Category Archives: Venezuela

Venezuela

Show us the long-form, Nicolás! (In which ‘birtherism’ comes to Venezuela.)

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So birtherism isn’t limited to the United States and the tea party movement’s nutty claim that US president Barack Obama was actually born in Kenya and not in the US state of Hawaii. Venezuela Flag Icon

As it turns out, Venezuelan president Nicolás Maduro is taking some heat over accusations that he was actually born in Colombia, not in Caracas, the capital of the country that he leads.

Maduro’s government is sinking under the weight of power outages, a return to expropriation (including a local toilet paper factory) and continued shortages of basic goods due to inefficient foreign currency exchange and a gap between the real and official value of the Venezuelan bolívar, which has led to ridiculous means to game the Venezuelan currency — one story earlier this week demonstrated how flights out of Venezuela are nearly 100% booked for months in advance as a way to arbitrage the difference in the official and actual rates.

Maduro, whose country is essentially locked out of conventional global debt markets, went to Beijing earlier this week (pictured above) to procure another $5 billion in financing (and $14 billion in development of Venezuela’s oil-rich Orinoco belt) from the Chinese government.  He picked another odd fight with the United States and came up with a truly nutty excuse for skipping the UN General Assembly meeting this week, which follows the possible implication of Venezuela’s government in the brazen attempt to transport 1.3 tones of cocaine from Caracas to Paris on an Air France flight earlier this month.

Rumors have swirled over the past months about Maduro’s birthplace and his nationality, but his chief rival in the April presidential election, Henrique Capriles, the governor of Miranda state, is ratcheting up the pressure.  Capriles and Walter Márquez, an opposition member of Venezuela’s Asamblea Nacional (National Assembly), took up the claim yesterday that Maduro was born in Bogotá:

Márquez claimed that he has documents and testimonies attesting to Maduro’s dual nationality.  “Nicolás Maduro lived in the Carora neighborhood, in Cúcuta (Colombia). There are testimonies of people who spent time with him. We found the record of the birth certificate of Nicolás Maduro’s mother. She was born in Cúcuta. I contacted people who can testify that Maduro was born in Bogotá,” Márquez stressed.

Márquez added that so far the supporting documents attesting that Maduro’s father is a Venezuelan have not been found. “We have a copy of the marriage certificate of his (Maduro’s) parents, and the birth certificate of his older sister. Later on, I will disclose documental and testimonial evidence proving Maduro’s Colombian nationality,” he stressed.

Maduro’s doing a pretty good job of discrediting himself these days, so further discrediting Maduro (instead of chavismo more generally) won’t by itself do much good for the opposition — and it could backfire against them.  By pursuing a ‘birther’ strategy, the opposition is giving the Venezuelan military or rivals within the chavista elite, such as National Assembly president Diosdado Cabello, an opportunity to remove Maduro and start anew once Venezuela’s basketcase economy truly hits rock bottom.

Even if Márquez and Capriles somehow had smoking-gun proof that Maduro was somehow ineligible for the Venezuelan presidency, it’s also pretty clear that Maduro could claim that he renounced his Colombian citizenship or he could do so and still remain eligible for the presidency.  But even if he didn’t, does anyone think that a chavista-dominated court system would even entertain removing Maduro from office?  It’s hard to see just why the opposition is pursuing this strategy, because it telescopes to the Venezuelan electorate that Capriles and the opposition are less interested in making their lives better than scoring political points — or even plotting a strategy that could win power.

But under the constitutional process for nationality in Colombia and Venezuela, it’s easy to see how Maduro might wriggle out of any ‘birther’ scandal, even without leaning on Venezuela’s corroded state institutions.

Article 41 of Venezuela’s ‘Bolivarian’ constitution — promulgated by late president Hugo Chávez in 1999 — states that only Venezuelans by birth who have no other nationality shall be permitted to hold the offices of President: Continue reading Show us the long-form, Nicolás! (In which ‘birtherism’ comes to Venezuela.) →

Venezuela

Where Capriles and the Venezuelan opposition go from here

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Henrique Capriles’s last hopes of winning a recount in the April 2013 presidential election slipped away earlier this month when the chavista-controlled judicial system dismissed his complaints over the election.Venezuela Flag Icon

No one thought that, four months later, the opposition candidate had much of a chance of unseating Nicolás Maduro, no matter whether he actually won more votes.  But the decision two weeks ago of Venezuela’s top constitutional court not only dismissed Capriles’s complaint but fined Capriles around $1,700 for insulting the integrity of the court, and it suggested that Venezuelan prosecutors file a case against Capriles, who is also the governor of Miranda, for offending the institutions of the state.

No one thinks that the April 14 vote was incredibly fair — Maduro’s ruling chavista party, the Partido Socialista Unido de Venezuela (PSUV, United Socialist Party of Venezuela) has co-mingled party and government for so long that it’s impossible to separate the two.  Chavismo remains both the dominant party and ruling ideology in Venezuela, even after Chávez’s death in March.  The Maduro campaign wielded a huge advantage in its access to state-controlled media and funds, and that followed a massive spending spree last year in the leadup to Chávez’s own reelection in October 2012.  But there’s credible evidence that the vote was not incredibly free either, with reports of voter intimidation and manipulation by chavistas and by police and army officials.

Officials in Venezuela’s electoral commission (the CNE) point to a June audit that ‘confirmed’ Maduro’s 1.49% margin of victory.  But the CNE won’t release the logs of voter signatures and fingerprints that correspond to the voting machines, which might otherwise reveal how fraudulent the voting actually was.  Neither Capriles nor the broad opposition group, the Mesa de la Unidad Democrática (MUD, the Democratic Unity Roundtable), believe the result is legitimate.

Meanwhile, the chavistas are engaged in a slow-motion, cold civil war, and the Venezuelan economy is struggling with a combination of low growth, import dependency, depressed oil output, dysfunctional currency markets, and hyperinflation unseen since the 1980s.

So what happens next — and how does the opposition think about the future?  Continue reading Where Capriles and the Venezuelan opposition go from here →

Venezuela

‘Pragmatic’ Merentes winning control over Venezuela economic policy, but to what end?

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When Venezuelan president Nicolás Maduro appointed Nelson Merentes as his new finance minister shortly after Maduro’s controversial election in April, no one knew whether Merentes would actually be the official in charge of economic policy.Venezuela Flag Icon

That’s because the former finance minister Jorge Giordani, the longtime policymaker in the era of former president Hugo Chávez, remained planning secretary — and in a huge public-sector country like Venezuela, there’s little left untouched by central planning.  Giordani, more than anyone else, was responsible for the statist economic policies of the Chávez era, including currency and price controls.

But this week, there was no mistaking that Merentes is now ascendant — Edmée Betancourt, who had served as president of Venezuela’s central bank (BCV) for just over three months, stepped down in favor of Eudomar Tovar, an economist who was most recently the head of Venezuela’s currency exchange (CADIVI).  Betancourt, a former commerce minister, was seen as closer to Giordani and the more ideological, statist wing of chavismo, while Tovar and Merentes are associated with a more pragmatic, moderate view of economic policy.  Rumors swirled last week that Giordani might soon leave the planning ministry, abandoning a recent push to raise taxes, to take up an ambassadorship soon.

Leave aside for a moment that in an era of central bank independence, neither Giordani nor Merentes would be dominating the BCV’s monetary policy in a country with sounder financial institutions.  If Merentes and Maduro really want to shake up Venezuela’s economy for the better, they should start by reintroducing a line between the ruling Partido Socialista Unido de Venezuela (PSUV, United Socialist Party of Venezuela) and the institutions of the Venezuelan state — starting with the BCV, but also with the national oil company, Petróleos de Venezuela, S.A. (PDVSA).

Merentes’s rise should provide at least some cautious optimism — if Giordani would have doubled-down on statist Chávez-era policies, at least Merentes seems to realize that Venezuela’s basketcase economy has some problems.  The central bank’s reserves are dwindling, Venezuelan GDP growth has slowed to nearly nothing, and inflation has reached its highest level since before Chávez came to power in 1999 on the road to a potential hyperinflationary collapse.

But it remains far from clear that Merentes is willing to embark upon a program of true economic reform or whether Maduro has both the political capital and the political will to enable him to do so.  Moves to devalue the bolívar both officially and unofficially earlier this year was a start in bringing the Venezuelan currency’s stated value in line with its real market value, but the currency has decline further in value throughout they year: despite an official value of 6.3 bolívares to the dollar, its real value has dropped from around 20 at the time of the April 14 election to more than 30 or 35 today.  Maduro took steps to tweak the currency exchange system through the introduction of SICAD auctions earlier this spring — because the vast majority of U.S. currency comes to Venezuela through the government’s sale of oil products, the government must develop a mechanism to sell those dollars to importers who need hard currency.  But neither Maduro nor Merentes have been in a rush to hold regular dollar auctions (only around $600 million has been auctioned off so far in 2013) or to deliver the actual dollars from the government to the private sector.  But the fuss over SICAD and currency exchange is really just a stop-gap measure — if the ‘pragmatists’ can’t even get this right, it leaves little faith in their ability to overcome more fundamental problems with Venezuela’s economy.

Maduro and Merentes still hope that they can borrow their way out of Venezuela’s current malaise, and the government had the brass to float the possibility two months ago that Merentes would go on a roadshow to New York and London to gauge appetite for Venezuelan bonds.  That roadshow plan quickly fell apart when it became clear that there’s little appetite for risky Venezuelan debt among global investors — yields on Venezuela’s benchmark bond have been in the double digits since Maduro’s election. Continue reading ‘Pragmatic’ Merentes winning control over Venezuela economic policy, but to what end? →

Venezuela

It’s Diosdado Cabello’s world, the rest of Venezuela is just living in it

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Venezuela, just over a month after its still-contested presidential election, has made global headlines in the past couple of weeks for its chronic shortages of everything from toilet paper to church wine, with rationing soon to begin in the large western state of Zulia.  Venezuela Flag Icon

That means that the country’s economic collapse is proceeding more or less as depressingly predicted — with oil prices stagnating, and with the state-owned Venezuelan oil industry’s production reducing, it means that the country has fewer and fewer dollars to fuel its increasing dependency on imported goods, a shortage that’s been exacerbated by the government’s somewhat inefficient system of auctioning off the dollars to importers and the fact that the Venezuelan bolívar is fixed at an artificially high rate.

That’s one of the reasons that Nicolás Maduro, even with the full force of a government that has excelled at blurring the line between the Venezuelan state and chavismo, only barely won election follow Hugo Chávez’s death and why his challenger Henrique Capriles is still waging a campaign in the court system, however quixotic, to expose voting fraud in April’s election that could well reveal that Capriles won the election instead.

Maduro’s loss weakened his already tenuous position within the ranks of chavismo, and the key power brokers under Chávez have largely retained their roles under Maduro, including Rafael Ramírez, the energy minister and the president of the state-run oil company, Petróleos de Venezuela, S.A. (PDVSA), and Jorge Giordani, the former finance minister who remains the planning minister under Maduro.  Forget the fact that new policymakers could potentially reverse course on Venezuela’s economy or that Giordani, Ramírez and Maduro appear to be doubling down on the same policies that have led to Venezuela’s precarious situation — it shows that Maduro lacks the power to replace his rivals with ministers who owe their loyalty to Maduro.

But as the economy melts down, it isn’t surprising to see chavismo itself breaking down.  The first major breach came a couple of weeks ago, when a purported recording of a conversation emerged between Mario Silva, who hosts the popular, massively pro-chavista ‘La Hojilla’ television program, and Aramis Palacios, a Cuban lieutenant colonel in G2, the Cuban intelligence agency.  Silva is as much of a true believer in chavismo as anyone in the top circle of Venezuela’s ruling elite, so if Silva has such wide doubts about Maduro (at one point he says, ‘we are in a sea of shit’), imagine what the rest of the government thinks.

It’s also, of course, somewhat of an international scandal as well — though Cuban intelligence long worked hand-in-hand with Chávez and the Venezuelan government, what exactly was a pro-Chávez talk show host doing talking to a Cuban spook?  The link between the two countries became an issue during the campaign, with Capriles attacking the generous oil subsidies to Cuba that Chávez initiated a decade ago, and Maduro is widely believed to have been Havana’s top choice to succeed Chávez.

But the recording was most tantalizing with respect to Diosdado Cabello (pictured above) and his role in Venezuela’s future — no one has more power in post-Chávez than Cabello, including even Maduro. Continue reading It’s Diosdado Cabello’s world, the rest of Venezuela is just living in it →

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We’re starting to see what Madurismo will look like in Venezuela

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It’s been nearly three weeks since I returned from Caracas to cover the Venezuelan presidential campaign, but the post-election situation there remains far from becalmed, unfortunately. Venezuela Flag Icon

Here’s a quick review of where things stand after another week that was, wherever you stand on the Venezuelan political spectrum, not a very good week for Venezuela and its political and legal institutions:

  • The opposition candidate Henrique Capriles, who leads the Mesa de la Unidad Democrática (MUD, Democratic Unity Roundtable) coalition, is taking his challenge directly to Venezuela’s Supreme Tribunal of Justice that contests over 2.3 million votes in over 5,700 polling stations from the April 14 vote.  A planned audit of the election will continue under the supervision of Tibisay Lucena, the head of Venezuela’s national electoral council, though Capriles and the MUD opposition have rejected the terms of the audit.  Although the audit will recount the votes, it will not audit aspects of the voting process, such as voter signatures and fingerprints, that could confirm that the votes were legitimately cast, not just properly tallied.  Capriles and his allies have also alleged a wider range of election-day concerns, including voter intimidation and dumped ballot boxes.  
  • In Venezuela’s Asamblea Nacional (National Assembly), which is dominated by the chavista party, the Partido Socialista Unido de Venezuela (PSUV, the United Socialist Party of Venezuela), opposition deputies have not only been prohibited from speaking, but were attacked in a vicious assault last week on the floor of the National Assembly while its chavista president, Disodado Cabello looked on with a smile.  No matter if you’re in Ukraine or in Venezuela, brawling politicians on the floor of a parliament are always unseemly:
  • Meanwhile, the government of president Nicolás Maduro has taken an increasingly harsh political line against the United States, attacking U.S. president Barack Obama for ‘meddling’ in internal Venezuelan affairs.  Maduro has railed against the Obama administration, which has not yet recognized Maduro’s victory on April 14, and which has aired concerns about the vote.  Maduro’s new administration has added additional tension to U.S.-Venezuelan relations by imprisoning a U.S. documentary maker on charges of inciting political violence in Venezuela.  Maduro, who suggested during the campaign that the United States may have caused the cancer that killed his predecessor, Hugo Chávez, has argued that the United States is fomenting post-election violence as well.  For good measure, he’s also accused former Colombian president Álvaro Uribe of attempting to assassinate him and he’s even attacked Peru’s foreign minister Rafael Roncagliolo.
  •  Maduro’s new cabinet, appointed in late April, looks much like the previous one, with many familiar high-level chavista faces retaining much of the power in Venezuelan government.  Rafael Ramírez remains the country’s energy minister and head of the national oil company, Petróleos de Venezuela, S.A. (PDVSA); Elías Jaua, a former vice president, will remain foreign minister; and Cabello remains the president of Venezuela’s national assembly.  The longtime head of the finance and planning ministry, Jorge Giordani, will remain merely planning minister and Nelson Merentes, formerly the head of Venezuela’s central bank, will become finance minister, a post he held briefly in the early 2000s as well.  Merentes’s promotion has caused some optimism internationally, and Merentes is seen as more of a pragmatist than Giordani and dislikes Venezuela’s currency controls, which have artificially skewed the flow of dollars to importers.  It’s not clear, however, that Giordani will relent control over economic policymaking, given that he’s been the economic czar of Venezuelan government since virtually the beginning of the Chávez era.

What is the sum impact of all of this?

So far, it seems that madurismo is the same as chavismo, but with less charisma, fewer petrodollars and the possibility of a more violent government than under Chávez.

With no signs that Capriles is giving up his challenge, Maduro faces a real legitimacy problem, and he’ll continue to do so as long as Capriles challenges the election’s audit process in a court system that’s widely seen as tilted more toward politics than toward impartial interpretation of the law.  In the best case scenario, chavismo somehow lost 600,000 supporters between Chávez’s reelection in October 2012 and Maduro’s own election in April.  In the worst case scenario, Maduro and the chavista government simply bought, scared or muscled enough votes last month to steal the election.  It’s not an enviable position, especially given Venezuela’s ongoing economic troubles.

But Maduro also faces serious challenges within the PSUV and the ruling chavista elite.   Continue reading We’re starting to see what Madurismo will look like in Venezuela →

Venezuela

Gettin’ Raucous in Caracas

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Here’s a piece I wrote for an LGBT website on the Caracas gay scene a couple of weeks ago– and how the election season put a damper on exploring Caracas’s nightlife.  It’s not my typical foreign policy analysis, but perhaps some of you will enjoy it nonetheless if you ever find yourselves with a free night in Venezuela’s capital.

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CARACAS, Venezuela — Perched in a valley of a mountain range that runs along the Caribbean coast on the northern rim of South America, Caracas isn’t exactly the first thing you think of when you think gay destination.Venezuela Flag Icon

But you’d be surprised at how much fun life could be in the capital of the Bolivarian Republic — Sean Penn can’t be completely wrong, right?

My chief obstacle was the ley seca, the dry law that went into effect at 6 p.m. Friday night in advance of last Sunday’s election.   Nothing kills a South American party faster than public teetotaling, though Venezuelans had figured how to circumvent that law fairly discreetly after a similar dry spell following the death of former president Hugo Chávez and another during semana santa (Holy Week).  But the state of things left nightlife a bit more subdued than it would have otherwise been.

Being stuck in Caracas during election season isn’t all bad, though.  In a society that now, more than ever, is incredibly political polarized, gay life is one of the few parts of Venezuelan society where chavistas — the followers of Chávez and his successor, president-elect Nicolás Maduro — mix with opposition supporters.

Unlike in the United States, both sides court the gay demographic, and early in the most recent campaign, opposition candidate Henrique Capriles lashed out at Maduro for using homophobic language to slur Capriles (he’s called Capriles a ‘little princess’), arguing that there’s no place for the kind of machismo language that ostracizes and excludes gay Venezuelans.  Despite Maduro’s language, the Venezuelan government hasn’t been wholly bad for LGBT rights.  Chávez’s 1999 constitution attempted to include language banning discrimination on the basis of sexual orientation, though Chávez in 1999 outlawed discrimination by statute.

Capriles, for the record, is fairly easy on the eyes and incredibly fit, in contrast to either Maduro or Chávez.  He’s also single, though he’s been linked to numerous women in the past, so don’t get any ideas.

Notwithstanding the pre-election ley seca, and the post-election tension, which continues even now to threaten Venezuela’s political stability, I still found some time to see the best of gay Caracas while covering the election and its policy issues.

Don’t expect Buenos Aires or Rio — Caracas isn’t a hard-dancing party town.  Instead, expect a surprisingly sophisticated mixed scene — the term in Caracas for the more gay-friendly scene is ‘en ambiente,’ but really the entire neighborhoods of Altamira and Chacao, as some of Caracas’s safest neighborhoods, come alive with a chill scene at night.  Forget what you’ve heard about the ‘murder capital’ of the world — Altamira and Chacao are walkable by night with the precautions you’d use in New York or Los Angeles.

I was lucky to have Julian Eduardo — a.k.a Stayfree — to show me around town.  He’s an icon of gay life in Caracas as one of the first Venezuelans to come out publicly, and he was for a while one of the hosts of a popular television show, ‘Noches de perros,’ making him one of the first openly gay figures on Venezuelan television.  He said that Caracas has become increasingly sensitive to LGBT issues over the past decade.  Though gay life in Venezuela may not be as out and proud as in countries like Argentina and Uruguay, which have both enacted gay marriage (Uruguay did so last week), gay life in Venezuela is a mellow thing, especially in the capital.

So, for instance, check out Puto Bar, which is Chacao’s answer to a hipster dive with great music, cheap drinks and a fun mixed, en ambiente scene where there’s usually even more action outside among the smoking area than inside with the night’s live set.  There were quite a few boys with some assets worth, ahem, expropriating, faster than you can say ‘Mister Danger.’ Continue reading Gettin’ Raucous in Caracas →

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CNE agrees to 100% audit of Venezuelan votes

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It’s been a testy week in Venezuela, to say the least, but the decision of the CNE (the National Election Council) to conduct a full audit of all of the votes in last Sunday’s election is an olive branch that could pull the country from the brink of tipping into violence and further instability.Venezuela Flag Icon

When I left Caracas on Tuesday afternoon, opposition candidate Henrique Capriles was canceling a planned rally on Wednesday after acting president Nicolás Maduro threatened that Capriles would not be allowed to hold the rally, accused Capriles and the opposition of trying to mount a coup against him, warned that he would respond to the opposition with a firm hand, all the while arguing that Capriles was the person inciting violence.

Wednesday was hardly any less tense, with Leopoldo López claiming that arrest warrants had been issued against him and Capriles, the chief justice of Venezuela’s top court, Luisa Estella Morales, ruled out a manual recount of all of the votes, and National Assembly president Diosdado Cabello refused to allow any opposition deputies to speak until they recognized Maduro’s victory as legitimate.

But late yesterday, the CNE’s decision came even as Maduro himself flew to Lima for a short emergency meeting of UNASUR (Unión de Naciones Suramericanas, or the Union of South American Nations), which recognized Maduro’s victory, despite issuing a stern call for peace.  It seems likely that the CNE decision may have been urged on by pressure from UNASUR, though that’s mere conjecture.

Maduro’s inauguration will proceed today as planned, though opposition officials will not attend.

Capriles has welcomed the CNE’s decision, though the CNE itself says the process of auditing results may take up to a month.  For now, though, both sides are backing away from a very fraught five days:

Capriles explained that the announced audit of 46% of the remaining ballots represents 12,000 ballot boxes approximately. “Irregularities will be found in those 12,000 boxes,” he noted.

The opposition leader stressed that the audit shall include the verification of fingerprints, the recount of ballots, and the review of tally sheets and voters’ lists.

One of the key issues is determining how many votes Capriles received abroad — his campaign claims that he won 55,000 votes to just around 3,500 for Maduro.  That’s not enough to make up the difference between the two (Maduro officially won 7.575 million votes to just 7.303 million for Capriles), but it could narrow the gap.  It’s widely believed, however, that many of the votes abroad won’t make it back to Caracas — Hugo Chávez prior to the 2012 vote closed the Miami consulate, forcing south Florida Venezuelans to travel all the way to New Orleans to register their votes.

It seems fairly unlikely that a very pro-chavista CNE would countenance enough wrongdoing to hand the presidency to Capriles, so I don’t know what the endgame is here.  Though Maduro may well have won on a purely numerical count, it’s impossible to know how many votes were bought, coerced or otherwise wrung out of an electoral machine that’s blurred the lines among the state, the state-owned oil company and the governing Partido Socialista Unido de Venezuela (PSUV, or United Socialist Party of Venezuela).

So the most likely scenario is that a long, drawn-out audit confirms Maduro as the winner.  That doesn’t mean Capriles has ‘lost’ in the full sense of the word, necessarily — he’s brought chavismo to the brink of defeat, and Maduro’s weak mandate is for the continuity of chavismo, not for Maduro’s leadership in its own right.  So it will likely be a very grim denouement for chavismo between now and 2019 — and the opposition will likely continue to grow in stature prior to 2015 parliamentary elections and a potential 2016 recall election to oust Maduro.  In the meanwhile, schisms are likely to open within chavismo as Venezuela’s economy continues to worsen between those who want to double down on chavista-style socialism (or even more Cuban-style socialism) and those who want to reverse course.

It won’t be pretty, but for now, at least, it won’t be so ugly as to involve violence against opposition rallies.  Given where Venezuela started its week, that’s not the worst outcome — even if you think Capriles is the rightful winner of Sunday’s vote.

Brazil, Venezuela

Chávez’s radical antics provide space for progressive Latin American left

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In a piece for The National Interest today, I stepped back from the immediate issues surrounding Sunday’s presidential election and the fallout, increasingly tense, with challenger Henrique Capriles canceling a march today against potential fraud in the election and with president-elect Nicolás Maduro very much using the threat of state violence to shut down the opposition’s mobilization for a full recount.brazilVenezuela Flag Icon

It’s a piece I’d been hoping to write for some time, and I wish I’d published it sooner, but it’s still relevant given how much the late Hugo Chávez (pictured above in happier times with the late Argentine president Néstor Kirchner and former Brazilian president Luiz Inácio Lula da Silva) looms not only over Venezuela, but over all of Latin America.  I’ve written that his radical, anti-American antics have allowed other more moderate leftists in Latin America room to develop a truly progressive, social democratic movement for the first time ever, really.  Chávez, at home, transformed Venezuelan politics from a right-left contest to a battle between a more business-friendly, democratic left, as personified by Capriles, and a more socialist, militant leftism, as personified by Maduro.

I argue that Lula da Silva, in particular, has been incredibly canny in triangulating himself between the U.S. center of gravity and chavismo, exquisitely playing one against the other:

But the tidy duality of a moderate lulista left and a radical chavista left obscures the complex, often symbiotic relationship between the two forces. In particular, Lula da Silva was always incredibly cunning in using Chávez as a foil in hemispheric politics. Lula da Silva made three failed presidential bids prior to his election in 2002, fully four years after Chávez took power. By the time Lula da Silva took office, Chávez had arguably done more than anyone else in Latin America to make Lula da Silva seem moderate in contrast.

It’s certain that Lula’s vast social reforms would seem more radical—and may have met more domestic and international disapproval—if not for Chávez’s ad hoc expropriations and anticapitalist fulminations from Caracas. By giving Chávez his full support, he guaranteed especially kind treatment of Brazilian private interests in Venezuela, and his fervent support for Maduro in a taped endorsement earlier this month was provided in no small part to ensure kindness from a Maduro administration. Brazilian officials have already started casting aspersions on the Capriles camp, which has called for a full recount of the vote. But Lula da Silva’s support for Chávez also gently reminded U.S. diplomats that they had an interest in boosting the Brazilian model as a counterweight to the Venezuelan model throughout the region.

 

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Photo essay: Caprilistas block traffic in Caracas suburb to protest fraud

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I was in Altamira this afternoon watching the opposition protest gathering steam — it’s now apparently devolved into something much more severe, with police responding shortly after I left, complete with rubber bullets and tear gas. The metro station in Altamira was shut down shortly thereafter.Venezuela Flag Icon

For background purposes, Altamira lies in the eastern part of the city, so it’s a natural place for a pro-opposition rally. It also lies in Chacao municipality, which is technically located in Miranda state, where opposition presidential candidate Henrique Capriles serves as governor.

The CNE (the National Election Commission) confirmed the election of Nicolás Maduro as the winner of Sunday’s election, and a hasty inauguration has been scheduled for Friday.

Meanwhile, Capriles has called for calm while also calling for further protests. Caracas has been ablaze with the sounds of banging pots and pans — the cacerolazo — for the past 45 minutes, and a broader strike is scheduled for tomorrow. As I wrote last night and earlier today, Capriles and the opposition believe he has won, but it’s far from certain where the country goes from here.

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Photo credit to Kevin Lees — Caracas, Venezuela, April 2013.

 

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A primer on the MUD, Venezuela’s broad opposition coalition

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Venezuela remains in somewhat of a twilight zone following Sunday’s election — CNE (the National Election Commission) has declared Nicolás Maduro the winner by a narrow margin, but opposition candidate Henrique Capriles has refused to concede until a full audit of all of Sunday’s votes has been conducted.Venezuela Flag Icon

The following days will put a brighter spotlight on Venezuela’s opposition than at any time since the early 2000s. The last broad opposition coalition, Coordinadora Democrática, disbanded in 2004 when it lost a referendum in August 2004 to recall Hugo Chávez from office by a lopsided margin of 59.1% to 40.6%.

Capriles (pictured above with Lara governor Henri Falcón)is the standard-bearer of a new, broader coalition — the Mesa de la Unidad Democrática (MUD, the Democratic Unity Roundtable). The MUD formed in January 2008, and Capriles was selected overwhelmingly to lead it into the October 2012 presidential election against Chávez. His loss to Chávez was by a margin of nearly 11%, but it was a better performance than any presidential challenger to Chávez in 14 years.

Capriles and the MUD have a lot of hard decisions ahead.

The first involves whether they have hard information that Maduro and the chavistas falsified the vote. As Maduro had the state media, the state oil company, the public bureaucracy and then some behind him, Sunday’s election was far from fair, though Maduro may have nonetheless won an essentially free vote, despite reports of all sorts of dirty tricks. But in the poker game that’s taking place today in Venezuela, we don’t know whether the MUD is holding a straight flush or a pair of 7s.

That defines the broader second decision facing the MUD — regardless of whether it thinks it can prove electoral fraud, will it do so? Capriles has two options here.

There’s the Al Gore / Richard Nixon model, whereby he can concede defeat for the unity of the nation, notwithstanding difficult questions about the election that may well never be answered, as was the case in the 1960 and 2000 U.S. presidential elections.

There’s also the Andrés Manuel López Obrador / Mikheil Saakashvili model. This is a high-risk / high-reward model. If Capriles presses his case on all courts, the result could be like what followed Georgia’s 2003 Rose Revolution, where Saakashvili mobilized popular opinion to dispute Eduard Shevardnadze’s fraudulent victory in the 2003 presidential election. But it could also be like the 2006 Mexican presidential election, when López Obrador fought an increasingly noisome battle against what most Mexicans concluded was a narrow but legitimate victory by Felipe Calderón.

But what is the MUD? So far, it’s been relatively united in the goal of bringing Venezuela’s chavismo chapter to an end, and it seems likely that the taste of victory in Sunday’s presidential election will fuel more unity. But it’s a far from homogenous coalition.

Here’s a look at its main components: Continue reading A primer on the MUD, Venezuela’s broad opposition coalition →

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Chavismo is a continuity of — not a rupture from — the petrostate

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I tried to plumb deeper into the role of Petróleos de Venezuela, S.A. (PDVSA) before the election, and I argue in The Atlantic this morning that chavismo really marks more of a continuity with than a rupture from the petrostate clientelism that preceded Hugo Chávez — both in the 40 years of democracy in the late 20th century, as well as the era of military dictatorship that stretches back to the discovery of petroleum in Venezuela and its widespread export starting in 1918:Venezuela Flag Icon

Chavismo marked a rupture from this system in two ways. First, he diverted a larger share of Venezuela’s oil wealth to the poor than ever before — although the deployment of those funds was never incredibly efficient, nor was it without corruption. Secondly, he flattened the system through his own personality cult. PDVSA, the state oil company, has a stronger brand in Venezuela than the PSUV, the governing United Socialist Party. It was Chávez personally who doled out the gifts

It’s the second part that will make Maduro’s task especially difficult. Chávez would have been a hard act for anyone to follow, but Maduro is a bland apparatchik in contrast whose legitimacy, so long as he remains president, will forever be challenged by his narrow victory . He ran a largely defensive campaign, wrapping himself in Chávez’s legacy. Provided that his victory is upheld, it’s hardly a mandate forchavismo, let alone madurismo, but it’s not at all clear whether chavismo would ever actually work without Chávez, the personal embodiment of the latest iteration of Venezuela’s petro-state clientelism

That’s why, I argue further, Nicolás Maduro will have a very hard time maintaining the system Chávez developed, and why I think Venezuela is headed for more difficult times before it sees better times.

I argue that not only is Venezuela suffering from a sort of ‘Dutch disease’ on steroids, but that the petrostate mentality has skewed the relationship between the government and the governed:

As in oil-rich Middle Eastern countries, resource wealth skews the link between the state and its citizens… and the traditional link between government and voters is turned upside down: instead of an electorate of taxpayers holding its leaders accountable for good government, voters look support politicians who can offer the largest slice of Venezuela’s oil wealth. That’s why domestic subsidies make Venezuelan gasoline prices the world’s cheapest, at just six cents a gallon.

That was true before and during the Chávez era, and it will certainly be true after Chávez. What seemed like a relatively mature democratic system before Chávez was always institutionally weaker than it looked from the outside.

I also caution that the opposition will have to do much more than just win an election in order to break the vicious cycle of Venezuelan (mal)governance:

But if Maduro’s victory is somehow overturned and Capriles becomes Venezuela’s next president, he’ll need a lot more than a change in expectations to put Venezuela on a firmer footing. The opposition’s hopes are based on what Paul Krugman might call the “hada de confiaza” — a Venezuelan confidence fairy.

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Venezuela’s economy is tumbling despite oil prices over $100/barrel

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I wrote a piece for The New Republic earlier today about the state of the Venezuelan economy and the difficult issues that await the next president, which for now looks like it will be Nicolás Maduro following Sunday’s landmark presidential election.Venezuela Flag Icon

I argued that although some of the economic reforms that Maduro could implement are relatively simple, he may well lack the charisma, the political capital (both within and outside the chavista camp) and the funds to pull Venezuela back from the brink of two devaluations in 2013, the threat of even higher double-digit inflation, increasing reliance on imports for basic staples, a crumbling oil infrastructure, an atrophied private sector and difficulty accessing international — and even Chinese — finance:

It’s now up to Maduro to sort all of this out in the background of a legitimacy crisis. Economically speaking, there are several options that could help. Venezuela could claw back some of its oil revenues by reducing subsidies to Cuba and the rest of the Caribbean basin. He could reverse the trend of ad hoc expropriations under Chávez that left the public sector bloated with bureaucrats, the private sector fearful, and the non-oil industry atrophied. He could direct more capital to be re-invested into PDVSA, the state-owned oil company, to boost oil production that’s fallen by up to a third in the past 15 years, and to develop refining capacity, especially in light of the ultra heavy crude oil that’s increasingly being drilled from the interior’s Orinoco Belt. Venezuelans believe cheap gas is virtually a constitutionally protected right, and an attempt to eliminate it pursuant to an IMF loan package in 1989 is widely seen as the catalyst for the deadly Caracazo riots later that year, but Maduro could gingerly begin to reduce the domestic subsidy that keeps Venezuela’s gasoline the cheapest in the world at about six cents per gallon.

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Cabello comments indicate cracks in the chavista high guard?

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One key piece of data that I missed last night is the response of National Assembly leader Diosdado Cabello (pictured above), who tweeted the following last night:Venezuela Flag Icon

Profunda autocrítica nos obligan estos resultados, es contradictorio que sectores del Pueblo pobre voten por sus explotadores de siempre.

Deep self-criticism obliges us to note these results, and it’s contradictory that sectors of the poorest people have voted for their exploiters.

Cabello is the behind-the-scenes pragmatic bulldog of chavismo and he’s clearly the most relevant political leader within chavismo after the newly declared president-elect Nicolás Maduro.  Given the narrow victory that Maduro won, he may well now be chavismo‘s most relevant political leader.

That makes his rather subdued statement an important touchstone for where Venezuela’s ruling part is headed, and it’s somewhat more subtle than the full-speed-ahead, at-full-volume victory speech that Maduro delivered Sunday night.

Some background: he served as the governor of Miranda state from 2004 to 2008 — opposition candidate Henrique Capriles got his start in national politics in 2008 when he ousted Cabello by a seven-point margin to become the governor of Miranda.

Cabello has since 2012 been the president of Venezuela’s Asamblea Nacional (National Assembly), where the Partido Socialista Unido de Venezuela (PSUV, or United Socialist Party of Venezuela) and its allies control 96 seats to just 65 for the opposition.

If Maduro’s victory is not overturned following an audit of the election results, the next electoral test for chavismo will come in December 2015, when Venezuela holds its next scheduled parliamentary elections, and it seems fairly possible that Cabello and the PSUV could lose their majority.

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LIVE BLOG from Caracas: Election night in Venezuela

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CARACAS, Venezuela — Polls closed at 6 p.m. (6:30 p.m. EST) and we have no results yet. Venezuela Flag Icon

Opposition candidate Henrique Capriles within the past hour tweeted that he was alerting the world that the chavista government is trying to subvert the will of the people.

Opposition leader Leopoldo López followed up with his own tweet warning the government that ‘we know what you know.’

That’s pretty aggressive.

Results weren’t announced in the October 2012 election until around 10 p.m., but an opposition campaign source noted a couple of days ago that the later the result is announced, the better for the opposition.

9:01 pm: Francisco Toro at Caracas Chronicles is reporting that a Capriles campaign quick count shows a very narrow lead for Capriles. That’s certainly more promising than an exit poll.

Meanwhile, at Capriles headquarters, the chairman of the Mesa de la Unidad Democrática (MUD, the Democratic Unity Roundtable), Ramón Guillermo Aveledo is very bullish. He says the opposition will wait for CNE (the National Electoral Council) to announce results, but threatens that the opposition will start announcing results if the CNE doesn’t. This is in contrast to a relative angrier and defensive appearance by Jorge Rodríguez, the campaign leader of the Partido Socialista Unido de Venezuela (PSUV, or United Socialist Party of Venezuela), who spoke earlier to note that turnout was high, and called for calm.

9:16 pm: We’re sort of in new territory now.   If Capriles has indeed won, and every indications from Capriles headquarters are that he has, there’s no precedent for a peaceful transfer of power.  But after 14 years of chavismo, it’s hard to know what come next.  Even if Capriles has lost by a narrow margin, we’re in for a long (and perhaps tense) night.  Stay tuned.

9:30 pm: The Capriles campaign has the same votes as the CNE, but winning more votes doesn’t mean that CNE will just stand down, announce Capriles the winner, and thereupon peacefully transfer power.  The key arbiter in this scenario would the armed forces, and many of their leaders have a vested interest in a win by chavista candidate Nicolás Maduro.  So though the army’s leaders emerged relatively early in the evening to assert their role in protecting the vote, if Capriles has won, don’t expect an announcement, but a lot of behind-the-scenes negotiations between Capriles HQ and Maduro HQ.  After 14 years in power, and 14 years spent disrespecting much of the tenets of a liberal democracy, it’s going to be a lot more difficult.

9:35 pm: When I talked to Capriles advisers on Friday morning, they warned that if Capriles does win more votes than Maduro, the most aggressive chavista supporters, gangs of armed partisans, may well incite violence.  This is why Capriles has regularly appealed to the military to keep the peace.

When I talked to López, he struck a cautious note as well:

‘We hope that the people will be a buffer to that, the people not only voting, but the people in the streets, people defining their commitment with a new face for Venezuela,’ he said. ‘[The chavistas of course will have the intention of using what they’ve always used — violence, intimidation, abuse of power. But it’s in the hands of the people in the streets to hinder that.’

9:52 pm: We’re approaching the time when October 2012 election results were announced, and there’s not yet any indication that the CNE is about to announce a result in this election. In that election, Chávez defeated Capriles by 10.76%.

9:55 pm: As I wrote on Friday, the difference between Chávez and Capriles six months ago was 1.6 million votes — Capriles won 6.59 million votes and Chávez 8.19 million votes. Assuming the same base in today’s election for Capriles (6.59 million votes), Capriles needed to get either 19.5% of the chavista base to abstain, 9.75% of the chavista base to switch to Capriles from Maduro this time around, or some combination of the two — say, by having 9.75% abstention and a Maduro-to-Capriles swing of 5%. That’s never been incredibly outside the realm of possibility, especially given the late-breaking momentum of Capriles and the defensive campaign that Maduro’s run.

10:05 p: We’re now awaiting the first bulletin from the CNE.

10:10 pm: My source in the Capriles campaign says they won. So all eyes are now on the CNE.

10:17 pm: Pots are banging in the Sabana Grande neighborhood in Caracas. That’s the cacerolazo traditional form of protest from the esquálidos, the opposition supporters — so named because Chávez called them the ‘little squalid ones’ once upon a time. It’s a far cry from the toque de Diana that I heard earlier this morning, the horns blaring a reveille for 13 minutes starting at 3:30 a.m., long a chavista tradition. The change, in 19 hours, from the chavista horns to the caprilista pots banging, is a metaphor for the change in the air today as the opposition has become increasingly optimistic.

10:22 pm: Gunshots are ringing out — a clear sign that the chavistas want to make some noise too.

10:32 pm: It’s worth noting for non-Venezuelan readers that Hugo Chávez didn’t go undefeated in elections over his 14-year rule. He lost a referendum in December 2007 when he pushed to amend the constitution to abolish presidential term limits, curb central bank independence, and allow the president to assert more control over the selection of state governors and mayors. That overreach — and the failure of the chavista electoral machine — showed that Chávez and the PSUV wasn’t invincible.

10:40 pm: While we wait for some further news about what’s happening at the highest levels of Venezuela’s power struggle, it’s worth noting that the MUD is a very diverse group of political parties that have banded together for electoral purposes. If Capriles wins, he’ll not only face a National Assembly that’s still dominated by chavistas and an entire state infrastructure, from the bureaucracy of the government to the courts to Petróleos de Venezuela, S.A. (PDVSA) dominated by chavistas, but a very wide coalition that includes many parties. The MUD has been more successful than a previous coalition attempt, the Coordinadora Democrática, which disbanded in frustration after Chávez won a referendum to recall him from the presidency by a lopsided 59.1% to 40.6% margin in August 2004.

10:49 pm: One of the issues that Aveledo mentioned earlier tonight was the importance of every vote being counted, especially the votes of Venezuelans abroad. There’s a lot of doubt that those votes will ever fully reach Caracas, and the Miami consulate actively stood in the way of largely anti-Chávez Venezuelan expats, who traveled to New Orleans to vote in both October and again in this election. Reports from the Caracas airport earlier today suggest that only one passport agent was available to allow expats back into the country, obviously back in the country for the purpose of voting.

11:00 pm: It’s been exactly five hours since polls closed across Venezuela, and so far, radio silence from the CNE.

11:14 pm: Here come the rectors at the CNE. Maybe we’ll have an official announcement shortly. At the podium.

11:18 pm: The official announcement from the CNE, with 99.12% of votes counted is 78.71% participation, is 50.66% for Maduro to 49.07% for Capriles. Hard to believe the Capriles campaign is going to accept this, so the long night is about to get even longer.

11:23 pm: Gunshots and music blaring here in Sabana Grande. The official count is 7,503,338 for Maduro and 7,270,403 for Capriles. But no one believes that right now. First question is whether the government is making this announcement with the full support of the armed forces. Second question is whether the opposition MUD will now announce their own set of results — they have access to the same numbers as the government, so it will be interesting to see how long it takes to call their bluff.

11:24 pm: Maduro is now addressing the crowd (yes, in a tri-color jumpsuit!)

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11:26 pm: Capriles will also address the Venezuelan people shortly.

11:35 pm: Maduro is saying that Capriles called and offered a formal pact, but he said no. Caracas is ablaze with the sounds of music and fireworks from Maduro supporters. So it will be interesting to see what Capriles has to say, presumably after Maduro is done with his speech at Miraflores. If this is the actual result, or if it’s fake, it certainly makes Maduro seem like he stole the election. As Francisco Toro writes at Caracas Chronicles tonight, it really is the worst-case scenario.

11:43 pm: The CNE and Maduro will support a full recount and audit of the votes.

11:46 pm: Does anyone know how many times he’s mentioned Chávez tonight? I’ve lost track, but at least a dozen.

11:52 pm: Maduro hasn’t even finished his speech (which I suspect has run so long to prevent Capriles from speaking anytime before midnight), but Argentine president Cristina Fernández de Kirchner has already congratulated him on his victory.

11:55 pm: Maduro is done speaking, so now the focus will shift to Capriles, who has a difficult task ahead of him. The 64,000-bolívar question is whether he accepts the CNE’s results (even with the audit) or declares his own victory on the basis of his campaign’s own information.

12:02 am: Actually, no, Maduro wasn’t done speaking. Here’s Fidel Castro’s response — simply, ‘Maduro’s won, the revlution continues.’ Not exactly a ringing endorsement.

12:11 am: OK, now he’s done, with a couple of ‘viva Chávez’ and a ‘hasta la victoria siempre.’

12:13 am: For the record, even if the CNE numbers ultimately turn out to be 100% correct, it would represent a drop-off of 680,000 votes from Chávez’s victory six months ago and a gain of 680,000 votes for Capriles. Turnout dropped by just 2%, so that’s around 296,000 votes, if we assume that that dropoff came mostly from the chavista camp. That means that 192,000 chavistas switched to Capriles, or Capriles picked up 384,000 new voters. Either way, it’s a huge victory for the opposition, given where he started a few weeks ago.

12:16 am: Here’s Capriles about to give his speech.

12:19 am: Holding up a stack of voting irregularities, Capriles denies Maduro’s story about a pact, calling him a liar.

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12:23 am: Capriles will not concede or accept the result until a full recount has been held of each and every vote.

12:26 am: Says that the MUD has a different result than the one announced, but doesn’t provide the actual result.

12:27 am: ‘My pact is with God and Venezuela.’

12:30 am: Capriles is taking an aggressive tone as ever with Maduro, saying that if he was illegitimate before, he’s still illegitimate and that the results do not reflect the truth in the country. Nonetheless, Capriles is not declaring victory outright — he’s holding back from that step, at least por ahora.

12:39 am: Major general Wilmer Barrientos: “Quiero felicitar al Presidente Electo Nicolás Maduro, usted es el jefe de la Fuerza Armada Nacional Bolivariana.” So that’s where the armed forces stand.

Photo credit to Kevin Lees — Caracas, Venezuela, April 2013.

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Happy Election Day in Venezuela

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This little pajarito told me earlier Saturday, while I was hiking up El Avila, the mountain that rises to the north of Caracas, that Nicolás Maduro’s campaign has indeed been blessed by the ghost of Hugo Chávez.Venezuela Flag Icon

Just kidding — but today should be a very interesting day. Stay tuned!

Photo credit to Kevin Lees — Caracas, Venezuela, April 2013.