Today reportedly it’s Pasta Milano’s turn to be expropriated.
Yesterday President Hugo Chavez ordered the immediate expropriation of Cargill’s Santa Ana rice plant in Portuguesa, though some local news media reported that all of Cargill’s Venezuelan assets had been nationalized.
Cargill has only a two percent share of Venezuela’s rice sector. But if all of Cargill’s Venezuelan assets are expropriated, the measure would affect 13 processing plants in 10 cities, and two main offices in Caracas, which together employ over 2,000 workers.
Cargill products in Venezuela include El Rey, Vatel, Deleite and Branca cooking oil; Los Tres Cochinitos lard; Mi Mesa, Santa Ana Santa Ana Parboiled rice; Blancaflor, Gold Medal and Mi Mesa flour; Fiorentina, Milani, Mi Mesa and Ronco pasta; Ronco sauces; Dogui, Gati, Robustin and Perrovita per foods.
Chavez also threatened yesterday to expropriate 100% of the Polar food and beverage group and “compensate” the owners with Bolivarian regime debt bonds (i.e. worth nothing in the real world) if they dare to challenge in court last week’s seizure of Polar’s Primor rice plant.
But Cargill wasn’t violating the Agriculture & Food Security Law or any other government rules/regulations; 100% of the Santa Ana plant’s production was rice which is not subject to government price controls – and the law and related rules state explicitly. However, Chavez ordered the plant’s expropriation anyway.
Polar hasn’t broken any laws or rules either, though immediately after Primor was intervened company officials indicated they would challenge the takeover in court. “You’d better not get comical with me,” Chavez warned Polar’s management.
The president also ordered immediate government inspections of all food processing plants in Venezuela, which means it’s very likely that more food processors will be intervened in coming weeks.
Meanwhile, reports from plants already intervened confirm that government “inspectors” and “supervisors” wearing red vests are on site to ensure producers comply with government rules requiring that 70-90% of their output (depending on the commodity) is price-controlled goods.
These Bolivarian supervisors have not tried yet to interfere directly with production operations at these plants.
But this could change at any moment, depending on the president’s mood, which since 15 February has been growing visibly more aggressive, menacing and confiscatory.
It’s unclear if President Chavez believes intervening private food companies will prevent massive food shortages in coming months. It’s more likely Chavez doesn’t care, since his priorities are political – complete centralization of all political, military and economic power in the hands of the Boliavrian revolution’s president for life.
Chavez was very clear about his goals during a speech today to some 300 soldiers, young men and women holding new AK-103’s (without ammunition clips inserted) at El Pao in Cojedes, where the new dual status of Vice President/Defense Minister Ramón Carrizales was reaffirmed.
At the end of a longwinded speech to the soldiers sitting on the packed-dirt parade ground in the blistering heat of Cojedes, Chavez referred to the armed forces as “…mi ejercito, mi armada, mi fuerza aerea y milicia nacional… Hasta la Victoria siempre… Patria, socialismo o muerte…Firmes…Venceremos…”
Note the president’s use of the word “Mine, mine, mine, mine…”
If the armed forces are the president’s personal property, so is everything and everyone else in Venezuela.
This is visibly evident in the intervened/expropriated food processing plants where Bolivarian supervisors in red vests are now making sure the producers obey the government’s production controls.
The state hasn’t seized these plants completely yet.
However, putting the equivalent of political commissars in each plant to make sure producers do exactly what Chavez says is only a step removed from physically and illegally stealing the plants from their owners.
Chavez knows his actions won’t prevent massive food shortages in a few months. The reserves Chavez claims he has stashed in places other than the Central Bank, Fonden and Pdvsa simply don’t exist. Seizing the food industry’s processing plants won’t solve the regime’s main problem: it has run out of money.
What happens if there isn’t enough raw rice to process because rice farming has collapsed thanks to the Chavez regime’s agriculture policies?
What happens if the owners of these food processing plants are unable to continue producing at an ever-greater loss in coming months?
Will the Bolivarian supervisors in red vests call in National Guard troops or armed civilian thugs to force the plants to continue operating?
Or will the regime bring in its own “gerentes” and “tecnicos” to keep the plants going, with the new government owner eating the losses and guaranteeing the (increasingly) imported rice supplies to process?
Short answer: Chavez doesn’t care.
His goal is total consolidation/centralization. The food industry will be nationalized, and then Chavez likely will move against the automotive, pharmaceuticals and other industries still in private hands.
This is consistent with his Bolivarian model, which is a lethal mix of socialist, fascist, communist and populist currents oriented at perpetuating Chavez in power for life.