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Why can't they just ask other more friendly countries (Russia, Norway, maybe China) for the expertise in exchange for oil? Should be an easy solution, or am I m

by binarray2000 10y ago

Why can't they just ask other more friendly countries (Russia, Norway, maybe China) for the expertise in exchange for oil? Should be an easy solution, or am I missing something in my oversimplification? (And, please, don't blame it on communism/socialism; people have interests and I believe so do people in Venezuela - including those working in the government.)

civilian 10y ago
I'm gonna blame it on communism. It's not that they don't know how to produce oil. It's that the oil company has been so heavily mismanaged and used for political purposes that it has become extremely inefficient. http://www.economist.com/news/americas/21607824-venezuelas-loss-thousands-oil-workers-has-been-other-countries-gain-brain-haemorrhage http://www.economist.com/news/americas/21607824-venezuelas-l... > IN 2003 Venezuela’s then president, Hugo Chávez, fired more than 18,000 employees, almost half the workforce, of the state-run oil corporation, Petróleos de Venezuela (PDVSA). Their offence was to have taken part in a strike (pictured) called in protest at the politicisation of the company. Their punishment was to be barred from jobs not only in PDVSA itself but also in any company doing business with the oil firm. The axe fell heavily on managers and technicians: around 80% of the staff at Intevep, PDVSA’s research arm, are thought to have joined the strike. At the stroke of a pen, Venezuela lost its oil intelligentsia. Obviously, this wouldn't have happened in a free market. But even other state-run oil companies haven't made this kind of blunder.
- metaphorm 10y ago
  your answer is on target but you're wrong to "blame it on communism." that has nothing to do with communism or any other abstract theory of political economy. that is an explicit example of incompetent authoritarian rule by an unhinged despot with no checks on his power.
  - zeveb 10y ago
    > that is an explicit example of incompetent authoritarian rule by an unhinged despot with no checks on his power … Communism!
  - civilian 10y ago
    Communism is tied to state-run monopolies of companies. Yes, the main fault was an incompetent authoritarian rule, but it wouldn't have been possible if the oil company hadn't be nationalized. If Venezuela has an incompetent authoritarian rule, but had a free market for oil companies and didn't harass the employees of oil companies? Then they'd still be drilling with a state-of-the-art technology & workforce today.
    - metaphorm 10y ago
      ok sure, but I still don't see what that has to do with Communism. suppose their incompetent authoritarian system had been nominally capitalist? or a theocracy? or a monarchy? what difference does it make. my point is its the incompetence and authoritarianism that caused the problems.
      - brownbat 10y ago
        > I still don't see what that has to do with Communism > my point is its the incompetence and authoritarianism that caused the problems A lot of people believe there's a causal road from Communist governing philosophies to incompetent authoritarianism (though you're right, it certainly wouldn't be the only way to get there).
        metaphorm 10y ago
        right, so there's many roads to perdition. what style of government is best equipped to avoid these types of problems? Is it democracy? Possibly so. Paraphrasing Churchill "the worst form of government except for all the other ones that have been tried". All of those other systems I've mentioned also have high functioning, efficient, non-corrupt versions of them as well. Look at Singapore for an example of a high competence, low corruption form of Authoritarian government. So I'll just say it one more time. Communism is orthogonal to competence/corruption of government. The fact that so many people implicitly believe they're linked is evidence of the century long propaganda campaign against anything socialist that has been waged by the powers-that-be in the capitalist system.
- binarray2000 10y ago
  What you (plus the quote from The Economist) describe is like shooting yourself in the foot. Still, ideology aside, why would Chavez do such a thing? Was he an intellectual moron? No. He knew that without oil exports his people would be hungry, and hungry people mean bloody revolution. Also, quoting from The Economist is one sided considering their position regarding Venezuela during and after Chavez. You see, media is biased and I don't want to trust them, no matter how "respectable" they are. (eg. NYT in the eve of 2003 Iraq invasion) I'd like to hear from people who live there (or from less biased reporters) about causes for this situation in which an oil rich country must import oil from its major adversary, in which the whole society dissolves. EDIT: User nnq asks the same questions as I do.
  - AnimalMuppet 10y ago
    You don't trust The Economist to be unbiased. Fine. But I know of no sources that assert either that the event in question (the firing of the oil workers) didn't happen, or that it didn't destroy Venezuela's oil production. So in the absence of any contrary evidence, I think The Economist's account of that specific event is to be trusted. Why would Chavez do such a thing? I suspect (OK, guess) that when you have a theory that you are so committed to that anything that doesn't conform is regarded as enemy propaganda, it becomes amazingly easy to do really stupid things. (Note that this does not depend on what the theory is; any theory, disconnected from any counter-evidence, is prone to this.)
  - civilian 10y ago
    Yeah, idk if I have the tools to convince you. AnimalMuppet's response is good. If anyone is curious what The Economist's "bias" against Chavez looks like, here's a good article: http://www.economist.com/news/leaders/21573106-appeal-populist-autocracy-has-been-weakened-not-extinguished-hugo-ch%C3%A1vezs-rotten http://www.economist.com/news/leaders/21573106-appeal-populi...
drzaiusapelord 10y ago
The idea that China or Russia would be more friendly to Venezuela is almost laughable. Even Venezuela's corrupt government knows this would piss off its neighbors and the Russians aren't just going to sell you oil. They'll want a military base, submarine dock, or listening post in your country, if not stooges of their own in high positions of government like they did in Ukraine and do in several neighboring countries. I suspect the US has a strong interest in Venezuela not going belly-up and is selling oil just for cash, perhaps turning the wheels on Maduro a bit by having your "enemy" take care of you in a time of need. I imagine Maduro is getting a good price as well. Suddenly all that Socialist talk doesn't make sense when your once wealthy country is dirt poor and the "evil" capitalist neighbor is the guy getting you out of trouble. We don't need anything political or strategic from them, but China and Russia certainly do. Venezuela would be in no position negotiate with these powers and history has shown them how getting into bed with Russia in the Americas tends to end badly. I imagine more civilized and less expansionist countries like Norway want none of the hot mess that is Venezuela and have no problems finding buyers of their oil. It would also be incredibly controversial to Norwegians who believe in human rights and Norway, being a democracy, would bow to the pressure of its people. I don't know why you think Norway would automatically approve such a sale. Just because both countries are 'not the USA' doesn't mean they are bosom buddies or somesuch.
tim333 10y ago
As the article mentions they have had expertise and screwed it up. First an American consortium was producing lots of oil but they nationalized it and then China National Petroleum Corporation moved in but can't get it's equipment delivered. They need some sort of sane economics so you can order stuff and have it turn up.
bpodgursky 10y ago
> please, don't blame it on communism/socialism; people have interests and I believe so do people in Venezuela (sic) This statement shows that you fundamentally don't understand the problems a socialist (or communist) economy runs into. People obviously have interests and incentives; people in Venezuela are people, just like people in the US. But you can have an economic structure which helps align those incentives with productive work -- in a market economy, those running the oil industry are heavily incentivized to actually _produce oil_ and get paid for it. When you have price controls and rampant shortages because of them, you can make far more money using your federal money to buy supplies and sell them on the black market, instead of fixing your oil rigs (because (1) you don't own the output and (2) the gas you sell is price controlled to ridiculously low levels). If you have a government which turns a blind eye to rampant theft and cronyism, you're not even taking risks by doing the above -- it's practically condoned. Russia, China, and Norway know that the government of Venezuela is just as likely to turn their kleptocratic ways on them, as soon as the going gets even tighter. The "state" oil industries in those countries are actually semi-private, and have actual financial incentives to not get screwed over.
usefulcat 10y ago
Pure speculation: the nation's infrastructure and institutions (think electricity, water, police) are now so broken that the investment that would be required is large enough and risky enough that the risk-reward ratio doesn't make sense even if the oil itself is free or nearly so. Doesn't seem too improbable given the current low market price of oil and the disastrous conditions in Venezuela.

civilian 10y ago

I'm gonna blame it on communism. It's not that they don't know how to produce oil. It's that the oil company has been so heavily mismanaged and used for political purposes that it has become extremely inefficient. http://www.economist.com/news/americas/21607824-venezuelas-loss-thousands-oil-workers-has-been-other-countries-gain-brain-haemorrhage http://www.economist.com/news/americas/21607824-venezuelas-l... > IN 2003 Venezuela’s then president, Hugo Chávez, fired more than 18,000 employees, almost half the workforce, of the state-run oil corporation, Petróleos de Venezuela (PDVSA). Their offence was to have taken part in a strike (pictured) called in protest at the politicisation of the company. Their punishment was to be barred from jobs not only in PDVSA itself but also in any company doing business with the oil firm. The axe fell heavily on managers and technicians: around 80% of the staff at Intevep, PDVSA’s research arm, are thought to have joined the strike. At the stroke of a pen, Venezuela lost its oil intelligentsia. Obviously, this wouldn't have happened in a free market. But even other state-run oil companies haven't made this kind of blunder.

metaphorm 10y ago
your answer is on target but you're wrong to "blame it on communism." that has nothing to do with communism or any other abstract theory of political economy. that is an explicit example of incompetent authoritarian rule by an unhinged despot with no checks on his power.
- zeveb 10y ago
  > that is an explicit example of incompetent authoritarian rule by an unhinged despot with no checks on his power … Communism!
- civilian 10y ago
  Communism is tied to state-run monopolies of companies. Yes, the main fault was an incompetent authoritarian rule, but it wouldn't have been possible if the oil company hadn't be nationalized. If Venezuela has an incompetent authoritarian rule, but had a free market for oil companies and didn't harass the employees of oil companies? Then they'd still be drilling with a state-of-the-art technology & workforce today.
  - metaphorm 10y ago
    ok sure, but I still don't see what that has to do with Communism. suppose their incompetent authoritarian system had been nominally capitalist? or a theocracy? or a monarchy? what difference does it make. my point is its the incompetence and authoritarianism that caused the problems.
    - brownbat 10y ago
      > I still don't see what that has to do with Communism > my point is its the incompetence and authoritarianism that caused the problems A lot of people believe there's a causal road from Communist governing philosophies to incompetent authoritarianism (though you're right, it certainly wouldn't be the only way to get there).
      - metaphorm 10y ago
        right, so there's many roads to perdition. what style of government is best equipped to avoid these types of problems? Is it democracy? Possibly so. Paraphrasing Churchill "the worst form of government except for all the other ones that have been tried". All of those other systems I've mentioned also have high functioning, efficient, non-corrupt versions of them as well. Look at Singapore for an example of a high competence, low corruption form of Authoritarian government. So I'll just say it one more time. Communism is orthogonal to competence/corruption of government. The fact that so many people implicitly believe they're linked is evidence of the century long propaganda campaign against anything socialist that has been waged by the powers-that-be in the capitalist system.
binarray2000 10y ago
What you (plus the quote from The Economist) describe is like shooting yourself in the foot. Still, ideology aside, why would Chavez do such a thing? Was he an intellectual moron? No. He knew that without oil exports his people would be hungry, and hungry people mean bloody revolution. Also, quoting from The Economist is one sided considering their position regarding Venezuela during and after Chavez. You see, media is biased and I don't want to trust them, no matter how "respectable" they are. (eg. NYT in the eve of 2003 Iraq invasion) I'd like to hear from people who live there (or from less biased reporters) about causes for this situation in which an oil rich country must import oil from its major adversary, in which the whole society dissolves. EDIT: User nnq asks the same questions as I do.
- AnimalMuppet 10y ago
  You don't trust The Economist to be unbiased. Fine. But I know of no sources that assert either that the event in question (the firing of the oil workers) didn't happen, or that it didn't destroy Venezuela's oil production. So in the absence of any contrary evidence, I think The Economist's account of that specific event is to be trusted. Why would Chavez do such a thing? I suspect (OK, guess) that when you have a theory that you are so committed to that anything that doesn't conform is regarded as enemy propaganda, it becomes amazingly easy to do really stupid things. (Note that this does not depend on what the theory is; any theory, disconnected from any counter-evidence, is prone to this.)
- civilian 10y ago
  Yeah, idk if I have the tools to convince you. AnimalMuppet's response is good. If anyone is curious what The Economist's "bias" against Chavez looks like, here's a good article: http://www.economist.com/news/leaders/21573106-appeal-populist-autocracy-has-been-weakened-not-extinguished-hugo-ch%C3%A1vezs-rotten http://www.economist.com/news/leaders/21573106-appeal-populi...

drzaiusapelord 10y ago

The idea that China or Russia would be more friendly to Venezuela is almost laughable. Even Venezuela's corrupt government knows this would piss off its neighbors and the Russians aren't just going to sell you oil. They'll want a military base, submarine dock, or listening post in your country, if not stooges of their own in high positions of government like they did in Ukraine and do in several neighboring countries. I suspect the US has a strong interest in Venezuela not going belly-up and is selling oil just for cash, perhaps turning the wheels on Maduro a bit by having your "enemy" take care of you in a time of need. I imagine Maduro is getting a good price as well. Suddenly all that Socialist talk doesn't make sense when your once wealthy country is dirt poor and the "evil" capitalist neighbor is the guy getting you out of trouble. We don't need anything political or strategic from them, but China and Russia certainly do. Venezuela would be in no position negotiate with these powers and history has shown them how getting into bed with Russia in the Americas tends to end badly. I imagine more civilized and less expansionist countries like Norway want none of the hot mess that is Venezuela and have no problems finding buyers of their oil. It would also be incredibly controversial to Norwegians who believe in human rights and Norway, being a democracy, would bow to the pressure of its people. I don't know why you think Norway would automatically approve such a sale. Just because both countries are 'not the USA' doesn't mean they are bosom buddies or somesuch.

tim333 10y ago

As the article mentions they have had expertise and screwed it up. First an American consortium was producing lots of oil but they nationalized it and then China National Petroleum Corporation moved in but can't get it's equipment delivered. They need some sort of sane economics so you can order stuff and have it turn up.

bpodgursky 10y ago

> please, don't blame it on communism/socialism; people have interests and I believe so do people in Venezuela (sic) This statement shows that you fundamentally don't understand the problems a socialist (or communist) economy runs into. People obviously have interests and incentives; people in Venezuela are people, just like people in the US. But you can have an economic structure which helps align those incentives with productive work -- in a market economy, those running the oil industry are heavily incentivized to actually _produce oil_ and get paid for it. When you have price controls and rampant shortages because of them, you can make far more money using your federal money to buy supplies and sell them on the black market, instead of fixing your oil rigs (because (1) you don't own the output and (2) the gas you sell is price controlled to ridiculously low levels). If you have a government which turns a blind eye to rampant theft and cronyism, you're not even taking risks by doing the above -- it's practically condoned. Russia, China, and Norway know that the government of Venezuela is just as likely to turn their kleptocratic ways on them, as soon as the going gets even tighter. The "state" oil industries in those countries are actually semi-private, and have actual financial incentives to not get screwed over.

usefulcat 10y ago

Pure speculation: the nation's infrastructure and institutions (think electricity, water, police) are now so broken that the investment that would be required is large enough and risky enough that the risk-reward ratio doesn't make sense even if the oil itself is free or nearly so. Doesn't seem too improbable given the current low market price of oil and the disastrous conditions in Venezuela.