Socialist Venezuela Still Sucking Air

Even though Venezuela is sitting on top of some of the world's largest oil reserves. And even though oil prices are record highs, their oil revenue has actually decreased over the last two years:

Vittorio Hernandez - AHN News Writer
Caracas, Venezuela (AHN) - Venezuela's oil industry shrank by 5.3 percent in 2007, according to the nation's Central Bank. In 2007 it contributed only $3.14 billion to the country's gross domestic product.
That was in sharp contrast to previous years when the oil industry yielded $3.3 billion (7.10 trillion bolivares) in 2006 and $3.38 billion (7.25 trillion bolivares) in 2005.
But despite the declining share of the oil industry Venezuela's economy still grew by 8.4 percent in 2007. The dip in oil contribution was made up by the non-oil sector which had a 9.7 percent growth.
The downtrend in oil revenues took place despite a 16 percent hike in the average basket price for Venezuelan crude oil. The price of crude climbed to $65.13 per barrel in 2007 from $56.35 per barrel in 2006.
Venezuela's oil industry is wracked by corruption and internal dissent. According to Venezuelan Energy Minister Rafael Ramirez, who serves concurrently as president of state-owned Petroleos de Venezuela, the company cannot hire enough rigs and that has resulted in a decline in oil production.

Is anyone surprised they can't hire enough rigs? What is surprising is that any foreign companies are doing business there at all, knowing that Thugo Chavez will likely steal their assets.

And now we learn that Thugo's central bank has devised a plan to reduce the high inflation rate: lop three zeros off the bolivar!

Venezuela is launching a new currency with the new year, lopping off three zeros from denominations in a bid to simplify finances and boost confidence in a money that has been losing value due to high inflation.
President Hugo Chavez's government says the new currency - dubbed the "strong bolivar" - will make daily transactions easier and cure some accounting headaches.
Officials also say it is part of a broader effort to contain rising prices and strengthen the economy.
"We're ending a historical cycle of ... instability in prices," Finance Minister Rodrigo Cabezas said, adding that the change aims to "recover a bolivar that has significant buying capacity."
Prices have risen as Chavez has pumped increased amounts of the country's oil income into social programmes, reinforcing his support among the poor and helping to drive 8.4% economic growth in 2007.
The Central Bank is promoting the new monetary unit with an ad campaign and the slogan: "A strong economy, a strong bolivar, a strong country."
Officials, however, have yet to clearly spell out their anti-inflationary measures.
Some Venezuelan critics, meanwhile, have dubbed the new currency the "weak bolivar", noting its predecessor, the bolivar, has seen its purchasing power suffer in an economy where inflation ran roughly 20% in 2007 - the highest in Latin America.
Venezuelan economist and pollster Luis Vicente Leon said that while the new currency may provide "the perception of stability" for some, it is largely a "cosmetic change".
Government officials say the change is overdue to bring Venezuelan denominations into line with those of other countries in the region. Instead of denominations in the thousands, the largest new Venezuelan note will be 100 strong bolivars.

Yeah, that's gonna work real well, Thugo. Just like your nationalization of foreign oil company assets managed to decrease your oil revenue during a period when oil prices have skyrocketed.

And there are many leftwing idiots, of the Michael Moore/Cindy Sheehan/Dennis Kucinich/Ralph Nader variety, who believe that Thugo's policies are good ideas.