Oil-rich Venezuela is abandoning the US petrodollar, plans to introduce new international payment system

“I am announcing that Venezuela intends to introduce a new international payment system and to create a currency basket for the liberation from the dollar and, [we intend] to free ourselves from the clutches of the dollar, the currency that is strangling our country.”

“If they pursue us with the dollar, we’ll use the Russian rouble, the yuan, yen, the Indian rupee, the euro,” Maduro said.

Maduro plans to use the weakest of two official foreign exchange regimes and a basket of currencies. Currently in Venezuela, one dollar buys 3,345 bolivars, according to the central bank. At the strongest official rate, one dollar buys just 10 bolivars, but on the black market the dollar fetches 20,193 bolivars. A thousand dollars of local currency bought when Maduro came to power in 2013 would now only be worth $1.20.

On August 25, US President Donald Trump signed an executive order imposing financial sanctions on the Venezuelan government. The White House said the measures were “carefully calibrated” to put financial pressure on Maduro’s government.

Its important to note that Venezuela sits on the largest amount of oil reserves in the world:

Reserves amounts are listed in millions of barrels (MMbbl):

READ MORE: Trump isn’t going to Invade Venezuela, but what he’s planning might be just as bad

The United States previously threatened to sanction anyone involved with the Constituent Assembly, which was elected on July 30.

The Constituent Assembly is a legislative body, which has the power to amend Venezuela’s constitution. The election of the assembly took place amid mass, deadly protests across the country. Venezuelan opposition, as well as the European Union and the United States, have refused to recognize the body’s legitimacy.

Maduro says this is part of an “economic war” waged by the opposition and Washington, aimed at his ouster.

“This is the fight against the economic blockade of the imperial sanctions of (U.S. President Donald) Trump,” said Maduro.

Will Venezuela and Nicolas Maduro share the same fate as Iraq and Saddam Hussein?


Trump tightens Venezuela’s access to U.S. financial system


President Trump moved Friday to restrict the Venezuelan government’s access to the U.S. financial system and squeeze the oil-based economy that sustains President Nicolás Maduro, but he stopped short of imposing a full oil embargo.

Trump signed an executive order barring dealings in new bonds and stocks issued by the government and the state oil company, Petróleos de Venezuela, the parent of Citgo. Banks also cannot engage in new lending with the government or the oil giant.

“Maduro chose to embrace dictatorship over his own people,” national security adviser H.R. McMaster said. “With today’s announcement, the president is keeping his promise of strong action and continuing to show strong leadership.”

The action followed Maduro’s decision to convene a special assembly to rewrite the constitution of the oil-rich nation and assume many government powers. U.S. and Latin American leaders say Maduro’s government is veering toward dictatorship.

U.S. officials said the new restrictions ensure that U.S. financial institutions cannot be used to help finance or underwrite Maduro’s expansion of undemocratic rule.

The sanctions would prevent, for instance, a repeat of a $2.8 billion bond deal with Goldman Sachs reached earlier this year that gave the cash-strapped Venezuelan government an important lifeline. Yet Venezuela’s growing international isolation because of Maduro’s power grab, coupled with its fast-eroding financial stability, has already effectively shut it out of debt markets, with investors seeing it as too great a risk.

The new economic sanctions are likely to deepen the financial crisis in Venezuela, where the oil-based economy has shrunk by about 35 percent since 2014.

The Trump administration’s goal is a return to full democracy, including free elections, adherence to the country’s constitution and the reestablishment of the authority of the elected assembly, U.S. officials said.

Treasury Secretary Steven Mnuchin accused Maduro of “hollowing out Venezuela” and said his government “has been a catastrophe for the country.”

“Maduro may no longer take advantage of the American financial system to facilitate the wholesale looting of the Venezuelan economy at the expense of the Venezuelan people,” Mnuchin said. “Today’s actions is the next step towards freedom for the Venezuelan people.”

The penalties come on top of U.S. sanctions on Maduro and senior government officials announced last month. They are the first to directly target Maduro’s access to prime sources of funding.

U.S. officials called the new financial penalties calibrated and acknowledged that they are less severe than some of Maduro’s critics had requested. Venezuela can still export oil to the United States and import it from here. Venezuelan heavy crude oil is crucial to some U.S. refiners, which are geared to handle that specific type. Venezuela imports lighter crude, including from the United States.

And while the sanctions stop far short of an oil embargo, the move does suggest a willingness by the Trump administration to gradually turn up the heat on Maduro in new ways.

“It won’t have any important impact in terms of financial flows to Venezuela, because there aren’t any to speak of right now,” said Siobhan Morden, managing director and Latin America expert at Nomura Holdings. “But it confirms what we know, that they now definitely do not have access to external capital.”

Vice President Pence had signaled the move, writing on Twitter that the United States “will not standby as Venezuela crumbles.”

Pence and other U.S. officials have been threatening further sanctions for weeks, since Maduro moved to go around the national constitutional assembly, where opposition to his rule is strong.

Trump has also said he would not rule out military action.

Asked Friday whether the president is still open to a military option, McMaster did not directly answer.

“The president directed us not just to develop plans for the current situation but to anticipate the possibility of a further deterioration in Venezuela,” McMaster said. “The president said if things get worse, how could they get worse, and what are a range of options available to him that we could take in concert with our partners in the region?”

Venezuelan officials responded defiantly.

“There it is, more and more sanctions against Venezuela,” Delcy Rodríguez, the Maduro ally who heads the new Constituent Assembly, said Friday on national television. “They think that with economic sanctions, they’ll be able to suffocate the Venezuelan people. But we’ve pledged and will keep pledging to defend Venezuela no matter the type of imperial threat.”

In a televised meeting with officials and oil-sector leaders Friday, Maduro said Trump administration officials “look at us, the brown-skinned from the south, as less than them,” adding that “they’re looking to suffocate Venezuela’s productive economy” and to continue leading a “brutal economic war.”

He asked the Supreme Court and the Constituent Assembly to conduct a judgment for “betrayal of the homeland” for all those who asked for the sanctions and accused the president of the opposition-led National Assembly, Julio Borges, of being directly involved.

Maduro claimed that the sanctions would affect oil imports and called on U.S. investors and companies that benefit from Venezuelan oil to hold an urgent meeting to find solutions.

Venezuela’s national reserves have already hit 15-year lows of about $10 billion, most in gold bars, not cash. As Venezuela is boxed in financially, it will be harder and harder, analysts say, for the country to avoid a potentially devastating debt default. A key test will come in the fourth quarter of this year, when $3.8 billion in bonds come due.

Failure to pay could spark a cascading effort by foreign investors to seize Venezuela’s global assets, potentially slamming its all-important oil industry. As the economic crisis gripping the country deepens, it could also create conditions so harsh that Maduro’s grip on power could be challenged by the country’s military, some analysts say.

“The idea is that a default would be devastating in terms of economic impact, and that would force a political transition,” Morden said.

It would also test the will of Maduro’s two main foreign benefactors — China and Russia — to continue propping him up. Maduro has accelerated his public courting of Moscow in recent days, boasting of stronger ties.

In a news conference Wednesday, Maduro called Russian President Vladimir Putin the “main leader of the world.” He heralded a deal struck in June to bring 60,000 tons of Russian wheat a month to Venezuela, with the first shipments arriving this week.

Maduro said he would soon make a trip to Moscow to advance the commercial relationship. He dismissed the threat of further U.S. economic penalties.

“Despite many sanctions that the Trump-Pence duo approves, we can achieve more than them,” Maduro said.

Israeli general mocks Abbas for sending medical aid to Venezuela

An Israeli general sharply criticized Palestinian Authority President Mahmoud Abbas on Monday for sending medical aid to distant Venezuela while cutting down on help to the beleaguered Gaza Strip.

“We draw the Palestinian Authority’s attention to the fact that traveling from Ramallah to Gaza is only one hour, while the distance between Venezuela and Ramallah is more than 10,000 kilometers,” wrote Coordinator of Government Activities in the Territories (COGAT) Major General Yoav Mordechai on his official Facebook page.

COGAT is the Defense Ministry department in charge of Palestinian civilian affairs.

On Sunday, PA Foreign Minister Riyad al-Maliki and PA Health Minister Jawad Awwad announced they were sending three truckloads of medical supplies to Venezuela, including antibiotics, drugs for the treatment of chronic diseases and “everything necessary for emergencies.”

Head of the Coordinator of Government Activities in the Territories (COGAT) Yoav (Poly) Mordechai, and the Palestinian Authority’s Civil Affairs Minister Hussein al-Sheikh signing an agreement to revitalize the Israeli–Palestinian Joint Water Committee, January 15 2017 (COGAT)

The shipment was slated to travel Sunday to the Israeli port of Ashdod, and from there to Venezuela.

Mordechai’s social media post included an image of Awwad and Maliki pinning messages onto one of the aid containers and the caption, “Abbas helps Venezuela with medical supplies, but what about the Palestinians.”

Maliki said he was ordered by Abbas to send the donation, and called Venezuela “the friend who has repeatedly stood with the Palestinian people in the ordeal that it has gone and is going through.”

Maliki noted the Venezuelan donation of $15 million being used to construct an eye hospital in the village of Turmus Ayya, near Ramallah.

Venezuela in currently suffering from a food and medicine shortage heightened by the fallout from a political battle over the country’s future.

The Gaza Strip has been suffering from a severe shortage of medical supplies in recent months. Hamas and international NGOs have accused the PA of slashing its traditional medical aid to the Strip, as part of a series of punitive measures aimed at forcing the terror group to cede control of the Palestinian enclave.

According to information given to Physicians for Human Rights Israel (PHRI) by Gaza’s Hamas-run Health Ministry in June, “one-third of essential medicines and more than 270 medical equipment items for operating rooms and intensive care units can no longer be obtained in the Health Ministry’s storerooms and in Gaza hospitals.”

PHRI, quoting statistics from the Hamas-run ministry, said most cancer patients in Gaza are not able to receive proper treatment because of shortfalls.

One of the groups hardest hit by the medicine shortage is patients, mostly children, suffering from the chronic lung disease cystic fibrosis, who can’t get the pills and vitamins they need, PHRI said.

The Palestinian Authority has also cut back on paying for Palestinians to leave the Gaza Strip for medical treatment in Israel and abroad.

Venezuela faces outrage after new assembly takes legislative power

CARACAS/BOGOTA (Reuters) – Venezuela’s new legislative superbody was criticized by South American governments and Washington on Friday after giving itself the power to pass laws, superseding the opposition-led congress while ex-top prosecutor Luisa Ortega fled the country.

President Nicolas Maduro sponsored last month’s election of the 545-member constituent assembly over objections from the opposition, which boycotted the vote, calling it an affront to democracy. In its first session on Aug. 5 the assembly fired Ortega, who had accused Maduro of human rights violations.

The oil-rich but economically ailing country has seen months of political unrest in which more than 125 people have died.

Ortega arrived in neighboring Colombia on Friday, migration authorities in Bogota said. She told Reuters in an Aug. 10 interview that she feared for her life in Venezuela, although she still considered herself the country’s chief prosecutor.

U.S. State Department meanwhile joined South American trade bloc Mercosur in condemning the new super-assembly.

“As long as the Maduro regime continues to conduct itself as an authoritarian dictatorship, we are prepared to bring the full weight of American economic and diplomatic power to bear in support of the Venezuelan people as they seek to restore their democracy,” the State Department said in a statement.

In practice, the assembly’s assumption of legislative power changed little in Venezuela, where the Supreme Court has shot down nearly every law that congress has approved since it was taken over by the opposition in 2016.

Delcy Rodriguez, a Maduro ally and president of the constituent assembly, insisted the move did not imply a dissolution of the congress.

“Those lazy bums have to work. What we are doing is telling them: ‘Gentlemen, we are not going to let you take a holiday’,” Rodriguez said in a reference to opposition legislators.

But trade bloc Mercosur condemned what it called a usurpation of legislative power, according to a statement released by Brazil’s Foreign Ministry. Mercosur founding members Brazil, Argentina, Uruguay and Paraguay will not recognize any measures taken by the assembly, the statement said.

The assembly had invited leaders of the existing congress to join the session. Congressional leaders did not attend, insisting it was fraudulently created and usurped their powers.

“(Congress) only obeys the constitution and the people. We do not recognize the constituent assembly, much less subordinate ourselves to it,” Freddy Guevara, an opposition politician and vice president of the congress, wrote on Twitter.


“This afternoon the attorney general of Venezuela Luisa Ortega Diaz arrived from Aruba in a private plane to Bogota’s airport and completed the corresponding migration process,” Colombia’s migration agency said in a statement.

She was accompanied by her husband, the legislator German Ferrer, the agency added. It was not clear whether the couple were seeking asylum in Colombia.

Her replacement, ex-human rights ombudsman Tarek Saab, this week outlined corruption accusations against Ortega and her husband. The couple is accused of running an “extortion gang” and funneling profits into an account in the Bahamas.

Maduro pushed for the creation of the constituent assembly on promises it would bring peace to the country.

Anti-government demonstrations have run out of steam since the assembly’s July 30 election as opposition leaders prepare candidates for gubernatorial elections expected in October. Many opposition supporters are demoralized and the assembly shows no sign of letting up the political pressure.

It has formed a truth commission to investigate opposition gubernatorial candidates to see if played a role in any violent protests over the last four and a half months. If found to have done so they may face charges under a proposed “law against expressions of hate and intolerance,” backed by Maduro.

Rights groups say the measure is worded so vaguely that it could be used to prosecute nearly anyone who voices dissent.

Jews flee Venezuela amid growing political violence

Jews in Venezuela are increasingly fleeing the country amid the rising political instability and violence under President Nicolas Maduro, with a growing number decamping for Israel.

Speaking at their new apartment in Jerusalem, Estella and Haim Sadna, a religious couple with four kids from the Venezuelan capital Caracas, described the food scarcity and rampant crime that drove them to move the Jewish state.

“Most of the supermarkets are empty. Everything is empty. You can see that all the aisles are completely empty,” Haim Sadna told Channel 2 in an interview aired Saturday.

His wife Estella complained of the difficulty in Venezuela of buying basic products such as milk for her kids, adding that “since Passover we haven’t had bread.”

“We lived in a beautiful home with seven rooms. But we left everything behind. We left the house, we left the furniture, the cars. Everything remained [there],” the couple said. “We brought the clothes that we use. That is what we brought, clothes and shoes.”

The Sadna family at their apartment in Jerusalem. (Screen capture: Channel 2)

The Sadnas also noted the collapse of public services in the country such as healthcare, as well the sky-high crime rates, with Venezuela having some of the world’s worst murder statistics.

“The crime situation is [so bad] that it is scary to go out to the street. I only go out of it is essential and that is it,” Estella said. “At five p.m. we would run home.”

“The situation got worse and worse. We could no longer go out to the street,” she continued. “On most days the kids didn’t go to school. They said they were in jail, that the house was a jail. The children have no life [in Venezuela].”

While Venezuela once had one of the largest Jewish communities in the region, numbering some 25,000 in 1999, only about 9,000 Jews are believed to remain in the country. Israel has been working behind the scenes in order to bring as many of those remaining as possible to Jewish state, according to Channel 2.

Illustrative: A young Jewish boy reads from the Torah when taking his Bar Mitzvah in Magen David synagogue in Caracas, Venezuela. January 01, 2005. (Serge Attal/Flash90)

Nissim Bezalel, who moved to Israel from Venezuela a year and a half ago, said that Jews are in an increasingly perilous situation as a result of the widespread poverty stemming from the collapse of the Venezuelan economy.

“Because there is the image of Jews as wealthy people — that they have money — they are a target, to kidnap them and demand a ransom for them,” he told Channel 2. “It is not because they are Jews, it is because they have money.”

While most of the Jews leaving Venezuela would flee to Mexico, Panama or Miami, an increasing number of have been coming to Israel. Last month, a batch of 26 Jews arrived in the Jewish state from Venezuela.

Ofer Dahan, who heads the immigration department for the International Fellowship of Christians and Jews, told Channel 2 that the state has increased its aid to Venezuelan immigrants as the situation in the country has gotten worse.

An opposition activist throws a Molotov cocktail during clashes with security forces in the Venezuelan capital of Caracas on August 12, 2017. (AFP Photo/Ronaldo Schemidt)

While many Jews have fled the country amid the growing instability, a number have joined the protesters demonstrating against Maduro’s rule.

Alex Cohen, who said he joined the protests in Caracas four months ago, told Channel 2 that the goal of the demonstrators is “the return of Venezuela to the people.”

“In Venezuela there is a dictator and Venezuela is held as a hostage by ten people,” he said, while calling on the international community to come to the assistance of the demonstrators.

Opposition figure Nixon Moreno, who said he was forced to go underground after being arrested, likened the opposition’s struggle to Israel’s fight against terror.

“Israel understands us very well because Israel is a victim of terror by extremist groups,” he said, adding that Venezuela is “fighting against another kind of terror.”

Despite once being one of the wealthiest nations in South America, with the world’s largest proven oil reserves, the Venezuelan economy has collapsed as a result of the economic mismanagement beginning under the late president Hugo Chavez.

The economic situation has further deteriorated since Chavez’s death in 2013 and the rise to power of his hand-picked successor Maduro, a former bus driver, with inflation hitting some 800 percent and ever growing shortages of basic foodstuffs, toilet paper and medicine.

With the collapsing economy, the country has been rocked by political turmoil, as Maduro has sought to consolidate power following the opposition’s victory in the 2015 parliamentary elections by weakening the legislature’s powers and imprisoning political opponents.

Venezuelan President Nicolas Maduro addresses the new constitutional assembly that replaced the parliament and is tasked with rewriting the constitution, in Caracas on August 10, 2017. (AFP Photo/Ronaldo Schemidt)

Last month, Venezuela held elections for a new constitutional assembly that supersedes the parliament’s authorities. The US and a number of other Western and Latin American have refused to recognize the results, citing fraud and other irregularities.

The US slapped sanctions on Maduro following the vote and on Friday US President Donald Trump said he was weighing a military response to the “very dangerous mess” in Venezuela.


CARACAS – US. President Donald Trump’s threat of military intervention in Venezuela was “an act of craziness,” the South American country’s Defense Minister Vladimir Padrino said on Friday.

Venezuela’s foreign ministry was expected to issue a statement on Saturday responding to Trump’s comment that “a possible military option” was under consideration for the crisis-racked nation.

The country is deep in a recession compounded by shortages of food and medicine, while anti-government protests have killed more than 120 people since April.

Responding to Trump, Padrino told state television, “It is an act of craziness. It is an act of supreme extremism. There is an extremist elite that rules the United States.”

“As a soldier, I stand with the Venezuelan armed forces, and with the people. I am sure that we will all be on the front lines of defending the interests and sovereignty of this beloved Venezuela,” he added.

Communications Minister Ernesto Villegas called Trump’s remark “an unprecedented threat to national sovereignty.”

In a Friday night message on social network Twitter, he said, “The diplomatic corps is summoned to the foreign ministry for tomorrow, when it will release a communiqué addressing the imperial threat to Venezuela.”

Last month’s election of a legislative superbody packed with allies of unpopular socialist President Nicolas Maduro drew international condemnation for usurping the authority of Venezuela’s opposition-controlled congress.

Maduro says the assembly, which has the power to re-write Venezuela’s constitution, is needed to bring peace and prosperity to the oil-rich but economically ailing country. Critics say the assembly casts aside any remaining checks on Maduro’s power.

The opposition boycotted the vote for the assembly, which assured that it would be stacked with Maduro allies.

The White House said Maduro requested a phone call with Trump on Friday, which the administration appeared to spurn, saying in a statement that Trump would gladly speak with the leader of Venezuela once democracy was restored.

Trump says he’s considering military response to Venezuela

BEDMINSTER, United States — US President Donald Trump said Friday he was considering military options as a response to the escalating crisis in Venezuela, describing the situation there as a “very dangerous mess.”

“We have many options for Venezuela, including a possible military option if necessary,” Trump told reporters in New Jersey.

“We have troops all over the world in places that are very far away. Venezuela is not very far away and the people are suffering and they’re dying.”

The comments came two days after his administration imposed new sanctions on Venezuela, targeting members of a loyalist assembly installed last week to bolster what Washington calls the “dictatorship” of President Nicolas Maduro.

The Venezuelan government responded to the sanctions by saying the US was “making a fool of itself in front of the world.”

Anti-government activists demonstrate against Venezuelan President Nicolas Maduro at a barricade set up on a road in Caracas on August 8, 2017. (AFP PHOTO / Ronaldo SCHEMIDT)

Trump said Venezuela’s ongoing crisis was among the topics discussed at the talks he hosted in New Jersey on Friday with his Secretary of State Rex Tillerson and UN Ambassador Nikki Haley.

“Venezuela is a mess. It is very dangerous mess and a very sad situation,” Trump said.

Venezuela’s New Leaders Begin Their March Toward Total Control

BOGOTÁ, Colombia — Members of President Nicolás Maduro’s governing party marched triumphantly into Venezuela’s Capitol building on Friday, calling to order a 545-member body with plans to rewrite the Constitution and consolidate their power over the nation.

The constituent assembly, as the group is called, took a symbolic jab at their political rivals, parading through the gates of the legislative chamber holding portraits of former President Hugo Chávez, which were taken down just last year after opposition parties won control of the National Assembly.

“This assembly didn’t emerge from nothing,” said Delcy Rodríguez, a former foreign minister close to Mr. Maduro who will lead the body. “It has dodged the obstacles thrown in its way by those who resist democracy.”

The convening of the assembly was the culmination of an ambitious plan by the president to secure political control over Venezuela. In a contentious election on Sunday, Mr. Maduro instructed Venezuelans to choose delegates from a list of allies in the governing party. Voters were not given the option of rejecting the plan.

The body will rule Venezuela for however long it takes its members to rewrite the Constitution, giving virtually unlimited power to Mr. Maduro’s party.

Among the new leaders were Mr. Maduro’s wife, Cilia Flores; the president’s son, Nicolás; Diosdado Cabello, a powerful former military chief who participated in a coup in the 1990s with Mr. Chávez; and a radical television show host known for broadcasting embarrassing recordings of opposition politicians.

Before the ceremony, crowds of government supporters surrounded the Capitol, many dressed in red, the color of Mr. Maduro’s Socialist party, waving flags and dancing to salsa music on speakers. The festive atmosphere was in marked contrast to the months of antigovernment protests and clashes that have left more than 120 people dead and to the hardships faced by Venezuelans dealing with shortages of food and medicine.

On Friday, Mr. Maduro urged assembly members to move swiftly to resolve these problems.

“The mandate of this constituent assembly is to use its powers to make peace, to construct peace, for a new economic model,” he told supporters.

Mr. Maduro’s own authority under the assembly — which is technically above the president — was a cause of speculation among some analysts in recent days, who noted that the president’s rivals within his party might try to take control of the assembly and sideline Mr. Maduro.

But the choice of Ms. Rodríguez, a trusted deputy of the president, to lead the assembly signaled that Mr. Maduro aimed to maintain a firm grip over the assembly’s decisions. Another pick for a leadership post was Aristóbulo Istúriz, a former vice president who had been involved in past talks with the opposition, suggesting that the party’s more radical figures were being kept from the top jobs.

The fate of the National Assembly, the opposition-controlled legislature, was unclear on Friday. Many members of the constituent assembly have called for the legislature to be dismantled, or even for its lawmakers to be jailed. Several countries sent their ambassadors to join the Venezuelan legislators’ sessions, fearful that their chamber would be overrun by force.

But the assembly on Friday chose not to gather in the National Assembly’s chamber, but rather in an adjoining hall in the Capitol, leaving open the possibility that the dueling government branches may — at least for now — coexist.

Elsewhere in Caracas, the capital, a number of supporters of the opposition marched to protest against the constituent assembly and were met by government forces who beat them back. At least one lawmaker was injured, according to the opposition. But the number of protesters was far smaller than those who had turned out for previous marches.

The opposition received some good news on Friday when the Venezuelan authorities released Antonio Ledezma, an opposition leader, from custody and placed him under house arrest, according to his wife, Mitzy Capriles de Ledezma. Mr. Ledezma was taken to a military jail as part of a crackdown this week against opposition politicians.

Politicians vowed to continue their fight in the streets on Friday. “Today the Venezuelan people have demonstrated that they have the power,” said María Corina Machado, another opposition leader, in a video from the march. “The power is here, the power is not in this Dante-esque circle of hell that they’re installing” in the Capitol building.

On Friday, the Vatican issued a statement urging the government to do away with the constituent assembly, saying the body “instead of fostering reconciliation and peace” would “foment a climate of tension.” It joined more than 20 countries that have objected to the assembly, including the United States, which this week imposed sanctions on Mr. Maduro and called him a dictator.



‘Nothing resembles Venezuela,” stated songster Dan Almagor’s chorus in the charming tune “Venezuela” that led the 1960 hit parade for eight months, and still is played on Israel Radio to this day.

With Google, Facebook, Wikipedia and the Israeli backpacker all yet to be born, Almagor didn’t know much about the Latin American country other than that it had a lot of coffee, gold and oil, and that he could make Venezuela rhyme with Ella, the name of a Hebrew University undergrad whose attention he hoped to catch through his song’s repetition of her name.

The romantic hope was dashed, he recently reminisced, but Venezuela became here a lovable connotation, an exotic land that had happily backed Israel’s establishment and which thousands of Israelis, thanks to the song, assumed was like no other country in the world.

Now Venezuela is indeed like no other place; an economic black hole, a social disaster zone and a political moonscape whose relevance to Israel may seem remote, but in fact is pertinent, first and foremost because in 2009 Caracas expelled the Israeli ambassador, charging us with “persecuting” the Palestinians.

We will return to that bizarre moment shortly, but before that, we should consider two other Israeli lessons from Venezuela’s tragedy, as a bewildered world watches it grapple with food lines, medicine shortages, rigged elections, street crime, political riots and a hyperinflation underscored by this summer’s introduction of a 20,000-bolivar bill whose black market value is less than $2.

THE FIRST lesson for us is about authoritarianism.

As this column has noted in the past, democracy’s global march since 1989 has come to face a great authoritarian reaction, driven by Russia, China and Turkey. The three’s apparent stability and predictability seem to be the envy of some Israeli politicians.

No, such Israelis would surely not go as far as arresting professors or assassinating journalists. They would, however, buy an unfriendly newspaper’s integrity, replace civil servants with party hacks, and also “bulldoze the Supreme Court,” as one of them recently put it himself.

To all these would-be Israeli autocrats, a glance at Venezuela can be educating: authoritarianism can only last that long and will ultimately fall that hard.

The second Israeli thought should be on what Venezuela did economically.

Sitting atop crude reserves more than 10% larger than Saudi Arabia’s, Venezuela is the world’s biggest oil barrel. Alas, it never used its black gold to industrialize its 30 million people and diversify its one-dimensional economy.

Instead, Caracas used its petrodollars to reward the regime’s cronies, featherbed a bloated public sector, and buy social quiet by subsidizing fuel and food. The result was an economy that did not supply enough goods to satisfy demand fueled by easy money. The result of that was inflation, followed by capital flight and unemployment.

Some of this dynamic might have been on its way to Israel later this century, following its recent gas findings. Fortunately, and thanks to former Bank of Israel governor Stanley Fischer, this syndrome will not develop here.

Fischer imposed on our politicians the establishment of a sovereign fund that will siphon most of Israel’s gas royalties and then drip them into the economy slowly and steadily, mainly for education, health and other social causes.

That is how Israel’s politicians lost the ability to abuse its gas revenues, and that is how the Israeli economy was disabused, in advance, of the kind of financial obesity that has plagued Venezuela with economic heart disease.

Still, the political and economic lessons of Venezuela’s collapse dwarf compared with its lesson for any anti-Semite.

EAGER TO reopen England to Jewish settlement for the first time since their expulsion in 1291, Dutch Jew Menasseh Ben Israel wrote Oliver Cromwell in 1655 that throughout history, whoever abused the Jews was “heavily punished by some ominous exit,” while whoever was “a benefactor to that people and cherished them in their countries” soon “begun to flourish.”

Ben Israel was obviously a biased Jew with a lobbyist’s cause, but anti-Jews indeed repeatedly met economic demise, while those who accommodated the Jews prospered.

Spain went bankrupt four times in the decades following its expulsion of its Jews, while the Ottoman Empire, which welcomed Spain’s Jews, blossomed.

Antwerp lost to Amsterdam its status as Europe’s financial hub in tandem with the two’s inverted treatments of their Jews. Antwerp attacked its Jews, while Amsterdam welcomed the Jews, so much so that Christian scholars often attended Ben Israel’s sermons. Antwerp’s brief financial stardom began when Iberian Jews arrived there, and it ended when they fled.

Faced with this phenomenon, German sociologist and future Nazi Werner Sombart waxed poetic: “Israel passes over Europe like the sun: at its coming new life bursts forth; at its going all falls into decay.”

This pattern repeated itself last century, when the anti-Jewish East Bloc and Arab world stagnated economically, while the West, which accommodated the Jews, prospered. Similarly, the economic rise of India and China overlapped the two’s normalization of relations with the Jewish state, and followed decades of poverty while they were hostile to the Jewish state – as if to vindicate the biblical Balaam’s vow that Israel’s cursers will be cursed and those who bless it will be blessed.

In 2009 Venezuela’s previous leader, Hugo Chavez, cursed Israel, hoping his bravado would divert the masses’ attention while he was robbing their riches.

Now Venezuela’s crisis obviously requires shock therapy unrelated to Israel. However, a good way to launch the procedure would be to apologize to the Israeli people, who never harmed Venezuela and even praised it in a song.

Venezuela’s controversial new Constituent Assembly, explained

On Sunday, Venezuelans took to the streets to either vote in or boycott a controversial election to choose members of an all-powerful Constituent Assembly. The new assembly will be made up completely of government supporters but will have authority over the lives of all Venezuelans.

The vote came in the midst of a constitutional crisis. For four months, there have been widespread protests, repression and failed negotiations as the government of President Nicolás Maduro battles the opposition Democratic Unity (MUD) coalition.

Here are five key questions and answers about Sunday’s vote.

Why did the government hold this vote?

The government said it was to bring peace to the conflicted country, but it was widely seen as a move to avoid holding other scheduled elections that the government expected to lose — including elections for governors and mayors in 2017 and for president in 2018.

The government’s approval rating has hovered around 20 percent because of the weakening economy, shortages of food and medicine, and the Supreme Court’s controversial decision to curtail the authority of the legislature. The resulting protests have left more than 100 dead, and at least 10 more died during Sunday’s vote.

What is a constituent assembly?

President Hugo Chávez established a similar body in 1999 that was intended to give the people “originary” power. Venezuelan constituent assemblies have the authority not only to change the constitution but also to dismiss existing officials and institutions.

The newly elected assembly is expected to dismiss the rebellious attorney general and perhaps even the opposition-dominated legislature. On Sunday night, Maduro called on the assembly to lift the immunity of legislators and to hold them accountable via a new Truth and Reparations Commission. This has led to fears of yet more recrimination and repression.

Theoretically, the Constituent Assembly could assert yet more power and even cancel the presidential election next year.

What was the outcome of the vote, and was it fair?

The opposition boycotted the vote, and opinion polls before the vote indicated that only 15 percent of registered voters definitely planned to vote. Government workers and poor people receiving subsidized food were heavily pressured to vote or risk losing their jobs and benefits. Media and independent observers reported long lines at one large stadium in Caracas that combined multiple voting centers but otherwise very short or no lines across the country. The official turnout of 8.1 million voters, or 42 percent of registered voters, was disputed by the opposition and treated with skepticism by analysts and observers.

The election’s rules were heavily biased in favor of Maduro’s government. Instead of “one-person, one-vote,” every municipality in the country elected one delegate and state capitals elected two, no matter the size of the town or city. In addition, a proportion of delegates was reserved for selection by members of specified organizations such as students, workers and indigenous groups. This helped ensure that a larger number of delegates would come from constituencies favorable to Maduro, even if the opposition participated.

The vote lacked many of the safeguards normally present in Venezuelan elections. The government agency in charge of the election skipped 14 of the 21 audits of the automated system, did not use indelible ink, and allowed people to vote anywhere in their city, not only where they were registered. Ballots didn’t even have names of candidates, just numbers.

What has been the international reaction?

A number of Latin American countries, the United States, Canada and Spain have said that they will recognize neither the outcome of the vote nor the decisions emanating from the Constituent Assembly. Peru has called for a meeting of regional foreign ministers on Aug. 8.

The willingness of other countries to ignore the Constituent Assembly is important. In March, the Supreme Court eliminated the authority of the existing legislature to approve financial transactions, loans and joint ventures. If the Constituent Assembly assumes that responsibility but its decisions are not recognized, this will affect foreign investment in and international transactions with Venezuela.

In addition, several countries have joined the existing U.S. sanctions targeted toward individuals in Venezuela, and on Monday, the Trump administration imposed further sanctions on Maduro himself, freezing any assets he has in the United States and prohibiting Americans from doing business with him.

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What happens next?

If international isolation builds and public opposition continues, some in the government may be willing to open negotiations and create a transitional government that could begin to stabilize the economy and restore the separation of powers in the country.

To reach such an agreement, however, the government and opposition will need guarantees that they will not be targeted by the other — including with judicial witch hunts or political and economic exclusion. The chance of success will increase if other countries provide emergency aid and monitor the negotiations as well as compliance with any agreement.

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If these conditions do not emerge, then the government is likely to escalate the conflict by dissolving the legislature and jailing dissidents. Some Venezuelans will then resort to arms, and repression and violence will escalate.

Jennifer McCoy is Distinguished University Professor of Political Science at Georgia State University and co-author of “International Mediation in Venezuela.”