Venezuela Threatens to Nationalize Banks

[northzax]

http://sfgate.com/cgi-bin/article.cgi?f=/n/a/2007/05/03/international/i123053D76.DTL

Threatens to Nationalize Banks
Thursday, May 3, 2007

(05-03) 12:51 PDT CARACAS, Venezuela (AP) --
Venezuelan President Hugo Chavez on Thursday threatened to nationalize the country's banks and largest steel producer, accusing them of unscrupulous practices.
"Private banks have to give priority to financing the industrial sectors of Venezuela at low cost," Chavez said. "If banks don't agree with this, it's better that they go, that they turn over the banks to me, that we nationalize them and get all the banks to work for the development of the country and not to speculate and produce huge profits."
Chavez also warned the government could take over steel producer Sidor, which is majority controlled by Luxembourg-based Ternium SA.

another brilliant idea from Caracas.

[Warren Stupidity]

1. Yes imagine a banking industry that worked for the benefit of the people!

Hideous. I shudder to even think of that.

[Naturyl]

2. Impossible!

Margaret Thatcher has proven irrefutably (by declaring it) that *there is no alternative* to market-fundie capitalism. Chavez cannot nationalize the banks because it is against the laws of nature.

</sarcasm>

[gravity]

12. It does work for the benefit of the people

Barely anyone in this country would been able to purchase a home if it wasn't for banks.

[Warren Stupidity]

16. Work for the benefit vs benefits.

Obviously banks have some public value. "Working for the benefit" means that a primary objective of a nationalized banking industry would be its public value. The primary benefit of the banking industry in our country is "maximum shareholder value", which if it happens to cause some public good as a by-product is fine.

[Greyhound]

19. You mean like the one originally set up in the US Constitution?

The whole central banking system is nothing but a scam to rob people of their industry.

[Colobo]

3. He'll get praise over here

which is very sad.

[Warren Stupidity]

4. No the post will get sarcasm. Lots of it.

:sarcasm:
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[Vidar]

18. Punishing criminal corporations--how evil of him.

[BlooInBloo]

5. Oh. They hadn't already?

[madeline_con]

6. Dang! Bad timing.

Our troops are spread so thin, we'll be hard-pressed to muster enough for an invasion.

We'll just HAVE to liberate those poor Venezuelans from that madman!

[ToeBot]

7. So, does this make him the Alexander Hamilton of Venezuela?

Snark!!

[northzax]

8. oh, two points

that was damn clever. disingenous, but clever :hi:

you know full well that Venezuela has a hamilton-esque national bank (Banco Central de Venezuela)

[WinkyDink]

9. Gee, Venezuela is an autonomous nation! Who knew?!

[rucky]

10. But, but... anything but capitalism is EVIL! n/t

[Wiley50]

11. Makes better sense than privatizing the money supply like we did withe the Federal Reserve

We sold (or gave) our entire economy to robber barons

and many still haven't figured it out

[Saboburns]

13. I'd like to say something if I may.

Last week he nationalized the Oil Industry.

This week it's the Banking Industry.

Before the usual DU Hugo Chavez Blood Bath begins I'd like to point out something that I think is of huge importance.

These are exactly what Hugo Chavez said he was going to do before being elected.

In other words, the majority of Venezuelans KNEW EXACTLY WHAT THEY WERE GETTING IN HUGO CHAVEZ.

And voted him in, in a very strong majority.


Thanks for listening.

[Mika]

20. Good point.

He's an elected dictator.

:sarcasm:

[Matsubara]

14. Why use the word "threaten"?

Like nationalizing a corrupt, broken industry is a bad thing?

Here, rewrite time:


"Chavez offered to nationalize the corrupt banks and steel producers on behalf of the fed-up citizenry."


Sounds different, no?

[pampango]

15. Nationalisation has been done many times in many places.

While it is a delicate political maneuver to pull off, the really hard part in the long run is making it work for the people it intended to benefit. Once the state owns and controls the economy, the challenge is to make sure that the government stays responsive to the people. Too often government officials value their own power and prosperity more than they do that of the people they govern.

Chavez may indeed have the welfare of his citizens as his main focus, but the same could be said of many nationalizers from Lenin to Mugabe. The critical task for the Venezuelan people will be to maintain control of the government, so that if Chavez, or his successors, stray from the path of the common good, they have a means of recourse. There is no reason to believe Chavez is not committed to democratic control of the government, but some other governments have come to believe that they "know better" than the people themselves what is best for them.

[Warren Stupidity]

17. Who does he think he is, FDR? nt.

[cooolandrew]

21. That would be a perfect solution to a lot of the world's problems. Like it.

[Selatius]

22. This might cause capital flight if done incorrectly.

I would recommend he set up a public banking mechanism that, while it may not necessarily replace private forms of gaining access to capital, would provide a choice to people between for-profit and non-profit creditors.

The public banking mechanism could become a powerful vehicle for organizing workers into co-op businesses nationwide, millions of them, giving them a real choice between working for themselves collectively to enjoy their own fruits of their labor or to work in traditional firms at the leisure of their employer.

[northzax]

23. sure, government credit can work wonderfully

look at, say, student loans in the US, you can't beat Uncle Sam for interest rates. of course, once cronies get involved, you end up with the mess of the current US student loan system (thank you, My. Bush) in what is, in essence, a one-party unitary executive, this is just consolidation of more power in the hands of the executive. Chavez has already appointed a cousin to run the oil ministry, a brother to control overseas sales of petroleum, maybe he has a sister who is a banker?


banking needs strong oversight and regulation, that is the responsibility of government. but one thing governments have never done particularly well, especially in de facto single party systems is provide either retail or commercial banking services. you already have to be a party member to work in the oil industry (Rafael Ramirez, "PDVSA es roja, rojita de arriba a abajo.") that doesn't bode well for nationalised banks. I personally want my bankers to be good bankers, not good party members. but we shall see.