American Elephants


Venezuelan Oil Can No Longer Support a Communist Government by The Elephant's Child

Some of you might remember when Venezuela was a beautiful and prosperous nation. But Americans mostly don’t pay that much attention to South America, I suppose because of the language barrier, which is why we pay more attention to our English-speaking allies, and Europe.

The proven oil reserves in Venezuela are recognized as the largest in the world, totaling 297 billion barrels, as of January 1, 2014. In early 2011 the Venezuelan government under Hugo Chavez announced that the nation’s oil reserves had surpassed those of Saudi Arabia, the long-term leader. OPEC said the Saudi reserves stood at 265 billion in 2009.

Wikipedia says “Venezuela’s development of its oil reserves has been affected by political unrest in recent years. In late 2002, nearly half the workers at the state oil company PDVSA went on strike, after which the company fired 18,000 of them.” I think it has been pretty well proven that “state owned” is not a particularly good idea, nor is business trying to play politics.

Reuters reported that state-owned PDVSA is completely falling apart, with workers walking off the job at a frightening pace. The conditions for oil workers have been deteriorating for years with shortages of food, unsafe working conditions, and hyperinflation destroying the value of paychecks. President Nicolas Maduro has sacked the head of PDVSA and handed control to the military in order to keep the armed forces on his side. Major General Manuel Quevado has only accelerated the decline. Apparently every Venezuelan military officer has a Cuban minder.

Venezuelan oil is a very heavy crude, which needs more in the way of refining than light crude, but Venezuelan refineries are breaking down from neglect and lack of investment.

Reuters reports that about 25,000 workers have quit PDVSA between January 2017 and January 2018, a staggering sum. PDVSA employs roughly 146,000 people. Thousands of workers are walking off of job sites, fed up with going to work hungry, putting their lives at risk at rickety refineries, all for a paycheck that fails to cover even the most basic expenses.

Fires have broken out, and the loss of both top-level engineers and managers as well as experienced workers means the losses will only get worse. Refineries are falling apart, and ports are reducing operations because of a lack of workers.

PDVSA accounts for about half the nation’s oil production — the rest are joint ventures. Last Tuesday, Chevron said that two of its workers were arrested. Chevron has not fled the country as many of its peers have, but the arrests may change matters. This is the first direct hit on an international company operating in Venezuela. At some point the costs of operating will become too high. The amount of oil available on the market will decline, the price of oil will increase. Maduro’s grip on the nation will become even more shaky. There’s not that much more available for him to squeeze.

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Raul Castro Has Resigned From the Presidency of Cuba by The Elephant's Child

The General Assembly has voted in a new president, the hand-picked former Vice President Miguel Diaz-Canel. The Constitution of Cuba is modeled after the Soviet Union’s and similar to modern-day China’s meaning the legislature has full control over who becomes president and who joins his cabinet. The former vice president has a reputation for following orders very successfully.

Many of our news outlets assumed that this was a big deal, but it is not. Raul Castro remains to run the Communist Party, which runs everything else.

Chapter I, Article 5 of the Cuban constitution makes the Communist Party “the superior directing body of society and the State, which organizes and orients the common efforts towards the end of the construction of socialism and advancement of communist society.” This makes the head of the Communist Party—Castro—the “superior” director of the State, above his future successor.

Who remains as commander in chief of the Revolutionary Armed Forces (FAR) of Cuba is not entirely clear from the constitution, as Fidel and Raúl Castro have typically been both president and comandante.

The head of government’s powers are fairly limited:

  • Represent the State and Government and manage general policy
  • Organizing and lead activities by the Council of Ministers
  • Control and attend to the development of activities at the ministries

Last year, Mary Anastasia O’Grady wrote in the Wall Street Journal about a brief uprising of a” Venezuelan National Guard Captain and some 20 others who had gotten some 120 rifles, ammunition and grenades from an armory at Fort Paramacay in Valencia. There were unconfirmed reports of similar raids at other military installations. ”

“The Cuba-controlled military regime put tanks in the streets and unleashed a hunt for the fleeing soldiers.” She added that “Cuba had embedded about 50 high-ranking Cuban military officers, 4,500 Cuban soldiers in nine battalions, and 34,000 doctors and health professionals in Venezuela,  with orders to defend the tyranny with arms. Cuba provides Maduro’s personal security and thousands of other Cubans hold key positions of the State, Government, military and intelligence and counterintelligence services.” What their part is in the starvation in Cuba is unknown.

Burning Cuban flags, when they can be had, is now practically a national pastime in Venezuela because Venezuelans understand the link between their suffering and Havana. The Castro infiltration began over a decade ago when Fidel sent thousands of Cuban agents, designated as teachers and medical personnel, to spread propaganda and establish communist cells in the barrios.

In an August column, O’Grady pointed out that Cuba is not “simply a dictatorship.” For the regime it is a “historical political project” aiming for the establishment of a Cuban-type regime throughout Latin America. The Cubans have taken Nicaragua, Bolivia, Ecuador and are now going after Columbia. Castro is dependent on Venezuelan oil and the money from the narcotics business. Fidel died at 90, and Raul is getting up there. There are a number of younger Castros in government, but future succession is unknown.

Now Venezuela cannot afford to export oil, and is having to import oil itself. The people are starving, and trying to get out of the country. Lefties are always sure that those other people just didn’t do it right, but Communism has a way of always ending up very, very badly.



Life’s Little Surprises Always Await Us. by The Elephant's Child

In the Wall Street Journal today, James Freeman brought up the historic tax reform that Trump signed in December may turn out to be his finest hour, ‘trumping’ even  the firing of James Comey. So many companies have reported positive news from the tax law, even though it’s barely four months old.  The Journal calculated that the four giants of American retail banking— JPMorgan, Wells Fargo, Citigroup and Bank of America have saved a total of $2.3 billion in the first quarter thanks to the new federal corporate tax rate of 21%, down from 35%.

Is that a big deal? Nancy Pelosi is arguing that the tax cut is a useless disaster, and when the Democrats get back in they will promptly raise taxes back to where they should be. (This is a campaign promise? Why?)

Wages have been growing. “Kroger, Walmart, Target Corp. and other food retailers are investing savings from the federal tax law to boost worker pay and benefits, ” the Journal reported recently. John Kartch at the advocacy group Americans for Tax Reform has been keeping a running tally of businesses (now 507) responding to their lower tax bills by announcing pay raises, bonuses, and higher 401K matches. The good news began to arrive almost as soon as President Trump signed the legislation.

Democrats seem to have a hard time getting their minds around the basic consequences of economic incentives. The Labor Department has reported that this is oficially the best job market for those seeking work in the history of  U.S. government statistics. Lefties are quite sure that the best results come from soaking the rich, by which they seem to mean the Koch Brothers, rather than themselves and their friends and supporters.

Ann Althouse notes that a new WaPo poll “finds that the gap between support for Deocatic vs. Republican House candidates dropped more than half since the beginning of the year.” A WaPo/ABC News poll found that 78 percent of registered voters considered voting for a candidate whose views on gun rights and gun control matched their own was either very or extremely important. 21% said it was somewhat or not important at all.

Investors Business Daily reported in an editorial on the macroeconomic effects of the tax reform bill. The Congressional Budget Office admitted that they had vastly overestimated the cost of the Trump tax cuts, because it didn’t account for the strong economic growth they would generate.

In any case, the CBO now expects GDP to be $6.1 trillion bigger by 2027 than it did before the tax cuts.

The CBO report also makes clear that this faster-growing economy will offset most of the costs of the Trump tax cuts.

In a table buried in the appendix of the CBO report, it shows that, before accounting for economic growth, the tax cuts Trump signed into law late last year would cut federal revenues by $1.69 trillion from 2018-2027.

But it goes on to say that higher rate of GDP growth will produce $1.1 trillion in new revenues. In other words, 65% of the tax cuts are paid for by extra economic growth.

Well, goodness. There might just be some reason to question conventional wisdom. The Center for Immigration Studies reported a few weeks ago that Trump’s Wall on our Southern Border would, over time, pay for itself, because illegal immigrants add a lot of cost with their dependence on welfare, crime, benefits and health care.  Who knew?  One can only urge Ms. Pelosi to keep railing about the necessity of raising taxes.

Among other surprises, a previously unknown asteroid the size of a football field had a near miss with Earth on Sunday. It came within one half of the distance to the moon.  It was the largest known asteroid to pass that close to Earth in observational history. Life always has interesting little surprises for us, even if we are paying attention.



We Aren’t Recognizing the Anger and Despair! by The Elephant's Child

Former FBI  Director James Comey’s new book is being released today, and he will be on a long book tour trying to push the book. He hates President Trump, whines like a 9-year-old, and reflects badly on the organization that he formerly headed. He expected Hillary to win, his wife was really excited about having a female president. He has not behaved well, and serious FBI people are concerned for the reputation of the agency.

Democrats clearly expected Hillary to win, but for the most part they seem to be pretty much done with her. I think that it wasn’t so much Hillary’s loss, but that red map of all the counties in the country that went for Trump. I suspect that they didn’t even consider the possibility that Trump might win, it was unthinkable. All those Republicans, a despicable bunch, and most of the Democrats had particular Republicans to hate, but the idea that Trump could triumph attacked all of their sureties, their world view, the things he espoused were beyond the pale — cutting taxes, closing the border.

Republicans aren’t all that inclined to fall in love with presidents. They recognize that presidents are only ordinary men, with all the flaws and faults of ordinary men, perhaps a little more so, when they suddenly become “the leader of the free world.” The “Never Trumpers”, certified members of the ruling class, were appalled by his tweeting, although many of them were on Twitter as well, but a president—tweeting? Clearly beneath the dignity of the office! His speech offended! Dan Bongino, who is from Queens, said Trump talked like someone from Queens who was in the construction trade. Trump told the people what he thought, and who he did not like nor trust. Beneath the dignity…

Barack Obama was, as someone said—a real good talker. Flowery words, designed to rouse the emotions, but fairly devoid of meaning. But people were thrilled, including the Nobel Prize committee, Not much follow through.

I think it’s that map. The Democrats lost control of practically everything, a huge,  immense loss. Their reason for everything is control. They are the intelligentsia. They are destined to run everything as soon as they dispose of the annoying Republicans. They went to the best schools, they run the biggest companies, they have the most billionaires, and all the movie stars, and the Republicans are backwoods people, racists, sexists, deplorables from flyover country. Who even knows what is down there when you fly from one enlightened coast to the other? Hillary thought it was her due, her destiny. She’s still out complaining, but the Democrats are done with her, and looking for someone who can restore their rightful place in the universe.  Joe Biden?



Business is Demanding to be Regulated. Bad Idea. by The Elephant's Child

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We seem to have entered an age where business executives assume that it is acceptable to do politics with their business. Businesses have, of course, long favored policies that help them to do business, and supported whatever politicians established the policy. That’s perfectly natural. But suddenly we have private-sector businesses entering the political fray, using their corporate budgets to silence free speech, sign on to very contentious political issues without the slightest awareness that there is a large mass of customers who may be offended.

“The reason that capitalism has managed to create real economic growth of 1.5% annually, and a 19-fold  increase in living standards over —the last two centuries — is because when people treat the marketers and inventors  as having some dignity and liberty, innovation takes hold.” (Those words are from economist Dierdre McCloskey). The reason why innovation has created and is continuing to develop computer connectivity, artificial intelligence and all that can lead to— is because business has been free of government control. There are many countries where such freedom does not exist, and government tells business what to produce and how and when, where and with whom.  Perhaps these executives were too busy with technology to study a little history: perhaps The Gulag Archipelago, or maybe Milton Friedman’s Capitalism and Freedom.

Milton Friedman, in his 1962 classic, presented his view of the proper role of competitive capitalism — the organization of economic activity through private enterprise operating in a free market — as both a device for achieving economic freedom and a necessary condition for political freedom.

Economic freedom is not going to work when some businesses chose to boycott other businesses for political reasons. They are dealing with the public, their customers, who can choose to boycott too, and are doing so.



The Left: Explained! by The Elephant's Child

Here is a speech by Dennis Prager, given a few years ago, in which he summarizes, or explains the Left. Do you find yourself wondering a lot— why are they doing this? Why are they saying this? What is the matter with these people?

Not much has changed in the past seven years. The Left is still Left, searching for more power so they can get rid of those pesky Conservatives who are so annoying, and so wrong about everything.

Oh, new terminology pops up now and then, but they continue to regard us as uneducated racists from flyover country. They seem unable to consider or recognize consequences. Life is full of miseries, but if we just let them be in charge, they would all be fixed.

In spite of all evidence to the contrary, they remain sure that if only they don’t have to be bothered with the dissent from us, they will create a brave new world where everyone is equal and there are no more wars and everything and everyone is properly diverse, and no one will be poor or needy and…

It’s a 40 minute video, so watch it tonight if you must, but it’s really worth your time.



Diversity Is Not Important. Merit Is. by The Elephant's Child

Heather MacDonald visits the “Diversity Debate” in her column today. The problem is apparently Interior Secretary Ryan Zinke, who “is being hammered for reportedly having rejected identity politics in favor of meritocracy. (Do read the whole thing, it’s short)

In the workplace we are supposed to ignore the knowledge and ability one brings to the job in favor of the color of one’s skin? Zinke is currently facing media criticism because he allegedly said that diversity is “not important,” and of course he absolutely correct. It is not.

(T)he Interior Secretary is being condemned for allegedly saying that he discounts racial categories in hiring, and prefers “having the right person for the right job.” This position, uncontroversial for decades, was the essence of Martin Luther King’s vision of a colorblind, merit-based society. Treating people the same way regardless of their race or sex used to be considered the definition of fairness; now it is understood to be vicious and intolerable.

We seem to be living in an era when the Left is seriously messing with our understanding of ordinary language and thought, and our minds.  Time to re-read 1984? The Constitution, written way back in the 1700’s, is outdated and needs the refreshing criticism of  a bunch of 17 year-olds who know better what it should say. Populism is supposed to be something bad, since it is the will of the people. Merit is undeserved. Only skin color matters, but is it trumped by ethnicity? Gender is a matter of your feelings at the moment. Citizenship is not only not important, but a question that should not be asked on the Census. The 12,000 gun-related homicides a year are heavily concentrated in inner- city neighborhoods that are afflicted with drugs, gangs and crime. There are serious  problems in the current understanding of the meaning of free speech. Universities have small designated spaces where one can go to practice free speech, which is not acceptable elsewhere.

If the tech companies want to know what ads I’d be most likely to be interested in, I’d be happy to answer a questionnaire, if they would stop monitoring my presence online.  And I have this odd idea that businesses have no business playing politics. If they want to financially support  a candidate privately, that’s their business. If they want to do politics then they should resign from business and do politics. But if they want to be political while asking customers to support them, they’ll be out of luck.




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