrument for the development of the country may not coincide exactly with the requirements of an oil policy, which considers oil on its won, out of the framework of the Venezuelan needs and proposes only to find the way to exploit it more rationally and conserve it for a longer period of time.

To exploit rationally and make use to the maximum of oil reservoirs is certainly something which can not be ignored, but postponing and delaying the development of Venezuela in the name of the convenience of conserving oil for future generations lacks a historical justification.

Future generations are not going to ask if we left them a lot or little oil underground, but they are going to launch at us a much more grave and peremptory question which is no more than this one: Did we make intelligent and opportune use of oil to build a country?. The tragic implication of that question is not going to be eluded by our absent shadows or our fuzzy memories alleging that we tried to make a prudent and rational exploitation.

If England had not taken advantage when it had the opportunity of its coal richness to turn rapidly into the first and largest industrial power of the XIX century, it would be a weak consolation for the British of today to contemplate the very large mountains of coal, which could have been conserved at the price of no taking their country to the level of development that it reached.

Oil is before anything the most powerful instruments for development that Venezuela has. It should be used and conceived that way. National and world circumstances have created this possibility. It is our duty to use it and not expose us to, what may be a conceptual error, the conditions evolve and turn against our interests and we come to realize it when it is too late and the opportunity has passed us without forgiveness.

Today much like yesterday, the investment of the majority of the oil income in economic development continues to be Venezuela’s most important need. At the recent Conference, the American Secretary of the Treasury, Dillon, announced the possible investment over the next ten years of a sum of approximately twenty billion dollars for the progress of Latin America. This promise was received with approval by a whole continent of twenty countries with almost two hundred million inhabitants, because they see in it the possibility of a definitive push in the transformation of the economic and social conditions of this vast part of the planet.

It calls us to reflection that, during that same decade, Venezuela, from its own fiscal resources, will obtain an amount that is not inferior to that one. In effect, the current level of our budget, at the exchange rate that the Central Bank receives the currency, can be estimated at a magnitude close to two billion dollars per year. With such fiscal income, the Venezuelan state should be in the capacity of promoting the most extraordinary development program that any American country has ever known.

Unfortunately, throughout the years the inadequate orientation of public spending, has affected an enormous part of those resources in taking care of management costs that only indirectly stimulate national economic progress.

The truth is that today as much as yesterday and even with more urgency than yesterday the statement of the objectives of Venezuelan economic policy, is simple and obvious.

We need to stimulate the production of oil and of the mines up to the highest levels compatible with world possibilities in terms of prices and volume. We need to maintain an aggressive competitive and expansive position of the oil and mining industry established in Venezuela.

From that production, maintained at the highest level, at the highest prices possible from our position in world markets we must derive for the state the highest possible share compatible with the needed stimulus for investment and the development of extractive industries

That is, take the oil and mining industries to produce at maximum, with the maximum benefit for the country.

And then, consider the funds arising from our share in that industry as if it came from a loan without interest and term, which needs to be repaid by the increase of the industrial and agricultural production of the country. That is, the investment at the maximum level of the oil and mining income in the effective economic development of Venezuela.

This means nothing more than sowing the oil which goes to prove and I can not say that it does not please me, that today, much like twenty years ago; this continues to be the fundamental slogan for Venezuelan progress


10:17:03 PM    comment []



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