The Wrecking of Venezuela (Fuente: The Economist)

THE WRECKING OF VENEZUELA
May 13th 2010


Venezuelans are starting to fall out of love with their president. Will
they be allowed to vote him out of power?

WITH his bellicose bombast, theatrical gestures and dodgy jokes, Hugo
Chavez, Venezuela's president for the past 11 years, has turned himself
into one of the world's most recognisable and controversial rulers. His
fans salute him as a saviour for the downtrodden of the planet, a man
who is leading a grass roots revolution against American imperialism
and its local sepoys. But to many others, including this newspaper, he
has come to embody a new, post-cold-war model of authoritarian rule
which combines a democratic mandate, populist socialism and
anti-Americanism, as well as resource nationalism and carefully
calibrated repression.

This model has proved surprisingly successful across the world.
Versions are to be found in countries as disparate and distinct as
Iran, Russia, Zimbabwe and Sudan. In one way or another, these regimes
claim to have created a viable alternative to liberal democracy.

In Mr Chavez's case, that claim has been backed up above all by oil. On
the one hand, he has deployed oil revenues abroad to gain allies, and
to sustain the Castro brothers in power in Cuba. On the other, having
kicked out Western multinationals, he has signed investment deals with
state-owned oil companies. Last month China agreed to lend Venezuela
$20 billion, mainly for oil development. Mr Chavez has armed his
revolution with Russian jets, tanks and rifles (albeit bought on tick).
Meanwhile, a Spanish judge accuses his government of sheltering members
of ETA, the Basque terrorist group. Intercepted e-mails from leaders of
Colombia's FARC guerrillas suggest that they have received help, and
possibly arms, through Venezuela. Of course Venezuela's government
denies such claims. So just how much of a menace is Mr Chavez, and
what, if anything, can be done about him?

VENEZUELA'S DARK AGE
Certainly his threats against Colombia--which include a total trade
embargo if Juan Manuel Santos, a former defence minister, wins this
month's presidential election--and the evidence of his veiled support
for the FARC are troubling. They are a constant, if so far manageable,
source of regional tension. And his efforts to build a block based on
self-proclaimed "revolutions", anti-Americanism and managed trade in
the heart of democratic Latin America have served to undermine the very
cause of regional integration that he claims to champion. But rhetoric
aside, his influence in the region peaked a couple of years ago. He
lost one ally, albeit in regrettable circumstances, when Honduras's
president, Manuel Zelaya, was overthrown last year. Several others are
on the defensive.

Much more important is the damage Mr Chavez is doing to his own
country. His "21st-century socialism" is a precarious construction. The
brief fall in the oil price of 2008-09 was enough to sink Venezuela's
economy into stagflation--even as the rest of Latin America is enjoying
vigorous economic recovery. Venezuelans are suffering declining real
wages, persistent shortages of staple goods (meat is the latest to
become scarce) and daily power cuts.

The blackouts are in part the result of drought. But they are also the
most dramatic sign that the bill for a decade of mismanagement of the
economy and of public services is now falling due (see article[1]).
There are plenty of other ugly portents. In one of the world's biggest
oil exporters hard currency is running short: to buy a dollar in the
tolerated parallel market now requires almost twice as much local
currency as the official exchange rate (and three times more than the
privileged rate for "essential imports"). Investors rate the country's
debt as the riskiest of anywhere. Crime and corruption are flourishing.

THE COMING CHOICE BETWEEN CHaVEZ AND DEMOCRACY
Awkwardly for Mr Chavez, all this is happening when he faces a
legislative election in September, the prelude to a vital presidential
ballot in December 2012.

That points to the contradiction at the heart of his project. He sees his revolution as permanent and irreversible.But he derives his legitimacy from the ballot box. He has been electedthree times, and won four referendums. He has hollowed out Venezuela's democracy, subjugating the courts, bullying the media and intimidating opponents.

But he has been unable, or unwilling, to disregard or repress opposition to the same degree as Iran's Mahmoud Ahmadinejad or even Russia's Vladimir Putin, let alone the Castro brothers in Cuba.

Public opinion still matters in Venezuela. Remarkably, opinion polls
show that two Venezuelans out of five still support Mr Chavez (higher
than the proportion of the British electors who voted for the
Conservative Party, the senior partner in the country's new coalition
government).

That is tribute to his skill in convincing the poor that
he is their champion, to the opposition's mistakes, to years of record
oil prices and to the ruthlessness with which he ransacks the economy
for the short-term benefit of his supporters. It means he is unlikely
to fade away. But provided that the opposition comes up with a
plausible alternative, it is not fanciful to imagine that in 2012
Venezuela will face a stark choice: Mr Chavez or democracy.

All the evidence is that Venezuelans, including many CHAVISTAS, are
democrats and want to remain so. But Mr Chavez is pushing on regardless
with his revolution, nationalising ever more businesses, expropriating
private properties and selectively locking up or harassing his
opponents. So the question increasingly being asked in Caracas is
whether Mr Chavez's rule will end peacefully or not.

The answer will lie largely with Venezuelans themselves. But outsiders,
especially in Latin America, can play their part, by urging that the
opposition receive guarantees that it can take part both this year and
in 2012 on equal terms.

That goes particularly for democratic Brazil,
whose president, Luiz Inacio Lula da Silva, has embraced Mr Chavez far
more than is desirable for his own country's long-term interest. Mr da
Silva has helped entrench prosperity, freedom and democracy in Brazil.
He should hope the same happens for Venezuela. Mr Chavez,
unfortunately, is not the man to bring that about.