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Historic referendum to decide fate of Venezuela's Hugo Chávez
The Washington Diplomat / August 2004

By Larry Luxner

On Aug. 15, millions of Venezuelans will vote in a referendum whether to oust President Hugo Chávez. It's the first recall election of its kind in Latin American history, and its outcome will determine Venezuela's relationship with the United States for years to come.

Bernardo Alvarez is sure his man will prevail — or at least that's what he tells the press.

In a lengthy interview last month, Venezuela's ambassador in Washington insisted that only 38% of Venezuela's 26 million people favor the idea of a referendum on Chávez, as opposed to 60% in February 2003.

"When President Chávez accepted, as it should be, the idea of a referendum, it was a surprise for many people except us," he said. "In a way, his critics didn't have anything to say, because their position had been, 'this guy will never accept a referendum about himself.' But it was put by us in the constitution, and this is the first constitution in the Western Hemisphere that allows people to demand a recall of any publicly elected official."

The wording of the referendum question itself is as follows: "Do you agree with leaving without effect the popular mandate, granted through legitimate democratic elections, to citizen Hugo Rafael Chávez Frias as president of the Bolivarian Republic of Venezuela for the current presidential term?"

The consultation will decide if Chávez finishes his term as scheduled in December 2006 — or if early elections will be held. The text, which does not include the words "revoke" or "ratify," will appear on the screens of 19,000 voting machines to be installed throughout Venezuela for 12.5 million eligible voters, who will have to decide "yes" or "no."

None of this would matter too much to the Bush administration, except for the fact that Venezuela ranks as the fourth-largest crude oil supplier to the United States after Canada, Saudi Arabia and Mexico, providing 12-14% of all U.S. petroleum imports. Of the roughly 2.9 million barrels of oil produced by Venezuela every day, about 1.5 million goes to the United States, where government-owned Petróleos de Venezuela S.A. (PDVSA) owns a number of refineries as well as the Citgo gas station chain, in which it has a $12 billion investment.

With gasoline already retailing for well over $2 a gallon, any political unrest in Venezuela that pushes oil prices even higher is likely to have serious political repercussions in an election year.

Even so, neither Democrats nor Republicans seem thrilled with Chávez and his antics.

Last month, Chávez accused Washington of bankrolling the campaign for a "yes" vote on Aug. 15, in in order to open Venezuela's oil industry to foreign investment.

"Evidence that has come to me that Bush is financing this plan shows once again what I have said all along, that the fight is not between us and opposition," the Venezuelan president told supporters July 11. "It is Chávez against Bush."

Chávez, a former army paratrooper who attempted to overthrow President Carlos Andrés Pérez in 1992, was elected only six years later with the overwhelming support of millions of poor people who had never shared in the country's enormous oil wealth. But Chávez quickly alienated the Clinton administration with his heavy-handed tactics against opposition parties at home —not to mention his well-advertised friendships with dictators like Fidel Castro, Moammar Gadhafi and Saddam Hussein.

As protests against Chávez mounted, the president's popularity fell from a high of 80% shortly after his election to around 30%. Relations with the United States took a further dive after the Sept. 11 terrorist attacks, when Chávez accused Washington of "fighting terror with terror" during the war in Afghanistan.

Bilateral ties worsened following an April 2002 coup against Chávez, which Alvarez blamed on "officers in the Venezuelan army, financed, guided and encouraged by incredibly wealthy interests, both domestic and international, and aided by a subjective and partisan national press."

The coup lasted no more than a few days, after which Chávez was restored to power. Yet the economy shrank by 10% last year and is growing this year largely as a result of record high oil prices, since petroleum exports account for 85% of Venezuela's foreign exchanage. Even so, demands for Chávez's resignation haven't let up.

"The opposition is very complex," Alvarez told the Diplomat. "It consists of many sectors — from the extreme right wing to the extreme radical left — and the only thing uniting them is that they want Chávez out. Some sectors of the opposition, after promoting a coup d'etat, signed a decree that abolished the constitution and the rule of law, and tried to paralyze the economy."

Alvarez adds: "We are optimistic, in the sense that we have been able to fight the non-democratic sectors of the Venezuelan opposition. So for us, it's a victory."

And what would happen in the event voters elect to boot Chávez from office?

"If he loses, there will be general elections in 30 days. We have to respect the results," said Alvarez with a smile. "But I'm sure he will win."

Just in case anyone doubts where the ambassador's loyalties lie, Alvarez proudly points to a big color poster dominating his office. It shows the populist president with a group of children. On top is the slogan "Chávez is the people," and on the bottom, "Now Venezuela is for all!"

It should be pointed out that Alvarez is a longtime Chávez supporter. Several months before the 1998 election that brought Chávez to power, he visited Washington in an attempt to persuade State Department officials to give the candidate a visa in the event he won the election. Following his landslide victory, Chávez visited President Clinton at the White House, with senior U.S. officials portraying the meeting as a success.

He also appointed Alvarez vice-minister for oil and gas, a subject on which the ambassador is somewhat of an expert.

Alvarez says Venezuela's economy, which shrank 9.2% in 2003, is likely to grow by 10% this year — the best performance in Latin America. But that's largely due to oil prices of nearly $40 a barrel.

"We have had higher prices in the past," he said. "The difference now is that we've been able to channel most of this extra income into very aggressive and far-reaching social programs in education, health, food and economic production. In health, we are reaching more than 10 million people, and for the first time, we have a real professional tax collection system."

Asked why the Bush administration seems to hate Chávez so much, Alvarez replied that the U.S. government takes its cues from Venezuela's privately owned newspapers and TV stations, which are bitterly opposed to Chávez.

"We have been subjected to the most extraordinary media campaign against us," Alvarez complained. "President Chávez has been called a dictator, crazy, a clone of Fidel Castro. He's been accused of fomenting unrest in Argentina, Ecuador and Bolivia. We've been accused of expropriating property, although we haven't expropriated anything. The Washington Post said Chávez ordered the killing of demonstrators, and we've proved that this was not true."

Chávez may not be a clone of Castro, but the strong comraderie between the two leaders does concern Washington deeply. And many of Chávez's strongest critics at home accuse the Venezuelan president of wanting to set up a communist dictatorship modeled after Castro's Cuba.

Alvarez once again defends his boss, arguing that relations between Washington and Caracas have taken a definite turn for the worse since George W. Bush moved into the White House.

"The Clinton administration wasn't hostile, but there was a clear perception that from the very beginning, the Bush administration — dominated by ideologues — would be very hostile to Venezuela," he said. "Some of these Cuban exiles in the administration see Venezuela as a consolation prize, since they have not been able to overthrow Castro."

Far from trying to sweep Venezuela's growing friendship with Cuba under the carpet, Alvarez is eager to talk about the subject.

"We feel proud of the relations we have with Cuba. I think it's a relationship based on mutual respect. We have been cooperating extensively — particularly in social issues — and we don't agree with the policy of the blockade against Cuba. This is not only Chávez's position, but Venezuela's position. The isolation of Cuba is a dream of the United States."

One reason Cuba is so important to the Chávez government is that it has sent an estimated 12,000 doctors to Venezuela. Many of them work in the worst slums of Caracas, providing medical services in areas where even Venezuelan doctors won't venture.

Cuba is also an important customer for Venezuelan oil, buying 53,000 barrels at preferential prices under the San José accord and a similar amount on the regular market.

"We are now supplying Cuba more than 100,000 barrels a day, so Cuba is a premium market for us. In fact, Cuba has become one of the best markets for Venezuelan oil over the years, because they're a large country and they consume a lot."

And that's not all, says Alvarez.

"We have been discussing investments in Cuba for a long time. We have created an important oil supply and technology sector, and there might even be some attractive opportunities for Venezuelan private companies to participate in the secondary recovery of some oilfields," he said. "In the future, Cuba might start becoming a major oil producer. We think it's important for Venezuela to participate in those developments.

"We want the public to see the reality. In Lara state, we are rehabilitating an old sugar mill with Cuban technical help. We have also adopted a Cuban technique supported by UNESCO to teach thousands of people how to read and write. What can you have against two countries cooperating in social programs, economic development and technology?"

Actually, quite a lot, say critics of Chávez.

Opponents claim the president is trying to weaken the private sector, which overwhelmingly opposes his mandate. They also accuse him of trying to replace Venezuela's market-driven economic system with Cuban-style distribution programs run by the government.

Alvarez denies charges that Cuban doctors are being sent to the barrios of Caracas to indoctrinate Venezuelans into believing in communism.

"The best way to see how good a doctor is, is to ask the people," he said. "People are not stupid. These guys have to go there and live in the communities, and they're dedicated to preventive medicine. There's a sense of solidarity. And thousands of people have gone to Cuba for cures, people who thought they never had a chance. We have historical ties with Cuba, and we'll never support the isolation of Cuba."

Yet Alvarez refused to criticize Castro's human rights record in any way.

"We have to discuss human rights all over the hemisphere. We don't believe in countries that try to portray themselves as the judge. Cubans have their own constitution, and we respect self-determination."

Notwithstanding its friendship with Fidel Castro, Venezuela badly needs U.S. investment — but even Alvarez concedes that's not likely to happen until the current political crisis is resolved.

And that probably won't happen as long as Chávez remains in power, but the ambassador says the current impasse between the two countries is the fault of Washington, not Caracas.

"The United States has to rethink its attitude towards Latin America," says Alvarez. "Looking only at free trade and the war against terrorism doesn't give you the tools to understand the region. Unfortunately, I'd say that the more ideological side of the State Department has prevailed over the more pragmatic side. We hope that will change soon."

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