VENEZUELA QUID PRO QUO NEG – 6WS – NDI 2013

***Case Defense

Investment Fails

Cheat

Venezuela will cheat – even if they accept the QPQ, they won’t invest the money – triggering financial crisisCoronel 8 – Venezuelan representative to Transparency International from 1996-2000 (Gustavo, “The Corruption of Democracy in Venezuela”, CATO, March of 2008, http://www.cato.org/publications/commentary/corruption-democracy-venezuela)In the nine years since Chavez came to power, an estimated $300,000,000,000 of oil income has entered the national treasury. The exact number is uncertain due to the poor transparency of the government accounts, and because the national petroleum company no longer presents financial results to the U.S. Securities Exchange Commission or to the Venezuelan people. In parallel, during Chavez’s tenure, national debt has increased from $22,000,000,000 to about $70,000,000,000. Together with income tax revenues, the total income of Venezuela during Chavez’s presidency has been

approximately $700,000,000,000. This formidable amount of money is nowhere to be seen in terms of public works or effective health and education programs.¶ Three parallel budgets existed—totaling more than $80,000,000,000—in 2007: the formal one, for some $55,000,000,000 (including additional amounts), approved without discussion by the submissive National Assembly; a second one, amounting to $10,000,000,000, derived from the international monetary reserves taken from the Venezuelan Central Bank, in violation of the laws of the country; and a third, in the amount of $15,000,000,000, built from the funds siphoned out of Petroleos de Venezuela, monies which were required for investment and maintenance of the petroleum industry. None of these budgets are discussed publicly or subject to accountability.¶ Irregularities abound in the management of public funds: more than $22,500,000,000 in dollar transfers have been made to foreign accounts, maintains the Venezuelan Central Bank, and at least half of that money remains unaccounted for. Jose Guerra, a former Central Bank executive, indicates that some of this money has been used by Chavez “to buy political loyalties in the region … and some has been donated to Cuba and Bolivia, among other countries.”¶ According to a Jan. 31, 2006, story in the Financial Times, a select group of Venezuelan bankers, including those at Banco Occidental de Descuento and Fondo Comun, has profited from the acquisition of Argentinean bonds by the Venezuelan government, at the expense of the national treasury. The bonds are bought at the official rate of exchange and sold at black market rates, at considerable profit. Venezuelan journalist Carlos Ball estimates that bankers loyal to the government could have profited by up to $600,000,000 as a result of the differential between the official and the black market rates. Former Chavez Minister of Finance Jose Rojas has predicted that “the loss of autonomy of the Venezuelan Central Bank and the disorder in the management of the financial resources on the part of the government will lead to a significant financial crisis .”

Corruption

The aff can’t overcome institutionalized corruption – takes out solvencyRoberts et al 13 – Research Fellow for Economic Freedom and Growth in the Center for International Trade and Economics (James, Sergio Daga is Visiting Senior Policy Analyst for Economic Freedom in Latin America at The Heritage Foundation, “Venezuela: U.S. Should Push President Maduro Toward Economic Freedom”, April 15 of 2013, Heritage Foundation, http://www.heritage.org/research/reports/2013/04/venezuela-us-should-push-president-maduro-toward-economic-freedom)As reported in the Index, political interference in Venezuela’s judicial system has become routine, and corruption is rampant .

The landscape in Caracas and elsewhere in the country is littered with half-finished, publicly funded infrastructure and housing projects. The government funds needed to complete them often disappear.¶ As government expanded under Chavez, corruption became institutionalized .

Chavez doubled the size of the public sector, many of whose 2.4 million[7] employees have no real job other than to work to keep the regime in power. A World Economic Forum (WEF)

survey found little trust among businesses, politicians, the judicial system, and the police in Venezuela.[8] The tragic result is

that Venezuela is now one of the most dangerous countries of the world. According to the Venezuelan Violence Observatory, in 2012 nearly

22,000 people were murdered.[9]¶ An inefficient and non-transparent regulatory environment that is hostile to private foreign direct investment obstructs long-term development and hampers entrepreneurial growth. The investment regime is tightly controlled by the state and favors investors from China, Russia, Iran, and other democracy-challenged countries.[10] Investor protection in Venezuela is ranked at 140 out of 144 countries , according to the WEF report.[11] In 1998, before Chavez took power, there were more than 14,000 private industrial companies in Venezuela; in 2011, after 13 years of extensive nationalizations and expropriations, only about 9,000 remained.[12]

Bureaucrats pocket any investment --- this turns the AFF and makes drilling ineffectiveCoronel 8 – Venezuelan representative to Transparency International from 1996-2000 (Gustavo, “The Corruption of Democracy in Venezuela”, CATO, March of 2008, http://www.cato.org/publications/commentary/corruption-democracy-venezuela)High levels of mismanagement at the state-owned petroleum company, Petroleos de Venezuela. Corruption here takes many shapes. It includes the naming of six presidents and boards in seven years, in an effort to control the company politically. This finally was accomplished by naming the Minister of Energy and Petroleum president of the company, in violation of good management practice, since he now supervises himself. As a result, oil production has declined by some 800,000 barrels per day during the last decade. In a recent public hearing, Luis Vierma, the firm’s Vice President for Exploration and Production, admitted giving an oil well drilling contract for some $20,000,000 to a company with only three employees and no rigs.¶ Systemic corruption, meanwhile, takes place when government bureaucrats and the private sector interact in a permissive environment where money flows abundantly and without controls. Examples include:¶ The emergence of a new, rich, “revolutionary bourgeoisie” that drives Hummers, sports Cartier and Rolex watches, and wears Ermenegildo Zegna suits. They

buy luxury apartments in the U.S. and Europe, fly in private jets, and, salesmen say, always pay in cash. Wilmer Rupert was a minor associate of an international company a few years ago; today, he is quite rich, thanks to obtaining a large share of contracts from the state-owned oil company. Rupert has bought a television station and, as a present to the government, recently spent $1,600,000 to acquire two pistols that belonged to Simon Bolivar at auction at Christie’s.¶ Private corporations that deal with the government are owned by government officers. Government officers own companies that do business with the government, but conceal this fact by working through private intermediaries. Kenneth Rijock, a financial analyst, notes that these types of corporations have sprouted under Chavez. He mentions major agribusiness organizations such as ProArepa, the main supplier of food for government handout programs. Rijock also points to a large grain transport group “rumored to be owned by Chavez’s brother, Adan.” Officers of record of ProArepa include Ricardo Fernandez Berruecos, whose private jet recently was detained by the U.S. government at a Florida airport for not having the proper documentation of ownership. Journalist Patricia Poleo mentions the case of the brother of Chacón, who made a $10,000,000 offer to buy INDULAC, a large milk producer, without the source of the funds being known.

FDI Fails --- Constitution

Venezuela’s constitution bans oil FDICoggin ’11 [May 26th, 2011, John, Senior Editor for International Policy Digest, “Venezuela’s Oil Sword,” http://www.internationalpolicydigest.org/2011/05/26/venezuelas-oil-sword/] It’s the uncertain quantity and quality of Venezuela’s oil reserves that keep U.S. foreign policy analysts and energy forecasters up at night. Like Saudi Arabia’s national oil company, PDVSA operates behind a cloak of secrecy. The Venezuelan constitution strictly forbids foreign investment in upstream oil activities. U.S. oil companies ExxonMobil and ConocoPhillips exited Venezuela in 2007 due to nationalization reforms.

Investment’s illegal—the aff cant happenUSTR ’13 [2013, Office of the United States Trade Representative, National Trade Estimate Report on Foreign Trade Barriers, “Venezuela,” http://www.ustr.gov/sites/default/files/2013%20NTE%20Venezuela%20Final.pdf]The government controls key sectors of the economy, including oil, petrochemicals, and much of the mining and aluminum industries. Venezuela began an ambitious program of privatization under the Caldera administration (1994 to 1999), but privatization halted under the Chavez Administration (2000 to March 5, 2013), who also re-nationalized companies in key sectors of the economy, including the telecommunications and oil sectors. According to data maintained by Conindustria (Confederación ¶ Venezolana de Industriales), there have been 1,171 state interventions (expropriations, private property ¶ seizures and nationalizations) since 2002. Of these, 40.9 percent were companies involved in the ¶ construction sector, 30.8 percent in the industrial sector (manufacturing, agro-industrial, agriculture or ¶ related industries), 19 percent in the oil sector, and 7.9 percent in the service and trade-related sectors. ¶ Other affected sectors include food, mining, chemicals, and transport services.¶ On January 24, 2012, the Venezuelan government announced its withdrawal from the Convention on the ¶ Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention). ¶ Venezuela’s exit from ICSID became effective on July 25, 2012. At least 29 ICSID cases against ¶ Venezuela are currently pending, making Venezuela the country with the largest number of pending ¶ ICSID claims. Prior to announcing Venezuela’s ICSID withdrawal, President Chavez announced that the ¶ Venezuelan government would not recognize any ICSID decision related to the pending claim of a U.S. ¶ company. The United States does not have a Bilateral Investment Treaty with Venezuela. Foreign investment in the petroleum sector is restricted. The exploration (except for offshore natural gas), production, refinement, transportation, storage, and foreign and domestic sale of hydrocarbons are reserved to the state. Private companies can engage in hydrocarbons-related activities only through ¶ mixed companies and equity joint ventures with the state-owned oil company, PDVSA. The government ¶ has in recent years forced international oil companies to convert investment interests in oil projects into ¶ minority stakes in joint ventures, without the right to operate the projects themselves. Combined with a ¶ windfall tax on profits, these and other government measures have substantially increased uncertainty in ¶ the hydrocarbons sector.

Hezbollah Not Threat

Generic

Hezbollah isn’t a threat – Chavez’s death and Ahmadinejad out of power means there is no Venezuela-Hezbollah relationship Willans 13 – degree in political science from Seton Hall University (Pierce, “Venezuela News: Hezbollah is in Venezuela, But There's No Threat to U.S. Security”, February of 2013, http://www.policymic.com/articles/29303/hezbollah-in-venezuela-is-no-threat-to-u-s-security)Is Hezbollah in Venezuela? Probably. A more interesting question is: Does it matter, and if so, how much? American foreign policy hawks have been sounding the alarm on this for years, claiming Hezbollah’s activities in South America, which they often refer to as

"America’s backyard," are a threat to national security.¶ The U.S. State Department labels Hezbollah as a terrorist organization and Iranian proxy. The origins of Hezbollah are murky, but it first emerged as a force in the early 1980s, in reaction to Israel’s occupation of

Southern Lebanon. During this period, the group quickly gained infamy in the United States when it blew up the U.S. Marine barracks in Beirut, killing over 200 Marines, only months after it had blown up the U.S. Embassy there.¶ That being said, attacks on American targets have been the exception, rather than the rule. Throughout its history, the majority of Hezbollah’s energies have been directed towards Israel. In the decades since its creation, Hezbollah has evolved and expanded its activities, operating as a political party in Lebanon while simultaneously maintaining its separate criminal and military activities. Sometime in the 1980s they are believed to have established a foothold in South America, probably to raise funds from the large Lebanese community there. It has been established that the group is engaged in narcotrafficking and money laundering, no doubt spurred in part by Iran’s declining support due to the crushing international sanctions against it. Though their activities in Latin America appear to be primarily aimed at raising money, fears of Hezbollah’s capacity for violence in the region are not without basis; Hezbollah is widely blamed for bombing the Israeli Embassy in Buenos Aires and then again that city’s Jewish Community Center in the early 90s, killing over 100 people.¶ The fears of a Venezuelan-Hezbollah axis seem to be spurred in large part by the highly visible personal friendship between the late Venezuelan president Hugo Chavez and Iranian President Mahmoud Ahmadinejad. This unlikely alliance between two men of such different cultural backgrounds appears to be a product of their respective governments’ isolation and shared antagonism towards the United States. In the UN, Venezuela has voted against international sanctions on Iran for its nuclear program. Iran has billions of dollars invested in Venezuela. There is, however, nothing particularly treacherous about that. The claims of a more sinister relationship have been most prominently voiced by Roger Noriega.

Iran Influence Decreasing

Chavez Death

Iran can’t increase influence – Chavez death and uncertainty Berman 13 – Vice President of the American Foreign Policy Council (Ilan, “Hugo Chavez's Death Is a Blow to Iran”, March 12 of 2013, http://www.usnews.com/opinion/blogs/world-report/2013/03/12/after-chavez-a-challenge-for-iran)Over the past several years, thanks in large part to the personal bonds between Chavez and Iranian President Mahmoud

Ahmadinejad, Venezuela has served as Iran's gateway to the region, opening diplomatic doors and facilitating economic contacts between Tehran and an array of sympathetic South American regimes. This assistance has been instrumental for the Iranian regime, allowing it to consolidate support for its nuclear effort and maintain international trade even as the sanctions being levied against it by the United States and Europe have intensified.¶ But now, Chavez's death—and the political jockeying that is sure to follow his passing, both within Venezuela and throughout Latin America—could call all of that into question.¶ Of course, Iran's leaders have not been caught totally unprepared. In truth, the Iranian regime has planned for some time for a post-Chavez era, and the past two years have seen it expand its political ties to the governments of Evo Morales in Bolivia and Rafael Correa in Ecuador, as well as to a number of other regional players (most recently the administration of Cristina Fernandez de Kirchner in Argentina). Iran has had considerable success in doing so, broadening its strategic footprint in the region in the process.¶ Even so, the departure of Chavez is bound to be a blow to Tehran. Without its most reliable broker, Iran now faces a region in profound political flux. During his 14 years in office,

Chavez had served as the champion of anti-Americanism in Latin America. Now that mantle of leadership, coveted by power-hungry regional leaders like Ecuador's Correa, is up for grabs. So, too, is the prevailing attitude toward Tehran.¶ Coming weeks will see the emergence of a new regime in Venezuela—one that, by all accounts, will look strikingly similar to the one that preceded it. Indeed, late last year, an ailing Chavez anointed his anti-American vice president, Nicolas Maduro, as his heir apparent, thereby guaranteeing a preservation of his "Bolivarian" ideas. But Maduro now faces a snap election next month, and could see his power diminished by internal challengers as well as an increasingly capable Venezuelan opposition. In other words, for the first time in nearly 15 years, the current regime's hold on power isn't assured beyond the shadow of a doubt.¶

Neither is the relationship between Caracas and Tehran. While Maduro can be counted on to preserve Venezuela's revolutionary character, the closeness of its ties to the Iranian regime is suddenly an open question—one made all the more acute by the fact that Chavez's Iranian counterpart, Mahmoud Ahmadinejad, will also leave the political scene in just a few months, when his term in office ends this June.

Latin America Not Key Region

Latin America isn’t an important region for Iran – they care more about Asia and the Middle EastSullivan et al 13 – Specialist in Latin American Affairs at the CRS (Mark, June Beittel is an Analyst in Latin American Affairs at the CRS, “Latin America: Terrorism Issues”, April 5 of 2013, http://digitalcommons.ilr.cornell.edu/cgi/viewcontent.cgi?article=2063&context=key_workplace)No matter the scope of Iran’s involvement in Latin America, Iran’s key foreign policy focus ¶ remains its immediate region. It is in the Middle East and South and Central Asia where Iran ¶ perceives that threats to its survival may emanate, and in which Iran has, for ideological, ¶ religious, and political motives, tried to alter political outcomes in its favor. Whatever efforts Iran ¶ is making to engage like-minded leaders in Latin America, these efforts pale by comparison to its ¶ level of involvement in countries such as Iraq, Afghanistan, Syria, or Lebanon, in which Iran’s ¶ Islamic Revolutionary Guard Corps—

Qods Force personnel are on the ground consistently, ¶ funneling arms and funds to pro-Iranian movements and parties. Interactions with national leaders ¶ and faction leaders in Middle Eastern and South and Central Asian countries such as these are ¶ frequent.

No Cooperation

Iran can’t sustain ties – US intelligence and no cooperation with anti-American statesAFP 13 – Agence France-Presse (“Iran's influence 'waning' in Latin America: US general”, March 19 of 2013, internally citing Head of

Southern Command John Kelly http://www.globalpost.com/dispatch/news/afp/130319/irans-influence-waning-latin-america-us-general)Iran is "struggling" to cultivate ties with Latin American countries that are wary of the United States, and Tehran's influence in the region is on the decline, a top US general said Tuesday.¶ "The reality on the ground is that Iran is struggling to maintain influence in the region, and that its efforts to cooperate with a small set of countries with interests that are inimical to the United States are waning," General John Kelly, head of US Southern Command, told lawmakers.¶ In Venezuela, Bolivia, Ecuador and Argentina, Iran has sought to expand diplomatic and economic links to counter international sanctions and to promote anti-US sentiment, Kelly told the Senate Armed Services Committee.¶ But the bid has only been "marginally successful" and the broader region "has not been receptive to Iranian efforts," the general said.

Studies

Iran’s influence is decreasing – sanctions and lack of investment proves – their evidence is unproven rhetoricGoodman 13 – Professor of Public Policy at the Harvard Kennedy School of Government (Joshua, “Iran Influence in Latin America Waning, U.S. Report Says”, June 26 of 2013, http://www.bloomberg.com/news/2013-06-26/iran-influence-in-latin-america-waning-u-s-report-says.html)Iran isn’t actively supporting terrorist cells in Latin America and its influence is waning in the region after almost a decade of promises to increase investment, according to a State Department report.¶ While Iran’s interest in Latin America

is a “concern,” sanctions have undermined efforts by the Islamic republic to expand its economic and political toehold in the region, according to the unclassified summary of yesterday’s report.¶ “As a result of diplomatic outreach, strengthening of allies’ capacity, international nonproliferation efforts, a strong sanctions policy, and Iran’s poor management of its foreign relations, Iranian influence in Latin America and the Caribbean is waning,” according to the report.¶ The findings disappointed some Republican lawmakers who say President Barack Obama’s administration is underestimating the threat from Iran. The report comes as the U.S. takes a wait-and-see approach to President-elect Hassan Rohani, who has vowed to seek more dialog with the U.S.¶ “I believe the Administration has failed to consider the seriousness of Iran’s presence here at home,” said Congressman Jeff Duncan, a Republican from South Carolina who wrote the legislation requiring the State Department report. “I question the methodology that was used in developing this report.”¶ Chavez Alliance¶ The U.S. stepped up its monitoring of Iran’s presence in Latin America in a bid to isolate the country over its nuclear program and after President Mahmoud Ahmadinejad forged closer ties with anti-American allies of the late Venezuelan President Hugo Chavez. While Iran’s outreach bears watching, claims about more sinister activities are unproven, said Christopher Sabatini, senior policy director at the Council of the Americas.¶ “It’s a shame that in such a dynamic hemisphere in which we have so many diplomatic initiatives that for some -- especially Congress -- attention to the region has boiled down to mostly spurious charges about Iranian infiltration,” Sabatini said via e-mail.¶ Ahmadinejad made repeated trips to Latin America after taking office in 2005, most recently to Caracas to attend Chavez’s funeral in March and the inauguration of his successor, Nicolas Maduro, a month later.¶ By contrast, Rohani has said little about the region since his surprise victory earlier this month. Instead, he said one of his main foreign policy priorities will be seeking “constructive dialog” with the U.S. and U.K., two nations with which the country has traditionally been at odds.

Indicts

Noriega

Reject Noriega – he is a right-wing alarmist who doesn’t base his claims in facts Willans 13 – degree in political science from Seton Hall University (Pierce, “Venezuela News: Hezbollah is in Venezuela, But There's No Threat to U.S. Security”, February of 2013, http://www.policymic.com/articles/29303/hezbollah-in-venezuela-is-no-threat-to-u-s-security)Mr. Noriega is currently a visiting fellow at conservative think tank the American Enterprise Institute. Mr. Noriega is no stranger to murky

Iran-Latin American intrigue; while at the U.S. Agency for International Development, he was implicated in the Iran-Contra Scandal during the Reagan administration. He subsequently served in high-level diplomatic posts under President George W. Bush, including as Ambassador to the Organization of American States, where he supported the abortive coup against Hugo Chavez in 2002.¶ More recently, he has publicly accused Venezuela of having a secret nuclear program. In his July 2011 testimony before Congress, Mr. Noriega further stoked the fires by claiming that Venezuela actually supports Hezbollah and allows it and drug cartel members to operate in its territory, though he offered no proof . He also hinted darkly that the federal government

knows more than it is willing to say publicly on the subject.¶ Noriega clearly knows how to get attention in Washington, but that is not the same as offering well-informed advice . In this post-9/11 foreign policy environment, his efforts seem to be aimed at reinforcing conservatives’ penchant for conflating a group’s stated anti-American sentiments with an unstated intention to actually do us harm. In many ways, Hezbollah’s activities in Latin America are similar to those of other drug

cartels, which are rightly viewed as a problem. But their activies are a law enforcement problem, and needs to be confronted without the hysteria that seems to accompany any statement containing "Hezbollah" and "America’s backyard" in the same breath.

Noriega is a neocon alarmist who doesn’t cite evidence – reject himSigger 10 – defense analyst and creator of Armchair General (Jason, ”Neocon Invents Venezuela Nuke Threat”, October 6 of 2010, http://crooksandliars.com/node/40459/print)On the one hand, it's admirable that the Foreign Policy website offers views from both the right and the left on controversial public policy issues. On the other hand, it would be nice if they added some kind of warning label. I don't know, something like "actual reality may differ from author's perspective." I have this in mind as Roger Noriega (former Bush political appointee, current AEI fellow) warns us of Hugo Chavez's supposed plans to develop nuclear weapons with Iran's help.¶ Venezuelan President Hugo Chávez admitted last week that his government is "carrying out the first studies" of a nuclear program. He attempted to portray it as an innocuous program designed solely for peaceful purposes.¶ --------¶ Chávez's suggestion that he is merely studying the idea of a nuclear energy program is misleading. In fact, in November 2008, Iranian and Venezuelan officials signed a secret "science and technology" agreement formalizing cooperation "in the field of nuclear technology." (The text of the agreement, available in Farsi and Spanish, is available here.) The week after the agreement was signed, Venezuela's Ministry of Energy and Petroleum prepared a presentation for the International Atomic Energy Agency documenting the establishment of a "nuclear power programme" in Venezuela. That presentation, obtained from sources within the Venezuelan government, reveals that an "Atomic Energy Committee" has been managing the nuclear program since 2007.¶ All countries have the right to a peaceful nuclear energy program under the Nuclear Non-Proliferation Treaty, of which Venezuela is a signatory. However, Chávez's decision to rely on one of the world's worst proliferators to help develop his country's capabilities in this sensitive technology sets alarm bells ringing. And his recent public declarations understating the nature of his nuclear program raise more questions than they answer.¶ Just for the sake of accuracy, I'd note that

China, Pakistan, and North Korea are far more busy in weapons proliferation than Iran, particularly with high-tech equipment and materials. But this kind of language isn't new for Noriega. He is a particular hard-liner against Cuba and Venezuela, with a long history of alarmist speeches and attacks against those governments. So it's not surprising to see this language, and it's easier to shoot holes into his argument.¶ First, it may be that Chavez is interested in nuclear weapons, but it's not a crime for him to invest in nuclear energy, even if his country is awash in oil. The more oil that goes to exports, the more money comes into the country. Both Brazil and Argentina have nuclear power reactors. So does Iran. If Iran wants to sell its expertise on nuclear energy technology, hey, it's a global economy. That's what happens.¶ Second, there's nothing that Noriega can point to that demonstrates either Iran receiving "yellowcake" from Venezuela or Venezuella receiving nuclear weapons technology or material from Iran. He can make a lot of noise about front companies and point to tangential evidence to suggest that something may wrong, but there's no smoking gun here.

Say No

Ambassador Comments

Maduro says no --- Samantha Powers’ statements prevent engagement Bercovitch 13 – staff writer for the Green Left Weekly (Sascha, With “Zero Tolerance to Gringo Aggression,” Maduro Cuts Off Venezuela-U.S. Talks”, July 21 of 2013, http://venezuelanalysis.com/news/9872?page=1)Caracas, July 21st 2013 (Venezuelanalysis.com) – The conversations that were started a month and a half ago between Venezuela and the United States have definitively ended , Venezuelan President Nicolas Maduro announced yesterday at an

event of the Strategic Regions of Integral Defense (REDI) in Cojedes state.¶ “My policy is zero tolerance to gringo aggression against Venezuela. I'm not going to accept any aggression, whether it be verbal, political, or diplomatic. Enough is enough. Stay over there with your empire, don't involve yourselves anymore in Venezuela ,” he said.¶ The announcement comes after controversial statements from Samantha Powers, President Barack Obama’s nominee for U.S. envoy to the United Nations, who testified to the U.S. Senate Committee on Foreign Relations on Wednesday that she would fight against what she called a “crackdown on civil society being carried out in countries like Cuba, Iran, Russia, and Venezuela.”¶ In a statement written on Friday that marks the last communication between the two countries, Venezuelan Foreign Minister Elias Jaua wrote, “The preoccupation expressed by the U.S. government regarding the supposed repression of civil society in Venezuela is unacceptable and unfounded. To the contrary, Venezuela has amply demonstrated that it possesses a robust system of constitutional guarantees to preserve the unrestricted practice and the respect of fundamental human rights, as the UN has recognized on multiple occasions.”

Opposition to Powers’ comments overwhelm any efforts to improve relationsNeuman 7-20 – NYT Venezuela correspondent (William, “Venezuela Stops Efforts to Improve U.S. Relations”, July 20 of 2013, NYT, http://www.nytimes.com/2013/07/21/world/americas/venezuela-stops-efforts-to-improve-us-relations.html)CARACAS, Venezuela — Venezuela announced late Friday that it was stopping the latest round of off-again-on-again efforts to improve relations with the United States in reaction to comments by the Obama administration’s nominee for United Nations

ambassador.¶ ¶ The nominee, Samantha Power, speaking before a Senate committee on Wednesday, said that part of her role as ambassador would be to challenge a “crackdown on civil society” in several countries, including Venezuela. President

Nicolás Maduro had already lashed out on Thursday at Ms. Power for her remarks, and late on Friday the Foreign Ministry said that it was terminating efforts to improve relations with the U nited States.¶ Those efforts had inched forward just last month after Secretary of State John Kerry publicly shook hands with the Venezuelan foreign minister, Elías Jaua, during an international meeting in Guatemala — one of the highest level meetings between officials of the two countries in years.

Anti-Americanism

Maduro will reject engagement – their evidence is just posturing Meacham 13 – director of the Americas Program at the CSIS (Carl, “The Kerry-Jaua Meeting: Resetting U.S.-Venezuela Relations?”, June 21 of 2013, http://csis.org/publication/kerry-jaua-meeting-resetting-us-venezuela-relations)Q2: Does the Venezuelan government want good relations?¶ A2: Despite recent discussions with the United States, it doesn’t seem to be the case. Earlier this year, the Venezuelan government suspended talks between the U.S. State Department and Venezuelan Foreign Ministry that had begun in late 2012, citing alleged U.S. meddling in Venezuela’s April election. The Maduro government has also largely followed the Chávez playbook, constantly accusing the United States of assassination plots, spying, and economic and political sabotage. While the Kerry-Jaua meeting may have

made for nice headlines, it’s difficult to imagine that the Venezuelan government will not play the anti-U.S. card again, if needed.¶ This week, Calixto Ortega—appointed to handle matters with the United States—will meet with Assistant Secretary of State for Western Hemisphere Affairs Roberta Jacobson to continue discussions and establish a new set of concrete goals to guide the relationship forward.¶ These good-faith gestures made by the Venezuelan government are neither new nor unheard of. Despite recent efforts, U.S. policymakers should temper any positive expectations, as a core basis of Chavismo is its anti-U.S. ideology. It’s of course difficult to improve relations with a government that consistently defines itself as vehemently against your foreign policy agenda. This suggests that Venezuela may be looking to reestablish a purely economic relationship—one that will eliminate U.S. sanctions.¶ Still, even if certain positive steps are taken , history suggests that the Venezuelan government could quickly scuttle progress made, likely with the goal of Maduro shoring up support within his own ranks.2

They’ll say no – anti-Americanism Drezner 13 – Professor, The Fletcher School of Law and Diplomacy, Tufts University (Daniel, “Why post-Chavez Venezuela won't be a U.S. ally anytime soon”, March 7 of 2013, http://drezner.foreignpolicy.com/category/wordpress_tag/venezuela)Now that the first news cycle has passed, we can get to the more interesting question of assessing Venezuela's future. There was always a fundamental irony to Hugo Chavez's foreign policy. Despite his best efforts to chart a course at odds with the United States, he could never escape a fundamental geopolitical fact of life: Venezuela's economic engine was based on exporting a kind of oil that could pretty much only be refined in the United States. ¶ So, with Chavez's passing, it would seem like a no-brainer for his successor to tamp down hostility with the United States. After all, Chavez's "Bolivarian" foreign policy was rather expensive -- energy subsidies to Cuba alone were equal to U.S. foreign aid to Israel, for example. With U.S. oil multinationals looking hopefully at Venezuela and Caracas in desperate need of foreign investment, could Chavez's successor re-align foreign relations closer to the U.S.A.? ¶ I'm not betting on it, however, for one simple reason: Venezuela might be the most primed country in the world for anti-American conspiracy theories . ¶ International relations theory doesn't

talk a lot about conspiracy thinking, but I've read up a bit on it, and I'd say post-Chavez Venezuela is the perfect breeding ground . Indeed, the day of Chavez's death his vice president/anointed successor was already accusing the United States of giving Chavez his cancer.

Continuation of Chavez Policies

Maduro will continue Chavez oil policy – means he won’t accept foreign oil investmentAlic 13 – senior journalist at the energy news site Oilprice.com (Jen, “Foreign Oil & Gas Companies Look to Status Quo in Venezuela”, April 15 of 2013, http://oilprice.com/Geopolitics/South-America/Foreign-Oil-Gas-Companies-Look-to-Status-Quo-in-Venezuela.html)Now that Nicolas Maduro—the late Hugo Chavez’s choice for successor—has narrowly won Sunday’s presidential elections in Venezuela, oil and gas investors can expect a perpetuation of the status quo .¶ In Sunday’s vote, Maduro won with a very

narrow 50.7% and a vow to continue with Chavez’s “revolution,” which has seen the oil industry nationalized and the state-run PDVSA oil company funding social programs and voraciously courting China and Russia.¶ The narrow vote will not be without its challenges. Opposition rival candidate Henrique Capriles has refused to recognize the results and is demanding a recount, though the electoral

commission is standing firm on Maduro’s victory.¶ For foreign oil and gas companies, we can expect more of the same . There are no regulatory changes in the works, and an unattractive windfall tax system announced in January will likely be pushed forward under Maduro.¶ What Maduro is inheriting, though, is a nightmare situation that will see him stuck between using PDVSA to fund expensive social programs that cost it $44 billion last year alone diverted from oil revenues, and cutting social spending or allowing a rise in the price of fuel that could spark regime-threatening unrest.¶ If Maduro feels compelled to reduce fuel subsidies, it could lead to riots as cheap fuel—which cannot be sustained—is one of the most crucial social benefits for Venezuelans, who pay around 6 cents per gallon.¶ Maduro has inherited a “sinking ship” and does not appear to have the political capital to make any short-term changes in Venezuela’s energy policy, experts at Southern Pulse told Oilprice.com.

Sanctions Now

IVB

AFF isn’t necessary – sanctions on the IVB will continue indefinitely IF 13 – Iran Focus News (“US places sanctions on Iran-Venezuela bank”, May 10 of 2013, http://www.iranfocus.com/en/index.php?option=com_content&id=27598:us-places-sanctions-on-iran-venezuela-bank&Itemid=45)WASHINGTON (AFP) — The US Treasury Department on Thursday announced sanctions on a former Iranian-Venezuelan bank it said is being used to avoid restrictions placed earlier on other Iranian institutions.¶ The US Treasury said that the Tehran-based Iranian Venezuelan Bi-National Bank (IVB) was providing financial services to the Iranian Ministry of Defense and acting on behalf of the Export Development Bank of Iran.¶ Both the ministry and the EDBI are already under US sanctions for alleged support of terrorism and backing Iran's suspected effort to develop nuclear weapons.¶ The Treasury said the IVB had handled money transfers on EDBI's behalf with a Chinese bank, Bank of Kunlun, itself also blacklisted by the Treasury for its dealings with Tehran.¶ The Treasury noted that despite its name, "there is no evidence Venezuela retains any ties" with the four-year-old IVB, originally established as a joint venture between Iran and Venezuela.¶ The sanctions forbid any US citizens or institutions from doing business with the sanctioned institution, and freezes any assets it might hold in the United States.¶ The Treasury also named for sanctions a shipping firm, Sambouk Shipping, as involved in attempts by Tehran to break restrictions on its oil exports with the alleged help of Greek businessman Dimitris Cambis.¶ Cambis was singled out for sanctions in March for acquiring and managing a fleet of eight aging oil tankers secretly on Tehran's behalf.¶ The Treasury said Thursday that the vessels had recently been renamed and/or reflagged.¶ "As Iran becomes increasingly isolated from the international financial system and energy markets, it is turning increasingly to convoluted schemes and shady actors to maintain its access to the global financial system," Treasury Under Secretary

for Terrorism and Financial Intelligence David Cohen said in a statement.¶ "As long as Iran tries to evade our sanctions, we will continue to expose their deceptive maneuvers."

Squo Solves

Generic

Status quo solves the aff—fiscal conditions force a shiftGonzález and Vyas ‘13 [April 4th, 2013, Angel and Kejal, “Unlocking Venezuela’s vast energy potential; Revival of the country’s oil sector post-Chávez on standby,” http://www.businesswithoutborders.com/topics/opportunities/unlocking-venezuelas-vast-energy-potential/]But declining oil output and rising shale-oil production in the U.S., Venezuela’s main market, may force a redirection. Barring any new political or military shocks in the Middle East, global oil prices look like “a balloon with a slow leak,” said Amy Myers Jaffe, executive director for energy and sustainability at the University of California-Davis. The Venezuelan government can’t count on high oil prices to match rising public spending, she added. Anticapitalist rhetoric heated up in the days leading to Mr. Chávez’s death. Venezuelan Acting President Nicolás Maduro accused Chevron Corp., the No. 2 U.S. oil company by market value behind Exxon, of aggression against Ecuador in a multibillion-dollar environmental lawsuit pitting the company against Ecuadorean plaintiffs. Analysts said they were surprised by the comments, as Chevron, the only major U.S. oil company to remain in Venezuela, was considered by Mr. Chávez as a key investor, and is lending Venezuela $2 billion to increase output at a joint-venture oil development. A spokesman for Chevron declined to comment on Mr. Maduro’s assertion. Despite the posturing, Mr. Chávez’s death presents an opportunity for a new administration to lift some of the burdens heaped on PDVSA, which has supplied billions of dollars in cheap oil to Cuba and other friendly foreign governments, said Carlos Jordá, a Houston-based oil consultant who was once a senior manager at the oil company. To reach its full potential, Venezuela´s entire oil industry sector needs to be reinvented, something that is unlikely, said Luis Pacheco, a former PDVSA executive fired during the oil strike of 2003 along with 20,000 other employees who opposed Mr. Chávez. In 2000, Mr. Chávez signed its first oil deal with Cuba, providing the communist island with 53,000 barrels a day of cut-rate oil, a sum that has risen to 110,000 barrels now. In return, the Cuban government has sent some 40,000 doctors and experts to support the popular social programs developed by Mr. Chávez. Mr. Jordá, who called those oil deals unsustainable, said that domestic fuel prices, the world’s lowest at around 6 cents a gallon, will also have to rise at some point. The cost to the country of the domestic fuel subsidies has also increased because refinery accidents forced the government to import growing quantities of gasoline, according to the EIA. The Venezuelan government denies it imports fuel. Worsening fiscal conditions will also prompt Mr. Chávez’s successors to improve relations with foreign investors—and eliminate bottlenecks created by the deceased leader’s highly-personal, hands-on management style, said Jim Loftis, a partner with Vinson & Elkins LLC’s international arbitration practice. The country also needs to increase oil production to pay for tens of billions of dollars in Chinese loans it undertook to finance large social projects and a big boost in election spending last year. “Venezuelans see their relationship with oil as if the nation’s virility is at stake,” Mr. Pacheco said. Until that perception changes, the oil industry will “keep dancing in a circle around the fire, waiting for it to rain.”

***FDI Bad

Dutch Disease

1NC

Venezuelan economy growing nowEl Universal ‘13 [May 31st, 2013, “Venezuela’s GDP Up 0.7% In The First Quarter”, http://www.eluniversal.com/economia/130531/venezuelas-gdp-up-07-in-the-first-quarter]The Central Bank o f Venezuela (BCV) reported on Friday that the gross domestic product climbed 0.7% in the first quarter of 2013, compared to the same period last year. The bank attributed the result to the increases of 2.0% and 0.3% in the gross value added (GVA) of the public and private sectors , respectively. "With the rise in GDP at the beginning of year, we have recorded 10 consecutive quarters of growth in the productive activity," the bank said in a statement. Some of the causes behind the behavior of the economic activity in the first quarter are the strengthening of social policies and the expansion of general government services. Other factors include the slowdown in the growth rate of aggregate domestic demand; reduced imports of intermediate and final goods , given the adjustment of the foreign exchange amidst a complex domestic and international environment and a lower number of working days in the quarter. The BCV said economic growth in the first three months of the year was determined by a 0.9% growth in the value added of the non-oil sector and the oil sector, compared to the same period last year.

The aff’s sudden influx of capital wrecks Venezuela’s economyCorrales ’13 [March 7th, 2013, Javier, professor of political science at Amherst College. He is the co-author (with Carlos A. Romero) of U.S.-Venezuelan Relations Since the 1990s: Coping with Midlevel Security Threats (Routledge, 2013), Writer for Foreign Policy and Foreign Affairs, “The House That Chavez Built”, http://www.foreignpolicy.com/articles/2013/03/07/the_house_that_chavez_built?page=0,3]By now it's widely understood that excessive dependence on commodity exports can

distort an economy in fundamental ways. One manifestation of this principle is what has come to be known as "Dutch Disease" (named after the problems faced by the Netherlands as it reaped a windfall from North Sea oil in the 1970s).

Dutch Disease occurs when a country that is excessively dependent on commodity exports experiences a price boom. The sudden inflow of foreign currency raises the demand for local currency, yielding an uncompetitive exchange rate. This overvalued exchange rate, if unaddressed, can kill the country's other exports as well as stimulating an avalanche of imports, which can hurt domestic producers. ¶ There is no question that Venezuela under Chávez came to experience one of the worst cases of Dutch Disease in the world. The Chávez government deliberately maintained an overvalued exchange rate during the oil boom that began at the end of 2003. Although

there have been periodic devaluations (five in the last nine years), these were never deep enough. Because of this persistent overvaluation, Venezuela's trading sector became increasingly distorted. Exports of fuels boomed, but by 2008 exports of everything else had collapsed. Meanwhile, imports have flooded the country on an unprecedented scale, to a greater extent than even during the free-trade years of the early 1990s. ¶ All this would have been bad enough on its

own. But Chávez's response to Dutch Disease exacerbated Venezuela's economic ills. Instead of, for example, squirreling away some of the country's oil windfall profits in a rainy day fund, as a way of minimizing their impact on

the rest of the economy, Chávez chose instead to spend lavishly on his constituents, creating the basis for the broad electoral coalition that kept him in power for so long. To the poor, he gave a vast array of social services, spanning doctors from Cuba, college degrees at newly created universities, free appliances, and even new homes. To the rich, he gave preferential access to exchange rates and hefty government contracts, all of which multiplied the fortunes of many wealthy Venezuelans. This overspending had a clear electoral bent. For the 2012 presidential election, according to the Venezuelan think tank Ecoanalítica, the government spent twice as much than it did for the 2006 presidential election. ¶ This lavish spending wrecked Venezuela's fiscal health. According to Barclay's, Venezuela's fiscal deficit went from 2.8 percent of GDP in 2007 to almost 16 percent in 2012. In addition, public sector debt has ballooned. Even the state-owned oil company, awash with cash, has increased its debt.

Continued overdependence on oil trades off with the development of other sectors necessary for economic sustainabilityRossi '11 [Third Quarter 2011, Carlos A., International Association for Energy Economics, “Oil Wealth and the Resource Curse in Venezuela.” www.iaee.org/en/publications/newsletterdl.aspx?id=137]Dutch Disease is a complex economics phenomenon that occurs to mineral rich nations when a sudden burst in the demand for its product is recorded. It has been

widely analyzed and documented from various sources. Here we will only describe the elements that explain why the oil wealth rent that has accrued to Venezuela has come with a double edge sword that has contributed to moving the country into a renter and unproductive society. 1. It has overvalued the national currency and weakened the competitive edge in the production of other staple goods that used to be made and now are imported. 2. Since oil related activities are much more lucrative, this has caused many entrepreneurs to abandon their traditional areas in the rural sectors in favor of flocking to the urban cities in search of a piece of the “oil pie’’. For example, in the 1970’s, a government decision was made to cancel all agricultural related debt in the

hopes of eliminating this financial burden and increasing agricultural production. The result was the opposite. Most landowners simply sold or closed their

latifundios and moved into the construction business or other urbanite ventures. 3. Massive internal migrations and foreign immigrations to the urban core of principal cities were caused, creating the infamous poverty belts, collapsing all social services and resulting in rampant crime. Venezuela’s population tripled since the first oil boom in 1973. 4. Lavish spending on huge industrial projects that were ill conceived and badly managed were induced, wasting valuable resources, creating the need for permanent

subsidies and international debt. Rampant rent seeking and corruption by both state ‘technocrats’ and private contractors occurred. In 1949 Venezuela’s

GDP per-capita income was higher than West Germany, Italy and Japan. Now it ranks number 44 in the world. 5. It made the nation more dependent on one commodity for hard currency earnings to pay for imports, which include both final food and medical goods, as well as in parts and

inputs for industrial plants. 6. It made the country totally dependent on the Government for all economic activity, including both public and private production since it is the state that controls foreign currency for imports of spare parts and finished goods. 7. It has transformed the political conditions of the country. This last effect is probably the least understood. As opposed to virtually all other developing countries, where the means of production (land, capital, companies) is privately held, Venezuela is different for two reasons: 1) Because, by the constitution oil belongs to the state and 2) because it is a full grown democracy. This means that the vote from the poor people count, and since the country has a lot more poor folk that rich, they count a lot. Hugo Chavez champions the poor people because he not only comes from within their ranks but has developed a great rapport with them. He has improved their lot and hastened their hope and dignity but he has done it charitably, not productively nor sustainably. The phenomena arises since by Venezuelan law whomever governs the state also governs the fate of the countries lucrative oil reserves. This dramatically hastens rent seeking but in the reverse. It is not the rich who have control of the lucrative means of production and the poor who want access to it, but just the opposite. The real paradox in Venezuela is that it is the rich who want access to what the poor (or some) have; the power over the oil

wealth. It is a political-sociological pyramid turned on its head. Today oil accounts for over 95% of Venezuela’s exports, 50% of government revenues and 30% of GDP directly. According to official figures, imports tripled between 2000 and 2008 to the unheard of level of US$ 49.4 billion, before they collapsed 22.3% the following year due to policy instigated recessions6. Venezuela’s populist president, Hugo Chavez, has presided over untold oil wealth and a recognizable reduction in Venezuela’s worst poverty levels (through ‘missions’ geared towards extreme hunger alleviation by handouts, free education and health care) has also presided over a collapse in the production of all of Venezuela’s agriculture and much of the industrial apparatus, including crude oil production and even some energy intensive sectors like steel and aluminium. In contrast to other socialist nations that focus on socialist distribution while

leaving production issues to private enterprise, Venezuela has opted for the ill defined “productive socialism’’ were the state interferes

with basic production decisions of key industries. This socialist production model has exacerbated rent seeking and Dutch disease,

and the constant “expropriations’’ have scared off would be investors in virtually all economic sectors. It is not that his socialist production model is not working, but that it can’t work; it is socially-physically impossible for it to work (100 years of productive capitalism is enough time to teach us how companies must be managed to produce.

Reliance on oil makes Venezuelan Dutch disease and instability inevitable The Economist ’10 [September 9th, 2010, “It's only natural” , The Economist, http://www.economist.com/node/16964094]

Latin America is uncomfortably dependent on commodities. In the past decade they accounted for 52% of the region's exports, according to the World Bank. That is down from 86% in the 1970s, but over the same period the figure in East Asia and the Pacific fell from 94% to 30%. Chile, Peru and Venezuela still rely on raw materials for more than three-quarters of their total exports. In all, as the World Bank notes in a report published this month, more than 90% of Latin Americans live in countries that are net exporters of commodities, the exceptions being in Central America and the Caribbean. Governments have also become more reliant on raw materials for their tax revenues (see chart 1). There is nothing wrong with producing raw materials. The rise in world prices for Latin America's commodities, and the related increase in their output, may have accounted for between one-third and half of the region's growth over the past decade. And thanks to Asia's economic vigour, commodity prices fell only briefly during the recession and remain at historically high levels. Over the past decade a region that has habitually suffered from balance-of-payments troubles has benefited from the foreign exchange that commodities bring in. This bonanza seems to refute the thesis put forward by Raúl Prebisch, the founding director of ECLAC, that the price of commodities is bound to decline in relation to the price of manufactured goods. Even so, relying on raw materials carries a series of risks. One is volatility: their prices are more variable than those of manufactures. Second, many economists worry about “Dutch disease”, a term coined by this

newspaper in 1977 to describe the impact of a North Sea gas bonanza on the economy of the Netherlands. This malady involves commodity exports driving up the value of the currency, making other parts of the economy less competitive, leading to a current-account deficit and even greater dependence on commodities. This matters all the more because

mining and hydrocarbons are capital-intensive businesses, generating relatively few jobs. The commodity boom, together with capital inflows attracted by better economic prospects, has already pushed up the value of some of the region's currencies. For example, São Paulo seems extraordinarily expensive to any visitor. The strength of the Brazilian currency, the real, worries officials and industrialists. A third concern is that many non-agricultural commodities are not renewable (although high prices

encourage new discoveries), so governments should invest the tax revenues they generate in infrastructure and training to diversify the economy. Producing commodities may also involve local environmental damage. In parts of Latin America

mines and oilfields are in areas inhabited by people of indigenous descent and have caused cultural clashes. A fourth problem is the potentially corrosive effect of commodity production on political institutions. Many commodities incorporate rents (ie, excess profits derived from the fact that supply is usually limited in the short term). It is in the state's interest to capture those rents, but corruption often follows when it does. Mines and oil- and gas fields often

involve high sunk costs and low variable costs, making them a tempting target for expropriation. Venezuela provides the clearest evidence of these ills.

Venezuelan oil dependence makes economic collapse inevitable Kott ’12 [November 3rd, 2012, Adam, Associate in Business Consulting - Trade and Risk Management at Sapient Global Markets, Business Development Intern at Urban Green EnergyConflict Resolution Intern at Tanenbaum Center, Government Affairs Intern and Communications Assistant at Healthcare Institute, New York University, The George Washington University, “Assessing Whether Oil Dependency in Venezuela Contributes to National Instability”, Journal of Strategic Security, Volume 5, Energy Security, http://scholarcommons.usf.edu/cgi/viewcontent.cgi?article=1176&context=jss&sei-redir=1&referer=http%3A%2F%2Fscholar.google.com.proxy.lib.umich.edu%2Fscholar%3Fstart%3D30%26q%3DVenezuela%2Bdutch%2Bdisease%26hl%3Den%26as_sdt%3D1%2C23%26as_ylo%3D2000#search=%22Venezuela%20dutch%20disease%22] The world is experiencing an unprecedented demand for energy as economic development begets rising incomes as well as increased stresses on the international marketplace. While petroleum has the potential to help meet the challenges of economic development, the international oil market is volatile and fragile, and seemingly insignificant changes in oil production can have a disproportionately large impact on global prices. Many states that are reliant on oil and other nonrenewable resources have fallen victim to the resource curse. Venezuela faces the various attributes of the resource curse, including an unstable economy, the rise of an authoritarian government, Dutch Disease, and corruption. The Economic Perspective Volatility and the Boom-Bust Cycle Over-reliance on a single commodity for a majority of a nation's export revenue is an especially precarious prospect. Over-reliant countries put their fate in the hands of a capricious global commodity market that regularly cycles through booms and busts. In the case of oil, prices have shifted as much as 70 percent in a year's time. The boom-bust culture presents many problems to countries reliant on a single export or two for a majority of their revenue. When prices are high, the opportunity cost of investing in another good for export becomes

extremely great. Capital and labor shifts toward one product may have short-term benefits, but this creates an economic monoculture. A country with an economic monoculture, such the case of Venezuela and oil, will experience considerable economic hardships when the price of the commodity falls. For instance, the price of oil decreased from $140/barrel to $40/barrel between 2008 and 2009. During this same time period, Venezuela experienced a negative 3.2 percent GDP growth rate due largely to the sudden shortage of export revenues, which declined from $93.5 billion to $57.6 billion. Boom-bust cycles also lead to poor governmental expenditure decisions. Overspending during good years and deep budget cuts during bad years have far reaching impacts. Renowned economist Jeffrey Sachs notes, "the benefits in the good years are transitory while the problems generated during the bad years endure." For instance, in 2009 Hugo Chavez slashed 33 percent of the national budget after oil traded well below what the Venezuelan Government initially projected. Poor financial decisions can often have international repercussions. During commodity booms, countries often borrow against future earnings from various international lenders. A prolonged drop in prices, however, may make it impossible for these countries to pay loans back, subsequently forcing the borrower to default or become mired in a deep debt crisis. Dutch Disease Dutch Disease is another common trait seen in countries reliant on natural resource exports. The term "Dutch Disease" was first coined in 1977 by the Economist to describe the economic impact of natural gas exports in the Netherlands. Following the discovery of natural gas in the Black Sea in the 1970s, the Dutch manufacturing sector began to experience a significant decline. Essentially, local currency appreciates as a result of high demands for a given commodity. The influx of money into the local economy due to high-value exports causes demand and, consequently, prices to increase. As a result, local currency appreciates and there is an increase of the real exchange rate. With such an overvalued domestic currency, other domestic products such as manufactured and agricultural goods become overpriced and uncompetitive in the global market. This in turn also contributes to what is often called the "resource pull effect." A dominant natural resource sector attracts a majority of the domestic capital and often becomes the wage-setter, with wages higher than the struggling domestic industries. While some labor shifts towards this natural resource sector cause layoffs in the now less competitive manufacturing and agricultural sectors, many nonrenewable resource industries are not labor intensive. For instance, mining rare minerals may require a large employee base, but oil and natural gas production is primarily a technology and capital-intensive process needing fewer workers. This results in high unemployment rates in petroleum dependent economies that do not have a viable manufacturing or agricultural base. In addition to a shifting work force, natural resource domination threatens to crowd- out entrepreneurial activity and innovation, especially if this industry is the wage-setter, as workers may be more inclined to work in the resource sector rather than create their own businesses. Overall, Dutch Disease creates a vicious cycle that gives primacy to a single sector and helps rein- force the natural resource monoculture.

Impacts

Instability

Venezuela uses oil money to destabilize the regionCrane ‘9 [2009, Keith, Director Environment, Energy, and Economic Development Program, ISE RAND Corporation, Andreas Goldthau, Michael Toman, Thomas Light, Stuart E. Johnson, Alireza Nader, Angel Rabasa, Harun Dogo, “Imported Oil and U.S. National Security,” RAND, http://www.rand.org/content/dam/rand/pubs/monographs/2009/RAND_MG838.pdf] Destabilization. The most controversial use of oil revenues by the Chavez govern- ment has been the support that it has given movements seeking to destabilize neighbor- ing governments. Documents seized from the laptops of Luis Edgar Devia Silva (Raul Reyes), the second in command of the Revolutionary Armed Forces of Colombia– People’s Army (Fuerzas Armadas Revolucionarias de Colombia–Ejercito del Pueblo, or FARC), killed in a Colombian army raid, show that the Venezuelan government has collaborated with FARC. The documents, disclosed in a news conference in Bogotá by General Oscar Naranjo, head of the Colombian National Police, included a letter from Commander Luciano Marin Arango (also known as Ivan Márquez), a member of the FARC Secretariat and FARC’s apparent go-between with Chavez, in which he writes about “Venezuela’s financing to the FARC at USD 300 million.” In a document dated February 9, 2008, Márquez passes along Chavez’s thanks for a $150,000 gift from the FARC when Chavez was imprisoned from 1992 to 1994 for leading a failed coup. Márquez discusses Chavez’s plan to try to persuade Latin American governments to get FARC removed from lists of international terrorist groups.¶ There are indications that Venezuela has supported subversive groups in Peru. A Peruvian parliamentary committee agreed to request the creation of a task force to delve into Venezuelan ideological infiltration in Peru through the so-called Houses of ALBA, a body sponsored and funded by Venezuela. In 2008, Peruvian authorities arrested nine people alleged to be militants bankrolled by Venezuela.

Venezuelan Economy

Venezuelan energy revenue dependence wrecks their economy and causes warCassidy ‘13 [March 6, 2013, John, The New Yorker, “VENEZUELA’S “RESOURCE CURSE” WILL OUTLIVE HUGO CHÁVEZ,” http://www.newyorker.com/online/blogs/johncassidy/2013/03/venezuela-resource-curse-will-outlive-hugo-chavez.html] Rather than generating peace and prosperity, the presence of mineral and oil wealth in countries that have been poor often leads to political conflict, corruption, and, in extreme cases, civil war. While Venezuela remains a very divided country, it didn’t fall to those depths. But with some estimates now showing Venezuela harboring bigger oil reserves than Saudi Arabia, the question of how to manage its immensely valuable natural resources may well cause even more intense conflict in the years ahead. ¶ As for Chávez’s socialist experiment, there’s little consensus on how it fared. Reflecting the views of Washington’s economic-development establishment and Venezuela’s large émigré population, Moses Naim, a Venezuelan who served as trade and industry minister during the early nineteen nineties, and who is now at the Carnegie Endowment, argued at Businessweek.com that Chávez left behind “an economy in shambles … [with] one of the world’s largest fiscal deficits, highest inflation rates, worst misalignment of the exchange rate, fastest-growing debt, and one of the most precipitous drops in productive capacity—including that of the critical oil sector.” But Chávez had his defenders. Writing for Salon, David Sirota pointed to the fall in poverty rates under his rule, along with a surge in college enrollment and a substantial increase in access to medical care. “Indeed, as shown by some of the most significant indicators,” Sirota noted, “Chávez racked up an economic record that a legacy-obsessed American president could only dream of achieving.”¶ The problems of the Venezuelan economy are certainly real: inflation is high—more than twenty per cent—and so is the budget deficit, which stands at fifteen per cent of G.D.P. In an attempt to deal with rising prices, the government has resorted to price controls, which have led to shortages of certain goods. And in an effort to bolster the public finances, it recently devalued its currency, the bolivar, by a third. (Venezuela gets paid for its oil in dollars, which are now worth more in bolivars.)

Terrorism

Venezuelan oil revenue causes terrorists attacks on the USWalser ‘10 [January 20th, 2010, Ray, PhD. From UNC-Chapel Hill; Senior Policy Analyst specializing in Latin America at The Heritage Foundation, “State Sponsors of Terrorism: Time to Add Venezuela to the List” The Heritage Foundation, http://www.heritage.org/research/reports/2010/01/state-sponsors-of-terrorism-time-to-add-venezuela-to-the-list]Since January 2009, the Obama Administration's attempts to improve relations with the stridently anti-America Chávez have yielded little more than empty gestures. Although ambassadorial relations were restored in June 2009, Chávez has signaled renewed support for the narcoterrorism of the FARC, begun threatening and punishing Colombia for its defense cooperation agreement with the U.S., helped destabilize Honduras by backing former president Manuel Zelaya's illegal referendum, pushed ahead with major Russian arms acquisitions, and sealed ever closer ties, including joint nuclear ventures, with Iran. Venezuela plays an increasingly prominent role as a primary transit country for cocaine flowing from Colombia to the U.S., Europe, and West Africa. Nevertheless, the Obama Administration, according to the President's National Security Council adviser on Latin America, Dan Restrepo, does not consider Venezuela to be a challenge to U.S. national security: President Obama "does not see Venezuela as a challenge to U.S. national security. There is no Cold War nor Hot War. Those things belong to the past."[2] This view is not optimistic--it is dangerous. The Administration needs to, as a recent bipartisan congressional resolution urges, adopt a genuinely tough-minded approach to dealing with Chávez and Venezuela. The Administration needs to develop a public diplomacy strategy to counter Chavista disinformation and a diplomatic strategy in the Americas that responds to growing threats of political destabilization. It also needs to recognize that under Chávez, Venezuela has become terrorism's most prominent supporter in the Western Hemisphere. The Obama Administration can begin to correct this policy of drift and inaction by placing Venezuela on the list of state sponsors of terrorism along with Iran.

Rogue State

Oil revenues emboldens Venezuela—they’ll go rogueCrane ‘9 [2009, Keith, Director Environment, Energy, and Economic Development Program, ISE RAND Corporation, Andreas Goldthau, Michael Toman, Thomas Light, Stuart E. Johnson, Alireza Nader, Angel Rabasa, Harun Dogo, “Imported Oil and U.S. National Security,” RAND, http://www.rand.org/content/dam/rand/pubs/monographs/2009/RAND_MG838.pdf] Many U.S. citizens and policymakers are concerned that proceeds from payments for imported oil are being used to finance activities contrary to U.S. interests. Govern- ments of some countries openly hostile to the United States—Iran and Venezuela, in particular—rely on oil exports for most of their budget revenues. To the extent that global consumption of oil contributes to increasing the revenues of these governments, directly or through the effects of U.S. consumption on global demand for oil, global importers’ payments for imported oil may help finance governments intent on thwarting U.S. policies. Oil exports are not a necessary condition for financing rogue states. North Korea is an oil importer but has built nuclear weapons. In the 1990s, when under the rule of the Taliban, Afghanistan, another oil importer, became a sanctuary for al Qaeda. In the 1990s, before it began exporting oil in large quantities, Sudan harbored Osama bin Laden.¶ Most major oil exporters—for example, Canada, the largest supplier of oil to the United States—are not hostile to the United States. However, in recent decades, a few oil exporters have threatened U.S. interests and, in some cases, global peace. Between 1980 and 1990, Iraq invaded two of its neighbors, Iran and Kuwait. Iran has perpe- trated terrorist attacks on U.S. installations, financed the activities of Hizballah, and supported violent militias and insurgents in Iraq and Afghanistan and is engaged in a nuclear program that is likely to produce enough enriched uranium to manufac- ture nuclear weapons. Although the hostile activities of Venezuela’s government under Hugo Chavez are not on the order of Iran’s, Venezuela is pursuing a foreign policy designed to thwart U.S. policy goals in Latin America.¶ The ability of these governments to pursue policies contrary to U.S. interests depends, in part, on financial resources. Because oil exports are such important sources of revenues for the budgets of Iran and Venezuela, if budget revenues were lower, either because of lower prices or smaller export volumes, the ability of these governments to oppose U.S. interests would be impaired. In this section, we evaluate the role of oil exports in government revenues, the successes of initiatives these governments have pursued to thwart U.S. foreign policies, and the limitations these governments face in maintaining or expanding these initiatives.

Counterbalancing

They use oil revenue to counterbalance the USCrane ‘9 [2009, Keith, Director Environment, Energy, and Economic Development Program, ISE RAND Corporation, Andreas Goldthau, Michael Toman, Thomas Light, Stuart E. Johnson, Alireza Nader, Angel Rabasa, Harun Dogo, “Imported Oil and U.S. National Security,” RAND, http://www.rand.org/content/dam/rand/pubs/monographs/2009/RAND_MG838.pdf] The Venezuelan government relied on revenues from oil for 53 percent of government revenues in 2006 (Figure 4.3). In current dollars, government revenues from oil have risen from $5.3 billion in 1998, the bottom of the oil bust in the 1990s, to $29.3 billion in 2006. Revenues surged again in 2007 and the first half of 2008, but the Venezuelan government has had to sharply cut spending in 2009 as oil prices have plummeted.¶ Oil Exports and Venezuela’s Policies Contrary to U.S. Interests. Venezuela’s presi- dent, Hugo Chavez, has used some of these revenues to consolidate his political base, expand Venezuela’s influence throughout Latin America and the Caribbean, and build up Venezuela’s military forces. Chavez has also attempted to create coalitions of coun- tries to counterbalance U.S. international influence—most notably, with Iran but also, less successfully, with China and Russia.

Oil revenue allows Venezuela to counterbalance the USBrown ’13 [April 4th, 2013, Stephen, Ph.D in Economics, “Consequences of U.S. Dependence on Foreign Oil”, http://nepinstitute.org/wp-content/uploads/2013/04/Brown-Costs-of-Oil-Dependence1.pdf] The Council on Foreign Relations (2006) also identifies the possibility of oil revenues enabling oil-producing countries to oppose U.S. interests as a cost of U.S. dependence on imported oil. Iran, Libya, and Venezuela stand out in recent history as countries whose oil revenue has allowed them to pursue interests that the United States opposes.

Nonetheless, the ability of a country to oppose U.S. interests depends more on its oil revenue than U.S. consumption of the marginal barrel of imported oil. In that regard, oil’s fungibility limits the effectiveness of policy tools directed at a country’s oil exports. Restricting U.S. oil imports to target the actions of a few countries represents a rather blunt policy instrument that punishes all oil-exporting countries—not just those who oppose U.S. interests. Other targeted sanctions directed at countries that behave badly may prove to be a more direct approach to foreign policy

Militarization

Venezuela uses oil revenue to militarize—causes extinctionReuters ‘8 [June 6, 2008,“Venezuela Shows Off Military Might in Missile Test,” Epoch Times, http://www.theepochtimes.com/news/8-6-6/71522.html] Venezuela test-fired missiles in the Caribbean Sea Friday in a display of military strength at a time of tense relations between Washington and leftist President Hugo Chavez.¶ Five Russian Sukhoi fighter jets swooped over the military base on the island of La Orchila, dropping a half-ton bomb and firing a KH-59 missile at a seaborne target. A patrol boat fired an Otomat surface-to-surface missile at the same target. Air Force Commander Gen. Luis Jose Berroteran, said the newly acquired military equipment would help Venezuela ward off potential invasions. "When you have (resources) that are desired by foreign powers, you have an obligation to your people to defend them," he said.¶ Chavez frequently accuses the United States of plotting his overthrow to snatch the OPEC nation's oil reserves, and in recent weeks has said the U.S. attitude toward Venezuela echoes U.S. "aggression" in Iran and Iraq.¶ The test was the first display of firepower purchased from Russia and China using profits from its record oil revenues. Washington has criticized Chavez's military buildup, arguing it could destabilize the region. Chavez bought the Russian fighter jets after the United States blocked his efforts to buy planes with U.S. technology. Venezuela has the fourth-largest military budget in Latin America, and analysts say its military spending is relatively low in relation to its GDP.¶ Tensions remain high between the United States, Venezuela and its neighbor, U.S.-ally Colombia, which accuses Chavez of helping Marxist insurgents fighting the government.

Democracy

Venezuelan oil revenue eviscerates democracy and destabilizes Latin AmericaCrane ‘9 [2009, Keith, Director Environment, Energy, and Economic Development Program, ISE RAND Corporation, Andreas Goldthau, Michael Toman, Thomas Light, Stuart E. Johnson, Alireza Nader, Angel Rabasa, Harun Dogo, “Imported Oil and U.S. National Security,” RAND, http://www.rand.org/content/dam/rand/pubs/monographs/2009/RAND_MG838.pdf] Implications for U.S. Security. Revenues from oil exports have enabled Chavez to pursue a number of policies that run counter to U.S. goals to create stable, peace- ful, economically dynamic democracies in Latin America. Within Venezuela, he has attempted to concentrate political power in the presidency, undercutting checks and balances. Higher oil revenues permitted him to provide subsidies to his core constitu- encies, shoring up domestic political support. He has pursued economic policies, and encouraged other countries to do so as well, that retard economic growth and burden government finances. The decline in oil prices in the second half of 2008 is already straining the budget. The Venezuelan government is in the process of reducing some subsidies and devaluing the currency so as to restore fiscal balance.¶ Chavez has provided campaign financing for presidential candidates in other countries in Latin America who also oppose U.S. policies. Most of these candidates have won recent elections. He has been an irritant to the United States in interna- tional forums, such as the United Nations. He has boosted military spending. He has also provided support for groups, such as FARC, that seek to overthrow neighboring governments.

Answers

AT: Responses Solve

Responses fail—increase inflation Corrales ’13 [March 7th, 2013, Javier, professor of political science at Amherst College. He is the co-author (with Carlos A. Romero) of U.S.-Venezuelan Relations Since the 1990s: Coping with Midlevel Security Threats (Routledge, 2013), Writer for Foreign Policy and Foreign Affairs, “The House That Chavez Built”, http://www.foreignpolicy.com/articles/2013/03/07/the_house_that_chavez_built?page=0,3]Venezuelan Disease involves more than just fiscal profligacy. It also involves misguided responses to inflation. Populist governments tend to make their worst mistakes in dealing with inflation. Governments today, unlike in the

1960s, have learned to worry about inflation because it is one of the quickest ways to expand poverty. Inflation acts as a form of consumption tax that falls heavily on low-income, salaried groups, lowering their purchasing power dramatically. Populist governments in particular panic about inflation precisely because it hurts the very same group they want to court -- namely, low-income workers. But rather than cutting back on spending and introducing productivity-boosting reforms (in order to increase the number of goods that currency units are chasing), populist governments respond to inflation by imposing microeconomic controls. ¶ They tend to favor three types. Foreign exchange controls try to lower the demand for dollars by restricting access to them. Retail price controls make raising prices illegal. And labor market controls, which aim to protect low-income salaried workers, can range from raising the minimum wage to making it harder for employers to fire employees. Venezuela under Chávez saw all three forms of controls. ¶ The problem is that these controls end up exacerbating the very same problems they are meant to address. For instance, exchange rate controls accentuate rather than alleviate the demand for dollars; those who hold increasingly

undervalued bolívars, the Venezuelan currency, become desperate to get rid of them. ¶ Price controls, in turn, precipitate a supply crisis. Producers facing price controls for their products, in a country with galloping inflation, soon discover that their costs exceed their allowable retail prices. At this point, production is no longer profitable. Producers must either discontinue that product (which yields scarcity) or switch to importing (which stimulates the demand for dollars, offsetting the government's effort). ¶ And labor controls produce more inflation and labor scarcity. By imposing an excessive increase in minimum wages, the government is actually increasing rather than decreasing the inflationary pressures on the private sector. And by creating restrictions on firing labor, the government creates labor scarcity. ¶ This is a vital point. When workers cannot get fired easily based on job performance, they begin to underperform. In

Venezuela under Hugo Chávez, the government increasingly restricted the ability of the private sector to fire workers. The latest labor code, for instance, makes it virtually illegal to fire workers for missing work. Venezuela is unusual in that firms need permission from the state to fire workers. Consequently, absenteeism in the workplace is booming. In

February, El Nacional, a Caracas daily, reported from various business chambers that absenteeism is on the rise, currently ranging from 5 to 46 percent

depending on sector and firm. ¶ The key point is that the excessively populist approach of relying on controls results in a microeconomic collapse. The entire economy, whether public or private, experiences a productivity crisis. In the Venezuelan public sector, the most embarrassing example is the oil industry, the government's most important source of cash. The Venezuelan oil industry is in the midst of a schizophrenic episode. On the one hand, levels of proven oil reserves and export prices are at historical highs. But productivity has plummeted. So dismal is the oil sector's situation that Venezuela now needs to import gasoline, and has a hard time finding creditors for its oil company (again, a remarkable thing for a petro-state). ¶ If oil, the regime's most important milk cow, is in trouble, the rest of the less vital state-owned enterprise is approaching a state of collapse. Ricardo Obuchi and colleagues at the Institute for Advanced Studies in Administration (IESA) in Caracas have been tracking the performance of state-owned companies, with alarming reports. For instance, cement production, whose sector was nationalized in 2008, is producing scarcity levels of up to 70 percent. Ten states thus far have reported severe electricity blackouts this year. ¶ In the private sector, the most conspicuous sign of microeconomic ailments is consumer goods scarcity. This problem is so acute that the Central Bank even keeps tabs on the issue by publishing a scarcity index. In January 2013, the index indicated the highest level of scarcity in four years, with "critical scarcity" in eight basic food products, such as sugar and sunflower oil, and "serious scarcity" in nine others.

AT: Oil Production Key to Growth

Oil production stunts Venezuelan growth—empirically provenGrisanti ’11 [May 4th, 2011, Alejandro, senior economist for Venezuela, Ecuador, Peru, Central America and the Caribbean at Barclays Capital Inc., writer for America’s Quarterly, “Venezuela’s Oil Tale”, http://www.americasquarterly.org/node/2436] President Chávez’ economic policies over the past 12 years have amplified the natural resource curse: low growth, high volatility, Dutch Disease, accusations of

fiscal greed and corruption, inequality and poverty, and weak institutions. Since 1998, and despite the oil windfall, Venezuela has grown on average 2.3 percent per year. In contrast, the seven largest Latin American countries grew on average by 3.2 percent. Within this period, Venezuela experienced five years of negative growth with an average contraction of 5.6 percent and seven years of positive growth with an average expansion of 8.4 percent. Venezuela is an extreme example of Dutch Disease: in nominal terms, oil exports have grown 410 percent since 1998, while imports have grown 130 percent. But in real terms, exports have fallen 40 percent, with imports more than doubling.¶ At the same time, Venezuela’s institutional development lags behind its Latin American peers. Using the

World Bank Governance Indicators for 2009, Venezuela’s percentile rank for control of corruption is 8 percent; the

regional average is 47 percent. Similar selective comparisons are as follows: rule of law (3 percent Venezuela, vs. 43 percent regional);

quality of regulation (4 percent vs. 45 percent); government effectiveness (19 percent vs. 50 percent); political stability (11 percent vs.

38 percent); and accountability (26 percent vs. 49 percent).¶ A country like Venezuela, with abundant natural resources, should be seen as having high potential investment in various projects and abundant access to foreign exchange to purchase capital goods and raw material. But unfortunately, after 12 years of

unproductive economic policy, Venezuela has spent more than $517 billion in oil income and increased its total debt from $31.3 billion in 1998 to an estimated $96 billion at the end of 2010. Although current distortions cannot be maintained indefinitely, no changes should be expected before the presidential election. The increase in indebtedness that the government has registered in recent years has moved it from a position of net creditor to that of net debtor.

Sole dependence on oil makes instability inevitableDrezner ’13 [May 7th, 2013, Daniel, Tufts University international politics professor, personal website, “Will energy abundance destabilize world politics?” http://drezner.foreignpolicy.com/posts/2013/05/06/will_energy_abundance_destabilize_world_politics] The Atlantic's Charles Mann has a long, winding cover story[2] on the growth of non-traditional hydrocarbon energy reserves -- shale gas, methane hydrate, and so forth -- and what that could mean for world politics. The good parts version:¶ Shortfalls in oil revenues thus kick away the sole, unsteady support of the state—a cataclysmic event, especially if it happens suddenly. 'Think of Saudi Arabia,' says Daron Acemoglu, the MIT economist and a co-author of Why Nations Fail. 'How will the royal family contain both the mullahs and the unemployed youth without a slush fund?' And there is nowhere else to turn, because oil has withered all other industry, Dutch-disease-style. Similar questions could be asked of other petro-states in Africa, the Arab world, and central Asia. A methane-hydrate boom could lead to a southwest-to-northeast arc of instability stretching from Venezuela to Nigeria to Saudi Arabia to Kazakhstan to Siberia. It seems fair to say that if autocrats in these places were toppled, most Americans would not mourn. But it seems equally fair to say that they would not necessarily be enthusiastic about their replacements.¶ Augmenting the instability would be methane hydrate itself, much of which is inconveniently located in areas of disputed sovereignty. 'Whenever you find something under the water, you get into struggles over who it belongs to,' says Terry Karl, a Stanford political scientist and the author of the classic The Paradox of Plenty: Oil Booms and Petro-States. Think of the Falkland Islands in the South Atlantic, she says, over which Britain and Argentina went to war 30 years ago and over which they are threatening to fight again. 'One of the real reasons that they are such an issue is the belief that either oil or natural gas is offshore.' Methane-hydrate deposits run like crystalline bands through maritime flash points: the Arctic, and waters off West Africa and Southeast Asia.

***Terror CP

1NC

ShellText: The United States federal government should-mandate that the U.S. Northern and Southern Commands, the U.S. Coast Guard, and the U.S. Drug Enforcement Administration develop and implement a strategy to confront Central American terrorism;-establish an international coalition to support anti-drug and anti-crime security efforts in Central America;-create an interagency task force to assess and respond to the threats posed by the Venezuelan government and its involvement with Iran and Russian arms purchases; and-use law enforcement sanctions and indictments by the DEA and the U.S. Department of the Treasury to unmask officials and companies that are involved with narco-trafficking, international terrorism, or sanctioned Iranian entities.

CP solves—US leadership is keyNoriega and Cardenas 13 (Roger F., ambassador to the Organization of American States from 2001-2003 and assistant secretary of state from 2003-2005. He is a visiting fellow at the American Enterprise Institute Testimony before the US Senate Committee on Foreign Relations, Jose R., help a senior post in the administration of President George W. Bush, current principal of Vision Americas, "Threats on our doorstep", Jan 26 2013, www.azcentral.com/opinions/articles/20130126threats-united-states-doorstep.html)What can President Obama do to meet these threats? First, we have to know what’s happening in our neighborhood. We must renew emphasis on intelligence capabilities to confront extra-regional threats and cross-border criminality. The State Department should be instructed to sound the alarm and enlist the support of responsible neighbors. The U.S. Northern and Southern Commands, the Coast Guard, and the Drug Enforcement Administration should be asked to plan a surge to carry our share of the burden in meeting these threats. Regarding Mexico, the president should cultivate strong bipartisan support in the U.S. Congress for Mexican counternarcotics efforts and for treating Mexico as not just an “enforcer,” but as an ally against drug-trafficking cartels. We should work with Mexico, Colombia and European allies to develop international strategies to attack the cartels wherever they operate — starting with a global rescue plan for Central America. In Central America, the United States, Mexico and Colombia should build an international coalition to support anti-drug and anti-crime security efforts. The United States should encourage interested nations to organize a summit of governments and institutions to develop such a plan and agree on how it should be implemented and funded. The multidimensional Venezuela threat requires a whole-of-government appraisal and response. An interagency task force under White House direction should assess and respond to the threats posed by the Chavez government and its alliance with Iran , its role in narco- trafficking, and implications of Russian arms purchases . We should use law-enforcement sanctions by the DEA and the U.S. Treasury — as well as indictments — to unmask Venezuelan officials and companies that are involved with narco-trafficking, international terrorism or sanctioned Iranian entities. Each of these challenges requires a cooperative, multinational response. However, there is no substitute for U.S. leadership.

Internal Net Benefits

Leadership

US leadership through a multilateral security initiative is vital for sustained economic growthNoriega and Cardenas 12 (Roger F., ambassador to the Organization of American States from 2001-2003 and assistant secretary of state from 2003-2005. He is a visiting fellow at the American Enterprise Institute Testimony before the US Senate Committee on Foreign Relations, Jose R., help a senior post in the administration of President George W. Bush, current principal of Vision Americas, "An action plan for US policy in the Americas", December 5 2012, www.aei.org/outlook/foreign-and-defense-policy/regional/latin-america/an-action-plan-for-us-policy-in-the-americas/)A stable and prosperous Americas is indispensable to US economic success and security. The region is home to three of the top four foreign sources of energy to the United States, as well as the fastest-growing destinations for US exports and investment. Clearly, geography and shared values predetermine a united destiny for the United States and its

neighbors in the Americas. How positive and fruitful that destiny will be depends on whether US policymakers, private businesses, and civil society move with a greater sense of purpose toward seizing promising opportunities and meeting critical challenges.¶ Times have changed. The US fiscal crisis and preoccupation with two distant wars have distracted policymakers in Washington and undermined US leadership in the Americas. Although access to the US market, investment, technology, and other economic benefits are highly valued by most countries in the Western Hemisphere, today, the United States is no longer the only major partner to choose from. Asia (principally China) and Europe are making important inroads. So, as US policymakers retool their strategy for the Americas, they must shelve the paternalism of the past and be much more energetic in forming meaningful partnerships with willing neighbors.¶ Of course, the United States must recover its credibility by making bold decisions to restore its own fiscal solvency, while aggressively promoting trade, energy interdependence, technology transfer, and economic growth. Then, Washington will be better positioned to cultivate greater economic and political cooperation among its neighbors, beginning with an open and candid dialogue with the region’s leaders about their vision, their challenges, and their priorities. Partnerships can thus be built on common ground.¶ The security challenges in the Americas are very real and growing more complicated every day. Illegal narcotics trafficking, transnational organized crime, and radical populism fueled by petrodollars and allied with dangerous extraregional forces pose daunting challenges. Although it is wise to prioritize a positive socioeconomic and political agenda, assessing and addressing threats is an indispensable prerequisite to achieving US security and regional leadership.

Latin American trade is keyNoriega and Cardenas 12 (Roger F., ambassador to the Organization of American States from 2001-2003 and assistant secretary of state from 2003-2005. He is a visiting fellow at the American Enterprise Institute Testimony before the US Senate Committee on Foreign Relations, Jose R., help a senior post in the administration of President George W. Bush, current principal of Vision Americas, "An action plan for US policy in the Americas", December 5 2012, www.aei.org/outlook/foreign-and-defense-policy/regional/latin-america/an-action-plan-for-us-policy-in-the-americas/)The Western Hemisphere’s Moment.The United States is strategically well-placed to begin a new chapter in trade relations with Latin America. The countries within the Americas are bound by close historical, cultural, familial, and geographic ties, linked by common values and mutual interests. What also facilitates expanded economic engagement is the regional trade partners’ proximity to US shores, and the significant number of Hispanics living in the United States—some 50 million—that provide an exceptional strategic advantage in doing business with their countries of origin.¶ Equally important are the advances that many countries within the region have made in establishing economic stability and growth in recent years as the roots of democracy and the rule of law continue to take hold. Countries such as Mexico, Chile, Peru, Brazil, and Colombia have been at the forefront in modernizing their economies and opening them to investment, liberalizing trade, and becoming more competitive overall.¶ The numbers tell the story. Since 2003, an estimated 73 million Latin Americans have risen out of poverty. Moreover, between then and 2010, the average Latin American income increased by more than 30 percent, meaning that currently, nearly a third of the region’s some 570 million people are considered middle class. And in just the next five years, regional economies are projected to expand by one-third. That macroeconomic stability generates even greater opportunities for US business.¶ The Western Hemisphere already supplies a quarter of the world’s crude oil, a third of the world’s natural gas, nearly a fourth of its coal, and more than a third of global electricity, while offering tremendous potential for the development of renewable energy technologies.¶ Certainly, many in the US private sector have already discovered the benefits of intrahemispheric economic relationships. In fact, Latin America has played a key role in expanding US exports in recent years.¶ The Congressional Research Service reports that from 1998 to 2009, US trade with Latin America increased an average of 82 percent, more than 72 percent with Asia, 52 percent with the European Union, and 64 percent with the rest of the world. In 2011 alone, trade with Latin America grew 20 percent.¶ The economic growth in 2011 elevated trade between the United States and the region to a historic high of $772 million. Exports to the region grew 22 percent to $350 million, while imports increased by 20 percent to a total of $420

million.¶ According to the US Department of Commerce, American companies now export more to the Western Hemisphere—some 42 percent of total US exports—than to any other part of the world, including China. Last year, US merchandise exports to Latin America totaled $367 billion, and the US private sector accounts for one-third of all foreign direct investment in the region.¶ The United States now has trade agreements with 11 countries in the Western Hemisphere, which the Department of Commerce reports help to support nearly four million US jobs. Clearly, however, there is much more that can be done to fulfill the potential of intrahemispheric economic relations in the hyper-competitive global economy.¶ High-level official US engagement is imperative to revitalizing existing alliances and developing new partnerships to boost mutual competitiveness. A reinvigorated US trade policy must transcend past approaches that have been too identified with solely US interests and too focused on bilateral relationships. A 21st-century approach necessitates more multilateral engagement and cooperation, mutually beneficial information-sharing and support, and an inclusive vision.¶ A complementary strategy to increase demand for US goods and services requires mobilizing private capital, encouraging technology transfer, and leveraging existing US programs to strengthen the private sector throughout the Americas. Traditionally, private-sector growth has been held back by lack of investment and access to credit. In a true win-win strategy, the United States can boost exports and investment while strengthening regional producers and consumers.¶ In summary, increased US government initiatives to expand economic partnerships with the country’s Western Hemisphere neighbors are crucial to America’s economic recovery and competitiveness. A prosperous hemisphere is also beneficial to US security concerns. The Americas is home to some of the most dynamic markets in the world. The US administration must recognize this reality and take full advantage of the opportunities.

Solvency – AFF Fails

Generic

The aff isn’t a long-term solution—Central American terrorism needs an international response to be effectiveNoriega and Cardenas 12 (Roger F., ambassador to the Organization of American States from 2001-2003 and assistant secretary of state from 2003-2005. He is a visiting fellow at the American Enterprise Institute Testimony before the US Senate Committee on Foreign Relations, Jose R., help a senior post in the administration of President George W. Bush, current principal of Vision Americas, "An action plan for US policy in the Americas", December 5 2012, www.aei.org/outlook/foreign-and-defense-policy/regional/latin-america/an-action-plan-for-us-policy-in-the-americas/)In Central America, the institutions of government and the rule of law have been overwhelmed by the onslaught of criminal gangs that have been displaced by Mexico’s stepped-up law enforcement. Guatemala’s state apparatus has been underfunded for decades, and the institutions of Honduras have been weakened by a succession of populist caudillo presidents, systematic corruption, and the expanding presence of organized crime. El Salvador confronts the unique challenge of hardened gang members deported from the United States maintaining their ties to criminal networks in US urban

centers. A public-security crisis in these countries has undermined popular confidence in elected officials and overwhelmed poorly trained and equipped security forces.¶ Unless the United States and neighboring countries organize an international response, several of these countries may soon become ungovernable territories, producing economic failure, civil strife, and refugee crises. This challenge requires a regional rescue plan (led by the United States, Mexico, Colombia, Europe, and the multilateral development banks). The United States should encourage interested nations to organize a summit of governments and institutions to develop such a plan and agree on how it should be implemented and funded.

Solvency—Terrorism

Border Security

Combining security technology with military strategy prevents terrorists from getting in the US—solves the information gapBarry 13 (Tom, senior analyst at the Center for International Policy in Washington, DC, directs the institute's TransBorder Project, cofounded the International Relations Center—1979-2007—where he helped establish its Foreign Policy, as authored and coauthored numerous books about the U.S.-Mexico borderlands and Latin America, "Homeland Security Drones Mission Creep from Border Security to National Security", March 20 2013, borderlinesblog.blogspot.com/2013/03/homeland-security-drones-mission-creep.html)CBP states its drone program is made up of the “leading edge of border security technology.” What is more, CBP’s Office of Air and Marine (OAM) boasts that its homeland security drone program is also on the leading edge of “shaping the US policy debate” and constitutes “the leading edge deployment of US in the national airspace.”¶ It’s no idle boast. The DHS fleet of seven Predators and three Guardians (a marine-surveillance variant of the Predator developed for CBP by General Atomics) stand at the vanguard of drone deployment for domestic ISR missions, and DHS has provided grants to local law enforcement agencies to acquire small UAVs while also pushing the Federal Aviation Administration to open national airspace to CBP drones.¶ Since 2004, when CBP first started using these unmanned flying machines, CBP has steadily expanded the scope of its mission for drones. First, the Predators were deployed for “border security” on the US-Mexico border, but congressional members from Michigan and North Dakota successfully pressured DHS to deploy Predators to “secure the northern border.”¶ With its three Guardians, CBP/OAM has again reached beyond the land borders to join the Coast Guard, the Drug Enforcement Administration, and the US Northern and Southern Commands to engage in drug interdiction operations throughout the Caribbean, the Gulf of Mexico, and in the Pacific. What were initially considered to be instruments of “border security” have become fully engaged in the war on drugs. (The Obama administration also declared an end to the “war on drugs,” transitioning in 2011 to what the White House calls the “Combat against Transnational Criminal Organizations.)¶ The mission creep of homeland security drones is a department-wide problem arising in large part from the lack of any coherent definition of the term “homeland security.” Similarly, DHS has never bothered to define what it means by “border security.” Nor does CBP have “performance measures” to evaluate its progress in securing the border—and in the case of the homeland security drones to evaluate their effectiveness.¶ Most of the concern about the domestic deployment of drones by DHS has focused on the crossover to law-enforcement that threaten privacy and civil rights—and without more regulations in place will accelerate the transition to what critics call a “surveillance society.” Also worth public attention and congressional review is the increasing interface between border drones and national security and military operations.¶ The prevalence of military jargon used by CBP officials—such as “defense in depth” and “situational awareness”—points to at least a rhetorical overlapping of border control and military strategy. Another sign of the

increasing coincidence between CBP/OAM drone program and the military is that the commanders and deputies of OAM are retired military officers.¶ The vague concepts of homeland security and border security facilitate the creep of the CBP/OAM drone

program. Nothing appears off-limits as to how these Predators and Guardians may be used at home or in the “near abroad”—in the Caribbean, Mexico, and Central America.¶ In a presentation to the National Defense Industrial Association in October 2012, OAM chief Michael Kostelnik explained other ways in which the “US are the leading edge of homeland security.” As these “US operations continue to expand and mature,” the homeland security drone program is providing “rapid contingency deployment supports” for “federal/state/local missions.” What is more, the “CBP US deployment vision strengthens national security response capability.”¶

Solvency—Banking Transactions

Generic

Sanctions on corporations that are involved in illicit terror funding prevent revenue streams—aff doesn’t solve because there are external funding sources from VenezuelaRubenfeld 13 (Samuel, a journalist published in The Wall Street Journal, WSJ.com, Dow Jones Newswires, citing David Coehn, undersecretary of Treasury for terrorism and finaicial intelligence, "Treasury, State Place Sanctions on Iranian Companies, Individual", May 9 2013, blogs.wsj.com/riskandcompliance/2013/05/09/treasury-state-place-sanctions-on-iranian-companies-individual/)The U.S. Treasury and State Departments each placed sanctions on Iranian attempts to evade sanctions.¶ Treasury identified Sambouk Shipping FZC as being connected with Dimitris Cambis, a Greek businessman who, along with a network of other front companies, was placed under sanctions in March for using Iranian money to buy oil tankers to help Tehran ship crude oil in violation of U.S. and European Union sanctions.¶ Cambis denies the allegations.¶ He is using Sambouk, which Treasury said was “recently formed,” to manage eight of the vessels he operates on behalf of the National Iranian Tanker Co., Treasury said. The vessels have been used to perform ship-to ship transfers of Iranian crude in the Persian Gulf to help obscure the oil’s origin, facilitating deceptive sales, it said.¶ “As long as Iran tries to evade our sanctions, we will continue to expose their deceptive maneuvers,” said David Cohen, undersecretary of Treasury for terrorism and financial intelligence, in a statement.¶ Treasury also targeted Iranian Venezuelan Bi-National Bank, which it said has been conducting transactions on behalf of Export Development Bank of Iran since at least January 2012. EDBI was placed under U.S. sanctions in October 2008.¶ The Iranian Venezuelan Bi-National Bank was originally established as a joint venture between Iran and Venezuela, but Treasury said there is no evidence Venezuela retains any ties to the bank.¶ Treasury’s Office of Foreign Assets Control also updated its list of vessels blocked because the National Iranian Tanker Co. has an interest in them. Eight vessels were renamed or reflagged, according to OFAC. In addition, eight more vessels were identified as property of National Iranian Tanker Co.¶ The U.S. estimates that sanctions, including those imposed by the European Union, have severely dented Iran’s ability to export oil, and has cost Iran’s government about $3 billion a month in revenue.¶ Separately, the U.S. State Department said it imposed sanctions on four Iranian nuclear support companies and an individual accused of trying to export U.S. material for use in gas centrifuges to help Tehran enrich uranium.¶ Three of the companies–Aluminat, Pars Amayesh Sanaat Kish and Taghtiran Kashan Co.–are chiefly involved in procurement of material for Iran’s nuclear program, the State Department said.

Pishro Systems Research Co. is responsible for research and development efforts, the State Department said.¶ “Iranian private sector firms should heed the risks incurred by conducting business with those who support Iran’s proscribed nuclear activities and should choose to focus their activities on legitimate international commerce,” the State Department said in a statement.¶ The State Department also placed Parviz Khaki, an Iranian citizen, under sanctions for attempting to procure material for use in gas centrifuges.¶ Khaki was indicted in July 2012 in the U.S. along with a Chinese man for allegedly trying to obtain and export material that could be used to build, operate and maintain gas centrifuges to enrich uranium, including things such as maraging steel, aluminum alloys, mass spectrometers and vacuum pumps.¶ He was arrested in May 2012 in the Philippines on a request from the U.S. based on an earlier indictment in the case, the Justice Department said at the time.¶ Citing the Justice Department, Al Monitor reporter Laura Rozen tweeted Thursday that Khaki remains in the Philippines fighting extradition to the U.S.¶ A Justice Department spokesman confirmed Rozen’s reporting, saying the legal process related to his extradition is continuing.

Sanctions are a key first step in deterring terrorist sponsorsMahjar-Barducci 11 (Anna, journalist, researcher and author based in Washington DC, "U.S. Sanctions Against Venezuela", June 3 2011, www.gatestoneinstitute.org/2170/us-sanctions-against-venezuela)In May, the U.S. State Department imposed sanctions on Venezuela's state oil company Petroleos de Venezuela (PDVSA) for trading with Iran. The press release states that between December 2010 and March 2011 the PDVSA delivered to Iran at least two cargoes of reformate (i.e. a blending component that improves the quality of gasoline), worth approximately $50 million.¶ The sanctions prohibit PDVSA from competing for U.S. government procurement contracts, from securing financing from the Export-Import Bank of the United States, and from obtaining U.S. export licenses. However, the sanctions do not apply to PDVSA subsidiaries and do not prohibit the export of crude oil to the United States. The measures will also affect other smaller companies PCCI (Jersey/Iran), Royal Oyster Group (UAE), Speedy Ship (UAE/Iran), Ofer Brothers Group, a family owned business (Israel), Tanker Pacific (Singapore), Associated Shipbroking (Monaco).¶ U.S. sanctions against Venezuela also affected the Venezuelan Military Industries Company (CAVIM) for illicit dealings with Iran.¶ Following the announcement, U.S. Vice Secretary of State James Steinberg said that "by imposing these sanctions we're sending a clear message to companies around the world: Those who continue to irresponsibly support Iran's energy sector or help facilitate Iran's efforts to evade US sanctions will face significant consequences."¶ U.S Congressman and Chairman of the Subcommittee on the Western Hemisphere, Connie Mack welcomed the State Department's decision. "The sanctions on PDVSA are an important step in the right direction for U.S. policy toward the region; however, we must acknowledge that PDVSA's shipments are only one example of Hugo

Chavez's support for the terrorist-supporting Iranian regime." Mack's communiqué continued that, "Reports of Iranian missile bases in Venezuela, the increasing presence of Hezbollah and the Iranian Revolutionary Guard Corps in the country, and [...] sanctioning of Venezuelan Military Industries Company show just how dangerous the Venezuela-Iranian relationship has become".

Sanctions keyShahi 13 (Benjamin, an Iranian-British international relations researcher and political columnist; also a member of the UK Political Studies Association, "Venezuelan Banks Help Iran Bypass UN & EU Sanctions", February 25 2013, www.khalije-fars.com/en/item/1853)Venezuela has become the country through which Iran intends to bypass UN sanctions. Following a new round of UN sanctions against the Islamic Republic, ABC’s report identifies Banco de Venezuela and Banco Internacional de Desarrollo as the main tools to bypass the sanctions over Iran’s nuclear works. Banco Internacional de Desarrollo, headquartered in Caracas, is actually a subsidiary of the Export Development Bank of Iran.¶ The main architect these secret financial arrangements is Mr. Tahmasb Mazaheri, former Iranian Minister of Economy and Finance and former Governor of the Central Bank of Iran, According to the newspaper, his arrest in Germany, announced last week, with a check in the amount of 300 million bolivars (USD70 million) issued by the Bank of Venezuela.¶ Mazaheri is senior director of the International Development Bank (IDB), an organization with headquarters in Tehran and Caracas. The IDB has long been included in the US and European Union blacklists, as well as its parent bank, the Export Development Bank of Iran (EDBI). The purpose of the activity of this entity is to cover the trade between the two countries including defence agreements, and also to overcome the limitations of currency operations and international problems related to Iran’s current economic sanctions, according to “nuqudy”.¶ Iran use Venezuela as a bridgehead for an expanded network of ties throughout Latin America. Shortly after elections brought Chávez allies to power in Bolivia, Ecuador and Nicaragua, Iran’s trade with Latin America soared, tripling from 2007–2008. To help bring those leaders closer into the fold, Venezuela and Iran pledged aid to Bolivia and Nicaragua that, when combined, amounted to more than 20 percent of each country’s GDP. Despite this, Iran’s support network in the region has thinned since 2010.¶ There is also substantial evidence to suggest that Iran is helping mine uranium in Venezuela and that financial institutions in Venezuela have funneled money to Iran’s nuclear program.

Treasury Sanctions solveAFP 13 (American Foreign Press, "US places sanctions on Iran-Venezuela bank" May 9 2013, www.google.com/hostednews/afp/article/ALeqM5iEOZ_lN7cFY5yGk1Ek34uPWyzTjQ?docId=CNG.83d357ad118d03da1bd3571a15dfa8cb.1c1)WASHINGTON — The US Treasury Department on Thursday announced sanctions on a former Iranian-Venezuelan bank it said is being used to avoid restrictions placed earlier on other Iranian institutions.¶ The US Treasury said that the

Tehran-based Iranian Venezuelan Bi-National Bank (IVB) was providing financial services to the Iranian Ministry of Defense and acting on behalf of the Export Development Bank of Iran.¶ Both the ministry and the EDBI are already under US sanctions for alleged support of terrorism and backing Iran's suspected effort to develop nuclear weapons.¶ The Treasury said the IVB had handled money transfers on EDBI's behalf with a Chinese bank, Bank of Kunlun, itself also blacklisted by the Treasury for its dealings with Tehran.¶ The Treasury noted that despite its name, "there is no evidence Venezuela retains any ties" with the four-year-old IVB, originally established as a joint venture between Iran and Venezuela.¶ The sanctions forbid any US citizens or institutions from doing business with the sanctioned institution, and freezes any assets it might hold in the United States.¶ The Treasury also named for sanctions a shipping firm, Sambouk Shipping, as involved in attempts by Tehran to break restrictions on its oil exports with the alleged help of Greek businessman Dimitris Cambis.¶ Cambis was singled out for sanctions in March for acquiring and managing a fleet of eight aging oil tankers secretly on Tehran's behalf.¶ The Treasury said Thursday that the vessels had recently been renamed and/or reflagged.¶ "As Iran becomes increasingly isolated from the international financial system and energy markets, it is turning increasingly to convoluted schemes and shady actors to maintain its access to the global financial system," Treasury Under Secretary for Terrorism and Financial Intelligence

David Cohen said in a statement.¶ "As long as Iran tries to evade our sanctions, we will continue to expose their deceptive maneuvers."

Empirically proven—US has broken up illegit Venezuelan investmentsDOJ 13 (Department of Justice, "SUMMARY OF MAJOR U.S. EXPORT ENFORCEMENT, ECONOMIC ESPIONAGE, TRADE SECRET AND EMBARGO-RELATED CRIMINAL CASES (January 2007 to the present: updated Feb. 14, 2013)", February 2013, www.pmddtc.state.gov/compliance/documents/OngoingExportCaseFactSheet022013.pdf)

Oil Field Equipment to the Sudan – On June 22, 2010, Agar Corporation Inc., a company in ¶ Houston, pleaded guilty in the Southern

District of Texas to violating the International ¶ Emergency Economic Powers Act and agreed to pay $2 million in criminal fines and forfeiture as ¶ well as civil penalties to the U.S. Treasury’s Office of Foreign Assets Control. The company was ¶

sentenced two days later to four years probation and a $760,000 fine. Agar Corporation illegally ¶ facilitated the export of multi- phase flow meters by an affiliate in Venezuela to the Sudan for use ¶ in the Melut Basin oilfield in violation of the embargo on the Sudan. The investigation was ¶ conducted by ICE.

Theory

Predictable

Interagency initiatives to solve terrorism are increasingly predictable given today’s national security challengesMunsing and Lamb 11 (Evan, a Subject Matter Expert at the Center for Strategic Research in the Institute for National Strategic Studies at the National Defense University, Christopher, Distinguished Research Fellow in the Center for Strategic Research, Institute for National Strategic Studies (INSS), at the National Defense University. He conducts research on national security strategy, policy, and organizational reform, and on defense strategy, requirements, plans, and programs, "Joint Interagency Task Force-South: The Best Known, Least Understood Interagency Success", www.ndu.edu/inss/docuploaded/Strat%20Perspectives%205%20_%20Lamb-Munsing.pdf)Interagency Coordination and Cross-functional Teams¶ Today’s national security challenges “lend themselves to increasingly ‘whole of government’” ¶ solutions that “will require structural and cultural changes in the executive and legislative branches.”11 Better interagency (or whole-of-government) organizational constructs are a common recommendation in national security reports and commentary,12 but the practical knowledge to act ¶ with confidence on these

proposals is far less evident. There is a vast amount of organizational ¶ literature on teams13 and some historical experience with interagency teams in the national security system. However, research on interagency teams per se is rare, and there is little effort by the ¶ national security system to codify lessons learned from interagency team experience. This remains ¶ true even though it is widely acknowledged that interagency collaboration within the U.S. Government needs to improve and that interagency teams are a promising means toward that end. ¶ Interagency teams are cross-functional teams. JIATF–South, as the commander of U.S. Southern ¶ Command (USSOUTHCOM) recently noted, is a cross-functional team in every respect:

AT Links to Politics

Popular

Empirical congressional support in interagency task forcesFraser 12 (General Douglas M. Fraser, United States Air Force, Commander of the United States Southern Command, Before the 112th Congress, House Armed Services Committee, March 6 2012, www.southcom.mil/newsroom/Documents/SOUTHCOM_2012_Posture_Statement.pdf)Joint Interagency Task Force South (JIATF South), our key component in detection and ¶ monitoring of illicit traffic, exemplifies this unity of effort. Considered the linchpin in U.S. ¶ counterdrug efforts, JIATF South capitalizes on the unique capabilities, authorities, and strengths ¶ of interagency partners such as the Drug Enforcement Administration, the Federal Bureau of ¶

Investigation, and the Department of Homeland Security. In 2011, JIATF South operations ¶ resulted in the disruption of 117 metric tons of cocaine, denying illicit traffickers approximately ¶ $3 billion in revenue. Our return on investment is substantial; in 2010, JIATF South supported ¶ the interdiction of eight times the amount of cocaine than was interdicted on the Southwest ¶ border, at a third of the cost and in an operating area that covers 42 million square miles.2¶ None of our efforts would have been possible without the continued support of Congress. ¶ Almost three decades ago, Congress recognized the important role the Department of Defense ¶ could play to counter the threat of drug trafficking , particularly in support of civilian law ¶ enforcement efforts.

More recently, through the provision of authorities commonly referred to as ¶ Sections 1206, 1207, and 1208, we trained and equipped partner nation forces to help the United ¶ States combat terrorism and conduct stability operations. Congressional approval to delink the ¶ International Military Education and Training (IMET) program from the American Service ¶ Members’ Protection Act sanctions has allowed us to educate and train hundreds of military ¶ personnel in the region, a critical element in strengthening military-to-military relations . We ¶ also appreciate the ongoing support Congress provides to the Department of State’s regional ¶ security initiatives such as the Central American Regional Security Initiative (CARSI), the ¶ 2 ¶ In FY2010 the U.S. government expended a combined $1.8 billion across 11 agencies on interdiction efforts on the 1,969-mile ¶ long Southwest border (SWB); FY2010 total operating cost for JIATF South was $565.5 million. In FY2010, law enforcement ¶ agencies seized 19 metric tons of cocaine at the SWB; in comparison, JIATF South operations resulted in the disruption 154¶ metric tons.4¶ Caribbean Basin Security Initiative (CBSI), and the Colombia Strategic Development Initiative ¶ (CSDI), all of which provide direction and support to our engagements in the region.

***China CP

1NC

Shell

The People’s Republic of China should substantially increase its investment in Venezuela’s energy infrastructure.

Collaboration solves—past sectors prove—energy development also solves relations (Xiang 09, Zhang Xiang—siting the Chinese VP, Editor for Xinhua News Agency , “Chinese VP predicts bright future for China-Venezuela ties”, Xinhua News Agency, 2/18/09, http://www.china.org.cn/international/2009-02/18/content_17299172.htm)To that end, Xi proposed that both China and Venezuela focus on the following four aspects:¶ First, both nations should focus on common development and boost mutual political trust. China and Venezuela should view each other from a strategic perspective and adhere to the principles of mutual trust, mutual assistance, reciprocity and mutual benefits.¶ "We should reinforce political dialogue, broaden strategic common grounds, deepen mutual political trust, constantly enrich the contents of strategic partnership, and promote a long-term stable reciprocal cooperation in an all-around way," the Chinese vice president said.¶ Secondly, he said the two countries should further improve their cooperative mechanism and upgrade cooperation.¶ This mechanism, namely the Sino-Venezuelan inter-governmental commission founded eight years ago, "has played an active role in communication and collaboration, under which great progress has been made in cooperation in all areas," said Xi.¶ He expressed hope that the commission would continue to play its guiding and coordinative role in laying the groundwork of pragmatic cooperation and opening new fields of cooperation.¶ He also proposed setting up a council for entrepreneurs from both countries.¶ Thirdly, Xi said China and Venezuela should boost cooperation in energy and finance.¶ Energy cooperation is a priority and constitutes an important part of bilateral cooperation, he said, expressing hope that the two sides would make a joint effort to push forward an all-around energy partnership.

Solvency

AT: Solvency Deficit

Strong relations with China prevent Venezuela’s economy from collapsing --- China will bail it out(Weisbrot 13, Mark Weisbrot, co-director of the Center for Economic and Policy Research, in Washington, D.C. He is also president of Just Foreign Polic, “More Room for Debate on Venezuela”, Center for Economic and Policy Research, January 9, 2013, http://www.cepr.net/index.php/op-eds-&-columns/op-eds-&-columns/more-room-for-debate-on-venezuela)But Venezuela has been running trade and current account surpluses for the past decade, since it recovered for the oil strike and political stability ensued. The exception was during the six months when oil prices collapsed at the end of 2008. ¶ The “headaches” that Naím refers to in terms of foreign exchange shortages, which have increased since the October election, are hardly a signal of impending collapse. Rather they are a result of the government trying to limit capital flight by denying dollars at the official rate to businesses that they think are not using them for legitimate purposes. If this results in too many shortages, the government will switch to another strategy. The current exchange rate regime is difficult to manage, it is prone to inefficiencies and corruption, and my own view is that Venezuela would be better off under a different exchange rate regime -- e.g. a managed floating exchange rate that was maintained at a lower real level. But that is quite different from the idea, or recurring dream of opposition doomsayers, that these problems will lead inevitably to a balance of payments crisis that will collapse the economy.¶ Of course the forecasts of catastrophe help promote capital flight by convincing Venezuelans that they should take their savings elsewhere.¶ But here’s the kicker: Even if their dream of a balance of payments crisis were to come true, the Chávez government has friends. And some of these friends have a lot of dollars. China, which is sitting on more than 3 trillion in reserves, considers Venezuela to be a strategic ally and has loaned the government $36 billion since 2007. Most of it has been paid back, and about $20 billion was loaned at extremely low interest rates (1-3 percent). Brazil and Russia are also among the countries that consider Venezuela to be a very important partner in the region. They also have hundreds of billions of dollars in reserves.¶ These countries would not want to see their partner and ally, the government of Venezuela, collapse because it needed a few billion dollars of hard currency to pay for its imports for a while, for example if oil prices crashed temporarily as they did in 2008. There are a number of reasons for this, but one is that a right-wing government is likely to ally with Washington. The Chávez government’s support for a “multi-polar world,” described as “anti-American” here, is quite appealing to most other governments in the world. Venezuela has the world’s largest oil reserves, and outside of Washington and the governments of Europe (which are not of much use to anyone these days), most governments don’t think that it’s a great idea for the country that is known throughout the world as an imperial power, with the world’s largest military, to also control the world’s largest oil reserves.¶ The other side of the coin is that Venezuela’s oil reserves are also the main reason that Washington has been so hostile to the country, supporting the military coup of 2002 and intervening as much as it can to try and discredit, undermine, and de-legitimize the government. While these efforts have been enormously successful in influencing media and therefore public opinion in most of this hemisphere, they did not do so well with governments, especially in the Americas but also in most of the world. And that is the irony: Washington’s never-ending battle against Venezuela has in some ways made the Chávez government and its political party stronger, by helping to infuse the left vs. right political contest there with an anti-imperialist dimension that would put most of the world’s governments on the side of Chávez.

Generic Solvency

China can do it--- oil refineries, profit in the status quo (China Daily 12, China can do it--- oil refineries, profit in the status quo ¶ “Venezuela seeks to fuel oil links”, China Daily, 12/2/12, http://www.china.org.cn/business/2012-12/02/content_27287270.htm)

"Venezuela is seeking independent economic development, and we hope that could be achieved via cooperation (with China)," said the Venezuelan oil minister.¶ The annual conference, the 11th of its kind since 2001, has seen the signing of 53 cooperation projects, with 23 of these related to the oil industry.¶ Zhang Ping, minister of the National Development and Reform Commission, who also addressed the conference, said oil imports from Venezuela are expected to reach 29 million tons this year, and will continue to rise in the next few years to reach the goal of 50 million tons.¶ Trade between China and Venezuela reached $18.2 billion in 2011, up 75.5

percent year-on-year. But the amount was already surpassed in the first 10 months of this year, which hit $20.5 billion, according to Zhang.¶ By the end of 2011, Chinese investment in Venezuela was more than $1.9 billion, most of which was oil-related.¶ China

is currently Venezuela's second-largest trade partner, and Venezuela is China's fourth-largest trade partner in Latin America.¶ Construction of a 58.6-billion-yuan ($9.4billion) oil refinery set up by PetroChina and PDVSA began in May 2012, and it is expected to have an annual capacity of 20 million tons when completed in 2014.¶ According to Zhang, the first oil tanker jointly constructed by the two sides has also taken to the seas, as one of 18 oil tankers ordered by Venezuela.

Investing in oil infrastructure solves access to Venezuelan crude (Hearn 12, Kelly Hearn, investigative reporter whose work has been funded by the Pulitzer Center on Crisis Reporting and the North American Congress on Latin America , “Venezuelan oil a risky investment for China”, Washington Times, 3/12/12, http://www.washingtontimes.com/news/2012/mar/12/venezuelan-oil-a-risky-investment-for-china/?page=all)Unlike light and sweet crude from Saudi Arabia, oil from Orinoco is tarlike. It is laced with metals and sits beneath deep jungles. Getting to the oil field means building roads, electrical-power grids and other major infrastructure. Once the oil is extracted from the ground, it is technically difficult to process.¶ “One of the major problems is that there are very few refineries outside the Gulf of Mexico that can handle Venezuelan crude,” said Jorge Pinon, a former president of Amoco Oil Latin America.¶ Years ago, U.S. companies such as Shell and Exxon invested heavily in U.S. Gulf Coast refineries capable of processing heavy crude after they saw that the world’s supplies of sweet crude were diminishing, Mr. Pinon said.¶ “The Chinese don’t have that kind of capacity,” he said.¶ But they are looking to get it by investing in oil infrastructure off Venezuela’s Caribbean coast.

Solves refineries—CP’s key (Kroth 12, Olivia Kroth, journalist for Pravda, a Russian newspaper, “Venezuela’s cooperation with Big Sister China”, Voltaire, 13 JUNE 2012, http://www.voltairenet.org/article174573.html)

Since 2009, a boost in Sino-Venezuelan cooperation can be remarked in agriculture, energy, housing, telecommunications, trade, transport and tourism.¶ Great energy projects have seen the light of day during the last three years, from drilling oil in Venezuela’s Orinoco Basin to creating a Sino-Venezuelan company to manufacture oil tankers and an oil refinery. “Venezuela has the largest oil reserves in the world”, says President Hugo Chávez. “All the oil China needs is here in Venezuela”.¶ The Faja del Orinoco contains 520 billion barrels of crude oil. The Orinoco oil belt has been divided into blocs, where oil is extracted by Sino-Venezuelan joint ventures in which Venezuela’s state oil company PDVSA keeps at least 60 percent controlling share.¶ Officials from PDVSA meet regularly with Chinese oil industry colleagues to plan further steps of oil extraction, building petroleum platforms, oil refineries and a fleet of oil tankers.¶ Currently Venezuela exports 400.000 barrels per day to China, the aim is to reach one million

in 2025.¶ Hugo Chávez speaks of “gradualness and joint development”. Sino-Venezuelan projects constitute part of a “strategic long-term development plan, to be implemented in several stages until 2025”, according to the Venezuelan President.

Investing in energy infrastructure solves—softens Maduro’s stance (Alic 13, Jen Alic , Foreign Oil & Gas Companies Look to Status Quo in Venezuela, Oil Price, 3/15/13, http://oilprice.com/Geopolitics/South-America/Foreign-Oil-Gas-Companies-Look-to-Status-Quo-in-Venezuela.html)“The main energy issue for Venezuela is that oil production is struggling, down from a peak of about 3.2 million barrels per

day in 1998 to less than 2.8 million bpd now. One would hope that fixing infrastructure, completing refinery repairs and construction, and investing in exploration and new technology would be priorities but Maduro will not have funds to invest unless he makes controversial cuts to social programs,” according to Southern Pulse, which does not believe that Maduro will attempt to cut fuel subsidies any time soon.¶ A top priority for Maduro will be boosting refining capacity, says Southern Pulse. Towards this end,

Maduro may be willing to negotiate if a partner steps forward to build a new refinery, which is a goal Chavez failed to realize.¶ “If PDVSA fails to increase production, PDVSA President Rafael Ramirez may be replaced this year. One way for Maduro to keep his

presidency afloat is to bring new proven wells online in the Orinoco Belt; but that will require major investment. PDVSA may need

more than a minority-partner-with-a-service-contract at those fields if they want to start pumping soon.”¶ In the meantime, China’s foothold in Venezuela remains on solid ground. China is already privy to 600,000 bpd from Venezuela in return for $42 billion in loans. Maduro is not likely to rock this boat with Beijing, and according to the terms already in place, Venezuelan exports are

set to increase to one million bpd by 2015, though most of the loan money has already been spent. According to Southern Pulse, Maduro will likely seek new loans from China, but this will depend on the terms and stability in Venezuela.

Venezuela would access 2.1 million barrels (Belsie 13, Laurent Belsie, Staff writer for CS Monitor, “What will Venezuela do with its oil? Top five energy challenges after Chàvez.”, 3/7/13, http://www.csmonitor.com/Environment/2013/0307/What-will-Venezuela-do-with-its-oil-Top-five-energy-challenges-after-Chavez/The-Orinoco-Belt)By 2009, it was clear that Chávez's strategy had failed to stop the slide in Venezuela's oil production, and he began allowing more foreign investment in the Orinoco Belt. China, India, Russia, Spain, Japan, Vietnam, and even Chevron in the US gained access to six blocks in the belt as minority partners with PDVSA. If all these projects come on stream, Venezuela projects that they would produce 2.1 million barrels of syncrude a day. Western analysts are pessimistic that Venezuela will achieve that boost without liberalizing its rules and opening up to more foreign investment. With a chaotic and arbitrary business environment within the country, foreign producers may be reticent to commit large investment sums to bring Venezuela's oil production back to pre- Chávez levels.

Plan Fails – Orinoco

China is key to accessing the Orinoco crude region (Wallis 13, Daniel Wallis, Senior Correspondent for Reuters, “Venezuela's post-Chavez oil policy to focus on China, Russia”, Reuters, 3/15/13, http://www.reuters.com/article/2013/03/15/venezuela-election-oil-idUSL1N0C69N220130315)CARACAS, March 15 (Reuters) - Venezuela's post-Chavez oil policy will increasingly focus on deals with China and Russia if acting President Nicolas Maduro wins an April 14 election to continue his late boss's socialist programs.¶ During his 14 years in power, Hugo Chavez nationalized most of the OPEC nation's oil industry with the aim of putting its crude reserves - the biggest in the world - at the service of his power base, Venezuela's poor majority.¶ Turning away from the United States, the traditional top buyer of Venezuelan oil, Chavez also sharply increased fuel sales to China and turned Beijing into his government's biggest source of foreign funding.¶ "We are not going to change one iota of the fundamental themes of President Chavez's policies," Energy Minister Rafael Ramirez said in a recent interview with a local TV station.¶ "We have a very important strategic relationship with China, which we're going to continue deepening and cultivating. It's the same with our cooperation with Russia ... Chavez's policies are more alive than ever, and we will push ahead with them."¶ Maduro, the late president's preferred successor, faces Henrique Capriles, governor of Miranda state, in the forthcoming election. The vote was called after Chavez's death last week following a two-year battle with cancer.¶ If Maduro wins, he can be expected to increase oil sales to political allies at the expense of the United States, while taking on more debt from those partners.¶ Venezuela is sending China about 430,000 barrels per day (bpd) of crude and products, up from just a few thousand bpd in 2005, in repayment of loans totaling $36 billion.¶ The biggest Chinese energy company, China National Petroleum Corp (CNPC), is a key part of Venezuela's efforts to tap its enormous Orinoco extra heavy crude belt , one of the planet's largest hydrocarbon reserves .¶ CNPC has joined with state oil company PDVSA in a joint venture in the Orinoco called Petrourica that is expected to begin producing within weeks. A PDVSA project with a Russian consortium, Petromiranda, began pumping there last year.

Orinoco region key to solve sustainability—accesses the goldmine of reserves (Belsie 13, Laurent Belsie, Staff writer for CS Monitor, “What will Venezuela do with its oil? Top five energy challenges after Chàvez.”, 3/7/13, http://www.csmonitor.com/Environment/2013/0307/What-will-Venezuela-do-with-its-oil-Top-five-energy-challenges-after-Chavez/The-Orinoco-Belt)The biggest issue for Venezuela is what to do with its immense deposits of tar sands (also known as oil sands). If one counts the technically recoverable oil estimated to lie in a 375-mile stretch of land along the Orinoco River, then Venezuela has bigger oil reserves than anybody, including Saudi Arabia – some 296.5 billion barrels of oil, by one estimate. The big question: Is it economically feasible to produce that oil? The process is energy intensive, costly, and environmentally questionable. Environmentalists have attacked Canada for producing oil from its tar sands – and have mounted a highly visible campaign to stop a planned pipeline that would carry its oil product to US refiners in the Gulf of Mexico. Venezuela's effort could turn out to be even bigger.¶ Venezuela needs to do something. Under Mr. Chávez, its economy became even more reliant on the oil industry even as production fell. In the mid-1990s, Venezuelan production peaked at around 3.5 million barrels of oil a day. Today, it's closer to 2.5 million barrels a day.¶ In the 1990s, Venezuela created four projects to begin to convert its tar sands into a lighter crude, known as syncrude. The facilities have the capacity to produce 600,000 barrels per day, according to the US Energy Information Administration, but they are estimated to be producing less than 500,000 a day. Venezuela could use more investment to develop its tar sands, but that would require outside help.

Plan Fails – Generic

The CP is key—Venezuela will say no to the US(Merco 13, “Venezuela plays the ‘US interference card’ suspends dialogue with Washington”, Merco Press, 3/21/13, http://en.mercopress.com/2013/03/21/venezuela-plays-the-us-interference-card-suspends-dialogue-with-washington)Foreign Minister Elias Jaua said the move was a response to “interventionist statements” by US Assistant Secretary of State Roberta Jacobson, who called for “open, fair and transparent” elections on April 14.¶ “This channel of communication is suspended at this time,

deferred until there is a clear message on what type of relationship the United States wants with Venezuela,” Jaua said.

“It makes no sense to continue wasting time ,” he added.¶ Venezuela's acting president Nicolas Maduro is running against opposition leader Henrique Capriles, who lost to Chavez in October elections. Capriles will likely also face an uphill battle against Maduro.¶ Chavez, who dominated Venezuela during his fourteen years of power, died of cancer on March 5 after a long illness that unsettled the political landscape.¶ Maduro said in January that he had had contacts with Washington in late 2012 through the Venezuelan ambassador at the Organization of American States, which he said were authorized by Chavez.¶ “Let's hope they rectify, let's hope the interference in internal affairs ceases,” said Jaua, who added, however, that diplomatic and consular affairs would remain at their current level.¶ Venezuela and the United States have not exchanged ambassadors since 2010, and are represented in their respective capitals only by charge d'affairs. Tensions between the two countries have been rising since the day of Chavez's death, when Maduro announced the expulsion of two US military attaches.

The CP is key—US investment can’t solve—Venezuela will break the contracts because they’re perceived as neoliberal (Alvarado 13, Liza Torres Alvarado, former diplomat in the Mission of Venezuela to the Organization of American States, “The U.S. Must Re-evaluate its Foreign Policy in Latin America”, Swiss Institute of Technology, 31 May 2013, http://isn.ethz.ch/Digital-Library/Articles/Detail/?lng=en&id=164370)Subsequently, regional leaders either nationalized industries or broke agreements with international oil corporations or others revolving around natural resources, as occurred in Bolivia with the gas companies and in Venezuela with the oil company. As these social movements found solidarity, U.S. influence was weakened. None of the promises of better standards of living from neo-liberal policies had materialized, and free market policies had bankrupted farmers. Deregulation destroyed the banks, and the middle class lost their savings.¶ At the hemispheric level, the U.S.’s proposal to remove barriers to trade through the Free Trade Area of the Americas (FTAA) was subsequently rejected by Venezuela, Ecuador, Bolivia, Argentina, and Brazil in the mid-2000s. Subsequently, ALBA (Bolivarian Alliance for the Americas) was born as a counterpart to the FTAA, changing the dynamics in the hemisphere. The Alliance posed as a new model, with the purpose being international cooperation based on the idea of social and economic integration of Latin America and the Caribbean countries. China appeared as an alternative market for the sale of raw materials from Latin America, reducing dependence on U.S. markets.¶ Failed attempts by the United States to destabilize Chavez’s administration radicalized the Venezuelan government's position,

which privileged sub-regional energy agreements and broke contracts with American oil companies as the decade progressed. Venezuela became an important counterweight to the United States, not only for its ability to provide an alternative to U.S. policies in the region, but also because oil revenues had enabled the country take Cuba’s place in financing an anti-imperialist crusade across the continent. Ironically, oil prices rose as a result of increased demand caused by the Iraq war, further helping Venezuela in this mission and weakening the U.S.’s influence in the Western Hemisphere as it was focused its efforts on dual war fronts on the other side of the globe.

Nationalization—US companies specifically get consolidated (Daniel 10, Frank Jack Daniel , “Venezuela to nationalize U.S. firm's oil rigs”, Reuters, Jun 24, 2010, http://www.reuters.com/article/2010/06/24/us-venezuela-nationalizations-idUSTRE65N0UM20100624)Ramirez said companies that refused to put their rigs into production were part of a plan to weaken Chavez's government,¶ "There is a group of drill owners that has refused to discuss tariffs and services with PDVSA and have preferred to keep this equipment stored for a

year," Ramirez told reporters in the oil producing state of Zulia. "That is the specific case with U.S . multinational Helmerich and Payne."¶ The company was not immediately available for comment.¶ Chavez, who faces legislative elections in September, often pushes ahead with radical plans during election campaigns.¶ The 55-year-old leader is having a hard time in his 11th year in power. Venezuela's economy is the worst performing in Latin America this year, a problem exacerbated by a drop in oil output since 2008, power outages and soaring inflation.¶ NO SURPRISE¶ The takeover of Helmerich and Payne's rigs was not a surprise, considering Chavez penchant for nationalizations and the company's refusal to work before being paid the $49 million

it has invoiced PDVSA.¶ Helmerich and Payne is a small player in the drilling industry, but global giants like Halliburton, Schlumberger and Baker Hughes also have a presence in Venezuela.¶ Halliburton and Schlumberger have avoided public spats with the

government.¶ Chavez has kept pressure up on the private sector in recent months, blaming a "parasitic bourgeoisie" for Venezuela's recession and 30 percent annualized inflation,¶ He has threatened to nationalize Polar, the top brewer and food

processor in the country of 30 million. The government has also seized a bank belonging to an owner of the leading opposition TV station and put an arrest warrant out for his partner, who is now on the run.¶ Chavez in 2007 nationalized multi-billion dollar projects in Venezuela's vast Orinoco oil region, persuading companies such as BP Plc, to accept minority stakes in facilities they had built.¶ Last year he ordered the takeover of dozens of smaller oil service companies as PDVSA, reeling from a sharp plunge in oil prices, struggled to pay contractors.¶ When he was flush with oil cash during a boom in oil prices that ended in 2008, Chavez often compensated nationalized companies fairly, although the 2007 takeovers led to lawsuits from ConocoPhillips and Exxon Mobil

Diversification—China invests in it—prevents oil sector dependency (Kroth 12, Olivia Kroth, journalist for Pravda, a Russian newspaper, “Venezuela’s cooperation with Big Sister China”, Voltaire, 13 JUNE 2012, http://www.voltairenet.org/article174573.html) The Venezuelan President loves China and is very impressed by Big Sister’s economic development. He lauds the Asian giant as being “the greatest motor that exists to drive the world beyond the crisis of capitalism. Nobody can doubt that the center of gravity of the world has been moved towards Beijing".¶ Hugo Chávez also wishes for ALBA member states to get more involved with Big Sister, encouraging them regularly at ALBA summits to “form a united front” of Latin America with China.¶ Sino-Venezuelan energy cooperation reaches even further than oil. China is helping Venezuela to develop its electricity grid by increasing hydro- and thermo-electricity production.¶

The Chinese Sinohydro Corporation and the Venezuelan state electricity company CORPOELEC cooperate in order to augment Venezuela’s hydro-electricity output.¶ Furthermore, Chinese specialists give Venezuela technical assistance and technology transfer to boost thermo-electricity production. A thermo-electric plant of 500 megawatts capacity has already been installed in the state of Mérida, three more plants with a capacity of 300 megawatts each are envisaged in the country’s north and east.

Answers

AT: Funds Get Diverted/Pocketed

Chinese funds aren’t diverted --- past agreements prove(Pitts 13, Pietro D. Pitts, reporter for Bloomberg, “PDVSA Signs $4 Billion China Loan to Boost Orinoco Field Output”, Bloomberg, Jun 3, 2013, http://www.bloomberg.com/news/2013-06-03/pdvsa-signs-4-billion-china-loan-to-boost-orinoco-field-output.html)Petroleos de Venezuela SA, the state-owned oil producer, said it signed a $4.02 billion loan agreement with China’s Development Bank Corp. to increase production at the Sinovensa heavy oil joint venture in the country’s Orinoco belt.¶ The accord was signed in Beijing by PDVSA President Rafael Ramirez, Sinovensa President Erwin Hernandez and CDBC Vice President Wang Yongshen, the Caracas-based company known as PDVSA said today in a statement on its website. Financing details weren’t provided.¶ Chinese companies, including China National Petroleum Corp., have agreements with PDVSA that aim to increase their portion of Venezuela’s production to as much as 1 million barrels a day by the end of 2019.¶ “A key variable to watch will be whether Ramirez, who has good relations with Venezuelan President Nicolas Maduro, has enough power and autonomy to tweak the policy framework or grant some degree of greater autonomy for PDVSA’s partners to manage joint venture operations,” Daniel Kerner, director of Latin America Research for Eurasia Group, said in a research

note to clients today.¶ Proceeds from the China development bank loan will be used to almost triple oil production at Sinovensa to 330,000 barrels a day from 140,000 barrels per day, PDVSA said. The company holds a majority 64.25 percent stake in Sinovensa while CNPC owns the remaining 35.75 percent stake.¶ Production Concerns¶ PDVSA’s business plan for 2013-2019 calls for the company to increase total Venezuelan production to 6

million barrels a day by the end of 2019, up from 2.910 million barrels at the end of 2012.¶ “PDVSA has committed to using these resources exclusively towards meeting production goals, and the Maduro administration is clearly concerned about stagnant production,” Kerner said.¶ PDVSA will allow joint ventures with CNPC and Chevron Corp. (CVX) to manage $6 billion in loans designed to boost output, a PDVSA official said May 17. The transactions will be signed by the end of June, said the person, who isn’t authorized to speak publicly.

AT: Loans DA

CP doesn’t mandate loans as investment --- doesn’t link to your offense

Chinese loans comparatively better – reduce debt (Weisbrot and Johnton 12, Mark Weisbrot is an economist and Co-Director, and Jake Johnston is a research associate at the Center for Economic and Policy Research, in Washington D.C. , “Venezuela’s Economic Recovery: Is it Sustainable?”, Center for Economic and Policy Research, September 2012, http://www.cepr.net/documents/publications/venezuela-2012-09.pdf)PDVSA Debt and Borrowing from China The state oil company, PDVSA, also borrows on its own. This is separate from central government debt, and for purposes of looking at the government’s debt burden it should not be simply added to the government’s debt, since PDVSA pays its debt service out of its own revenue, and not government revenue. So, the main concern is whether PDVSA’s debt burden will significantly reduce government revenue in future years.¶ PDVSA’s debt for 2011 was $34.9 billion, which is almost all foreign debt. For 2011, interest payments on the debt were approximately $1.35 billion, or 1.5 percent of export earnings. As can be seen in Figure 6, under the conservative assumption that export earnings do not increase, these would be expected to peak at 3.1 percent of export earnings for 2012, then decline gradually to 2.3 percent in 2017. Even if we were to add the central government and PDVSA debt together, we get¶ a peak of 7.2 percent of export earnings in 2012, declining to 5.7 percent in 2017. Therefore, there is no reason to think that PDVSA debt would change the picture.¶ It is worth emphasizing that all of these projections assume no increase in oil revenue.

Venezuela has plans to increase production from the current level of about 3 million barrels per day to 6 million barrels per day in 2019. Even if only a fraction of this were achieved, it would of course make the country’s debt burden even smaller, relative to public sector export revenue.¶ Since 2007, Venezuela has also borrowed from China under a set of arrangements that is somewhat complicated. Total borrowing has been $36 billion; according to the Ministry of Petroleum and Mining, $13.5 billion has been repaid. Of the remaining $22.5 billion, $20 billion has been borrowed under the Gran Volumen program. These loans pay interest rates of LIBOR plus 1-2 percent, which is far below the rate on most other Venezuelan government borrowing.14 These interest payments would take up about 0.5 to 0.7 percent of public sector export earnings for 2012. Even with another $2 billion per year for amortization, this wouldn’t add too much to Venezuela’s debt service burden. But in practice, Venezuela can undoubtedly

borrow more from China, in effect rolling over the principal as needed. Perhaps most importantly, the Venezuelan government’s ability to borrow from China, with which it has established a strategic partnership, gives it a very important source of non- market and low-interest credit that the government might tap in an urgent situation.

Better---Lower borrowing costs(Simpkins 12, Jason Simpkins, Energy Editor , “China’s Latest Big-Ticket Purchase: Venezuela’s Presidential Election”, Wall Street Daily, Oct 11th, 2012, http://www.wallstreetdaily.com/2012/10/11/chinas-latest-big-ticket-purchase-venezuelas-presidential-election/)Yet Venezuela also has some of the highest borrowing costs in the world. Fitch, Standard & Poor’s and Moody’s all grade Venezuela in speculative – or junk bond – territory, limiting the number of funds willing to buy its debt. As result, Venezuelan bonds due in 2027 yield 10.9%, compared to 4.7% for equivalent Colombian paper.¶ So where’s Chavez getting the money?¶ Simple: He’s solicited low-cost loans from China by putting his country’s vast oil reserves up as collateral.¶ According to a recent Bloomberg report, in the past five years, the China Development Bank has lent Venezuela $42.5 billion. And $12 billion of that sum was accrued in the past 15

months, as Chavez ran his hotly contested campaign.¶ Venezuela pays no more than 6% interest on these loans – half of what it pays to investors for bonds issued in capital markets.¶ In return for its generosity, China gets a steady supply of crude.

AT: Dependence Bad

CP solves dependence --- Venezuela is too dependent on the US in the status quo (Estreuelas 05, Patrick Esteruelas, former Vice President, Sovereign Risk Group at Moody's Investors Service, MA, International Relations and Economics from Johns Hopkins, “The US and the Chavez question”, Financial Times, 7/1/05, http://www.ft.com/intl/cms/s/2/85651f3c-e963-11d9-ba15-00000e2511c8.html#axzz2arZdZWrf)Chavez’s influence however is as limited outside of Latin America as it is within the region, confined to specific commercial deals that have little hope of making much diplomatic headway. Chavez’s attempt to diversify exports away from the US and turn to China as the future primary destination of Venezuela’s crude exports

perfectly illustrates this point. Venezuela has so far only just begun to export a mere 30,000 barrels per day of its cheaper trademark Orimulsion

boiler fuel to China a full six months after a first memorandum of understanding was signed by both President Chavez and Chinese Premier Hu Jintao in January of this year.¶ Venezuela’s lack of direct access to the Pacific will make it extremely difficult for Venezuela to ramp up crude or derivative exports to China in a cost effective manner, forcing Chavez into selling crude at a heavy discount for China to later trade to any interested third parties at

a profit. More importantly, China does not have the refining capabilities in place to process Venezuela’s sulphur-rich heavy crude, forcing Venezuela into a dependent relationship with the US until China or Venezuela build an adequate refining infrastructure. China is more likely using the possibility of establishing a long term trading arrangement as a means to gain preferential bidding access in Venezuela, capitalizing on Chavez’s desire to bring in friendly state national oil companies to help ramp up Venezuelan crude production in the future.

***Add a Condition CP

1NC

Shell

CP Text: The United States Federal Government should [Plan] if and only if Venezuela institutes democratic reforms and reduces the size of the public sector

The US should condition lending to Venezuela on – reducing the size of the public sector, reversing nationalization of companies, restoring independence to institutions, reforming the electoral system, privatizing PDVSA, ending subsidies, and reforming the freedom of the press – all these are generally mandated through the initiation of democratic reforms and reducing the size of the public sector – this is the ONLY way to solve the economy of Venezuela, food shortages, instability, democracy, and poverty in VenezuelaRoberts and Daga ’13 [4/15/13, James M. Roberts is Research Fellow for Economic Freedom and Growth in the Center for International Trade and Economics and Sergio Daga is Visiting Senior Policy Analyst for Economic Freedom in Latin America at The Heritage Foundation. “Venezuela: U.S. Should Push President Maduro Toward Economic Freedom,” http://www.heritage.org/research/reports/2013/04/venezuela-us-should-push-president-maduro-toward-economic-freedom]Hugo Chavez’s hand-picked successor, former trade union boss Nicolás Maduro, appears to have defeated Governor Henrique Capriles by a narrow margin in a contentious and hard-fought special election on April 14. Venezuela is in such shambles after 14 years of seat-of-the-pants mismanagement that Maduro—assuming his victory is confirmed—may ultimately be forced to pursue more moderate policies and seek help from the U.S. to restore stability. The Obama Administration and Congress should exploit this opening by using U.S. leverage to push Venezuela to turn from Chavez’s failed experiment in oil-cursed[1] “21st-century socialism” toward economic freedom. An Economy in Ruins The foundations of economic freedom in Venezuela have crumbled. When Chavez took office in 1999, Venezuela scored 54 out of 100 possible points in The Heritage Foundation/Wall Street Journal’s annual Index of Economic Freedom. Today, however, after 14 years of Chavez’s soft authoritarian populism, Venezuela merits a score of just 36 points. This nearly 20-point plunge is among the most severe ever recorded by a country in the history of the Index. Its 2013 rank—174th out of 179 countries—places Venezuela among the most repressed nations in the world.[2] Venezuela’s dismal economic freedom score is reflected in statistics that translate into real-time hardship for Venezuelans, who must spend more of their incomes on higher prices for necessities—if they can find them on empty store shelves. There are scarcities of nearly all staple food and fuel products. In fact, according to the Banco Central of Venezuela’s (BCV) shortages index, Venezuela faces the most severe food shortages in four years.[3] And what food is available comes at a price: Mary O’Grady

reports in The Wall Street Journal that “over the past 10 years inflation in food and nonalcoholic beverages is 1,284%.”[4] Financial disequilibrium in Venezuela is the result of a sharply widening fiscal deficit that reached almost 15 percent of gross domestic product (GDP) last year.[5] Government control of the formerly independent BCV also contributed to a massive expansion of the money supply. There are anecdotal reports in Caracas of people paying as much as 23 bolívars for one U.S. dollar in the black market as of early April. The official rate is just 6.3 bolívars per dollar—and that is after a significant 32 percent devaluation in February.[6] These problems were aggravated by Chavez’s foreign adventurism—which drained billions of petrodollars from the economy to keep afloat the failed economy in Fidel Castro’s Cuba—as well as generous subsidies to his Chavista cronies in the region through such schemes as ALBA and PetroCaribe. Corruption and Weak Rule of Law As reported in the Index, political interference in Venezuela’s judicial system has become routine, and corruption is rampant. The landscape in Caracas and elsewhere in the country is littered with half-finished, publicly funded infrastructure and housing projects. The government funds needed to complete them often disappear. As government expanded under Chavez, corruption became institutionalized. Chavez doubled the size of the public sector, many of whose 2.4 million[7] employees have no real job other than to work to keep the regime in power. A World Economic Forum (WEF) survey found little trust among businesses, politicians, the judicial system, and the police in Venezuela.[8] The tragic result is that Venezuela is now one of the most dangerous countries of the world. According to the

Venezuelan Violence Observatory, in 2012 nearly 22,000 people were murdered.[9] An inefficient and non-transparent regulatory environment that is hostile to private foreign direct investment obstructs long-term development and hampers entrepreneurial growth. The investment regime is tightly controlled by the state and favors investors from China, Russia, Iran, and other democracy-challenged countries.[10] Investor protection in Venezuela is ranked at 140 out of 144 countries, according to the WEF report.[11] In 1998, before Chavez took power, there were more than 14,000 private industrial companies in Venezuela; in 2011, after 13 years of extensive nationalizations and expropriations, only about 9,000

remained.[12] The Chavez government did make one product very inexpensive for Venezuelans: Generous energy subsidies mean a car can be filled up with 15 gallons of gasoline for less than one U.S. dollar.[13] Although that might buy short-term political advantage for the Chavista government, in the long term these energy subsidies are very destructive to future economic growth, since Venezuelan companies have a distorted cost base and thus cannot compete globally. Operations of the state oil company, PDVSA, have also deteriorated significantly under Chavez. When he took office, PDVSA was producing 3.5 million barrels per day (bbl/d); today,

it is down to 2.5 bbl/d.[14] Social Programs and Inequality Ironically, Chavez’s years in power did not result in much reduction of poverty and inequality. Although some measures of income inequality (such as the Gini coefficient) did improve under Chavez,[15] according to a recently published research paper by Darryl McLeod and Nora Lustig[16] that used data for 18 Latin American countries, market democracies such as Chile and Brazil were far more successful at reducing inequality and poverty than the populist Chavista regimes Despite its vast oil wealth, Venezuela’s economic growth performance has also been poor. Between 1999 and 2012, average annual per capita growth was just 1.1 percent, while in the top four Latin American countries (Panama, Peru, the Dominican Republic, and Chile) the rate was 3.6 percent.[17] Not surprisingly, the rate of private investment in Venezuela—under 5 percent—is also one of the lowest in the region. In Peru and Chile, it is almost 20 percent.[18] Washington should insist on strict conditionality before sending a new U.S. ambassador to Caracas or assenting to any new lending to Venezuela by international

financial institutions until the new government: Produces a comprehensive plan for reform that reduces the size of the public sector, reverses nationalizations and expropriations of land and enterprises with just compensation to owners, restores the independence of the central bank and judicial institutions, reforms the electoral system, and submits to an internationally supervised audit of the government’s books during the Chavez years; Takes steps to privatize PDVSA to bring in international equity partners with the expertise and financial capacity to restore PDVSA to the high level

of professional operational and managerial expertise for which it was widely respected prior to 1999; Immediately stops all subsidies to Cuba and terminates wasteful and economically destabilizing subsidy programs such as PetroCaribe and ALBA; Ceases cooperation with international state sponsors of terrorism (such as Iran) and joins the international community’s cooperative efforts in the fight against transnational crime, narco-trafficking, and terrorism; and Restores freedom of the press and access to information for all Venezuelans. Use U.S. Leverage The foundations of economic freedom in Venezuela were severely weakened during the 14-year misrule by

Chavez. Although Chavez’s death may aggravate instability and further polarize Venezuela, it need not be that way. Venezuela is in need of immediate and sweeping reforms, but these changes will take time, effort, determination, and, above all, dedicated reformers in Venezuela. The Obama Administration should step into the breach with active and forward-looking policies to bring Venezuela back into the globalized economic system.

Internal Net Benefit – Democracy

Shell

Instability spills over to the broader region – democratic reforms are key to solveShifter ’3 [6/16/03, Michael Shifter is vice president for policy at the Inter-American Dialogue (www.thedialogue.org) and adjunct professor at Georgetown University's School of Foreign Service. “Why Venezuela Matters,” http://nationalinterest.org/article/why-venezuela-matters-2388?page=1]Oil aside, there are other key U.S. interests at play in Venezuela, though these are less widely recognized. Regional stability and security top the list. The five countries that make up the Andean region of South America are particularly

convulsed. Continued chaos and escalating violence in Venezuela would not only inflict damage on the country itself, but could well undermine the ability of neighboring countries to achieve and maintain social peace. In this regard, Colombia deserves special mention. The United States has long sought to bolster the Colombian government's efforts to extend state authority and control. Since 1999, Colombia has received some $2.5 billion in security aid from the United States, making it the largest beneficiary outside of the Middle East. Yet, there has been increasing violence on the Colombia/Venezuela border involving Colombian guerrilla and paramilitary forces - and even Venezuela's armed forces. Should the Venezuelan crisis become a military conflagration, the resulting instability would be detrimental to longstanding US policy objectives. The conditions are combustible, and the risks are growing. More fundamentally, Venezuela under Chavez potentially poses a challenge to U.S. policy objectives, leadership, and core values in this hemisphere. Chavez has sought to build a counterweight to the United States on a range of key questions. For example, he explicitly opposes US efforts to pursue a Free Trade Area of the Americas, an important goal for many of the hemisphere's elected governments. Venezuela, under Chavez, has enhanced its relationship with Cuba, hardly a friend of the United States. And the Venezuelan government has maneuvered to counter the US position on the Inter-American Commission on Human Rights, a critical body of the Organization of American States. In its actions at the OAS and elsewhere, the Chavez government's conception of democracy and human rights has differed markedly from the one adopted by the United States and other hemispheric governments. Chavez, a former paratrooper who led a failed coup attempt in 1992, has consistently shown disdain for the institutions of representative democracy, for a system of checks and balances and the rule of law. What is Chavez up to and what does he mean for the United States? The ambiguity reflected in his actions and words is itself disquieting. It is unclear whether the Venezuelan president is an old-fashioned strongman, determined to cling to power but likely to fall of his own weight. Or he may in fact have a more sinister plan and become more repressive. If that were the case, he would then pose a serious problem for the United States. Such conjecture should in and of itself be enough to warrant the highest level of U.S. attention and concern. In this regard, American indifference has been especially surprising. To be sure, it is not clear what options and instruments the U.S. government has available to become more constructively and vigorously engaged in shaping the situation in Venezuela. U.S. leverage is limited. The bilateral relationship, mainly centered on oil, has long been mutually beneficial. Still, the United States could, and should, call on high-level political resources, first to consult widely and systematically with other Latin American

partners, and then to increase pressure on both sides in Venezuela to insure that the referendum is held and all guarantees are provided. The referendum is the best way to resolve the crisis. It is not, however, self-executing, and it is only a first step in a long process. To move towards reconciliation, long-term, external support, strongly backed by the United States, will be critical. High-level public concern about any violations of press freedom in Venezuela should also be a top U.S. government priority. It is tempting to step back and let the Venezuelan crisis play out, hoping for a peaceful outcome. Yet, such an approach is myopic, based on wishful thinking, and fails to take into account the fundamental nature of the crisis, the deep wounds that divide the country. The problems are unlikely to take care of themselves. Already, the United States has paid a heavy price for such a mindset. The missteps committed in reaction to the April 2002 coup (for which U.S. officials expressed tacit approval) -- and again in response to the general strike in late 2002 (in which the U.S. appeared to explicitly side with opposition forces) -- are a product of inadequate attention from Washington. Having been burned in trying to respond to such critical moments in the Venezuelan drama, the United States has been even less inclined to take risks, and has been consigned to the sidelines. How the Venezuelan crisis will turn out is anyone's guess. , Though the United States is right to hope for a peaceful, democratic outcome, it is hardly prepared to deal with a plausible though less desirable result-a Venezuela that continues to deteriorate, and that poses a serious problem for the region and the United States, for years to come.

State failure in Venezuela causes extinctionManwaring ‘5 [October 2005, Max G., Retired U.S. Army colonel and an Adjunct Professor of International Politics at Dickinson College, venezuela’s hugo chávez, bolivarian socialism, and asymmetric warfare, pg. PUB628.pdf]

President Chávez also understands that the process leading to state failure is the most dangerous long-term security challenge facing the global community today. The argument in general is that failing and failed state status is the

breeding ground for instability, criminality, insurgency, regional conflict, and terrorism. These conditions breed

massive humanitarian disasters and major refugee flows. They can host “evil” networks of all kinds, whether they involve criminal business enterprise, narco-trafficking, or some form of ideological crusade such as Bolivarianismo. More specifically, these conditions spawn all kinds of things people in general do not like such as murder,

kidnapping, corruption, intimidation, and destruction of infrastructure. These means of coercion and persuasion can spawn further human rights violations, torture, poverty, starvation, disease, the recruitment and use of child

soldiers, trafficking in women and body parts, trafficking and proliferation of conventional weapons systems and WMD, genocide, ethnic cleansing, warlordism, and criminal anarchy. At the same time, these actions are usually unconfined and spill over into regional syndromes of poverty, destabilization, and conflict.62 Peru’s Sendero Luminoso calls violent and destructive activities that facilitate the processes of state failure “armed propaganda.” Drug cartels operating throughout the Andean Ridge of South America and elsewhere call these activities “business incentives.” Chávez considers these actions to be steps that must be taken to bring about the political conditions necessary to establish Latin American socialism for the 21st century.63 Thus, in addition to helping to provide wider latitude to further their tactical and operational objectives, state and nonstate actors’ strategic efforts are aimed at progressively lessening a targeted regime’s credibility and capability in terms of its ability and willingness to govern and develop its national territory and society. Chávez’s intent is to focus his primary attack politically and psychologically on selected Latin American governments’ ability and right to govern. In that context, he understands that popular perceptions of corruption, disenfranchisement, poverty, and lack of upward mobility limit the right and the ability of a given regime to conduct the business of the state. Until a given populace generally perceives that its government is dealing with these and other basic issues of political, economic, and social injustice fairly and effectively, instability and the threat of subverting or destroying such a government are real.64 But failing and failed states simply do not go away. Virtually anyone can take advantage of such an unstable situation. The tendency is that the best motivated and best armed organization on the scene will control that instability. As a consequence, failing and failed states become dysfunctional states, rogue states, criminal states, narco-states, or new people’s democracies. In connection with the creation of new people’s democracies, one can rest assured that Chávez and his Bolivarian populist allies will be available to provide money, arms, and leadership at any given opportunity. And, of course, the longer dysfunctional, rogue, criminal, and narco-states and people’s democracies persist, the more they and their associated problems endanger global security, peace, and prosperity.65

Conditioning Solves

Democratic reforms should be conditionedChristy ’13 [3/15/13, Patrick Christy is a senior policy analyst at the Foreign Policy Initiative. “Obama Must Stand Up for Democracy in Post-Chavez Venezuela,” http://www.usnews.com/opinion/blogs/world-report/2013/03/15/after-chavez-us-must-encourage-democratic-venezuela]

Venezuela's upcoming election to replace the late Hugo Chavez gives the country an important opportunity to break away from over a decade's worth of strongman rule—and move towards better governance, improved internal security and stability, a stronger and more vibrant economy, and a truly constructive role in regional and global affairs. It's critical that the

United States do what it can to encourage Venezuela to seize that opportunity. For over a decade, Chavez led ideologically-driven efforts to erode U.S. standing in Latin America and around the globe. The populist leader expanded Venezuela's ties with rogue states such as Cuba and Iran, aided and protected terrorist organizations such as the Revolutionary Armed Forces of Colombia (FARC), and actively undermined the rule of law in Venezuela and throughout the Americas. In the Western Hemisphere alone, Chavez used record petrol prices to prop up anti-American socialist leaders, most notably in Bolivia, Cuba and Nicaragua. Chavez leaves behind a broken economy, a deeply divided nation and a dysfunctional government, all of which

will take years—if not decades—to overcome. Venezuela is plagued with double-digit inflation, mounting budget deficits and rising levels of violence. While the OPEC nation maintains one of the world's largest geological oil reserves, crude exports—which account for roughly 45 percent of federal budget revenues—have declined by nearly half since 1999. The United States imports roughly one million barrels from Venezuela per day. [See a collection of political cartoons on the economy.] Chavez's protégé Nicolas Maduro, the former vice president who's now acting as Venezuela's interim president, is running to succeed the late strongman, but it's not preordained that he'll win. It remains to be seen the extent to which he can properly unite prior to the election the many competing populist factions that benefited under Chavez for so many years. What is clear is that he will drape himself in the political ideology of chavismo in the run up to April 14 elections, and use—and quite possibly abuse—government institutions and petrodollars in attempt to woo the country's voters. What's perverse is how the Obama administration's move to "reset" relations with Maduro is doing more to legitimize him as the rightful heir to Venezuela's presidency than to resuscitate relations between the two governments. The move showed itself to be even more naive after Maduro accused the United States of plotting to poison Chavez shortly after the strongman's death. [Check out our editorial cartoons on President Obama.] Washington must realize that a strategy of engagement alone will not ensure a renewed and improved partnership with Caracas. Failure to realize this will not only undermine whatever influence America has in the months ahead, but also send a troubling signal to Venezuela's increasingly united political opposition. The Obama administration should instead pursue a more principled policy towards a post-Chavez Venezuela. In

particular, it should: Pressure Caracas to implement key election reforms. Venezuela's opposition faces formidable obstacles. Interim President Maduro will use the government's near-monopoly control of public airwaves, its established networks of political patronage and last-minute public spending programs to bolster his populist agenda. Washington should stress publicly and privately that any attempts to suppress or intimidate the opposition runs contrary to Venezuela's constitution and the principles defined in the Inter-American Democratic Charter, which was adopted by Venezuela in 2001. To this point, José Cárdenas, a former USAID acting assistant administrator for Latin America, writes, The Venezuelan opposition continues to insist that the constitution (which is of Chavez's own writing) be followed and have

drawn up a list of simple electoral reforms that would level the playing field and better allow the Venezuelan people to chart their own future free of chavista and foreign interference. Demand free, fair and verifiable elections. Although Venezuela announced that a special election to replace Chavez will be held next month, it is important to remember that elections alone do not make a democracy. Indeed, Chavez long embraced the rhetoric of democracy as he, in reality, consolidated executive power, undermined Venezuela's previously democratic political system and altered the outcomes of election through corruption, fraud and intimidation. [Read the U.S. News Debate: Given The Current Deficit Crisis,

Should Foreign Aid Be Cut?] The Obama administration should make clear that free and fair elections, properly monitored by respected international election observers, are essential to Venezuela's future standing in the hemisphere and the world. Likewise, Secretary of State John Kerry should work with regional partners—including (but

not limited to) Brazil, Canada, Colombia and Mexico—to firmly encourage Maduro's interim government. A unified regional voice would send a powerful signal to Chavez's cronies in Caracas and longtime enablers in China, Iran and Russia. Condition future diplomatic and economic relations. Corruption and criminality were widespread under the Chavez regime, as high-level government and military officials benefited from close ties to corrupt businesses and international drug traffickers. Yet to date, the Obama administration has done little to hold Venezuela's leaders accountable. [See Photos: The Life of Hugo Chavez] Washington should make clear that

full diplomatic relations with the United States will be contingent upon Venezuela ending ties to international terrorist groups and rogue regimes like Iran. If Venezuela takes meaningful steps to end these ties and ensure future elections, the United States should work with Caracas and the private sector to reform Venezuela's energy industry and identify key development projects and reforms to improve the country's economic future. The United States can play an important role in shaping Venezuela's post-Chavez future. But to do so, the Obama administration will need to stand with the people of Venezuela by publicly defending democratic principles and the impartial rule of law in Latin America.

Democratic reform solves instability in VenezuelaWalser and Zuckerman ’13 [3/6/13, Ray Walser, PhD, is Senior Policy Analyst for Latin America and Jessica Zuckerman is a Research Associate in the Douglas and Sarah Allison Center for Foreign Policy Studies, a division of the Kathryn and Shelby Cullom Davis Institute for International Studies, at The Heritage Foundation. “Venezuela After Chavez: U.S. Should Rally to Democracy,” http://www.heritage.org/research/reports/2013/03/venezuela-after-death-of-chavez-us-should-rally-to-democracy]

On Tuesday, cancer claimed the life of Venezuela’s President Hugo Chavez, silencing one of Latin America’s most controversial leaders in the 21st century. Chavez’s death opens the way to an uncertain succession process, continued polarization, and potential instability in oil-rich Venezuela. Dealing with a post-Chavez Venezuela will require an ongoing U.S. commitment to free and fair presidential elections, to the defense of individual rights and liberties, and to leveraging future improvements in bilateral relations to genuine cooperation in the fight against transnational crime and terrorism. Working with Venezuela for a more stable and secure hemispheric energy market is also a desired, if still distant, objective

Both conditions are necessary to solve democracy in Venezuela – the plan alone is not sufficientWalser and Zuckerman ’13 [3/6/13, Ray Walser, PhD, is Senior Policy Analyst for Latin America and Jessica Zuckerman is a Research Associate in the Douglas and Sarah Allison Center for Foreign Policy Studies, a division of the Kathryn and Shelby Cullom Davis Institute for International Studies, at The Heritage Foundation. “Venezuela After Chavez: U.S. Should Rally to Democracy,” http://www.heritage.org/research/reports/2013/03/venezuela-after-death-of-chavez-us-should-rally-to-democracy]

A principled U.S. policy toward Venezuela should be guided by continued commitments to broad-based—not

just electoral—democracy enshrined in the 2001 Inter-American Democratic Charter. Preservation of the constitutional order in Venezuela requires new elections that are not only free but fair. The interests of the U.S. will be best served with the return of fully functioning democracy (separation of powers, rule of law, protection of individual rights and liberties) in Venezuela. To achieve these objectives, the Obama Administration should: Deliver by public diplomacy channels a comprehensive report on the costs and consequences of the Chavez regime; Insist on maintaining the 30-day electoral timetable and press for real international electoral observation; Signal clearly that anything other than free and fair elections will open the door to possible diplomatic and economic sanctions; Continue to investigate narco-corruption and collect intelligence on criminal, terrorist, and Iranian activity in Venezuela; and Refrain from restoring relations at the ambassadorial level without a firm Venezuelan commitment to cooperate in fighting drug trafficking and international terrorism. Too Big to Ignore The weeks and months ahead are a period of opportunity and peril in Venezuela. The Obama Administration should not be content with leading from behind or claiming more pressing engagements. From defending democracy to preserving stability, a post-Chavez Venezuela is too big to ignore.

Now Key

Now is the key time for reforms – only US pressure can solve – Maduro will work with the USPagano ’13 [3/18/13, James Pagano is a contributing writer to the Truman Doctrine. “Moving Venezuela to the Center,” http://trumanproject.org/doctrine-blog/moving-venezuela-to-the-center/]

After over a decade in power, Hugo Chavez is now dead, providing U.S. policy makers an opening to mend fences and steer Venezuela’s next president towards the center. With smart policy and a light touch, the United States can help Venezuela’s next president lead his country out of the mess that Chavez built. Chavez won the presidency in 1999 on a promise to “sow” the oil wealth of Venezuela into its social program. Bolstered by record high oil prices, Chavez spent billions on such programs. While millions of Venezuelans were able to obtain healthcare and an education, the poorly designed programs left little money to reinvest in oil exploration; output in Venezuela declined threatening the longevity of all Chavez’s initiatives. Meanwhile, Chavez became an increasingly authoritarian leader, consolidating power in the executive. He blacklisted opposition figures, altered the constitution and unevenly enforced laws for personal benefit. By creating a steeply slanted playing field, Chavez was able to retain power. Venezuela’s next president will have to decide whether to reverse these trends, or continue the slide to outright authoritarianism. The United States can and should influence this decision. The United States must support the democratic process and engage the likely winner of April’s election, Chavez’s chosen successor, Nicolás Maduro. He will have a real opportunity to put Venezuela back on the path to a free-market democracy. The next president will face an extremely politicized Supreme Court and military and reforms are likely more palatable if made by Maduro. Changes to apportionment, food subsidies or tax rates coming from Enrique Capriles (the opposition candidate) could spark a legal challenge from the supreme court; or worse, opposition from the military. What should the U.S. role be? It must work with its Latin American

allies in the region, Chile, Brazil, Colombia and Mexico to gently pressure Maduro into making the types of institutional and economic changes necessary for Venezuela to prosper. Failure to do so could lead to the reemergence of authoritarianism in Latin America, instability in world oil markets and serious regional security repercussions.

Internal Net Benefit – Appeasement

Shell

Forcing Democratic reforms is the only way to show the illegitimacy of the Maduro regime – it solves democracy and prevents the perception of appeasementNoriega ’13 [3/11/13, Roger F. Noriega is a visiting scholar at AEI. “On Venezuela, Latin America’s democrats must come out of hiding,” http://www.aei.org/article/foreign-and-defense-policy/regional/latin-america/on-venezuela-latin-americas-democrats-must-come-out-of-hiding/]

It is important to recognize that Chávez’s grandiose socialist project at home and check-book diplomacy abroad would not have amounted to much if the price of oil had not increased five-fold since his election. And the folly of chavismo is evident in the simple fact that a trillion dollars of oil revenue is exhausted, billions in foreign loans are piling up, oil

production is down 30 percent, infrastructure is crumbling, and basic staples are scarce. In short, the only people who think Chávez’s economic model is sustainable were on his payroll. What is tragic is that Venezuelans have been forced to surrender most of their political rights and even their national sovereignty in this bargain.

In order to impose his economic vision, Chávez concentrated all political power in his hands or under the control of political loyalists. Chavismo commands the electoral council and the judiciary and has disproportionate representation in the National Assembly (despite the opposition having won a majority of the votes in 2010 elections). And,

it is barely safe to walk the streets of Caracas. Meanwhile, dissidents are suppressed systematically by a politicized police force. A fierce defender of “sovereignty,” one of Chávez’s final acts was to surrender the management of his political succession to Cuban outsiders, who must have a leader in Caracas who will continue to provide the bankrupt Castro regime vast quantities of oil and aid. Nicolás Maduro, a Castro loyalist, was Chávez’s vice president and hand-picked successor. Maduro quickly claimed the role as “interim president,” despite the fact that article 233 of the constitution says that those duties should be transferred to the president of that National Assembly, Diosdado Cabello. If Maduro and his handlers try to hold on to the presidency or pass it to another Havana loyalist, Cabello and nationalists in the army may move to enforce the constitution. Today, Venezuelans live under a de facto (read illegal) government. The dozen regional presidents who gather in Caracas for

Chávez’s state funeral will likely be silent on this illegitimate succession. The international community must do better than that if the Venezuelan people are to have any chance of recovering their country and their future. Latin-American democrats who have steered clear of Chávez for more than a decade should come out of hiding to advocate free and fair elections in Venezuela. They should join democrats in Venezuela in pressing for simple but profound reforms in the electoral system to forbid favoritism by the state, ensure a more even playing field, eliminate technical traps, and count all the ballots. The international community might consider sponsoring a “code of conduct” for the campaign as well as truly independent election monitors. Inexplicably, in recent months, U.S. diplomats have been caught showing favoritism to the Maduro faction. These intelligent, informed, and talented people appear to have committed the colossal blunder of mistaking the Venezuelan government for Venezuela. That is a mistake that should be easily corrected now that Maduro — in the space of two days — has usurped power, accused the United States of poisoning Chávez, and expelled two U.S. diplomats. The short-run future of Venezuela is uncertain. However, if democrats in Latin America and the United States are at least as active in supporting their values as Havana is in promoting its interests, Venezuelans may have a chance of recovering their country and their future.

Solvency

Economy

Investment in the oil sector is not enough – liberalizing the sector and stopping subsidies is criticalNaim ’13 [1/8/13, Moisés Naím, a scholar at the Carnegie Endowment for International Peace, is a syndicated columnist and author. His next book, "The End of Power," will be published in March. He is the former minister of Trade and Industry for Venezuela and the former editor of Foreign Policy magazine. “An Economic Crisis of Historical Proportions,” http://www.nytimes.com/roomfordebate/2013/01/03/venezuela-post-chavez/chavez-will-leave-behind-an-economic-crisis]

The crisis includes a fiscal deficit approaching 20 percent of the economy (in the cliff-panicking United States it is 7

percent), a black market where a U.S. dollar costs four times more than the government-determined exchange rate, one of the world's highest inflation rates, a swollen number of public sector jobs, debt 10 times larger than it was in 2003, a fragile banking system and the free fall of the state-controlled oil industry, the country's main source of revenue. Oil-exporting countries rarely face hard currency shortages, but the Chávez regime may be the exception.

Mismanagement and lack of investment have decreased oil production. Meanwhile oil revenue is compromised partly because of Chávez’s decision to supply Venezuelans with the country's most valuable resource at heavily subsidized prices. Thus a large and growing share of locally produced oil is sold domestically at the lowest prices in the world (in Venezuela it costs 25 cents to fill the tank of a mid-sized car). Another share of the oil output is shipped abroad to Cuba and other Chávez allies, and to China, which bought oil in advance at deeply discounted prices (apparently the revenue from China has already been spent). Most of the crude left to be exported at market prices is sold to Venezuela's best client, and, ironically, Chávez's main foe: the United States. Yet, as a result of America's own oil boom, U.S. imports of Venezuelan oil have recently hit a 30-year low. Moreover, due to an explosion in its main refinery,

Venezuela is now forced to import gasoline. The Financial Times reckons that for each 10 barrels of crude it sells to the US, it has to import back (at a higher price) two barrels of oil refined abroad. Meanwhile, the nation's total imports have jumped from $13 billion in 2003 to over $50 billion currently. Paying for those imports and servicing its huge debt requires more hard currency than Venezuela's weakened economy can generate.

Oil is key to Venezuela’s economy – only liberalization can solveCampbell ’13 [4/16/13, Darren Campbell is a writer for Alberta Oil. “A new leader could signal change for Venezuela’s troubled oil and gas sector,” http://www.albertaoilmagazine.com/2013/04/a-new-leader-could-signal-change-for-venenzuelas-oil-and-gas-sector/]

However, the status quo can’t continue, either. Maduro needs oil and gas revenue to fund the country’s social programs and keep the country from falling into chaos. A better run, more free market-leaning oil and gas industry will help Maduro accomplish this and keep him in power longer. Therefore, Tissot thinks Maduro has little choice but to shake things up when it comes to oil and gas matters. “One could expect a government more accessible to foreign investments, and foreign investors concerns (rule of law, security of payments, stability of

contracts.) Although it is too early to say, one should expect the Venezuelan oil sectors – after years of stagnation and mismanagement – to perhaps start showing some signs of life again,” he wrote in an email exchange. “How soon and how deep is something that will depend on how Mr. Maduro’s administration performs.

Liberalizing the oil sector is the only way to solve Venezuela’s economy – they will say yesMetzker ’13 [6/17/13, Jared Metzker is a writer for the Inter Press Service news Agency. “Analysts Say Oil Could Help Mend U.S.-Venezuela Relations,” http://www.ipsnews.net/2013/06/analysts-say-oil-could-help-mend-u-s-venezuela-relations/]

Over half of Venezuela’s federal budget revenues come from its oil industry, which also accounts for 95 percent of the country’s exports. Estimated at 77 billion barrels, its proven reserves of black gold are the largest of any nation in the world. Despite a troubled political relationship, its principal customer is the United States, which imports nearly a million barrels a day from Venezuela. Venezuela’s oil industry has been officially nationalised since the 1970s, and, as president, Chavez further tightened government control over its production. His government took a greater chunk of revenues and

imposed quotas that ensured a certain percentage would always go directly towards aiding Venezuelans via social spending and fuel subsidies. While these measures may be popular with Venezuelans, who pay the lowest price for

gasoline in the world, critics argue such policies hampered growth and led to mismanagement of Petroleos de

Venezuela, S.A. (PdVSA), the main state-run oil company. The same critics also point to increasing debt levels, slowdowns in productions and accidents stemming from faulty infrastructure. In order to boost production, PdVSA agreed in May to accept a number of major loans. This includes one from Chevron, one of the largest U.S. oil companies, which will work with Venezuelans to develop new extraction sites. “The oil sector is in deep trouble in Venezuela – production is down and the economic situation is deteriorating,” explained Shifter. “They know they need foreign investment to increase production, and this is in part what has motivated Maduro to reach out.” If its economy continues to falter, Venezuela may be further tempted to embrace the United States, which has the largest, most sophisticated fossil fuel industry in the world. Kerry’s recent words suggest that the administration of President Barack Obama would be waiting with open arms. “Venezuela cannot confront its economic crisis and the United States at the same time,” Diana Villiers Negroponte, a senior fellow at the Brookings Institute, a Washington think tank, told IPS, “and we are a pragmatic country which will deal with Maduro if it is in our interests.”

Answers

AT: Say No

ALL their cards are generically about energy reform NOT the condition – means that the desire for reform will make Maduro accept this condition too

Venezuela will cave into demands for democratic reforms – failing economy means the US holds all the cardsChristy 6-13 [6/13/13, Patrick Christy is a senior policy analyst at the Foreign Policy Initiative. “US Overtures to Maduro Hurt Venezuela’s Democratic Opposition,” http://www.usnews.com/opinion/blogs/world-report/2013/06/13/us-overtures-to-chavez-successor-maduro-hurt-venezuelas-opposition]Rather than accept Maduro's strongman tactics, the Obama administration should take a firm stand and make clear to Caracas that any steps to undermine the country's constitution or threaten the opposition will be detrimental to bilateral ties with the United States. The fact is that Washington holds all the cards. Venezuela's economy is in a free-fall, Maduro's popularity is plummeting, and various public scandals – especially those related to institutional corruption – could further erode public confidence in the current government. By resetting relations with the Maduro government now, the United States risks legitimizing the Chavez protégé's ill-gotten hold on power and undercutting the Venezuelan democratic opposition efforts to sustain and expand its popular support. It's time the Obama administration rethink this hasty reset with Maduro.

Relations are generally improving tooMetzker ’13 [6/17/13, Jared Metzker is a writer for the Inter Press Service news Agency. “Analysts Say Oil Could Help Mend U.S.-Venezuela Relations,” http://www.ipsnews.net/2013/06/analysts-say-oil-could-help-mend-u-s-venezuela-relations/]WASHINGTON, Jun 17 2013 (IPS) - A shift in U.S. foreign policy towards Venezuela may be pending as a bilateral rapprochement suddenly appears more possible than it has in years. On the sidelines of talks held earlier this month in Guatemala by the Organisation of American States (OAS), U.S. Secretary of State John Kerry met with Venezuelan Foreign Minister Elias

Jaua, with Kerry’s subsequent statements indicating that relations could be heading in a friendlier direction. “We agreed today – both of us, Venezuela and the United States – that we would like to see our countries find a new way forward,

establish a more constructive and positive relationship and find the ways to do that,” Kerry said following the meeting with

Jaua, which was reportedly requested by the Venezuelans. The meeting happened on the heels of the release of Timothy Tracy, a U.S. filmmaker whom Venezuela had been holding on accusations of espionage. His release was interpreted by many as an “olive branch” being offered by the new Venezuelan government of Nicholas Maduro, whose presidency

Washington still has not formally recognised. Only months ago, before the death of Venezuela’s long-time socialist leader Hugo Chavez, any normalisation of relations between Venezuela and the United States seemed highly unlikely. In 2002, Chavez was briefly removed from power by a military coup d’état that the U.S. Central Intelligence Agency (CIA) had known was imminent. Chavez immediately accused the United States of having played a part in the event. After his suspicions were confirmed partly valid, his rhetoric grew more scathing. In 2006, he famously told the United Nations General Assembly that then-U.S. President George W. Bush was “the devil himself”. Following Chavez’s death from cancer in March, however, his hand-picked successor, Maduro, the former vice-president, has not been as vitriolic in his posturing vis-à-vis the United States. According to Michael Shifter, president of the Inter-American Dialogue, a Washington-based think tank, Maduro has offered “conflicting signals”. “Maduro has so far shifted in his position toward the U.S. between a moderate approach and a more hard-line one,” Shifter told IPS.

Venezuela needs us economic cooperationMeacham ’13 [6/21/13, Carl Meacham is the director of the Americas Program at the Center for Strategic and International Studies “The Kerry-Jaua Meeting: Resetting U.S.-Venezuela Relations?” http://csis.org/publication/kerry-jaua-meeting-resetting-us-venezuela-relations]Q2: Does the Venezuelan government want good relations? A2: Despite recent discussions with the United States, it doesn’t seem to be the case. Earlier this year, the Venezuelan government suspended talks between the U.S. State Department and Venezuelan

Foreign Ministry that had begun in late 2012, citing alleged U.S. meddling in Venezuela’s April election. The Maduro government has also largely followed the Chávez playbook, constantly accusing the United States of assassination plots, spying, and economic and political sabotage. While the Kerry-Jaua meeting may have made for nice headlines, it’s difficult to imagine that the Venezuelan government will not play the anti-U.S. card again, if needed. This week, Calixto Ortega—appointed to handle matters with the United States—will meet with Assistant Secretary of State for Western Hemisphere Affairs Roberta Jacobson to continue discussions and establish a new set of concrete goals to guide the relationship forward. These good-faith gestures made by the Venezuelan government are neither new nor unheard of. Despite recent efforts, U.S. policymakers should temper any positive expectations, as a core basis of Chavismo is its anti-U.S. ideology. It’s

of course difficult to improve relations with a government that consistently defines itself as vehemently against your foreign policy agenda. This suggests that Venezuela may be looking to reestablish a purely economic relationship— one that will eliminate U.S. sanctions.

He says yes – want the energy cooperationOlson and Toothaker ’13 [4/16/13, Alexandra Olson and Christopher Toothaker, staffwritters for Huffington Post World. “Nicolas Maduro, Venezuela's President-Elect, Faces Massive Challenges". Huffington Post World. www.huffingtonpost.com/2013/04/16/nicolas-maduro-venezuela_n_3091649.html]

The state-oil company that gave billions of dollars to fund social programs is saddled with mounting debt and declining profits. Critics say the company has failed to invest in boosting oil production, which has fallen for years even though Venezuela has the world's biggest oil reserves. Throughout the campaign, Maduro blamed Venezuela's frequent power blackouts on sabotage by government enemies and said food shortages are caused by hoarding by the private sector. So did Chavez before he died, but Sunday's election results showed that a growing numbers of Venezuelans are no longer buying it. Maduro, a former bus driver who rose to become foreign minister and vice president under Chavez, offered no ideas of his own for resolving the country's problems. He did suggest at the news conference Monday night that a Cabinet shake-up was in the works. The president-elect said he would have to "conform a new government," though he quickly added that he would ratify Vice President Jorge Arreaza, Chavez's son-in-law, in his post. In his own Twitter message, Arreaza also hinted that the election results were sobering, though he used softer language than Cabello. "Review and rectify where we have to," he wrote. Chavez swiftly sidelined those who openly questioned him during his 14 years in power. Maduro's narrow victory has given him a weaker mandate for keeping the disparate factions of the movement in line. The factions include former soldiers like Cabello who joined Chavez in a failed 1992 coup. Maduro comes from the ranks of leftist political and labor groups that united to help elect Chavez president in 1998. Chavez's relatives, led by his brother Adan, form another bloc. "His legitimacy comes from the fact that Chavez named him as his successor and other factions were forced to accept it," said Grais-Targow. "But he faces this landscape where the other main figure, Diosdado Cabello, could elevate his role and have more power. There are also governors who have bases of support and could pose challenges." Anger over past Chavista fissures surfaced amid Monday's tensions. Adan Chavez blamed two former Chavista politicians for disturbances in Barinas. "They are traitors of the revolution," Chavez told state television. The powerful state political apparatus built by Chavez is standing with Maduro. The National Electoral Council, where four of the five directors are accused by the opposition of having ties to the government, has so far brushed off the demand for a recount. Lucena, the council president, suggested Capriles take his complaints to other channels - presumably the Supreme Court, which is stacked with Chavista sympathizers. Another thing Maduro may have going for him: Other Chavista leaders don't have considerable big bases of their own after years in Chavez's shadow. That may motivate them to stay united as long as possible. "His leadership will not be publicly questioned for at least the first year of his government," said Moya-Ocampos. "After that, if he fails to resolve domestic problems, members of the PSUV and the military will step forward and begin to publicly question his leadership." Some politicians and diplomats who have met Maduro, who was Chavez's foreign minister for six years, describe him as

a smooth negotiator. Former longtime U.S. Rep. Bill Delahunt, a Democrat from Massachusetts who attended Chavez's

funeral in representation of the United States and met with Maduro, said he thinks that given the pressures "enveloping" Maduro, the pragmatist in him will show. "He has an excellent sense of humor. He connects with people. He's bright. He's very easy to underestimate and that's a mistake for people," Delahunt said in an interview with The Associated Press.

AT: Perm do the CPThe permutation is SEVERANCE – it severs the scenarios in which the aff condition is met but the added condition is not met – the CP would not result in the plan in those instances – severance is a voting issue because it undermines neg ground necessary for clash – clash leads to in depth debates that help us become competent policy advocates

Functional competition outweighs textual – it doesn’t matter if the plan text is in the CP text as long as the CP takes a different action – this is critical to testing the INTRINSIC necessity of the condition the aff chose

Also textual competition leads to word PICs which are uniquely worse for debate – they incentive debates on the margins of plan texts that fails to consider the specific details of policy – we don’t learn relevant debates about policy and become less competent advocates

AT: Perm do BothCP is mutually exclusive – the permutation is impossible – if Venezuela says yes to the plan then they won’t agree to the Democratic reform/liberalization condition of the CP – they have an incentive to get away with the weaker condition – means that the permutation fails and links to the NB’s

AFF

Venezuela Says NoVenezuela and Iran will never break ties FNA ‘6-10 [6/10/13, Fars News Agency (FNA) is Iran's leading independent news agency. “Ahmadinejad: Iran-Venezuela Alliance Unbreakable,” http://english2.farsnews.com/newstext.php?nn=9203180954]Ahmadinejad: Iran-Venezuela Alliance Unbreakable TEHRAN (FNA)- Iranian President

Mahmoud Ahmadinejad underscored the strategically good relations between Tehran and Caracas, and said no one and no problem can weaken or break the two countries' alliance. "No obstacle can block the deepening of the two nations' friendship and brotherhood," Ahmadinejad said in a meeting with new Venezuelan Ambassador to Tehran Amenhotep

Zambrano on Monday. "Our friendship and brotherhood is far beyond bilateral diplomatic relations and will continue for good," he added. "Iran and Venezuela are in the same front and they

have common enemies, causes and goals and will stand beside each other like a strong mountain," Ahmadinejad stressed. Iran has in recent years expanded friendly ties with Latin America, specially in economic, trade and industrial fields. Since taking office in 2005, President Ahmadinejad has expanded Iran's cooperation with many Latin American states, including Venezuela, Bolivia, Ecuador and Cuba. Iran's strong and rapidly growing ties with Latin America, specially with Venezuela, have raised eyebrows in the US and its western allies since Tehran and Latin nations have forged an alliance against the imperialist and colonialist powers and are striving hard to reinvigorate their relations with the other independent countries which pursue a line of policy independent from the US.

Maduro is done with the US – any pressure or aggressive policy will be denied vehementlyEl Universal ’7-20 [7/20/13, “Maduro: Venezuela will have "zero tolerance" for aggressions of Washington,” http://english.eluniversal.com/nacional-y-politica/130720/maduro-venezuela-will-have-zero-tolerance-for-aggressions-of-washingto]Venezuelan President Nicolás Maduro on Saturday described as “terminated” his government-initiated talks with Barack Obama administration. He stressed he would implement a “zero tolerance” policy for “aggressions” on Venezuela. “My policy as president is zero tolerance for gringo aggression against Venezuela. I am not going to stand any verbal

aggression against Venezuela, neither political nor diplomatic. Enough is enough! Stay away with your empire. Do not mess any more with Venezuela,” said Maduro during a ceremony of military promotions in Cojedes state, central Venezuela. The Venezuelan president also reiterated his rejection and condemnation of the statements issued by Samantha Power, the Washington ambassador nominee to the United Nations, on Venezuela. “When she went to Congress, she went crazy and started to attack Venezuela just like that. She started to say that she is going to the UN to monitor and make clear what the repression on political and civil institutions in Venezuela is, and that she will address the lack of democracy in Venezuela.”