[News] Venezuela’s Upcoming Double Confrontation

[Anti-Imperialist News]

  Venezuela’s Upcoming Double-Confrontation

*http://venezuelanalysis.com/analysis/11816*
<http://venezuelanalysis.com/printmail/11816><http://venezuelanalysis.com/print/11816> 


By Gregory Wilpert – TeleSUR English , January 14th 2016

Following the Venezuelan opposition’s recent electoral victory in the 
Dec. 6 parliamentary elections, the opposition seems to be more 
determined than ever to steer towards an outright confrontation with the 
president. The goal is to destabilize the government as much as 
possible, with the aim of achieving his ouster before the end of the year.

The new National Assembly president said that his aim is to have a plan 
in place for president Maduro’s ouster within the first six months of 
2016. Ramos Allup furthered this confrontation Jan. 6, when he swore in 
three opposition members as representatives, whose election the Supreme 
Court had previously put on hold due to electoral irregularities. On 
Monday, January 11, the Supreme Court thus declared that the National 
Assembly president had acted in defiance of the Court and that from now 
on all laws that the National Assembly passes are null and void, since 
the assembly had incorporated members into its body that should not be 
there.

The political confrontation between the legislature and the executive is 
thus programmed. The next conflict will be about the amnesty law, by 
which the opposition intends to free all so-called political prisoners, 
that is, all opposition figures who have been involved in violent 
protest of one kind or another, many of whom have been held responsible 
for deaths of innocent bystanders. Ramos Allup already warned Maduro 
that if he and the Supreme Court do not implement the amnesty law, he 
will begin removing ministers from Maduro’s cabinet: “Whether or not he 
accepts [the amnesty law] will not matter, to which we will say, ‘We do 
not accept his naming of ministers.’”

The options for the new opposition-dominated National Assembly to get 
rid of Maduro are several. As mentioned above, it can remove not only 
the ministers and the vice-president (though this could lead to new 
National Assembly elections if the vice president is removed three times 
in a row), remove the heads of other branches of government, such as the 
Supreme Court, the attorney general, or the National Electoral Council 
(with prior approval from either the Supreme Court or the attorney 
general), amend or reform the constitution (which then has to be 
submitted to a referendum), or call for a constitutional assembly 
(followed by a referendum).

Also, there is a lot of speculation that the opposition might try to 
organize a recall referendum against Maduro, but doing so would require 
the collection of 20 percent of registered voters’ signatures, which 
amounts over 3.8 million signatures. This latter course is a difficult 
undertaking. In comparison, when the opposition organized the recall 
referendum against president Chávez in 2004, it had to collect only 2.5 
million signatures because the electorate was substantially smaller.

Aside from the project to remove Maduro and to give amnesty to its 
law-breaking supporters, the oppositional National Assembly also plans 
to introduce a number of laws that could undermine the Maduro 
presidency. A populist measure that the opposition has wanted to pass 
for a long time is to give ownership titles to the beneficiaries of the 
housing mission. Over the past five years the government has constructed 
one million public homes, which it has essentially leased to families in 
perpetuity, but without giving them a title that can be bought and sold. 
The reasoning behind this is to avoid the development of a speculative 
housing market of homes built with public funds. The opposition is 
betting that most public housing beneficiaries would prefer a saleable 
ownership title, so that they can sell the home and thereby possibly 
make a profit from it.

Another law that would probably get the president into trouble is a 
rumored project to dollarize the economy. It is obvious to everyone in 
Venezuela that the current economic situation of high inflation, 
frequent shortages of basic goods, long lines at supermarkets, and a 
massive black market for price-controlled products, is not sustainable. 
One “solution” to these problems that some opposition leaders have 
favored it to simply get rid of the local currency, the bolivar, and 
base the entire economy on dollars, just as Ecuador did in 2001. Aside 
from undermining the country’s economic sovereignty, such a move would 
also almost definitely mean major painful displacements for economy, 
leading to increased inequality and unemployment. No doubt the 
opposition would then try to blame Maduro for this, but it is possible 
of course that they themselves would end up carrying a large part of the 
blame, which is why the opposition will enter into this project neither 
unambiguously nor unanimously.

Other major projects on the opposition docket include the repeal of a 
wide variety of progressive laws that were passed during the Chavez and 
Maduro presidencies, beginning with the land reform, re-privatization of 
key industries, and the dismantling of price controls, among other things.

Finally, the opposition has also announced that it will convoke special 
investigation commissions. Among these are commissions to investigate 
corruption within the executive and another to investigate the 
credentials of newly appointed Supreme Court judges. The investigation 
of the judges could lead to the removal of several of these because the 
Supreme Court law allows for the removal of judges who do not meet the 
fairly tough requirements for appointment.

On the Chavista side of the confrontation the options for maneuvering 
are even tougher. Here the foremost issue for the government is how to 
deal with the on-going economic crisis, which is bound to get worse 
especially since the price of oil is tumbling. While the price of an 
average Venezuelan barrel of oil reached a high of US$55 per barrel in 
early 2015, the most recent figures point to half that amount, at US$27 
per barrel. Unless this price recovers, this could be devastating for 
Venezuela, especially since 95 percent of the country’s export earnings 
and 50 percent of its fiscal budget come from the sale of oil.

The 50 percent collapse in the price of oil over the past eight months, 
however, means a far larger collapse in revenues because a large 
proportion of Venezuela’s oil is extra-heavy oil that is expensive to 
extract, reaching a high of around US$20-$25 per barrel, leaving 
relatively little to no profit at such low prices. In other words, a 50 
percent  drop in the price of oil represents a far larger than 50 
percent drop in revenues for the state.

Maduro recently named a new cabinet, reshuffling many positions, but in 
the key position of vice president for the economic area, Luis Salas, 
Maduro appointed someone considered to be a proponent of the same 
policies as before, who says that price controls and the currency 
control must be maintained and that the government’s main weakness has 
been in the area of enforcement of existing policies. In other words, 
even though the country is now waiting for the announcement of a 
promised “economic emergency plan,” it seems doubtful that this plan 
will signal a significant departure from the economic policies so far.

The drop in revenues, combined with an inflationary spiral that the 
economic war of smuggling, hoarding, and speculation and that the black 
market for dollars have inflicted on Venezuela, signal a very difficult 
near-term future for Venezuela’s economy and everyone in it. Some 
economists warn of possible hyperinflation and of an inability to pay 
its foreign bills (balance of payments crisis).

In short, Venezuela is heading towards two confrontations 
simultaneously, where each threatens to exacerbate the other: one 
economic and the other political. What the prospects are for overcoming 
these confrontations is impossible to predict at this moment. Within the 
chavista social movements and the governing party, the PSUV (United 
Socialist Party of Venezuela), more and more voices are calling on the 
government to organize a massive consultation process with the 
grassroots, which is something that Maduro has endorsed, but it remains 
an open question whether these will happen in time and if it does, 
whether it will be able to provide solutions that will allow the 
Bolivarian Revolution to move forwards, despite the reinvigorated 
opposition in parliament.

-- 
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