links for 2009-11-16
Proposed Class Topics: DRAFT: Econ 210a, Spring 2010, U.C. Berkeley

"But That Political Economy Trick Never Works!": A Dispatch from Chavez's Venezuela

In my email inbox, from "A Leftist":

I asked Xcdv Umesnagos about the power outages [in Venezuela] reported by Simon Romero of the NY TIMES. His reply:

Romero is a fool but the NYT is more so for keeping on a guy who just rewrites the articles in oppo papers.

That said, there definitely is a electricity crisis, short and medium term. Short reflects in part the very heavy reliance upon hydro-electric power which doesn't look so great when climate change and el nino mean the rainy season is cancelled. [In Caracas, water is being rationed one day a week for different parts now.]

Medium term because demand is rising very rapidly both because of new projects propelled by the state and because rising income for the poor has unleashed a mad consumption splurge--tvs. air conditioning in every room, etc... and because generation and distribution networks have fallen well behind [firstly because state ones were run to the ground in anticipation of privatisation and secondly because private distribution ones were doing so well that they saw no need to invest in new facilities].

The crisis, though, reflects the idiocy of the state managers who just pushed pawns while the workers kept shouting a crisis is coming. That's the situation still--- the privates were taken over by the state a little while back but still have their separate boards and the mgrs from the multinationals. The crisis forced Chavez in a few weeks to create a new ministry of electricity [union had demanded this for several years] and to call upon the minister to meet with the workers; so far, the minister keeps meeting with the suits and the workers are pissed.

You're getting this almost from the horse's mouth as I participated in a meeting yesterday with the electrical workers and reps from other unions. Ie., I've got lots of inside dope.

Electricity shortages in a country whose sole export is energy are truly a miraculous thing. It takes a very special government to produce them.