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Colombia

Uribe returns to Colombian political life as senator

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The big headline from Sunday’s congressional elections in Colombia is the return of the powerful conservative former president, Álvaro Uribe, who won election to the Colombian Senado (Senate).Colombia Flag Icon

But the bigger story is more complicated — and the truth is that each of the two major camps in Colombian politics has something to be happy about from the weekend’s elections, which were conducted in the shadow of two important upcoming elections — a recall election involving Gustavo Petro, the leftist mayor of Bogotá on April 6 and a presidential election on May 15 (with a potential runoff to follow later in the summer).

Uribe (pictured above) has carved out a space where he now leads the main opposition to Colombia’s president Juan Manuel Santos, demonstrating his enduring popularity and his determination to play a role in Colombian governance, despite his ineligibility to run for the presidency in the future.  It will make Colombia’s congress a much livelier place, to say the least, and it will require Santos (or his successor) to work hard to maintain a working majority in the Colombian congress, and especially in the Senado.

Santos, however, should be delighted that his coalition suffered only marginal losses to Uribe’s forces.  Despite Uribe’s gains on Sunday, Santos remains the heavy frontrunner in the upcoming May 15 presidential election.  That’s in part because Uribe himself is barred from reelection, so Uribe’s new party is supporting former finance minister, Óscar Iván Zuluaga, who has far less popularity and charisma than either Uribe or Santos.

You can think of Colombia politics today as a competition between two major blocs — a centrist/center-right coalition that supports Santos and a more conservative bloc that supports Uribe.  In addition, there’s a minor bloc of leftist parties that today find themselves largely outside the mainstream of Colombian politics, with the exception of the Colombian capital, Bogotá.

Uribe formed CDlogothe Centro Democrático (Democratic Center) last year, and he ran on the slogan of ‘mano firme, corazón grande,’ or ‘firm hand, big heart,’ campaigning in opposition to Santos’s high-profile push to negotiate a lasting peace settlement with the Fuerzas Armadas Revolucionarias de Colombia (FARC, the Revolutionary Armed Forces of Colombia).  While Uribe should be happy with the results of the senatorial elections, it’s clear that the ‘Uribe bloc’ is still far smaller than the ‘Santos bloc,’ which includes three major parties:

  • The Partido Liberal Colombiano (Colombian Liberal Party), once Colombia’s largest center-left party, has converged with the other parties in the Santos-led coalition, pulling it ever closer to the center-right in recent years.  The party split over whether to support Uribe, who began his political career in the Liberal Party.  Though it fielded separate presidential candidates in both 2006 and in 2010, it will support Santos in 2014.
  • The Partido Social de Unidad Nacional (Social Party of National Unity, ‘Party of the U’) is a conservative party formed in 2005 by Liberal uribistas, and the ‘U’ once stood as much for Uribe as for ‘unidad.’  It became Colombia’s largest party in the Uribe era, and it now forms the backbone of Santos’s coalition.
  • Cambio Radical (Radical Change), founded in 1998, became increasingly important over the course of the 2000s, and it formed part of Uribe’s presidential majority in the 2000s, just as it today forms part of Santos’s presidential majority.  Like the Party of the ‘U’ and the Liberal Party, it will support Santos in the upcoming presidntial election.

The major swing vote between the two blocs is the Partido Conservador Colombiano (Colombian Conservative Party).  Like the Liberal Party, the Conservative Party dates back to the 1840s, and it was once Colombia’s chief center-right party.  It’s currently part of Santos’s coalition, but it’s the weakest link among the four parties that have backed Santos since 2010, and it’s the likeliest source of future support for Uribe.  Though it supported Uribe in 2002 and 2006 and Santos in 2010, it is fielding its own presidential candidate in 2014, Marta Lucía Ramírez, a former senator and defense minister between 2002 and 2003.  That hurts Santos by depriving him of the Conservative brand (though only a few Conservative lawmakers have actually endorsed Ramírez), but it also hurts Uribe and Zuluaga by dividing the conservative opposition to Santos.

JMsantos

Uribe guided Colombia’s transition from a country paralyzed by drug-related violence into a more secure, economically vibrant regional leader between 2002 and 2010, backed by the military and economic aid of the US government.  Despite efforts to run for a third term, Uribe bowed out of the presidency in support of Santos, his defense minister.  Santos (pictured above) easily won election in June 2010, king nearly 70% of the vote in a runoff against Bogotá mayor Antanas Mockus, the candidate of the Partido Verde Colombiano (Colombian Green Party).

Almost immediately, however, Uribe started criticizing Santos, and Uribe irrevocably broke with his one-time protégé when Santos directed the Colombian government to enter into negotiations with FARC, a leftist guerrilla group that has waged an insurgency against Colombia for the better part of the last half-century.   Continue reading Uribe returns to Colombian political life as senator →

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

The policy case for Maduro in Venezuela

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In my earlier companion piece today, I discussed the policy case for electing Henrique Capriles as the next president of Venezuela in an attempt (however vain) to separate the emotional divide in Venezuela from the policy rationales that underline each candidacy.Venezuela Flag Icon

Separating the policy from the personal is even more difficult in the case of Nicolás Maduro, however, whose campaign at every turn has been one massive embrace of Chávez, not only as a predecessor, but as nearly a deity in his own right.  So far, the Maduro campaign begins and ends with ‘Chávez,’ and there’s no guarantee that once elected, Maduro would wield a sufficient personal mandate even to take sufficient control of Chávez’s Partido Socialista Unido de Venezuela (PSUV, or United Socialist Party of Venezuela).

There’s frustratingly little substance as to what Maduro (pictured above) would do with a six-year presidency, let alone whether he could come to dominate a governing regime with a handful of key powerbrokers, such as energy minister Rafael Ramírez, finance minister Jorge Giordani, and national assembly president Diosdado Cabello, none of whom will easily step aside from their relative and significant fiefdoms in government.

But, as I asked with respect to Capriles earlier today, what policy arguments should motivate a moderate voter who enthusiastically supported Chávez in 1998 but who’s become increasingly disenchanted about the reality of Venezuelan governance and who may be flirting with supporting Capriles — is there a rational case for supporting Maduro over Capriles?  Continue reading The policy case for Maduro in Venezuela →

Venezuela

In death, the Chávez cult has become even creepier

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cheque

If you already thought that Venezuela was the Turkmenistan of Latin American politics, you need no further proof than the latest stunt on Tuesday from acting president Nicolás Maduro.Venezuela Flag Icon

In the clip below, Maduro has launched an oversized check up to the heavens to a grateful Hugo Chávez, representing the dividends received by CANTV, the Venezuelan telephone company that Chávez nationalized in 2007.  It’s another great find from Caracas Chronicles, which has been on quite a roll in the post-Chávez era in covering Venezuelan politics:

‘!Vuela, Vuela!, ¡en homenaje al Comandante!,’ Maduro exclaims (‘Fly! Fly! In tribute to the comandante!’), as red balloons (red symbolizing the color most associated with Chávez) float the check of 1,800 million bolívars upward to the skies.

As outrageous as it seems, it’s part of a series of impressions that the post-Chávez era is featuring an even creepier cult of personality in Venezuela than when el comandante was alive.

It began with the plans — now apparently aborted — to embalm Chávez and place him on display, just like Vladimir Lenin is on display in Moscow or Mao Zedong is on display in Beijing.  Those plans were belatedly phased out after officials determined that officials had waited too long after Chávez’s death in order to embalm him.

Then there are the over-the-top tributes like this, mingling the legacy of Chávez with that of Venezuelan founding father Simón Bolívar and other left-wing martyrs, and even Chávez’s Cuban benefactors have a thorough celebration of his life at Granma. 

Maduro even joked (or was it a serious claim?) that Chávez, his place in heaven secured, nudged God to make Argentine cardinal Jose Maria Bergoglio the world’s first Latin American pope.

It wouldn’t surprise me if, like in Turkmenistan, Maduro started trying to rename the months of the calendar after Chávez — there’s even a snarky website, madurodice.com, that tracks the number of Maduro’s mentions of Chávez on the campaign pre-campaign trail.

But the massive miles-long queues of people waiting to pay tribute to Chávez in death, and an extremely elegant funeral that drew nearly every leader in Latin America from Chile to México, with a ley seca (dry law) implemented to keep life in Caracas especially a bit more subdued in the potentially challenging days following Chávez’s death should have been enough to mark the extremely oversized impact that Chávez played within Venezuela’s political system — and above all in the spoils system that funneled oil wealth from the government to its supporters, from top government officials on downward.

All of this and Venezuela’s formal campaign season doesn’t even kick off until April 1.

French public intellectual Bernard Henri-Lévy has already decried the growing chavismo cult of personality:

What is less known, something that we will regret overlooking as the posthumous cult of Chávez swells and grows more toxic, is that this “21st-century socialist,” this supposedly tireless “defender of human rights,” ruled by muzzling the media, shutting down television stations that were critical of him, and denying the opposition access to the state news networks.

For Chávez supporters, there are certainly myriad policy reasons to support Maduro in the upcoming election over challenger Henrique Capriles — like him or not, he fundamentally transferred Venezuela’s oil wealth to the poorest Venezuelans in amounts unknown in nearly a century of the country’s oil wealth.  You can argue that Chávez’s redistribution of wealth has been inefficient, that his expropriations and other economic policies have left Venezuela mired in debt, a pariah of the global financial system and ill-prepared for the day that oil prices drop, and that other more moderate regimes from Perú to Brazil have notched records of poverty reduction just as impressive as — or more so than — Venezuela under chavismo. Continue reading In death, the Chávez cult has become even creepier →