Venezuela reduced its oil windfall profits tax somewhat today. I think it vindicates my analysis from two years ago, when the tax was raised, which was that the increase was just a way to get some extra money in the slush fund for last year’s election campaign. It also vindicates my recent analysis that cutting that tax was one of the few things a new government could do that wouldn’t stir up the Venezuelan public, though I was assuming in that article that Chávez would no longer be in command. OK, maybe he isn’t. What do we know, anyway?
Anyway, I’m looking forward to Eva Golinger’s take on this tax cut. She said the increase two years ago was good for the Venezuelan people. Now PDVSA has had to turn over a few billion dollars to FONDEN and has fallen even further behind on its responsibilities, and now the tax gets cut. Is this also good for the Venezuelan people?