A Military Populist Takes Venezuela

...Homeland For All (PPT), the closest party to ChAvez in his electoral alliance, has its origins in the split of the Radical Cause party (LCR), which had become one of the country's principal political forces in the 1993 elections...

...Nevertheless, in the context of an oil glut and declining world prices, the critics of PDVSA's plans to expand the industry with the help of foreign capital found more sympathy than in previous years...

...Caldera had been elected president on the basis of explicit promises to develop an economic model distinct from the current orthodoxy of the International Monetary Fund (IMF) and the World Bank...

...Lieutenant colonels Hugo Chavez, the principal leader of the conspiracy, and Francisco Arias, the leader of the successful uprising in the strategic state of Zulia, acquired a public notoriety which they have never lost...

...With the emergent actors, those with a populist vocation as well as others, new faces have entered the political fray and new generations finally seem to have come into political leadership...

...A month earlier, in regional and congressional elections, a group of Chavez supporters bound together in a populist multiparty alliance called the Patriotic Pole (PP) gained political prominence by capturing over a third of the votes in the group's first electoral Margarita L6pez Maya is a research his- torian at the Center for Development Studies (CENDES) of the Central University of Venezuela (UCV) in Caracas...

...The first place where this tension is likely to be felt is in the new government's organization of a national constituent assembly...

...Translated from the Spanish by NACLA...

...By 1997, the combination of a rise in the price of oil, the improved collection of non-oil tax revenues and greater discipline in public spending permitted a recovery of macroeconomic performance...

...Tenaciously pursuing constitutional reform, he surprised the country--and many of his close advisors--on inauguration day by announcing that he would call a popular referendum to decide whether or not to rewrite the Constitution by convoking a constituent assembly...

...The moderate optimism at the close of 1997 turned into deep pessimism and a general questioning of the government's handling of economic policy...

...The Caldera years were not the worry-filled years of the P6rez presidency, but life did not get any better, nor was there any recovery of political and institutional stability...

...Unemployment continued to be high and the informal economy was expanding dramatically...

...Other organizations joined the alliance in the heat of the electoral campaign...

...A few days before the new government was to take office, the interim government in place since P&rez's impeachment was forced to take over one of the country's largest banks, Banco Latino, which was on the verge of bankruptcy...

...In many political circles, this behavior has deepened concerns for Venezuela's democratic future...

...On the social plane, things were also getting worse...

...By June 1997, an estimated 45% of all Venezuelan households lacked sufficient income to satisfy their basic needs, and 19% could not meet minimal dietary requirements...

...After two years of erratic efforts to define economic policy, in April 1996, the President announced the implementation of "Agenda Venezuela"--an attenuated version of "The Great Turnaround...

...This past December 8, a retired lieutenant colonel named Hugo ChAvez Frias, the leader of a failed military coup in 1992, capped a stunning election season by gaining the presidency of Venezuela with one of the largest pluralities in the country's history...

...The last-minute anti-Chivez alliance called itself the Democratic Pole...

...The majority of LCR activists sided with a leftist faction led by then-Congressman Pablo Medina, which split from LCR and called itself PPT...

...The PP came away with about a third of the seats in the Senate and just under 40% in the Chamber of Deputies...

...or the more conservative sectors of society, the arrival of political forces with roots in the barrios has been perceived with fear and rejection...

...This has forced successive adjustments of the expected public revenue from oil sales from an initial projection of $15.50 per barrel at the beginning of the year to $11.50 by year's end...

...Once the attempt was brought under control by the government of Carlos Andr6s Ptrez, the arguments put forth by the conspirators to justify their action, as well as the attitude they conveyed in the first hours of defeat, gained them public sympathy...

...In the initial days of his presidency, however, he has once again roiled the waters...

...Since October 1997, however, the price of oil has been tumbling to new lows on world markets, falling by 34% over the course of 1998, according to Central Bank figures...

...climbed to 56% of the vote in the December presidential contest...

...The dismal performance of AD and COPEI signals more clearly than Caldera's independent victory in 1993 the decline of the country's old two-party system...

...Since then, MBR-200 has reconstituted itself as a civilian-military political organization with Chavez as presidential candidate...

...The victory of Chavez and his Patriotic Pole rode on the unresolved transition of Venezuelan society...

...Chfivez's announcement--or decree--may be an early warning of a governing style that does not respect democratic practices and dialogue...

...All these positions, of course, are staunchly antineoliberal...

...But the intense-and at times awkward-campaign they launched against him ended up benefiting Chivez...

...Its name comes from the desire to emulate the conduct and action of Sim6n Bolivar, and the number 200 refers to the bicentenary of the Liberator's birth in 1983, the year the conspirators say they initiated their activities...

...PNrez's program was the first coherent attempt to overcome the crisis of the exhausted oil-rent model by means of a neoliberal program...

...If, on the other hand, the new government seeks a democratic dialogue in search of a new national project to further the interests of the impoverished and excluded majority, the process will be very different...

...President Caldera kept a low profile, but two days before the elections he made clear in a speech to the National Guard that the government would guarantee and respect the electoral results and democratic institutionality...

...The most important of them was the Movement Toward Socialism (MAS), whose leadership since early 1998 had been debating various electoral options, including the candidacies of the former Miss Universe, Irene SAez, and Henrique Salas Romer...

...Yet it signaled the beginning of the worst financial crisis of the century, and compelled the federal treasury to inject funds totaling about 10% of Venezuela's gross domestic product (GDP) into the banking system...

...Chavez's candidacy, if unpopular among the leadership, had always enjoyed wide support among the rank and file, and a MAS-MVR alliance proved to be advantageous for both parties in the congressional and regional elections...

...And a leftist party called Homeland for All (PPT), born around the same time, won three state governorships and placed sixth on the list of political organizations...

...Not only the method of choosing representation, but the very tasks and procedures the assembly assigns to itself will be important...

...In the parliamentary elections, no party or alliance gained an absolute majority in the new Congress...

...This severe fall in world prices produced a $7 billion reduction in public oil revenues, forcing a budget cut of $2.3 billion and a fiscal deficit of at least 5% of GDP...

...This promise was quickly frustrated...

...From a third of the vote in November, the PP A soldier directs voters on election day in a Caracas suburb...

...In outlining his economic policies, he announced that the CTV would no longer participate in the tripartite economic discussions among business, government and labor, which would now become twoway discussions in which he would represent the interests of labor...

...Caldera had taken office in February 1994, on the heels of a major attempt to restructure the economy known as "The Great Turnaround...

...ince he launched his campaign in 1997, Chivez's fiery rhetoric allowed his adversaries to mount a campaign to demonize him...

...The life of MBR-200 has been intense and unique...

...The opposition thus formed the last-minute Democratic Pole in support of the candidacy of Salas Rimer, but to no avail...

...A constituent assembly which is inclusionary in its makeup, transparent in its procedures and intensely focused on the writing of a new democratic constitution, might create a document which takes all Venezuelans into account and, in so doing, help them take the first hopeful steps of the twenty-first century...

...ChAvez's overwhelming victory and the significant regional and national gains of the PP in November climaxed a year in which Venezuelans, reeling from two decades of declining living standards, were stung by the drastic drop in the international price of oil, the country's principal export commodity...

...The uncertainty which was aggravated at the outset of 1998 by the insistent fall in oil prices, made the modest achievements of the Caldera government seem temporary and deepened the country's pessimism about the current economic model...

...His speech was transmitted nationally-an unusual move-suggesting the seriousness of the situation...

...Since 1997, the MVR has counted on the active support of many old experienced cadres of the Venezuelan left...

...By November 8, the date of the regional and parliamentary elections, the principal groups that made up the PP alliance-MVR, PPT and MAS-had agreed upon a common slate of candidates...

...Chivez's campaign dis14NACLA REPORT ON THE AMERICAS 14 NACIA REPORT ON THE AMERICASUPDATE / VENEZUELA For the more conservative sectors of society, the arrival of political forces with roots in the barrios has been perceived with fear and rejection...

...The overwhelming margin of Chivez's victory came as somewhat of a surprise...

...Urban riots, two coup attempts and the anti-neoliberal victory of Caldera at the polls that year were among its results...

...The polarization that occurred toward the end of the campaign clearly favored ChAvez more than it did Salas...

...The two parties that had long dominated Venezuelan politics, Democratic Action (AD) and the social Christian COPEI, lost ground in the regional and congressional elections and ran so far behind in the presidential race that five days before the elections they abandoned the lists and threw their support behind a center-right independent named Henrique Salas Romer, ChAvez's closest rival...

...course was the only one of all the presidential candidates to give a prominent place to the impoverished and the excluded, and to value them as citizens...

...VOL XXXII, No 5 MARCH/APRIL 1999 0 F 11UPDATE / VENEZUELA The outgoing administration of President Rafael Caldera (19941999) had been unable to come up with an economic strategy to replace the exhausted statist model based on oil revenues...

...In 1994, a few weeks after taking office, in a skillful step toward reconciliation and governability, President Caldera dismissed charges against the coup leaders...

...For nearly ten years prior to the 1992 insurrection, it existed as a basically military group which operated in the 12NACIA REPORT ON THE AMERICAS 12 NACIA REPORT ON THE AMERICASUPDATE / VENEZUELA Workers remove a poster of defeated presidential candidate Henrique Salas R6mer...

...This event marked the public birth of the Bolivarian Revolutionary Movement 200 (MBR200), the political-military organization which became the electoral Fifth Republic Movement (MVR...

...His remarks at a public rally that he would "sweep AD from the face of the Earth," and "fry the heads" of AD and COPEI, and his declarations that those who opposed a constituent assembly could simply be sent to jail provoked angry and worried responses not only from his opponents but from the public at large...

...Chavez will have to display a steady political hand to overcome those who are intransigently opposed to any proposals of constitutional reform, neutralize or win over those who are less intransigent, and strengthen and consolidate those who favor reforms...

...Nationalism, understood as the defense of sovereignty in an increasingly globalized world, is embodied in the PPT's defense of the public ownership of the country's oil reserves and its opposition to the privatization of basic industry and to the passive acceptance of the country's huge foreign public debt...

...This restructuring was presided over by long-time AD politician Carlos Andr6s P6rez--whose presidency was cut short when he was impeached for the "misappropriation of funds" -and was guided by the multilateral financial agencies...

...The only candidate who expressed any disagreement with the oil industry was ChAvez, and many of the critics and opponents of the country's oil policy over the past years ended up joining the Patriotic Pole...

...Chavez's attempt to politicize judicial decisions suggests little respect for institutionality, confusing those who run the institutions with the institutions themselves...

...This confusion has also been evident in his attacks on the AD-affiliated Venezuelan Confederation of Workers (CTV...

...Less strident but equally strong were the tensions between the PP and the state-run oil corporation, Petr6leos de Venezuela (PDVSA...

...In the poorest neighborhoods, infant morAttempts to demonize Chavez-by portraying him as a fascist and an antidemocratic instigator of violence-backfired...

...Throughout the campaign, ChAvez was portrayed as an VOL XXXII, No 5 MARCH/APRIL 1999 13UPDATE / VENEZUELA authoritarian fascist, an antidemocratic instigator of violence and someone who would go to any lengths to win, even if that meant sweeping away the country's democratic institutions and unleashing a reign of terror which would end up in a civil war...

...The fiscal austerity measures, while achieving some positive macroeconomic results in the first years, unleashed sociopolitical and institutional instability of vast proportions...

...Another prominent PPT leader, Ali Rodriguez, has been appointed Minister of Energy...

...In the days immediately preceding the presidential vote, rumors abounded of a planned military coup to prevent ChAvez from being elected...

...The consensus around questions of democracy is not as clear but involves a stronger emphasis on participatory rather than representative democracy, as well as a broader conception of democracy to include social equity and equal economic opportunity...

...PP gubernatorial candidates were victorious in eight of the country's 23 states, and placed second in ten of the remaining 15 state contests...

...The main themes expounded by the PPT are nationalism, antineoliberalism and participatory democracy...

...Luis E. Lander is a social researcher at the Economics and Social Science Faculty (FACES) at the UCV...

...The name change was necessary because in Venezuela the name of Bolivar is a national symbol which by law cannot be used for electoral purposes...

...n February 4, 1992, a failed military insurrection led by a group of unknown junior officers shook Venezuela...

...Unlike the coup attempts at the dawn of the country's democratic era in the late 1950s and early 1960s, this one was not rejected out of hand by the Venezuelan public...

...The fact that he had been responsible for a military uprising was a key element in this effort...

...In addition, his skillful management of the emblems and symbols of the nation apparently stimulated a very needed recovery of self-esteem among Venezuelans, who had lived through 20 years of the disintegration of both public and private life...

...The party brought a contingent of experienced social and political activists to ChAvez's candidacy, and has enriched the alliance by incorporating its knowledge of both the institutional and popular politics of the recent past...

...But concerns linger over his commitment to democratic instituitions...

...MAS has a large regional base, including four governorships, and by the time the alliance took shape, ChAvez's candidacy was already at the head of the presidential polls...

...In a speech on February 12, he called on the Supreme Court, "in the name of millions of Venezuelans," to listen to the people and not to "corrupt politicians and thieves...

...outing...

...Among the parties in this new alliance, ChAvez's Fifth Republic Movement (MVR), an organization a little more than a year and a half old, won the second-largest representation in the country's new multiparty Congress...

...And in the midst of a deepening malaise, it had become clearer than ever that the country's traditional political powers were unwilling to change the rules of the political game...

...These two organizations formed the hard nucleus of the Patriotic Pole, giving the alliance an unmistakable popular stamp...

...Only by the middle of the year did the party decide to support Chtvez and form part of the PP...

...The ad was censored by the National Electoral Council, but it had provoked such public ridicule that it further damaged the party's reputation...

...The results of December 1998 make it likely that there will be a permanent redrawing of Venezuela's political map...

...The most important political event of his first year of government, and that which will have the greatest long-term impact on Venezuelan society, is no doubt the calling of a constituent assembly...

...The support of MAS reinforced this position...

...This prompted the industry's spokespeople to join the campaign against the candidate, accusing him of being ignorant, badly advised and a defender of outdated ideas...

...The presidential elections attracted over a million additional voters, most of whom evidently voted for Chavez...

...In dealing with institutions that are particularly fragile, like the judiciary, Chivez has taken a hard line...

...silence of the barracks, its leaders studying and evaluating the Venezuelan political situation in order finally to conspire against the established political order...

...In the November elections, party leader Medina was elected to the Senate, and since has been appointed by Chivez to head the PP's commission to call for a national constituent assembly-a forum which would reform the country's Constitution...

...The split was provoked in February 1997 by the party's 1993 presidential candidate, union leader Andr6s Velasquez, who wanted to moderate the party's political discourse...

...This move was interpreted by the incoming president as "the tail end of the moral and economic crisis" of the previous years...

...In the period between winning the election and assuming office, Chavez has successfully reversed the campaign to demonize him...

...Ch&vez will find it difficult to create an equilibrium between the expectations of change expressed by the electorate and the necessary construction of consensus required for the permanence and consolidation of democratic rules and procedures...

...In addition, the elections took place as the country's long, uncertain "transition" from its old habit of living on onceabundant oil rents seemed to lose all direction and energy...

...Among traditional Venezuelan elites, comments suggesting social and even racial prejudice have surfaced-attitudes rarely expressed in public debate during the country's democratic period...

...If the new government's principal objective in this process is simply to replace the country's old exhausted leadership with a new set of hegemonic political actors, the process will be exclusionary and nonparticipatory...

...tality is now 2.5 times higher than the national average, and life expectancy in the lowest income quintile of the population is 12 years less than average life expectancy in the highest two quintiles...

...Though there were certain actions that created apprehension and opposition, like his announced intention to invite the exiled former dictator Marcos P6rez Jim6nez to his inauguration, he established a network of relationships and developed a style which permitted him to be seen as open and receptive to dialogue...

...In addition to these genuine democratic concerns, the traditional political actors, especially AD and COPEI, the business elite, the mass media, sectors of the armed forces and some prominent "opinion makers," perceived in ChAvez a threat to the political system of which they were, to one degree or another, privileged members...

...The November results led the worried adversaries of the PP to constitute an alternate electoral pole for the December elections, reasoning that they could unite the two thirds of the electorate who had voted against the candidates and proposals of Chivez...

...This did not happen until April 19, 1997, however, when the organization decided to compete in elections and created a political structure, the MVR...

...The financial burden on the federal government limited its ability to design and put into practice its own economic model...

...Crisis and uncertainty had thus been in the Venezuelan air for quite some time, and the forces of the PP were able to articulate the fears and anger of the most disaffected sectors of the population...

...There was also a higher level of voter participation in December...

...This created an atmosphere, principally within the business community, of relief and moderate optimism, seeming to foreshadow the beginning of a process of recovery and resolution of the country's long-standing economic crisis...

...For example, an AD television spot showed a group of poor Venezuelans standing around a pot of boiling oil saying they would have to fry all of Venezuela because "we are all adecos (members of AD...