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UNCLAS SECTION 01 OF 03 CARACAS 001831 
 
SIPDIS 
 
SIPDIS 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: PGOV ECON SOCI VE
SUBJECT: WE AREN'T MAKING THIS UP: THE BRV'S BIZARRE POLICY 
HIGHLIGHTS 
 
¶1. (SBU) Summary: Over the last month the BRV has proposed an 
amalgamation of ambitious socialist and populist projects 
that further expand the role of the state in society and 
seemingly defy common sense.  President Chavez has announced 
his intention to construct socialist cities and islands, 
reduce the work week, arbitrarily adjust central bank 
policies, shift time zones, and change the official name of 
Caracas to "Cradle of Bolivar and the Queen of Guaraira 
Repano."  While these arbitrary policy changes often seem 
irrational and capricious, they strongly adhere to Chavez' 
populist and nationalist ideology and allow attention to be 
diverted away from more controversial policy changes.  End 
Summary. 
 
------------------------------------- 
Moving toward a New Bolivarian Utopia 
------------------------------------- 
 
¶2. (U) Chavez first announced his plans for a socialist city 
in January 2007.  During his August 26 "Alo Presidente" 
television program he proposed naming the first one, 
"Cariba," in honor of the aboriginal tribe that first 
inhabited Caracas.  Located just North of Caracas in a former 
environmentally protected area bordering Vargas state, Cariba 
will be the new home for families from the poorest barrios in 
Caracas.  The BRV plans on moving families from the 
over-crowded and dangerous Catia Barrio into this 11,370 
hectares block of land, setting a population goal of 100,000 
inhabitants.  The proposed city will purportedly have blocks 
of 5-floor houses with 20 family units, communication 
infrastructure, transport, trains, and possibly even cable 
cars.  Besides building in a former environmentally protected 
zone, the government evicted 350 families who were previously 
occupying this area.  On July 22, Ramon Carrizalez, the 
Minister of the People's Power for Housing and Habitat said 
that there were 12 ministries and 16 autonomous institutions 
working on this project, and the first 4,280 apartments 
should be completed in 12 - 18 months. 
 
------------------ 
Chavez' Waterworld 
------------------ 
 
¶3. (U) On August 19, President Chavez rolled out plans for 
installing artificial islands in Venezuela's Exclusive 
Economic Zone (EEZ) to "protect the security and sovereignty 
of its 760,000 square kilometers of national maritime space." 
 This ambitious plan calls for erecting platforms in the 
middle of the ocean as small operation bases for boats that 
gradually would become navigation networks with permanent 
civil-military presence.  These platforms would also serve as 
bases for scientific research, submarines, and the 
exploration of petroleum and minerals.  Chavez neglected to 
set a time frame for when the BRV would implement this plan, 
but noted that his long term goal would be to create 
inhabited island cities.  The Dutch government, not 
surprisingly, has already expressed concerns about the BRV's 
unilateral intention to assert sovereignty in waters to which 
they believe the Dutch Antilles have a claim. 
 
---------------------------------- 
Time Changes and the Sun President 
---------------------------------- 
 
¶4. (U) During this same August 26 "Alo Presidente," Chavez 
announced that Venezuela would move its official time back a 
half an hour at midnight on December 31, ostensibly to boost 
the amount of natural sunlight intake during school hours. 
Chavez said he would change the Law of Meteorology to reflect 
Venezuela's new time grid, placing Venezuela four-and-a-half 
hours behind Greenwich Mean Time (GMT) instead of the current 
four hours.  The Minister of Popular Power for Science and 
Technology, Hector Nevarro argued that he sought "a more fair 
distribution of the sunrise" and that more natural sunlight 
would have a positive metabolic effect, making Venezuelans 
even more productive at work and school.  However, given the 
increasingly perilous crime situation in Caracas, many 
average Venezuelans worry more about having to walk or drive 
home in the dark than increasing productivity.  With this 
move, Venezuela would be returning to its pre-1965 time zone 
and become the fifth country in the world in between time 
zones, joining Burma, Iran, India, and Afghanistan. 
 
-------------------------- 
Revolutionary Name Changes 
-------------------------- 
 
¶5. (U) In another attempt to leave a symbolic fingerprint on 
 
CARACAS 00001831  002 OF 003 
 
 
Venezuela, Article 18 of Chavez' "reformed" constitution 
proposes changing the name of Caracas to the "Cuna de Bolivar 
y la Reina de Guaraira Repano" (Cradle of Bolivar and the 
Queen of Guaraira Repano).  (Note: Guaraira Repano is the 
name the native Caraquenos gave to the mountain range that 
borders the northern edge of Caracas.  End Note.) Name 
changes are nothing new for Venezuelans, and besides changing 
the country name in 1998, Chavez has added a star to the 
national flag and modified the figure of the horse in the 
national shield to run left instead of right.  Much to the 
confusion of visitors, the BRV has been constantly changing 
the names of major parks, highways, and streets, providing 
names that better reflect Chavez' personal world view.  For 
example, Caracas' Parque del Este's name has been changed 
from Romulo Betancourt to Generalismo Francisco de Miranda, 
and part of the principle highway in western Caracas, Avenue 
Paez, has been changed to Avenue Tehran.  Caraquenos have 
largely coped with these increasing number of name changes by 
simply ignoring them. 
 
------------------------ 
Prohibition in Venezuela 
------------------------ 
 
¶6. (U) During the April 2007 Semana Santa vacation, President 
Chavez made a startling announcement affecting nearly all 
Venezuelans when he outlawed the purchase and sale of alcohol 
outside the hours of 10 AM and 5 PM from March 31 to April 4. 
 He also declared April 5, 6, and 8 completely dry.  This 
announcement was made the day before the vacation began, 
catching bars, restaurants, discos, and even embassy 
employees completely off guard.  To his credit, Chavez' 
reasoning for this decree was to reduce the number of drunk 
driving accidents during Venezuelans' mass exodus from the 
cities.  Besides shutting down bars and discos during one of 
the busiest times of the year, even Chavez' supporters 
protested this decree and most Venezuelans responded by 
stocking up and hoarding even more alcohol than usual. 
Venezuelan pro-opposition newspaper "El Nacional" reported 
that while traffic accidents were reduced from 2,847 in 2006 
to 2,773, traffic fatalities increased from 94 to 121 over 
the 2007 Easter week. 
 
----------------------------------- 
Say Good-bye to Superman and Usnavy 
----------------------------------- 
 
¶7. (U) On August 31, the National Electoral Council (CNE) 
proposed a Civil Registration Law that would allow the 
national registry to bar parents from giving their children 
"names that expose them to ridicule, are extravagant, 
difficult to pronounce, or leave doubts over the gender of 
the child."  The new law proposes creating a list of no less 
than 100 traditional names for boys and girls that could be 
offered to parents as a reference when they are registering 
their child's birth.  If approved by the National Assembly, 
besides cracking down on actual Venezuelan names like 
Superman and Usnavy, this bill would likely allow the 
registry authorities to refuse names like Lizette, Diogenes, 
Mizher, Leobardo, Ysmer, and Iroshima, coincidentally all 
names of National Assembly representatives.  (Note: On 
September 13 the CNE withdrew this proposal.  End Note.) 
 
------------------------------ 
Working Hard or Hardly Working 
------------------------------ 
 
¶8. (U) As part of President Chavez' constitutional reform, 
and a sweetener for the masses, the Venezuelan work week 
would be reduced from eight hours a day and a maximum of 44 
hours per week, to six hours a day and a maximum of 36 hours 
per week.  Chavez stated logic is that a 25 percent reduction 
in the number of hours worked would increase the number of 
jobs by the same percentage.  Unsurprisingly, most Venezuelan 
economists have argued that instead of hiring new workers, 
companies will pay overtime, doling out more money for 
workers doing the same job.  The likely unintended 
consequence of this policy, therefore, is more inflation. 
Economists estimate that labor costs would increase by 25 - 
35 percent due to this change, and even loyal Chavista 
business associations have argued that this should either 
only affect large businesses or the BRV should help pay for 
the cost.  The Minister of the People's Power for Labor and 
Social Security, Jose Ramon Rivero has said that the 
reduction, should it come into affect, would not be automatic 
and the goal is to reduce to six hours daily before 2010. 
 
-------------------------------------- 
 
CARACAS 00001831  003 OF 003 
 
 
Central Bank Becomes the People's Bank 
-------------------------------------- 
 
¶9. (U) During his September 2 "Alo Presidente" show, Chavez 
suggested that the Venezuelan Central Bank (BCV) should stop 
acting as an "oxygen tank" for private banks and instead 
called on the BCV to help "farmers and peasants."  On 
September 5, the Central Bank, apparently following Chavez' 
orders, announced that it would no longer allow overnight 
lending to banks that lacked liquidity.  This move took 
banks, mainly small ones, by surprise and they were forced to 
borrow from larger banks, driving the overnight rate very 
quickly to 120 percent.  The BCV apparently realized their 
mistake and resumed lending money to banks, driving the rate 
back down to 30 percent, however, still up from an average 
daily rate of 8.7 percent.  (Note: On September 12, the BCV 
issued a circular stating that it would, starting today, 
resume "liquidity injection operations" that had been 
suspended on September 5.  End Note.)  During his September 2 
speech Chavez said that he was having people study the BCV to 
revise the procedures inherited from previous governments. 
 
------- 
Comment 
------- 
 
¶10. (SBU) While the above policies clearly illustrate the 
arbitrary and capricious nature of Chavez' regime, these 
changes adhere to his populist, paternalistic, and 
nationalist ideology.  Chavez' name changes and socialist 
cities show his seemingly relentless desire to construct both 
symbolic and physical manifestations of his reign.  Besides 
simply allowing him to brandish power, he justifies these 
measures as a way to eradicate the vestiges of capitalism. 
Although these policies occasionally seem to defy logic, they 
allow Chavez to focus public attention on outlandish policies 
and away from more controversial ones like his proposals to 
eliminate presidential term limits and reduce the power of 
local governments. 
 
DUDDY