The Venezuelan oligarchy attempts to provoke a food crisis

PROGRESO WEEKLY -
March 8, 2007 -

http://www.progresoweekly.com/index.php?progreso=Salim_Lamrani&otherweek=


By Salim Lamrani,

The Venezuelan oligarchy, opposed to the economic and social reforms
of President Chávez, once again attempts to destabilize the nation by
speculating with the prices of basic products. After the coup d'état
of April 2002 and the oil sabotage in December 2002, the elite wishes
to provoke a food crisis and unleash disturbances throughout the
country.

The Venezuelan hypermarkets disproportionately raised the prices of
basic products such as meat, sugar and cereals, which became
inaccessible to the population and thus created serious food
shortages. According to the Central Bank of Venezuela, the artificial
inflation affects about one fourth of the basic food basket and
afflicts the most modest layers of society first. Thus, the prices
increased an average of 66 percent and in some cases doubled. For
example, the price of poultry rose 110 percent; the price of cheese,
245 percent. [1]

"The increase observed in the price of meat since January and during
the first week in February is due to the interest of some
distributors and retailers to maximize profits, because Venezuelans
at present have a greater purchasing power than before," explained
María Cristina Iglesias, Minister of the People's Power for Light
Industries and Trade. [2]

The government took steps immediately, announcing that the prices
should not exceed the regulations set in 2005. "Whoever does not
respect the fixed and regulated prices for a basic basket [...]
should accept the consequences [because] we are not going to retreat
a single millimeter" in the struggle against speculation, warned Vice
President Jorge Rodríguez. A Committee for the Social Control of
Supplies was created, managed by the communities, for the purpose of
"creating a country without speculators, hoarders and [...]
management lockouts." [3]

Several supermarkets that manipulated the supplies and set prices
higher than those established by the law were visited by inspectors
and sanctioned by the authorities. The products were seized and sold
at the right price in the people's stores known as Mercal.

"The speculators are delinquents, criminals and enemies of the
people, and must experience the firm actions of the law," said
William Lara, Minister of the People's Power for Communication and
Information. He rejected the argument of penury raised by the major
companies and accused them of hoarding their products. [4]

In fact, several stores decided to suspend the sale of meat,
provoking a food crisis. President Chávez reacted at once and sent a
message to the owners of the supermarkets demanding that they cease
speculating and guarantee the food security of the citizens. He
warned that he would nationalize any hypermarket, slaughterhouse or
cold-storage plant that continued to sell basic products at prices
higher than the legal prices. [5]

"I have sent messages to the producers, and to the middlemen at the
slaughterhouses, the cold-storage plants and the supply warehouses.
But if they insist on violating the interests of the people, the
Constitution and the laws, I am going to seize the cold-storage
plants, the supply warehouses and the slaughterhouses and I am going
to nationalize them," the Venezuelan president announced. He invited
the population to make all the necessary complaints, and every
establishment that charges more than the fixed prices will be
nationalized and its administration will be turned over to the
Communal Councils. "We'll do everything necessary to achieve justice
and food equality," he said. [6]

A law was adopted against speculation and boycott: The Law for the
People's Defense, which establishes a strict control of prices and
stipulates that "the suppliers and establishments that violate this
measure or incur in the crimes of speculation, hoarding, or usury,
who refuse to sell, restrict the circulation or distribution of
price-regulated products, as well as those persons who engage in
evasive practices of any nature and other connected crimes to not
comply with the maximum sales prices of food to the public will be
punished according to the law." [7]

Article 4 of the law stresses that "all the goods needed to develop
the activities of production, manufacture, importation, storage,
transport, distribution and commercialization of food or products
subjected to price control" are public utilities, a status that
allows the government to legally seize control of any abandoned or
shut establishment or those establishments that engage in
speculation. [8]

Despite it all, the Bolivarian government wished to give proof of its
good will and made a gesture in favor of the producers and merchants.
It decided to rescind the Value-Added Tax of 14 percent on some foods
-- such as meat, corn, mayonnaise, white cheese and oats -- as well
as the land transportation of basic foodstuffs, beginning March 1,
2007. This exoneration from taxes applies to the entire food chain,
from the producer to the merchant. [9]

This new effort to destabilize the country, orchestrated by the
Venezuelan oligarchy, is illustrative in several aspects. First, it
shows that the country's elite still does not accept losing its
political power and the ever-growing involvement of citizens in the
construction of a participative democracy and a new society that
wants to be inclusive.

The elite is also incapable of admitting that the political, economic
and social systems of Venezuela are changing radically, and that this
process, begun in 1999, has become irreversible. In sum, Venezuelans
must remain vigilant because the antidemocratic opposition, actively
supported by Washington, has shown in the past that it's willing to
do anything to achieve its objectives.

Notes

[1] Casto Ocando, «A lack of food unleashed in Venezuela,» El Nuevo
Herald, Feb. 9, 2007.

[2] Bolivarian News Agency, «Government will not permit sale of meat
at prices that exceed regulations,» Feb. 10, 2007.

[3] Bolivarian News Agency, «We shall not retreat in the struggle
against speculation,» Feb. 11, 2007.

[4] Casto Ocando, op. cit.

[5] Aline Leclerc, «Hugo Chávez threatens to nationalize
supermarkets,» Le Monde, Feb. 15, 2007.

[6] Suhelis Tejero Puntes, «A threat to nationalize businesses,» El
Universal, Feb. 15, 2007 ; Bolivarian News Agency, «Supermarkets and
cold-storage plants that violate regulated prices will be
nationalized, » Feb. 14, 2007; Casto Ocando, «Chávez threatens to
seize food stores,» El Nuevo Herald, Feb. 15, 2007.

[7] Ibid.

[8] Bolivarian News Agency, «Council of Ministers passes Special Law
for the People's Defense,» Feb. 17, 2007.

[9] Associated Press, «VAT exoneration will begin in March in
Venezuela,» Feb. 12, 2007; Bolivarian News Agency, «Government lifts
VAT from beef and pork prices,» Feb. 11, 2007.

French researcher Salim Lamrani specializes in U.S.-Cuba relations.
He contributes regularly to Rebelión. This article may be reproduced
freely on condition that its integrity be respected and that its
author and sources are mentioned.



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