Venezuela’s President Hugo Chávez surprised no one with this announcement on Monday during the swearing-in ceremony for his new cabinet.
During his speech, Chávez also confirmed the “nationalization” of Venezuelan telecomm company, CANTV, which was one-third owned by American telephone giant Verizon, and of the American-owned Caracas electric utility.
Originally owned by the Venezuelan government, CANTV was privatized in 1991 because of inefficiency and its unwieldy, bloated organizational bureaucracy. At that time, Verizon paid $1.8 billion for its stake. According to Gerver Torres, the former Venezuelan cabinet minister who handled the transaction for the government, Verizon’s share was worth an estimated $3.5 billion on Monday, just before the Chávez announcement plunged its stock price 40% on the NYSE, when the Exchange halted trading.
According to Reuters, “[IBC], the [Venezuelan] stock market, lost almost a fifth of its value on Tuesday, debt prices tumbled to a six-week low and the currency changed hands at nearly twice the official rate.”
Reaction from the White House was relatively muted as Administration officials continue to work behind the scenes to initiate a dialogue with Chávez. “Nationalization has a long and inglorious history of failure around the world,” said Press Secretary Tony Snow. “We support the Venezuelan people and think this is an unhappy day for them.”
With these actions, Chávez continues his impersonation of his mentor, Fidel Castro, whose reign in Cuba has transformed that island nation from one of the most vibrant and prosperous countries in the Americas to one of the poorest, with its people among the most oppressed in the region.
As he continues to build his already considerable power, Chávez also outlined a plan to consolidate his supporter base into a single political party, as well as plans to bring the autonomous Central Bank directly under his control. He is also seeking an end to constitutional term limits as part of his plan to drag Venezuela into his version of “21st Century Socialism.”
At his own inauguration yesterday, Chávez symbolically wore the presidential sash over his left shoulder, rather than the traditional right. According to BBC News, Chávez affirmed in his oath of office, “I swear on Christ, the greatest socialist in history; I swear on all this; I swear on all grief; I swear on all love; I swear on all hopes.”
Ever the dutiful student of his hero, Fidel Castro, Chávez recently closed a speech with the tired old Castro slogan, “¡Patria ó Muerte, Venceremos!.” “Fatherland or Death, we will triumph!”
Let us hope the death to which he was referring isn’t that of Venezuela, its economy, and the democratic freedom of its people!