May 2, 2006 — Hey President Morales, you just came back from a summit with America's arch enemies, Fidel Castro and Hugo Chavez … what are you going to do now?
That question was quickly answered Monday by President Evo Morales when he nationalized Bolivia's national gas industry. The announcement came just two days after he signed an alternative trade pact with Cuba and Venezuela, and the bold move is sure to anger both President Bush and private energy companies that do business in the Andean nation.
Morales immediately ordered soldiers to occupy Bolivia's gas fields, and he told energy companies operating in the country that they have six months to hand over majority control of their holdings to his government.
So Bolivia nationalized the gas fields, and have ordered the big energy companies to transfer control of their holdings to the government. You can bet that President Bush has a few choice words to say about Morales--Cheney's probably got a bullseye target of Morales taped to a wall in his office! Continuing on:
Bolivia has South America's second-largest natural gas reserves and those companies affected by the announcement include such major producers as Britain's BG Group and U.S.-based Exxon Mobil. Multinational corporations last year produced 100 million cubic feet of natural gas in the country and now they are expected to hand over 82 percent of their production to the Bolivian government. The companies are being allowed to keep 18 percent, only because the Bolivians are unable to tap all of its natural gas on its own.
Morales, a leftist, won Bolivia's presidency in part by lashing out against foreign corporations, saying his country's natural resources had been looted by these companies. Bolivia is South America's poorest country and poverty remains a large factor in its politics.
This past weekend, Morales met with Presidents Chavez of Venezuela and Castro of Cuba to denounce the United States and its trade policy in the region, which these leaders say hurt the poor of the Southern Hemisphere.
The announcement Monday by Morales is one more attempt to redistribute the region's wealth, and the summit was one more attempt to stall U.S. free trade agreements with countries in the region. The United States has signed nine such agreements with Latin American countries.
We have two issues here. The first is that the big energy companies have secured lucrative contracts with the Bolivian government to pump and sell this gas for their profit. Whatever royalty payments these companies paid into the Bolivian government has gone into the coffers of government officials and rich elites through graft and corruption. None of this revenue from the gas sales has gone into providing basic poverty-fighting services to the Bolivian population. So we have an extreme distribution of wealth in Bolivia--a rich, elitist Bolivian ruling class supported by a large, impoverished population.
Karl Marx would be delighted.
So now we've got a leftist president Evo Morales meeting up with Venezuela's President Hugo Chavez, and good old Fidel from Cuba. Chavez has already gotten on the Bush administration's bad side regarding energy, trade, and even terrorism issues. President Bush has pretty much disregarded Latin and South America, relegating U.S. foreign policy in the region to "you do what Washington tells you to do," while ignoring these countries own national interests. And it certainly doesn't help US-Latin American relations when Religious Right Wing-nut Pat Robertson calls for Chavez's assassination. So is it no wonder that these three leftist governments are coming together in their own alliance against an extreme rightward Bush administration? And where can these governments hurt the U.S., and force the Bush White House to take their issues seriously? You've guessed it--Oil and gas.
And that is the second issue here. The Bush White House has pretty much ignored Latin America, and the problems this region faces. Whatever policy that is created through the Bush administration, is a policy that would continue favoring U.S. corporate interests in expanding their economic clout in the region. Morales, Chavez and Castro views this issue as being the rich United States, under control of the Bush White House and their corporate masters, are raping these countries of their natural resources and are not providing anything to improve the quality of life for their peoples. And to stop this raping of natural resources by U.S. companies, Morales nationalizes the gas industry.
I don't know how the Bush administration is going to respond to Morales' nationalization of the gas industry. An American invasion into Bolivia? Or will Pat Robertson call for the assassination of Morales? I would say that the Bush White House doesn't have a clue as to how to respond, considering that their attention is focused on both Iraq, and the upcoming invasion of Iran. Leaving this troubled spot to simmer is just going to cause another explosion of natural gas prices, once Morales kicks the big energy companies, who refuse to hand over control of their holdings, out of Bolivia after the six months are up--of which the deadline is this November, by the way.
It is going to be a long, hot summer.
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