An oldie but a goodie


Looking through for links on chavismo’s batshit-nuts exchange control system, I found this rant, squirreled away in the 2009 memory-dustbin of my archive.

It’s nice to find something I wrote three years ago has held up as well as it has.

The permuta system is a virtuoso feat of misdirection. While we all focus on what the government is doing with one hand, it’s off remaking society with the other.

Because, make no mistake about it: the government really is upending Venezuelan society. It’s just that the upending is happening not on the political level, but by stealth, through a mechanism too obscure for most observers to quite grasp, let alone pay any attention to.

When you get past the jargon, you see the permuta system is the vehicle for a 21st century montonera: a way to replace one elite with another.

Sure, the details have changed…but the underlying mechanism has not…

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  1. “The skills needed to ride this particular gravy train – politicking, bureaucratic empire-building, scheming and intriguing – are skills that do precisely nothing to advance the welfare of Venezuelan society as a whole. This is the system Chávez has reinvented. This is the receptacle into which all that drool pouring out of Oliver Stone’s slack jaw must eventually be collected. This is the revolution, people. The rest is bread and circus.”

    No adjectives on this one. This is the paragraph in the article I would specially cite to any and all PSFs, that is people who delude themselves that somewhere in the middle of this cesspool they can find a genuine Socialist Revolution. As if a genuine Revolution wouldn’t be (additionally?) bloody instead of dirty.

  2. The Econ 101 lesson about price and exchange controls should be taught in high school for everyone, not college for those who take that course. Prices and exchange rates are like thermometers: controlling them does not change the temperature; it just makes them bad at measuring.

  3. “When you get past the jargon, you see the permuta system is the vehicle for a 21st century montonera: a way to replace one elite with another.”

    I’m sure the exchange control has been the source of the most blatant corruption this country has ever been subject to, making those involved amazingly wealthy. Exchange related corruption has taken over public commercial agencies, goverment banks, ports, customs agencies and the armed forces as the institution governing all the rest. Of course this public corruption could not be possible without the aid of the private sector acting as the vehicle, the link, the executor of the most corrupt operations.


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