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Obama’s Red Chorus

June 9, 2009

IBD 4 June 09

Socialism: Is Hugo Chavez emerging as a sort of tropical Greek chorus for the Democrats’ ongoing redistribution schemes? It says something that he cheers every time a new act of socialism is performed in the U.S.

Rest assured, Venezuela’s self-described Communist commandante does not wish us well. But Obama’s administration has managed to awe him with its takeover of General Motors.

 “Hey, Obama has just nationalized nothing more and nothing less than General Motors. Comrade Obama!” Chavez cheered on Venezuelan TV Tuesday. He gushingly added that he and Cuba’s Fidel Castro would now have to work harder just to keep up.

 It underlines two things: just how closely the Venezuelan strongman watches what’s happening in the U.S and just how badly it resembles his own war on private property.

Unlike Cuba’s Fidel Castro, who shot his way into a Marxist dictatorship, Chavez has achieved his “socialist revolution” by manipulating institutions, particularly legal ones.

He’s been at it for 10 years, picking off companies one by one, using legal technicalities unrelated to his true aim of state ownership for all means of production. It ought to worry people that what’s happening at GM is perfectly recognizable in Caracas.

In 2004, Chavez began by expropriating cattle ranches in Venezuela, saying he only wanted to clarify property rights, not confiscate land. End result: Virtually all productive land now is in his hands, redistributed to his loyalists in serfdom.

After that, he went after the U.S. oil industry, snagging prizes like Exxon Mobil’s $1 billion heavy-oil complex on the Orinoco River in 2007, citing a different legal issue: tax disputes.

He did similar expropriations with steel, cement, ports, banks, sugar, rice, pretty much any industry that was viable.

Running out of companies to steal, he now persecutes private media — not, he claims, to stifle dissent, but to protect children from smut, his pretense for shutting down RCTV in 2007.

For the last remaining nonstate TV station, his concern is now environmental desecration, with Chavistas using the pretense of some old antlers on the wall of a Globovision executive following an open-ended state raid as the excuse to shut down the TV station.

Whatever Chavez’s legal concerns are, the punishment is always the same: expropriation and more power to the state, the two pillars of socialism.

The GM case is in this league and should give Democrats pause, because they also are using legal pretenses to justify a takeover.

Obama administration officials invented a right for themselves to muscle in on existing company owners, using bailout cash as an instrument of expropriation over the rights of bondholders.

They also used bailout cash as a green light to distribute gravy to their United Auto Workers union cronies, handing them a disproportionate stake in the company, illegally favoring unsecured debts over secured debts.

In so doing, they expropriated property without compensation, broke 150 years of contract law, and made Chavez proud.

Make no mistake: The Venezuelan dictator does not wish us well. He’d like to see all of our institutions crash to the ground and put the U.S. into the same socialist morass he’s in.

He knows that one act after another on this GM model in the U.S. will end in state socialism, with all the poverty, misery, shortages, noninvestment and lack of freedom that now plague Venezuela.

The Obama administration officials involved in the GM takeover may not think their action will harm the system, but they’re wrong.

Chavez is watching closely and will follow their example, hitting more American companies on similar pretenses abroad.

Unlike them, he thinks private property is itself the enemy and now has a new tool. Exxon officials have pointed out convincingly that the continuous vilification of oil companies by Congress helped to embolden Chavez to steal Exxon’s assets abroad.

One hopes the Obama administration thinks hard about what Chavez is telling them: “They’re criticizing him because they say he’s moving toward socialism — come Obama, ally with us on the path to socialism, it’s the only road,” Chavez declared on Venezuelan state TV in March. “Imagine a socialist revolution in the U.S.! Nothing is impossible.”

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