Brazil Senators Approve Venezuela Entry Into Mercosur (Update1)

[bemildred]

Dec. 15 (Bloomberg) -- Brazil’s congress approved Venezuela’s admission to Mercosur, South America’s biggest trade bloc, as the Senate turned aside arguments that President Hugo Chavez had made his country ineligible by smothering democracy.

The 81-lawmaker chamber voted 35-27 with President Luiz Inacio Lula da Silva, who had pushed to admit the biggest oil exporter in the Americas to the group that Brazil, Argentina, Paraguay and Uruguay formed in 1991. Approval by Paraguay is the last hurdle Venezuela needs to clear for full membership.

“To have Venezuela in Mercosur is important in every aspect, not only commercially,” said the leader of the government coalition in the Senate, Romero Juca. “Isolating the country doesn’t solve the democracy problem in Latin America, on the contrary, we must promote integration in the region”.

Opposition lawmakers had argued that under Chavez, Venezuela had lost its democratic character with regards to the press, courts and legislature, disqualifying the country from membership under Mercosur’s charter. The bloc’s leaders had agreed to admit Venezuela in 2006 and took the recommendation back to their respective congresses for ratification.

http://www.bloomberg.com/apps/news?pid=20601086&sid=aKMncefxQsq4

[Peace Patriot]

1. Naturally, we get only the RIGHTWING view of these ridiculous charges against Venezuela--

--charges that have been debunked time and again by THE FACTS:

1. Venezuela has one of the most transparent, honest and aboveboard election systems in the world.

2. Venezuela's government and democracy continually receive some of the highest approval ratings by its own citizens, in the world.

3. Venezuela's broadcast media continues to be dominated by corpo-fascist ownership and far rightwing opinion. (The Chavez government denied a broadcast license renewal to ONE broadcaster which had actively participated in the violent rightwing military coup against the government in 2002, and furthermore had repeatedly violated the terms of its license--and even then it was not banned from cable, only from the public airwaves.) Shouldn't corporate broadcasters be subject to the legitimate regulation of use of the PUBLIC airwaves? (They are in every other country in the world!)

4. Goals of the Chavez government, in word and deed: maximum citizen participation in government and politics; bootstrapping of the poor majority, through education, health care and other social programs; use of the country's resources to benefit the people who live there; equal rights for women and gays, for African-Venezuelans and for the indigenous; fair and equitable taxation; strong regulation of the financial system and of large or multinational corporations; assertion of Venezuela's sovereignty visa vis the U.S., multinational corporations or anyone else who tries to interfere; regional cooperation and a "raise all boats" philosophy (in common with Brazil, Argentina and others) with regard to smaller, poor countries; national and regional independence.

These rightwing, U.S. corporate inspired and promoted charges that the Chavez government is not democratic are WRONG. The Chavez government could hardly BE more democratic!. Venezuela has never had a better government in all of its history. THAT'S WHY Venezuelans keep electing it, in transparent, honest, aboveboard and internationally certified elections!

Lula da Silva has said, of Chavez personally, "They can invent a lot of things to criticize Chavez, but not on democracy!" And that is the truth of the matter. And now that Lulu has, at long last, DEFEATED the corpo-fascist senators in Brazil who were blocking Venezuela's entry into Mercosur, Bloomberg uses the opportunity to REHASH all of the scumbag rightwing charges that were being used as FLAK to punish Venezuela for BEING more truly democratic than any other country in the western hemisphere.

In Venezuela, they print the Venezuelan Constitution on grocery bags, so everybody will read it! In Venezuela, tens of thousands of people poured out of their hovels and surrounded the seat of government, braving troops and tanks, to demand restoration of their Constitution and their elected government--and won! In Venezuela, they actually defended and restored their democracy, against the conniving support of the rightwing military coup by the U.S. government. In Venezuela, they know what democracy IS and what it is NOT. In Venezuela, the poor majority has a stronger voice in government than in any country in the world, as things should be in a democracy, and the government represses NO ONE. All of this has been achieved democratically and with maximum respect for all human and civil rights.

And THAT is Venezuela's true "crime" in the eyes of our corpo-fascist rulers and their agents in Latin America: REAL democracy.

[bemildred]

3. Well I mean it is Bloomberg. nt

[Braulio]

6. Sorry, guy, but Venezuela is an emerging dictatorship

Too many NGO's, and the UN raporteurs, are now of the opinion Venezuela has a repressive regime, which doesn't respect human rights. As for democracy, it's broken down, there's no division of powers, and they're led by Chavez, the would be king.

[Peace Patriot]

8. "Too many"? How many is that? nt

[EFerrari]

9. Bigfoot agrees with you.

[ChangoLoa]

10. Half of what you say has been debunked by "the facts" time and again

You don't need to go that far to defend a government you like, it looks surrealistic and absurd to push the hyperbolic mode that way.

1. Lista Tascon, last mayor elections in Caracas, etc...
3. What are you talking about? You've never even watched Venezuelan TV. You've been proven wrong about this.
4. Strong regulation of the financial system?! Where have you been lately?

"Venezuela... BEING more truly democratic than any other country in the western hemisphere." "maximum respect for all human and civil rights"... do you actually think this?
"and the government represses NO ONE" ...not even in the whole galaxy.

Peace Patriot, you're riding unicorns...

[Braulio]

16. I got the feeling he's deceived

To put it mildly. By the way, a friend tells me new engineering recruits into PDVSA have to demonstrate they are members of Chavez' "socialist united" party before they can get a job. I suppose this is one reason why the wheels are falling off PDVSA's oil fields, they look at political pedigree before they hire.

[EFerrari]

2. I see Brazil's crazy uncles can do better than ours.

lol

[bemildred]

4. I guess Lula put a lot of pressure on them.

The "divide and rule" stuff doesn't seem to be working.

[Braulio]

5. Money talks

They're doing it because Brazilian businesses are getting such good deals in Venezuela. This however means Mercosur is going to remain a trade pact, and can't move forward to become something like the European Union.

[bemildred]

7. Yeah, I just love the free enterprise system.

It's good to see it spreading all over the world like this.

[Braulio]

11. I'm for free enterprise but...

Venezuela is giving away too much when it issues mega-contracts without a proper tender process. The government to government deals lack transparency, and many of them give away too much. In general, we can say the Venezuelan government is led by individuals who lack the basic know how to run the government.

[bemildred]

12. "We can say" pretty much anything we like.

But words by themselves don't mean much.

[Braulio]

13. Look at economic indicators, they aren't words

But if we look at Venezuela's economic indicators, they show the country is in trouble, and headed for even worse trouble in the near term. Let's go over some figures:

Inflation: At least 25 % per year, some say the government rigs the number and inflation exceeds 30 % per year.

Gross Domestic Product: Down about 3 % for 2009, forecasted to drop 3.4 % in 2010. This is significant because most countries are predicted to have positive GDP growth in 2010. If we take into account Venezuela's relentless population growth, the per capita GDP will probably drop a cumulative 10 % before it pulls out of this tail spin - and this assumes the government takes the measures it's unlikely to take.

Agricultural production: down (percentages vary according to product, but overall it's down).

Industrial production: down (also depends on the product).

Tourism: down

To cap the list of bad news, they have an electric power shortage, and the remedial actions they are taking are not going to solve the problem - the people in charge just don't know what they're doing.

Other bad news: PDVSA production is down, and the problems with complex equipment in the refineries and upgraders are increasing. Labor problems are also increasing, and there are signs the government lacks cash flow to satisfy its commitments, many contractors are unpaid, and municipalities complain they are not receiving the payments they are due.

Thus, coupling the hard figures, the forecasts, and the news reports, we can see that Venezuela is likely to be the worst performer in Latin America in the combined 2009-2010 cycle. Even worse than Mexico, which was really hit by the US recession.

[bemildred]

14. You do know the global economy is in the toilet, right?

It is not just Venezuela that is in trouble, even if it were true that Venezuela is in trouble, which so far remains in the "stuff people with an axe to grind say about people they don't like" category. If Venezuela is being badly run, then the USA is run like an overcrowded rat cage.

[ChangoLoa]

15. The world economy is in the toilet, right.

But the only connection with the rest of the world that affects Venezuela is the price of oil... and it's still 4 times higher than what it was during the 90's. IMO, our problem is that we weren't able in 5 years of all-time record oil shock to create the basis for a long-term self-sustained growth. Almost all of it went in current expenses, fast growth of the state administration's personal while very few infrastructural projects were achieved, very little real investment, no industrial policy, permanent indirect subsidies going to foreign multinationals through import-encouraging policies.

Now, we will pay the political impossibility of downsizing current expenses (mainly administration nominal salaries) in favor of public investment. As it has always worked, the reaction of the government is to finance itself with devaluation/inflation, in order to lower the real value of money and manage to meet its nominal fiscal compromise. Remember the Venezuelan government's main source of financing is oil, hence dollars, hence they speculate against the national currency when they have difficulties to fund their expenses.

The government wasn't able to create other sources of growth than itself. It is almost the only generator of growth in the country, even if you see that growth is happening in the private sector. The private sector has been growing because the government expenses were pushing up the general demand in the economy. If oil prices don't increase substantially, we won't be able to produce any growth.

Nothing has changed at this level since the 80's.

[Braulio]

17. But Venezuela is in worse trouble

Bemildred, when I write about economic indicators, I do so with performance tables sitting right here, at my desk. Some of them are updated daily, some weekly. If I point out some area where Venezuela is doing poorly, I do so because it's doing much worse than the average. And right now Venezuela is doing a LOT worse than the average when we combine 2009 actuals and the 2010 forecasted values.

If you don't believe me, pick up "The Economist" and look at the tables they publish on the last two pages (just before the backcover). Look at the GDP figures, and you'll see Venezuela is in deep trouble, like say Mexico, Spain, Greece, etc. However, consider the 2010 consensus forecast value - Venezuela's is BAD, while the others show recoveries. What does this mean? The Venezuelan government has taken the wrong measures to correct for the crisis. Let's be clear, I would like for them to improve, because IF they did, then I could direct clients to invest in Venezuela, and being a fast mover in a changing market is very profitable. However, thus far they are NOT taking action, what they do is making matters worse. This means only a huge rise in oil prices can save them from a very hard time in 2010.

Ecuador, another country following the Chavista line, is also in deep trouble, but Correa seems to be hitting the panic button a bit earlier. Hopefully he'll see the light, and pull up before the economy crashes.

[enid602]

18. Chavez

Chavez gave away and loaned $89 BILLION to other countries in ´98, and only $2 Billion so far this year. Given his mindset, I suppose he just thought he was being generous. Nonetheless, this was the Venezuelan patrimony, and and in wasting all this money, Chavez has shown that he is equally as wasteful and economically unschooled as the rightists who proceded him.

[Braulio]

19. I assume you mean from 1998 to 2008?

I don't think you meant, 1998, right?

A lot of what Chavez says he's giving away or doing never shows up. It's like European and North American aid, blah blah blah. I sat down and watched a presentation by a Venezuelan official discussing their investment plans for refineries and other facilities outside Venezuela - it also turned out to be vaporware (and this is good because most of their planned investments outside of Venezuela don't make economic sense).

On the other hand, as you probably know they found a suitcase full of cash the Venezuelan government was sending to Cristina Fernandez, and I bet there's a lot of money flowing from Venezuela in suitcases the government never reveals.

[enid602]

20. 2008

Actually, I meant in 2008 alone. Sorry.