Hugo Chavez, Joe Kennedy and Cheap Oil
Oil: Joe Kennedy was an easy mark for Venezuela's Hugo Chavez, who promised cheap oil in exchange for Joe's endorsement. But after a first $100 million, the well went dry Monday. How's it feel to be had, Joe?
It seemed like easy money at the time. To get cheap oil for the poor, raise his power profile and get his Citizens Energy Corp. set for life, Kennedy made a deal with the brutal dictator in Caracas in 2005 to distribute cheap heating oil to the poor.
In exchange for Venezuelan oil at a 40% discount, Kennedy would enhance Hugo Chavez's reputation and shame private oil companies for not getting involved.
And that he did. Joe blanketed television stations across the U.S. for over three years as Chavez's pitchman, urging the poor to sign up for Chavez's cheap oil. Call 1-877-Joe4Oil, he said, begging them to take it. Kennedy said he fueled 400,000 households in first 16 and then finally 23 states, praising Chavez's "generosity."
But behind the pretty image was an odious dictatorship that's devastated democracy in Venezuela, multiplied poverty and forged military ties with America's enemies. That's why having a shill or two in the U.S. to praise Chavez as a "humanitarian" is always useful, at least while the money lasts.
But it didn't. On Monday, a distraught Kennedy announced he had been cut off by Chavez with no warning, leaving him with 90% less fuel to give away this winter. He had to lay off 20 employees.
Worse, he faced angry recipients from Alaska to Maine who'd been counting on him for all that cheap oil. Chavez wasn't on the hook for that — Joe was. Kennedy said he'd try to change the dictator's mind and urged recipients to write him letters.
But even Joe had to know that with falling oil prices, the party was over. Chavez was flat busted after squandering $600 billion in oil earnings around the world in such giveaways.
For Joe, all that remains was sullied family honor and no fuel. He'd been used by Chavez during the boom, thrown overboard as excess baggage during the bust, and finally realized it Monday.
There are ways to deliver cheap oil, if that's the aim, and one doesn't need dictators to do it. Raising money is one. Although it's harder than dictator cash, it's honorable and its results last. Chavez's profligate spending and mercurial policies should have been a warning, because anything too good to be true, usually is.
Now left cold, Joe can contemplate what happens when a deal is made with a dictator: Like the devil, he eventually gets his due.