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The Hard Left Team Venezuela's Maduro Just Appointed to Tackle the Country's Crisis

Venezuela's President Maduro has shuffled his cabinet further to the left in response to the rising power of the opposition, and the country's acute economic crisis.
January 8, 2016, 1:50pm
Via Prensa Miraflores

Venezuela's President Nicolás Maduro has moved his left wing cabinet further leftward in answer both to the political crisis unleashed by the ruling party losing control of the legislature, as well as to the country's acute economic crisis.

The main political appointment in the reshuffle announced on Wednesday was of veteran union leader Aristóbulo Istúriz as the new vice president. The 70-year-old Isturiz was close to former president Hugo Chávez when the founder of Venezuela's so-called Bolivarian Revolution entered politics in the 1990s.

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His appointment was widely seen in Venezuela as an attempt by President Maduro to appease criticism from the more radical wing of the ruling Socialist Party that blames his government for the electoral defeat in December that stripped the party of control of the National Assembly for the first time in 17 years. Maduro was handpicked by Chávez to succeed him before he died of cancer in 2013, but has never commanded anything like the same level of loyalty.

Related: Venezuela Is Running Out of Everything — and Its Government Is Blaming Supermarket and Pharmacy Owners

The other most important cabinet change is the designation of a young vehemently anti-capitalist professor of sociology as vice president of finance. Luis Salas is also joined on the new economic team by Jesús Farías, a radical left wing economist who failed to win a seat in new congress that was inaugurated on Tuesday.

Salas is now charged with finding answers to an economic crisis that is difficult to measure because of the absence of official figures, but that nobody doubts is extremely severe.

Most international observers estimate that Venezuela's oil-dependent economy shrunk by between 6 and 10 percent during 2015 and that inflation ran into three digits. The Caracas-based firm Ecoanalítica estimates that inflation was 223 percent last year and could reach 600 percent in 2016.

While announcing his cabinet reshuffle President Maduro repeated a promise to soon reveal emergency economic measures.

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"We are faced with a new economic emergency and in the coming days I will present a rescue plan," he said in his address. "We have been looking for a sustainable way to move from resistance to an economic war — an offensive that will create our own economy and strengthen it."

Related: Venezuela Is Running Out of Everything — and Its Government Is Blaming Supermarket and Pharmacy Owners

In the meantime, the president's decision to hand the reins of the government's economic policy to Salas appears to be a triumph for the most radical wing of Chavismo — that advocates for more state control over the economy — over the moderates who lobby for market-driven macroeconomic adjustments.

"They named the creator of the concept of economic war, who sees the economic distortions as a result of a conspiracy and not as a failed economic model," economist Asdrúbal Oliveros told VICE News. He said that Salas — who has previously penned articles blaming inflation on private sector profits and has declared himself in favor of price controls — supports printing more money to finance the deficit.

Oliveros said that he thought the moderates also named in the government's economic team — Miguel Pérez, a pro-Chavista businessman, and Ricardo Medina, a career economist — might be allowed to push through some adjustments, but only as far as Salas would allow.

"Maduro could have named Luis Salas as a dam to stop any reforms if they begin to be felt as too liberal."

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The reaffirmation of left wing priorities in the government comes at a time when the political opposition is also hardening its stance as it seeks to exploit its control of the new congress.

The new president of the legislature Henry Ramos has sparked particular fury by ordering that images of Chávez and non-classical portraits of his hero, the 19th century independence leader Simon Bolivar, be banned from the congressional building.

A video shot on a mobile phone shows Ramos dismissively gesturing at a billboard of Chávez photographs being carried out of the building and then commenting: "They can take them to Miraflores [the presidential residence] or put it in the trash…but I don't want any of them here."

Video via YouTube

Caracas Mayor Jorge Rodríguez responded on Thursday by pledging to put an image of Chávez on every street corner in the capital.

The standoff also has potentially constitutional implications in the decision of the newly elected National Assembly to swear in three opposition deputies whose electoral victories were suspended by a supreme court decision associated with allegations that they won their seats through dirty tricks.

Ruling party deputy Diosdado Cabello said the decision to ignore the supreme court ruling would nullify all decisions made by the new legislature.

Fellow ruling party legislator Pedro Carreño called on other state institutions to "ignore" the legislature and urged the supreme court to formally declare all legislative decisions void until the three questioned deputies are excluded.

Related: The Fall of Chavismo in Venezuela (Trailer)

According to Juan Raffalli, an expert on constitutional issues, the confrontation could produce a crisis of governability in Venezuela. "We would enter into absolute uncertainty," he said. "The constitution requires government branches to cooperate with each other."

Such cooperation seemed like fantasy this week with each side digging in its heals. More sparks are expected to fly next week as President Maduro is obligated by law to submit the government's annual report on its activists to the National Assembly before January 15.

Follow Victor Amaya on Twitter: @victoramaya