Friday, May 06, 2005

With Dictators Like Hugo Chavez, Who Needs to Make It Up?

I was wrong: Tony Blair did not lose his bid for a third term as Prime Minister. He did not, however, "beat the number"...and in that respect, he loses.

Pre-election, Blair's Labor Party held a 166-seat majority in Parliament. The betting was on how big a majority he would keep, with the general consensus--in Wall Street parlance, "the whisper number"--being 100 seats.

It's looking closer to a 66-seat majority, and that is not a good thing for Blair. As in the U.S., a reasonable slice of the majority party's representatives never go along with their leaders. In the UK, this amounts to about 50 members. So a 66-seat majority is uncomfortable enough to make it likely Blair's third term will be his last, and his new government will have a tough time getting its agenda passed into law.

The press says "it's all about Iraq." I heard that on the radio this morning and read it in the New York Times, too. But based on five days in London (Labor country) and surrounding environs, I would say that's wishful thinking on the part of the U.S. press.

Not a single person, from whatever slice of the UK's highly stratified life that I experienced--cabbies who called me "Guv'nah," professionals who called me "Mr. Matthews," Pakistani hotel clerks who called me "Sir,"--not one person complained about the war. But I heard plenty on both sides of the immigration debate.

The spin on Blair's election isn't half as interesting, however, or important, as the spin on Venezuela's oil production decline--worthwhile reading in today's Wall Street Journal.

Since that country's totalitarian/socialist/whacked President Hugo Chavez began looting the oil sector for his own socialistic wealth-redistribution program--firing 19,000 workers and installing his own pals in management--Venezuela's oil production has declined far below the fake numbers issued by the government.

Instead of producing over 3 million barrels a day, as the official statistics show, actual production is closer to 2.5 million barrels a day. Not a good thing for a country with little else in the way of exportable resources, and not good at all for the U.S.--the major importer of that resource.

Chavez's solution? No, it's not the rational one: to hire competent managers and reinvest in the oil infrastructure. It's the whacky one: to blame "sabatoge."

Yes, that's right.

"So (according to today's Journal) the military has launched Operation Black Gold, in which military staff will work with industry specialists to protect oil installations, pipelines and power stations."

Just what those fields need: another layer of corrupt bureaucracy.

In any event, we're going to need all the oil those anti-saboteurs can find, if this commodity price inflation keeps going. Did anybody else notice what Clorox blamed its earnings miss on yesterday?

"Intense commodity price pressure."

And did anybody else notice how much they're raising prices on Clorox Bleach?

9%.

That's triple the Fed Funds rate.


Jeff Matthews
I Am Not Making This Up

1 comment:

Tom M said...

I understand Clorox has amended their earnings press release to read:

"We continue to have intense commodity price pressure; however, longer-term inflation expectations remain well contained."

I think "well contained," in this instance, means one-gallon jugs...