CARACAS – The Venezuelan opposition needs to understand that “the revolution is going to continue,” President Nicolás Maduro said Thursday, while urging his political foes to remain part of the dialogue the two sides began earlier this week.
The revolution begun in 1999 by his predecessor, the late Hugo Chávez, “is irreversible,” Maduro said in a speech at the presidential palace.
He said that his opponents “must learn to co-exist with the revolution” and to accept the principle of democratic governance.
The leftist head of state went on to accuse the MUD opposition alliance of looking for “excuses” to abandon the dialogue that got under way last Sunday under the auspices of the Union of South American Nations and the Vatican.
Addressing opposition leaders, Maduro said: “I am the only president of the republic who ensures that you continue existing and the MUD continues exercising its political rights – and you know it.”
Earlier Thursday, the MUD set several conditions for resuming talks with the government on Nov. 11, including a demand that both sides commit to an “electoral solution” to the nation’s political crisis.
That electoral solution could involve a reactivation of a suspended presidential recall referendum process or early presidential elections, opposition Mayor Carlos Ocariz said.
Maduro responded to Ocariz by accusing the MUD of presenting an ultimatum and creating “false expectations.”
“Nobody can say that in 10 days, if the government doesn’t respond the way they want … they will go to war,” the president said. “Nobody can accept that.”
The purpose of the Nov. 11 session will be to review the findings from the four working groups established during Sunday’s opening of the talks, Maduro said hours after government supporters began pitching tents around the presidential palace, Miraflores.
Prior to the start of the dialogue, the MUD had called for a march on Miraflores to take place Thursday.
Venezuela’s currency is dying
To paraphrase noted economic expert Obi-Wan Kenobi, many of the truths we cling to about currencies really do depend greatly on our own point-of-view.
Take Venezuela. The good news is that, if you look at it over a long enough timeline, its currency hasn’t changed much the past month. The bad news, though, is that’s because it’s gone from being almost worthless to almost entirely worthless. And the worse news is that it’s actually lost over a third of its value during this stretch.
Now, there’s never been a country that should have been so rich been so poor as Venezuela. Indeed, it has the world’s largest oil reserves, but has still managed to have the world’s worst-performing economy. The International Monetary Fund estimates that its gross domestic product will end up shrinking 10 percent this year, and its inflation rate will reach 720 percent. Nor is this expected to get any better any time soon. Inflation is supposed to get up to 2,200 percent next year, and 3,000 percent the one after that.
This has been the result of a government that has spent more than it could borrow, and has borrowed more than it could probably pay back. The problem was that the Chavista regime bungled the state-owned oil company so badly that it didn’t have enough money even when crude prices were high, and really doesn’t now that they’re low. So it’s printed what it’s needed instead, setting off what is currently the world’s worst inflation. Which, according to black market rates, made Venezuela’s currency, the bolivar, lose 99.1 percent of its value between the start of 2012 and the start of this October. In the last month, though, that’s picked up to the point that the bolivar is now worth 99.4 percent less than it was five years ago.
That last part might not sound like much, but when your currency is down to 0.9 percent of its former value, dropping another 0.3 percentage points is a pretty big deal. It means that the bolivar has lost 36 percent of what little value it had left in just a month. Or, to put it in more practical terms, it now takes so many bolivars to buy even the most basic goods that storeowners are starting to save time by weighing money rather than counting it.
But this isn’t just about Venezuela’s economic collapse. It’s about its political one too. In the last year, you see, the government has begun to lose legitimacy with even some of its diehard supporters. People are tired of its strategy of trying to make inflation go away by pretending that it has. As anyone who’s taken Economics 101 could tell you, simply decreeing that prices won’t go up and the currency won’t go down won’t work. Companies won’t sell things for less than they cost. They won’t sell things at all. Or, as it turns out, even stock their shelves—which is why the only thing Venezuela doesn’t have a shortage of right now is lines. Food, beer, toilet paper, and basic medical supplies have all been casualties of this self-inflicted economic wound. It’s made the country, as the AP’s Hannah Dreier reports, the kind of place where a scraped knee can be a life-threatening condition.
This has brought Venezuela seemingly to the brink of civil war. That’s because the opposition might have been able to win a big majority in last year’s congressional elections, but it hasn’t been able to launch the recall referendum it wanted against President Nicolás Maduro now that the regime-controlled electoral commission has disallowed it. The opposition, of course, called this a “coup,” and threatened to march on the presidential palace before the Vatican stepped in to negotiate the political equivalent of a temporary ceasefire. The regime, meanwhile, is trying to solve its problems by finding new and innovative ways to stick its head even further in the sand. One of those is barring foreign journalists, including from the Washington Post, from entering the country. And another is its new radio show hosted by Maduro himself dedicated to salsa and the rest of the country’s culture. The hope is that it will “multiply happiness.”
That’s why, as you can see below, the bolivar is falling faster than ever before if you look at it in absolute terms. The opposition doesn’t want to wait until the 2018 presidential elections to get rid of Maduro, and the regime is determined to hold onto power and pretend that everything is okay. So it’s getting harder and harder to see how this gets resolved peacefully, or at all. The collapsing economy, in other words, might lead to a collapsing society, which, in turn, makes the economy collapse even more—and, in the process, makes the bolivar get asymptotically closer to being completely worthless.
So what I told you was true from a certain point-of-view. Venezuela’s currency hasn’t changed much the last month, and has changed more than it has in any other single month before it.
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