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By Robert Rapier on Feb 13, 2008 with no responses

Chavez Targets "Big Milk"

After threat to cut off oil, Chavez says Venezuela may expropriate milk plants

CARACAS, Venezuela: President Hugo Chavez warned that some milk plants may be expropriated to ease shortages, singling out Italy’s Parmalat SpA and Switzerland’s Nestle SA.

Chavez mentioned the two companies during his weekly program Sunday, saying international companies sometimes “pressure” Venezuelan farmers to obtain their milk for export.

“It’s no use for us to be setting up plants (if) then there is no milk for the plants because Parmalat or … Nestle take it all away,” Chavez said. “That’s where I say this government has to tighten the screws.”

If companies ensure a supply through “blackmail, offering money up front” while leaving state-run plants without enough milk, “that’s called sabotage,” Chavez said. He added that in such cases, “the plants must be taken over and expropriated.”

This is long overdue, given the atrocities committed by the milk industry in South America. The Swiss and Italians are clearly milking Venezuela. Call it a hunch, but something tells me that chicken, flour, and sugar plants will be next on the expropriations list:

There have been sporadic shortages of basic goods like milk, chicken, flour and sugar for months, and the problem has been considered a political liability for Chavez since he lost a vote last year on constitutional changes that would have let him run for re-election indefinitely.

Of course critics were quick to lie about the situation, as critics do:

Critics blame government price controls and a poor investment climate. The government says strong economic growth has boosted demand for meat and milk and other products.

The companies involved apparently get news of items like this from the media, and not through official channels:

Parmalat declined comment. Francois-Xavier Perroud, a spokesman for Nestle in Vevey, Switzerland, said he read news accounts quoting Chavez but that “the company in Venezuela has not received any official notification, any official statement that anything is being thought about or considered or being planned.”

And then as expected, it turns out that it is really the plotters behind this. Venezuela’s problems are always caused by someone else:

Chavez also accused opponents of plotting to ensure food shortages by hoarding supplies ahead of state and local elections in November. He did not elaborate but said, “We’re facing an economic conspiracy, and we’re obliged to act.”

Like I said, this move is long overdue. Let the government take over, and show Big Milk how an efficienct operation should be run. Lessons from the oil industry expropriation are that you can shirk maintenance and investments for a quick short-term gain. Longer term, Chavez can hope it will be someone else’s problem. But as far as actually increasing milk supplies as a result of taking over the industry, lessons from the oil industry should have citizens concerned about starving to death.