posted on March 4, 2009 06:54:40 PM new
Chavez Seizes Rice Operations From U.S. Grain Giant
CARACAS – President Hugo Chavez on Wednesday ordered the expropriation of the local rice operations of U.S. grain giant Cargill Inc., and threatened to take over beer and food manufacturer Polar, the country's largest private company.
Mr. Chavez's move comes amid a growing battle between his populist government and private food companies, who are straining under strict price controls aimed at slowing down high inflation set off by Mr. Chavez's non-stop spending. The controls have led to shortages of staples like milk and rice. Mr. Chavez blames the companies; the companies say the prices are set too low to make a profit.
Hugo Chavez
Earlier this week, Mr. Chavez ordered army units to take over other rice mills belonging to Venezuelan companies whom the president accuses of causing shortages of rice. He also imposed new regulations forcing producers to devote at least 70% of their production to price-regulated products, including certain types of sugar, milk and vegetable oil.
The intervention is aimed at keeping companies from finding ways around the price controls, for example switching to value-added variations of goods such as low-fat milk or flavored rice, which aren't covered by the controls. For rice producers, this means that 90% of their production must be price-controlled white rice, which is consumed by the vast majority of Venezuelans.
"We have state officials in our company now, observing production," said Frank Rojas, the sales and marketing manager for Arroz Mary, one of the leading rice producing companies in Venezuela. So far, government representatives aren't making any production decisions, he said.
On Wednesday, Mr. Chavez went after Cargill, based in Minneapolis. "Prepare a decree and let's expropriate Cargill," Mr. Chavez told Agriculture minister Elias Jaua alter a meeting of his cabinet.
The former army officer also threatened to expropriate Polar, Venezuela's largest private company which makes a multitude of food products as well as the country's trademark Polar beer. "We will expropriate you Mr. Mendoza, I'm warning you," Mr. Chavez said, referring to the CEO of the family-owned company, Lorenzo Mendoza. "Get the decrees ready, one after the other."
Mr. Chavez is renewing his push to create what he calls 21st Century socialism after winning a referendum last month eliminating term limits and permitting him to run for office as many times as he wants. In the past few years, he has nationalized broad swathes of the economy.
But the outspoken leader faces a growing set of problems from the falling price of oil, which Venezuela relies on for 90% of its hard currency earnings. Venezuela's oil currently fetches about $36.80 a barrel, almost half the $60-a-barrel needed to finance this year's budget.
Unlike previous takeovers, Mr. Chavez doesn't have the money now to pay anything close to market prices for the assets. So far, he has been unable to pay for the last batch of company nationalizations from 2008 that included three cement makers, the country's top steel mill and a bank owned by Spain's Banco Santander SA.
But the leader suggested that might not stop him from seizing assets.
"I have no problem expropriating rice companies," Mr. Chavez told a crowd on Saturday. "And also I will pay [company owners] with paper. I won't pay them with cash, no."
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Economic Reform act of Chairman Obama of the socialist States of America :
10 ounces of meat per month,half a yard of cotton per year per adult.
Hellilujah!
[ edited by HWAHWA on Mar 4, 2009 06:55 PM ]
posted on March 4, 2009 07:14:26 PM new
Yes Hwa, please do enlighten us. What does Hugo Chavez nationalizing companies in his country have to do with our president?
How is it you've come to the conclusion that Chavez is a "mentor" to Obama? Especially consider the following before you reply:
Hugo Chavez has said that Obama has "the same stench" as George Bush.
Obama has said that Hugo Chavez is "a dangerous demagogue"
Did you give your login information to bear or something?
posted on March 4, 2009 07:25:33 PM new
Honestly, Hwa, you are attributing every evil act committed by any socialist to Obama. This is not valid. Your credibility sinks. Try to put aside your fears and face the facts, weigh them, and then make your comments.
posted on March 4, 2009 07:25:50 PM new
Ironically, the only thing I need to do to respond to this one is cut and paste from a couple days ago.
Hwa....
Some things really don't change. You always could be counted on for our daily dose of fact challenged nonsense.
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People put their hand on the bible, and swear to uphold the constitution. They do not put their hand on the constitution, and swear to uphold the bible.
posted on March 4, 2009 10:20:02 PM new
"Mentor"?! Please, hwahwa, explain why you posted this with such a title. Don't go and hide.
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"Here in America we are descended in blood and in spirit from revolutionists and rebels - men and women who ***dared to dissent*** from accepted doctrine. As their heirs, ***may we never confuse honest dissent with disloyal subversion."*** --Eisenhower
posted on March 5, 2009 05:52:32 AM new
THis is nothing like Obama Hwa Hwa. The US Gov't is not seizing companies providing many jobs for the local people and feeding the masses of the population. Cargill has not asked for a Government bailout. In fact, it seems that Chavez is basing the expropriation on a failure to print the regulated price on the package!
My husband works for Cargill and has spent quite a bit of time in Venezuela in the flour and rice mills. The rice produced by Cargill at that plant is par-broiled (like Uncle Ben's) a process that preserves and enhances the vitamin content. I am glad that he is not there just now!
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posted on March 5, 2009 06:47:25 AM new
The far right has the delusion that Obama is a socialist out to overthrow capitalism in the failed fashion of Chavez. With that delusion in mind, Hwahwa is apparently trying to make an outrageous comparison between the two by calling Chavez the mentor of Obama.
