Every imperial court has a jester, joker, jokester, fool, wit-cracker, prankster, or buffoon. In the Middle Ages, jesters wore brightly colored costumes and a distinctive hat with three points called a cockscomb.
Finance Minister Ali Rodriguez Araque (ARA) is the jester in the court of President Hugo Chavez, though he only wears conservative business suits and his dour expression never changes as he cracks bad jokes about the alleged health of Venezuela’s economy in the presence of journalists.
*A currency devaluation is not in the cards for now. What Rodriguez means is that Chavez is resisting pressures to devalue officially until sometime after the 15 February referendum. However, state-owned companies like Pdvsa already are quietly selling dollars and euros in the black market to raise bolivars.
*The recent transfer of $12 billion of Central Bank’s reserves to Fonden, where the president can spend the cash at will, is not inflationary. However, Central Bank reports that inflation rose 2.3% in January after rising 2.6% in December.
*No tax increases are contemplated for now (ie before 15 February).
*The government does not plan nationalize any privately-owned assets this year. What Rodriguez means is that President Chavez hasn’t decided yet what to nationalize next. But we suspect the automotive industry ranks high on his list of companies/industries targeted for expropriation.
*Government negotiators have almost concluded compensation talks with the foreign owners of Ternium Sidor and three cement companies. In fact, the government has no money to make any compensation payments this year. Meanwhile, production and profits are falling at all of the companies nationalized in the past year.
*Effective government policies reduced Venezuela’s debt by $150 million in 2008, and now the country owes “only $43 billion.” [In fact, Venezuela’s total debt at end-2008 was $43.9 billion, including $29.5 billion of external debt and $14.3 billion of internal debt. Total indebtedness was about the same as the Central Bank’s international reserves position before President Chavez ordered $12 billion transferred to Fonden recently. Imports totaled over $50 billion in 2008, but the Central Bank’s reserves now total under $29 billion, and falling.]
Finance Minister ARA jests, of course. After all, he is Finance Minister today because Chavez has no other candidates to place in the job. The presidnet’s circle of even poorly-qualified loyal allies has diminished greatly, so ARA got the job – for now.
However, ARA has done a bit of everything in his career as a communist revolutionary.
In the late 1950’s-early 1960’s he spent several years as an armed guerrilla battling government troops. But that didn’t work out so he accepted the pacification offer extended by President Rafael Caldera in the mid-1960s. Caldera allowed Venezuela’s armed communist militants to return from the cold and reintegrate into a democratic society with full pardons for everyone who accepted.
During the Guanabana (green-white) years of the Fourth Republic ARA wasn’t a prominent player, but apparently he didn’t do badly in business. And he never stopped conspiring with others in the radical left, including many active-duty officers in the armed forces, to topple the democratic government of Venezuela and create a Marxist revolutionary regime.
ARA was in the group of civilian communists waiting at Tazon in the early morning on 4 February 1992, where Lt. Colonel Chavez was supposed to arrive with a column of paratroopers and weapons for the civilians. But Chavez betrayed ARA and his fellow communists, and deliberately took a detour because he was bound for glory amid the ashes of a coup he knew would fail – because failure was part of his personal plan that day.
Despite Chavez’s betrayal of the radical communists on 4 February, 1992, ARA sought out Chavez while the latter was in Yare prison, and helped to arrange the formal introductions between Hugo and Fidel in 1994.
Over the past decade ARA has served Chavez faithfully (and reportedly to great personal profit) since 1999 as Foreign Minister, Energy Minister, president of Pdvsa, Venezuela’s governor to OPEC, OPEC Secretary General, and Ambassador to Havana, before his current post as Finance Minister, where he says silly things about financial issues he obviously doesn’t understand to reporters who dare not challenge the minister’s more obvious stupidities lest they risk offending the king.