President
Chávez is razing to the ground anything that seems to him to have the slightest
whiff of capitalism, free market or private enterprise. This Thursday, the
President’s nationalization maelstrom threatened Siderúrgica del Orinoco
(SIDOR) and the private banks if they fail to act in accordance with the
socialism (read communism) that, to satisfy a whim of the President, prevails
in Venezuela.
It could be that some still think that, in the 21st century, it will not be
possible for the government to make good these threats, particularly in the
case of the banks. But it is worth remembering that, unfortunately, the vast
majority of Chávez’ threats of yesterday are today faits accomplis.
A few years ago, for example, he said he was going after rural land. Today,
more than 1,500,000 hectares that formerly belonged to private farms and
ranches and were under full production have been confiscated or expropriated.
Now this land is in the hands of the government, most of it abandoned and not
producing anything. Back then, many continued to believe that nothing was
happening.
Then he went after private companies, such as Constructora Venezolana de
Válvulas and Venepal, both of which generated employment and investment. Today,
the co-managed Inveval and Invepal are being eaten away by politicization and
inexperience. At that time, most Venezuelans couldn’t have cared less about
these confiscations.
After that he went after PDVSA’s service contractors, who were forced to become
mixed enterprises with the State as the majority shareholder. And as though
that were not enough, the government mounted an attack on the crude upgraders
in the Orinoco Oil Belt, so scaring off foreign investment and condemning PDVSA
to becoming even more mired in inefficiency and corruption. Many Venezuelans
believe that this will not affect them.
The telephone company CANTV and the electricity company La Electricidad de
Caracas also fell into the clutches of the government. Once again, very few
were concerned over this turn of events and many, believing in the government’s
promise, expect to pay less for these services.
Chávez is also threatening to pass private clinics and schools and the food
marketing chain over to public ownership, and the sword of expropriation is
even hanging over a large number of housing units and plots of land in urban
areas, not to mention the media, which are faced with the choice of either
toeing the government’s line in matters of communication or run the risk of
having their concession confiscated, as is happening to RCTV.
The cherry on the cake of this disaster that is Venezuela today is the threat to
pass the private banks over to state ownership. When this happens, the fate of
the entire banking system will be the same as that of the state-owned banks,
such as Banco Industrial, Banco del Pueblo, Banco de la Mujer or Bandes, in
other words, inefficiency, unaccountability and lack of transparency.
The consequence of a barbarity of this magnitude is that the government will
take control of the savings of all Venezuelans to finance “social” projects of
any kind, on the one hand, and on the other, the banks will fast run out of
capital and the source of financing for productive investment will collapse.
But, what does that matter? After all, as far as the President is concerned,
obtaining a profit, which in turn makes the economic growth of the country
possible, is simply one of the sins of capitalism.
11:17:41 AM 
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