Chavez's expenses account: austerity for whom?

Chavez Expenses in Contradiction with his Call for Austerity

El Nuevo Herald

Written by Casto Ocando

President Hugo Chavez urgent call to Venezuelans to assume a more austere lifestyle is in direct contrast with his luxurious lifestyle as evidenced by his bloated official personal budget. According to the 2009 budget President Chavez have available about $20 million for the expenses of his office. Among them, $8.7 million are travel expenses.

In contradiction with his own call to eliminate superfluous spending and to tighten the bell, President Chavez has an abundant budget that includes money to fund the following:

-$250,000 for clothing

-$28,000 for shoes

-$230,000 for grooming products

-$380,000 for dry cleaning

The budget also includes $160,000 for books, $860,000 for vehicles, $1.9 million for food and beverages, $3 million for “social relations” and 3.2 million for the maintenance of the presidential residences.

Just last week, Chavez said that he had ordered to limit all luxury spending in the public administration including “superfluous decoration in buildings” and “remodeling of office spaces”. Yet, as recently as last November –when it was quite clear that the economic situation of the oil producing country was going to get worse- Chavez gave the green light for the remodeling of his presidential office at a cost of $2 million.

It seems that Chavez does not see any contradiction between his own spending and his call for austerity. “Mega-salaries are over” he decreed last week after signing up a new law to cap the salaries of public officers at a maximum of 10 minimum wages or around $5,000 a month at the official exchange rate. “Whoever wants to become rich [in a public office] it is best that just quit and goes somewhere else” said Chavez during a recent TV address.

The decreed salary reduction was the result of oil tumbling prices which have fallen 64% since July 2008. This year the price has hovered around $39 a barrel in dire contrast with the $100 price tag that the Venezuelan oil reached last year.

“It is necessary that we put a stop to the high salaries and high bonuses. Those who want to amass big fortunes should go somewhere else”, said the President.

Reality though seems to contradict very frequently the President’s words. During Chavez administration, there has been a new generation of bankers and businessmen tightly associated to the government that are known as the “boli-bourgeois”. Many of them are famous because of their luxurious lifestyles thanks to the astronomical fortunes they have acquired in very short time.

One of the best known is Leopoldo Castillo. He has been associated to high public officers in the Chavez administration and is currently under investigation by the Attorney General office. Castillo recently acquired a private jet for $54 million and he has important investments in the South of Florida according to a report seen by El Nuevo Herald.

“The way Chavez’s followers have spent money is not precisely an example of socialism” said Carlos Berrizbeitia, former member of the House by the Proyecto Venezuela opposition party.

According to the figures released during his weekly program “Alo Presidente”, Chavez said that he has a base salary of $2,500 per month. However, Berrizbeitia says the President has bonuses of about $15,000 per month for a total salary of $180,000.

However, the person with the highest salary in Chavez administration is not the President but Rafael Ramirez who is simultaneously the Energy Minister and President of Venezuela’s oil company PDVSA. He makes about $50,000 per month including base salary and bonuses. Last week, Ramirez was the target of criticism by oil industry workers and contractors. Oil workers unions in the State of Anzoategui accused Ramirez of having acquired a very luxurious home on the eastern side of the country with a cost of more than one million dollars. El Nuevo Herald tried to get an answer from Ramirez about the criticism by the oil industry workers but he did not return several phone calls from us.

“Chavez double speaks when he demands a reduction of public spending while at the same time the budget for his personal expenses are excessively high” said Berrizbeitia. “Chavez wants to appear to Venezuelans as a humble and austere person but everyone is in shock when they find out the truth about the salaries and expenses in the public administration” said the ex member of the House who has documented through the years the luxury spending of Chavez government.

Criticism to the high salaries of public administration officers does not just come from the opposition. The pro-Chavez member of the house Luis Tascon recently questioned in Congress the base salary of $30,000 per month of PDVSA president when compared to that of the President.

Chavez call to austerity generated a sour polemic that involved journalists and the media. Beatriz Adrian, from the Globovision channel –a fierce critic of the government- published that Cilia Flores –President of the National Assembly- had transportation bonuses of $42,000 per year. She also revealed that Oscar Figuera, a House member for the Communist Party of Venezuela, earns $70,000 including base salary and bonuses. Because of her journalistic work Adrian was threatened with a judiciary investigation by Cilia Flores.

Flores answered the journalistic investigation saying that House members earn “decent and honorable salaries” and accused Adrian of “violating private correspondence” in order to obtain her information. Adrian said that she will not reveal how she obtained her information, a right that is written in Venezuela’s current legislation.

Flores also strongly protested when the opposition House member Juan Jose Molina, from the Patria Para Todos party (PPT), revealed that the National Assembly paid a collective insurance that costs three times as much as the one paid by the government of the State of Miranda controlled by the opposition. The National Assembly just this week decided to launch an investigation into the Miranda government regarding its collective insurance.

The contrast between the call for austerity and the high official salaries earned by high public officers also generated several journalistic investigations into the lifestyle of several Chavez government figures. The daily “La Verdad” from Maracaibo, State of Zulia, published a piece detailing the lifestyle of House member Mario Isea who has been the leader in prosecuting the opposition figure Manuel Rosales for alleged corruption.

According to the newspaper that circulates in the State of Zulia, House member Isea has a salary superior to the top of $5,000 a month established by the government and lives in a house that costs $50,000 in Lago Mar Beach, one of the most exclusive areas of the state capital.

Oscar Perez, an opposition ex House Member, revealed the official salary of important public officers that are soon supposed to be reduced. Among them: the President of the National Electoral Councial (CNE in Spanish), Tibisay Lucena, and the General Comptroller, Clodosvaldo Russian, who each earn about $20,000 per month. Luisa Estela Morales and Luisa Ortega, president of the Supreme Court and Attorney General respectively, who each earn about $24,000 per month and, The Central Bank Director who currently earns $25,000 per month.

ocasto@herald.com

Translated by "Digital". Please forgive any errors in syntax and grammar. I am not a native English speaker or a professional translator. Thanks.