Quote :

"Chavez, an ally of Cuba who is vehemently opposed to what he sees as U.S. imperialism, is boosting state involvement in Venezuela, the No. 4 supplier of oil to the United States, as he consolidates power after a landslide re-election last year. Venezuelan authorities said on Tuesday they would buy the assets of U.S. power company CMS for $106 million, a day after cutting a similar deal with telecom giant Verizon for $572 million. Last week the government signed an accord to buy the holdings of U.S.-based global power generation firm AES Corp. for $750 million despite analysts' predictions of protracted takeover battles. "The government has showed it's clearly willing to move at a particularly fast pace to deliver on promises," said Patrick Esteruelas, an analyst with the Eurasia Group. The deals came two weeks after Chavez received special powers to rule by decree and five weeks after he vowed to nationalize the telecommunications and power utilities. Chavez quickly implemented the nationalizations by avoiding protracted legal battles and outright seizures, and, instead, striking buyout deals. The companies did not have the choice to hold on to their investments, but they and economists said the buyout terms were tough but fair given the nation's deteriorating investment climate. The aggressive nationalization efforts have sparked investor concerns about working in Venezuela, already a tough environment due to double-digit inflation and heavy government regulations. Chavez's heavy social spending has built up political support but has sparked inflation, and government price controls at times restrict the supply of basic consumer goods. Annual inflation reached 18.4 percent in January and grocery stores last week ran out of beef, a problem the government blamed on hoarding by suppliers. Luis Zambrano, an economist with Venezuela's Banco Mercantil, said Chavez's nationalization announcements had led to panic that fueled economic problems, convincing authorities they needed to finish the takeovers quickly."

Wow. Just wow. I guess I did not give Chavez and his cronies enough credit. My opinion of the Venezuelan state has been improved by this article. It is so novel; to nationalize an industry the state just bought it! Sure, it was a forced sale, but the owners have been compensated, hurray for the respect of human rights!

Of course, I fear he paid up only to rush the process; if he was willing to wait I suspect he would have just siezed the companies in question. Nevertheless, so far so good.

2/14/2007 2:57:38 AM

human rights? since when is a company a human?

2/14/2007 3:17:18 AM

I'm just outraged! A foreign country makes a bad decision. Stop the presses!!!! Hugo Chavez farts. Breaking news!!!

2/14/2007 3:21:11 AM

I just found it interesting. I'm not saying it is really that big a deal. He and his supporters are all gung ho about socialism yet when it comes to nationalizing companies he respects property rights enough to pay for them.

nutsmackr, you idiot, a company is property; it is owned by humans, which have a right to be compensated when their property is taken. Where did you get the bonehead idea that a company was human? If that was the case then why isn't someone serving 25 to life for killing New England Wire & Cable? (See Other People's Money for reference)

2/14/2007 11:10:46 AM

property rights are not usually seen as the same thing as human rights.

2/14/2007 11:12:15 AM

Really? Odd you think that. The 5th Amendment of the U.S. Constitution seems to think we have some kind of right to just compensation. But like most semantics, this one is in the eye of the speaker. If you don't think it is immoral to strip someone of their property, then you probably don't list that one. I'm sure we can find people that don't think we have a right to privacy, a right to liberty, a right to life, or simply list them as secondary to other rights, such as a right to fraternity or equality.

2/14/2007 11:20:28 AM

I say Chavez bought the companies, not to respect property rights, but to keep whatever reputation for investment Venezuela has in tact. The climate is already deteriorating for international investment, might as well not fuck it all up.

It's insane to assume that the man has respect for property when he murders political adversaries.

[Edited on February 14, 2007 at 11:22 AM. Reason : .]

2/14/2007 11:22:14 AM

I think it does help ease the pain and reduce the general investor panic from the initial threat of industrial nationalization in Venezuela. However, given that the companies had no choice but to sell, I imagine that it would make foreign investors a bit uneasy. Afterall, you go through the effort of building up infastructure and developing a business only to be forced to sell to the government on their terms?

Still, it is smart of them.

2/14/2007 1:12:47 PM

I would say property rights can be human rights, in that you have a right to not be deprived of your means for livelihood.

2/14/2007 1:20:00 PM

Quote :

"I say Chavez bought the companies, not to respect property rights, but to keep whatever reputation for investment Venezuela has in tact. The climate is already deteriorating for international investment, might as well not fuck it all up"

That and could you imagine how ape-shit verizon and AES would go. We'd probably have the marines in there next week. It would be absolutely insane/ unacceptable to basically steal from these two companies... especially since they're US owned. Now they've been stealing a lot in assets from Brazil- like 10 or 15 factories.... saying "yeah, they're ours now, you need to leave." Brazil however probably wouldn't fight/ embargo/ blockade they way we might.

2/14/2007 2:06:21 PM

Well Verizon would've been able to write it off as a loss on their taxes... which means the american public would have to subsidize the Venezuelan dictator... which means the government would be out about a billion or so dollars... sounds like a recipe for invasion to me...

2/14/2007 2:08:18 PM

All in favor of jump-starting our ethanol program here even further and getting our hands out of there, say "aye".

2/14/2007 2:28:43 PM

off topic, but I am not for ethanol one bit. For many people in the western hemisphere, corn is a primary staple in their diet and they're already seeing the price of corn go up because the demand for ethanol is going up.

We're the only people on the earth to use a food source as a means of energy.


It's actually disgusting.

2/14/2007 2:49:22 PM

Quote :

"We're the only people on the earth to use a food source as a means of energy."

...

2/14/2007 3:18:03 PM

nonbiological energy

2/14/2007 3:18:40 PM

once there is a market for ethanol corn wont be used for very long

2/14/2007 3:20:15 PM

yeah but it's nice having it come from a crop that can grow just about anywhere in the mainland US and is renewable... but I see what you mean


maybe more tobacco farms will grow corn since there are less and less tobacco farms every year


but cotton is taking back over as the king

2/14/2007 3:21:00 PM

Property is an idea created by man, thus it is not immutable as we would consider human rights to be.

2/14/2007 3:22:31 PM

seriously, though. If you look at the modern anti-corporate, anti-oil, anti-bush, environmental movement, nothing speaks to its arrogant nature than that of using corn, of which central and south americans depend on, and turning it into fuel for transportation.


And this is applauded by the environmental movement as making the world better... for the rich elite who can afford cars and not have to use corn to make their tortillas with.

2/14/2007 3:23:36 PM

well yeah... it goes with the territory

but I don't try to hide under some veil of caring either, if it's cheaper to grow corn and make fuel one day for me to get where I need to go, then fine, lets do it

2/14/2007 3:26:42 PM

Quote :

"nonbiological energy"

http://news.bbc.co.uk/2/hi/business/4715332.stm

2/14/2007 3:28:24 PM

it's not going to be cheaper until extracting fuel becomes more expensive.


And drilling oil has only made people rich... not hungry... going from a utilitarian point of view.

[Edited on February 14, 2007 at 3:30 PM. Reason : .]

2/14/2007 3:28:44 PM

Quote :

"We're the only people on the earth to use a food source as a means of [non biological]energy."

sugar can be substituted. Corn cannot.

2/14/2007 3:30:21 PM

Quote :

"We're the only people on the earth to use a food source as a means of energy."

Hardly. The Brazilians are making a killing off of sugar-cane based ethanol (which can be processed much more cheaply and efficiently than the corn-based fuel). Of course, they're chopping down rainforests at a record rate to do so, but hey, at least they are no longer dependent on foreign oil.

2/14/2007 3:31:16 PM

Well, corn prices going up should help corn producers in the third world...

2/14/2007 3:46:16 PM

that will do no good if they can't eat.

2/14/2007 3:47:01 PM

you do realize ethanol comes from more than just corn, right?

2/14/2007 3:47:11 PM

Quote :

"That and could you imagine how ape-shit verizon and AES would go. We'd probably have the marines in there next week."

Actually, while running for the Presidency, John Kerry's wife's company, Heinz, had a factory siezed by Chavez, no compensation what-so-ever.

South American countries have nationalized U.S. companies repeatedly throughout the last 150 years, we have never invaded in response, with the possible exception of Cuba, which was also trying to point nuclear missiles at us at the time.

2/14/2007 3:49:23 PM

Quote :

"you do realize ethanol comes from more than just corn, right?"

You do realize that the global price of corn is going up because of the production of ethanol, right?

Yes I realize it's made of more than just corn. But corn is the primary input.

2/14/2007 3:51:53 PM

True, and it's not the only solution. It's thankfully one of many routes to energy independency.

2/14/2007 3:58:22 PM

Quote :

"that will do no good if they can't eat."

If they make money from the sale of their corn, they can use that money to buy food. Increasing corn prices helps many people in third world countries. It goes both ways.

2/14/2007 4:11:30 PM

There was a guy on NPR awhile back talking about this. Sounded like it would cause an issue for corn growers in the midwest, but that will be evened out by tarriffs on imports of corn for the time being. Outside the US, I'm not sure.

2/14/2007 4:20:21 PM

if it came from NPR, you know the idea is sympathetic to communism

2/15/2007 9:22:27 AM

http://news.bbc.co.uk/2/hi/business/6364515.stm

It's good to know that American companies aren't the only target.

Given that these are food shortages, this can't end well...

2/15/2007 11:16:57 AM

I was listening to NPR maybe a week ago and they claimed that the majority of the corn produced in this country next year would go towards ethanol production, to which I am thinking, hey whatever drives the market.

As for Chavez, he's quickly leading his country down the road to disaster. Profit is the bottom line and if you take away the profits, what incentive is left for the businessman other than to close shop?

[Edited on February 15, 2007 at 11:27 AM. Reason : ]

2/15/2007 11:26:52 AM

Quote :

"nothing speaks to its arrogant nature than that of using corn, of which central and south americans depend on, and turning it into fuel for transportation."

You can use switchgrass, which can be grown on marginally productive lands and would probably usher in a new agricultural revolution around the world.

2/15/2007 12:36:23 PM

Totalitarianism is now in effect

2/15/2007 1:14:05 PM

^^ If switchgrass is so great then there is nothing anyone needs to do, farmers will notice and seek profits.

The cure for high corn prices are high corn prices.

2/15/2007 5:07:58 PM

corn lobby is pretty powerfull

2/15/2007 8:52:11 PM

Ethanol isn't the answer now and never will be. We will never produce enough to offset the massive amounts of oil we import.

And don't forget that ethanol does nothing about lowering CO2 in our atmosphere...evil CO2

We need more nuclear power plants, a lot more.

On topic, this move by Chavez surprises me.

2/16/2007 1:26:45 PM