Bulletins and News Discussion from July 24th to July 30th, 2023 - Venezuela's 4,600,000th House

The Great Housing Mission of Venezuela, launched in 2011 by Hugo Chavez, is the most ambitious housing project in the country's history. This week, the 4,600,000th house was built, with a goal for 5 million homes by 2024 and beyond. The program has built 1,255 residential complexes on a total of 9,837 hectares, an area equivalent to six times the Swiss city of Geneva.

The program additionally provides social infrastructure like schools, subsidized food markets, and recreational and green spaces. Over 70% of constructions are self-managed by communities, with financial and logistics support from the government. Communities also provide each other with materials - from each according to their supplies, to each according to their needs. Russian, Chinese, and Belarusian companies have helped supply the program over the years.

In Antímano Parish in southwestern Caracas, a group of predominantly women came together in 2015 and trained in construction, cleared land, and then built apartments while under the pressure of food and materials shortages and electricity blackouts due to the United States' sanctions campaign.

Claudia Tisoy, a mother and self-trained plumber, said “This goes beyond building homes for our families, we are also building the future of our country, with women leading the way. This is what the socialist horizon is all about.”^VA

Here is the map of the Ukraine conflict, courtesy of Wikipedia.

This week's first update is here in the comments.

This week's second update is here in the comments.

This week's third update is here in the comments.

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Update for July 26th
Takeaways:
The IMF is getting more optimistic about world economic growth (in GDP terms anyway) though obviously we all know that things are not as they seem, and the long term trend is still not looking so great given all the talk of decoupling from China. Germany and the UK still seem uniquely screwed. Inflation is being brought down in some countries (like Singapore) but remains sticky in others (Japan, the UK, the US) and interest rates continue to be hiked in Russia, the US, etc (though in Brazil they might be coming down).
Russian oil and LNG exports have fallen, as have revenues, due to in part the global manufacturing recession - but Goldman Sachs predicts oil demand to hit record levels soon, so who knows what's gonna happen.
Russia and China are sending delegations to the DPRK. One cannot help but sense that this is co-ordinated, especially with the news that South Korea is sending more military aid to Ukraine.
- The Biden admin has announced a proposal to force health insurers to cover mental health and addiction care as comprehensively as they cover treatment for physical health conditions.
  The jokes write themselves.
  The Pentagon needs even more money in order to upgrade itself.
  I've often said it, but I believe that the Pentagon budget is the real measure of US$ inflation. The US military industrial complex will never tolerate a drop in real revenue.
- I Love My Trans Comrades!
  
  Maybe someone who's more versed in economics, or at least in Liberal economics, can point holes in my hypothesis but I don't expect brazilian interest rates to decline a whole lot. Even if the inflation target is changed. Because I think the problem is external, and has more to do with the upcoming Global South Debt Crisis than anything that either the government, the parties, or the central bank are ready to talk about in the open.
  In Brazil interest rates are high even though inflation is not. I am not an economist of any kind, however, so what interests me is the political discourse that stems from these policies and realities. It has been predictably been split in two. Right-wingers and the pro Bolsonaro sectors praise the policy, praise that the central bank is now 'professional and independent', and claim that the reason inflation is low at all is because of interest rates and that everything will be fine as long as those damn leftists don't destroy the economy again (the economy is always good when Lula is in power, by sheer luck!). Centrists, center leftists and pro government people in general claim that the policy is smothering economic growth and the country, sometimes claiming that this is a political stunt by a pro Bolsonaro central bank college with the intent of sabotaging Lula's administration. It would appear that Brazil's economy is going to grow and maintain low inflation at the same time, regardless. Media for it's part plays into the aforementioned discourse, with nothing more interesting in between or outside the box.
  What I find interesting however are two things. One, if Lula's government truly wished to intervene in the Central Bank then it has levers to do so. A leftist might say that Lula's government is ultimately the government of a defeated, neoliberal country and not always opposed to financial and rentier interests ('The banks never made as much money as they did under me, yet there's still people there who hate me'), only trying to do damage control and maintaining state investment and industrial policy wherever it can. A centrist might say that, actually, the Lula administration is spending all of it's political capital trying to discipline a hostile and physiological (ie: here for the money) Congress, and in the midst of a series of important reforms. The Lula government is partially abolishing the Spending Cap Bill in favor of it's own 'Fiscal Framework' law, which would actually slightly flexibilize spending in health and education a bit instead of just capping it. There's also a tax reform that unifies a series of 5 taxes on taxes on consumption into a VAT arrangement, and also an administrative reform which I know little about but seems to be in talks right now. All of these reforms seem to please the Capitalist class, though you can always count on latin american elites to hate the vaguely leftward guy who pushes all the 'right' buttons under a capitalist regime anyways.
  Second, and it's what I think is even more interesting, is when the Government and the Central Bank have to talk to the Capitalists, which is where the political discourse almost seems to give away the game. The government of course tries to preserve it's political capital with the industrial class by blaming the Central Bank, while promising some mild subsidies and consumption support here and there as the short term solution. The Central Bank otoh, tells the Capitalists that, yeah, the situation is bad, but 'Brazil is a latin american country, we don't play by the same rules of credibility as rich countries'. The impression I'm left with is that the Brazilian Liberals aren't masochistic. They are afraid of a second Volcker Shock.
  The Great Latin American Debt Crisis of the 1980s was triggered by a perfect storm. Insane fiscal and monetary policy by the Juntas lead to a bunch of countries borrowing money on floating interest rates to fund infrastructure development. Brazil is a bit of an outlier in this, because by virtue of it's sheer size it was more developmentist than others. The Junta was there mostly to grind on the working class and to prevent land reform. But otherwise it kept on the industrial policies of the previous political arrangement: import substitution, industrial policy for agricultural development and civil/military engineering, development of the internal consumer market with infrastructure development. And so on. The problem is that infrastructure here was roadworks rather than rail, so the combination of high american interest rates together with the oil crises brought the country to it's knees.
  The basic assumption of the Liberals seem to be that Brazil can hopefully afford the next debt crisis. It's a richer country today with strong financials. It can 'afford' to pay it's own high interest rates and keep on with some sort of growth until the US brings rates down again. If that's the true and actual consensus behind the scenes, then it explains the government's actions better than the political discourse of any side. Brazil is squarely within the Global South, it is subjugated to a Liberal paradigm and it is exposed to capital outflows into the US. Even if one is not a Liberal, under these conditions one might be forced to deal with human (and Capitalist) behavior under a Liberal world order. Only nobody wants to lose their political capital over this. So they do what's normal and turn to partisan politics to insulate themselves.
  
  I couldn't even make it through that MKULTRA article. monsters. what they fucking did to those people
  
  It's so incredibly deeply fucked up. the even more awful part is that there almost certainly will never be justice delivered, nobody will be punished, and if anything the feds will just burn the documents if they're close to coming out (or some kind of revolutionary group tries to seize them) and say that they were misplaced
  
  First of all I realy, I mean strongly recommend reading Michael Roberts blog, here is the latest relevant post from him. The cost of living and profits If you go back and read his other posts you'll get all of what I write down below, he already showed multiple times the Marxist understanding of the current inflation crisis.
  So that is perhaps rather obvious but here is the thing, There Is No Alternative. The power of this worldview can't be understated and in a broader context the interest rate is very superficial almost to the point of being a distraction.
  The marxist view is that interest rates don't contribute much if anything at all to inflation. What drives inflation is supply chain disruptions and mostly the financial market speculation e.g corporations buying their own stocks, creating an artificial monetary bubble that eventually propagates to the rest of the economy.
  Some corporations also found out unsurprisingly the old mainstream liberal academic discourse about "supply and demand" is just purely made up shit so they can raise the prices to extortionary levels because consumers will not actualy fight against it, fighting here of course is disingenuous you can't just "protest" the cost of bread away. So in the end some corporations got a huge boost in profits from higher arbitrary prices and these profits both justified higher stock valuations and also gave them cash flow to buy more their own stocks.
  You can note that the Brazilian stock market is very heavily co-related with the US stock market with very similar boom cycles, including COVID and even right now!
  Perhaps here is #1: There is currently a "hot potato" game between the stock market and the Fed/CBs which is basicaly who will blink first. The stock market keeps going up which makes inflation a long term problem.
  Likewise at least the Fed has shown that they're willing to double down on their useless interest rate policy. I expect the Fed will blink first and so will other CBs. Interest rates will go down eventually because the Fed played out their hand, the market is no longer afraid of hikes. So the approach now will be to make people get accustomed to higher prices. See the MR post above.
  After CBs declare their victory over inflation it will be left for governments and parties to convince the average worker seeing a real fall in wages and higher cost of living, once again TINA and better get used to it. I believe many such headlines were already posted on this site already specially in the UK/EU where the media is saying exactly this.
  On the other hand if you delay the problem long enough the supply chain problems are easing up already. CBs will take the credit for "lowering inflation" soon inflation will go down in some areas but not others. It will be enough for both the media and politicians to point and say "HA look at it see we were right!".
  Here is #2: No capitalist government leftist or not would ever intervene over the CB before the crisis is over and after the neoliberal economists can point to some made up statistics about how their policy "worked".
  The time for that was 2 years ago, leftist governments should have argued against rising interest rates in the first place, but ultimately we go back to the beginning. TINA so what would a succ dem government say? "Oh inflation? Don't worry about it!"
  There should have been a key moment for regulation and dismantling of the stock market, in the US even just the PP loan fraud money funneled to the stock market should've been a key realization.
  If we talk about Brazilian inflation I believe that was a key moment to tackle the land reform, the food export policy(a very key component of food price inflation) for starters, to fight against Eletrobras privatization and in fact introduce extreme price controls over utilities and energy prices, health care, rent etc.
  Realistically imo there is no also TINA with regards to fighting inflation, either you raise a revolutionary movement against the private sector or you're at their whim.
  Interesting we can look at China and ask why is the Chinese stock market boom and bust cycle not tied to such a massive inflation problem? The simple answer is government control over a large sector of the economy, despite a mixed capitalist structure corporations are not free to raise prices and profits arbitrarily like the west. Also strict capital control etc.
  So what is Brazil to do? With a succ dem government in charge and a neoliberal ghoul Haddad in charge? Whether the interest rate drops significantly or not will not change much of anything IMO, go back 20 years during Lula's first term, as you remember correctly he boasts about bank profits back then even.
  The points I raised earlier, government control over a large sector of the economy(in this case revoke privatizations), strict price controls, land reform, control over food export, heavy investment in sustainable energy(reduce reliance on oil) are the key points to tackle inflation in the long term IMO.
  
  oops, I responded to the wrong comment with my other reply sorry

719 comments

Update for July 26th

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