Nationalization has a high price

Nationalization has a high price
A high economic and social price

Alfredo Ascanio (askain)

The Venezuelan president Hugo Chavez was reelected the 9 of January and he informed several political decisions.

The first political alarm to the investors: the nationalization of the Telecommunication Company (Verizon Inc. Communications), the electricity Company (AES Corporation of Arlington, VA) and the investments of foreign companies that operate petroleum in Orinoco River Basin (British Petroleum PLC, Exxon Mobil Corp., Chevron Corp., ConocoPhillips Co., and Statoil to upgrade heavy crude in the Orinoco).

These three nationalizations surely will cost more or less US$ 15 billion, said Miguel Octavio, executive director of BBO Servicios Financieros, a brokerage firm. Only 28.5% of Compania Anonima Nacional Telefonos de Venezuela (CANTV)´s shares in portfolio of the North American Company Verizon, at New York, will have a much greater value of US$ 676 million, when the company offered those shares to America Mobil and Telefonos of Mexico.

But with a price of the petroleum barrel of 55 dollars, president Chavez would not matter to him to make that enormous cost that would be the political price to eliminate the North American companies that are “companies of the empire” as he likes in describing them. The decision is ideological and political but no economic and social.

It is surprising that these decisions have been taken because all these companies are very efficient and they have contributed to the country with cutting edge technology.

These policies are irrational and contradictory because the country has a social debt that that “the revolution” ethically must solve but the policies of Mr. Chavez with the ideological objective to spend this enormous amount of money in nationalizations and arms bought to Russia, are harmful to the society and in special to the poor people who need better quality of life.

This is in short a policy Socialist-Marxist totally mistaken and populist because only responds to a desire to take revenge and to demonstrate that the president has all the power in its hands. Resentment fed his anger. Today there’s a great political ferment in the country and quite a few people they begin to discuss and to analyze these subjects.