Life after Chavez
Life after Chavez

Within minutes of the announcement of the death of Venezuelan President Hugo Chavez, media outlets worldwide covered this breaking story. Considered larger than life, Chavez ruled Venezuela with an iron fist for the past 14 years. In 1998, Chavez came to power through the ballot box, but he swiftly decimated potential opponents and consolidated power. He wrote a new constitution that expanded the president’s and the military’s powers. It theoretically protected private property, human rights, and an independent judiciary (Now for the reckoning, 2013).

Nicolás Maduro, Venezuala’s Vice President and Chavez’s hand-picked successor, called for new elections on April 14, 2013. Opposition candidate Henrique Capriles, who lost the last elections in October 2012, has already declared his run for the presidency as well. No one is sure which candidate will win since Maduro may gain sympathy votes, though no one is disregarding Capriles. Whoever wins will have to deal with chronic food shortages, low currency reserves, depleted government coffers, inflation, and high crime.

This news analysis will examine the future of Venezuela, future of South America, and the future of U.S.-Venezuelan relations in a post-Chavez era.

Venezuela Post-Chavez

Chavez leaves a mixed legacy to Venezuela. On the positive side, Chavez improved the lives of poor Venezuelans by providing primary health care and a free college education.  He cut poverty in half and extreme poverty by 70 percent (Weisbrot, 2013). It will be hard for any leader to remove these popular and costly social programs.

The rest of Chavez’s legacy is not as positive. The country is certainly less democratic than before Chavez took power. The military, courts, legislature, and government offices are filled with Chavez supporters that were appointed or elected (Now for the reckoning, 2013). If Maduro is voted president, he is unlikely to improve Venezuela’s democracy or change the political landscape.

On the economic front, Chavez nationalized the oil sector and food companies, expropriated farms and factories, and controlled capital flows. The end result was decreased foreign investment, decreased output of textiles, cattle, sugar and steel and an increased reliance on imports. Venezuelan imports went from $10 billion in the 1990s to $59 billion in 2012.

To counter the reliance on imports, in February 2013, the government devalued its currency (the Bolivar) by 46.5 percent. Basic household items are already scarce and are often bought on the black market for inflated prices (Kraul and Mogolon, 2013). Further devaluations will bring more inflation, so are not likely. The next leader is unlikely to privatize these companies or give up control of capital flows because of the amount of money these firms provide the current government.

While many of Chavez’s policies failed, changing them will be difficult. Cuba will try to keep Maduro in power, as he is likely to continue to give Cuba subsidized oil. In return, Cuba will give Maduro state security agents , which he needs to stay in power. Unlike Chavez, Maduro has weak military ties and risks being overthrown (O’Grady, 2013). The opposition, on the other hand, might try to reduce the costly oil giveaways to Cuba, but they will still need to stimulate local production. In return for oil, many Latin American countries provide payments in kind, such as chicken, soybeans, wheat or clothing (Neuman, 2013) and without these low cost imports, prices for goods will rise even further. Few believe that Venezuela will change dramatically in the coming years.

South America Post-Chavez

Chavez had strong supporters as well as critics across South America. Those that supported him will try to continue Chavez’s policies that they felt strengthened the continent, while critics may fight for a different approach.  Leaders (and countries) that supported Chavez include: Castro (Cuba), Cristina Fernández (Argentina), Evo Morales (Bolivia), and Rafael Correa (Ecuador).

Chavez-supporter and former president of Brazil (2003-2010), Luiz Inacio Lula da Silva, wrote a New York Times editorial (2013) extolling Chavez’s contribution to South America:

Mr. Chávez was instrumental in the 2008 treaty that established the Union of South American Nations, a 12-member intergovernmental organization that might someday move the continent toward the model of the European Union. In 2010, the Community of Latin American and Caribbean States leapt from theory to practice, providing a political forum alongside the Organization of American States. (It does not include the United States and Canada, as the O.A.S. does.) The Bank of the South, a new lending institution, independent of the World Bank and the Inter-American Development Bank, also would not have been possible without Mr. Chávez’s leadership. Finally, he was vitally interested in fostering closer Latin American ties with Africa and the Arab world.

The future prominence of Union of South American Nations (UNASUR) and the Community of Latin American and Caribbean States, both formed from mergers of existing bodies, is unknown. Analysts have not discussed whether these regional bodies will become more or less important in a post-Chavez world. Only time will tell whether South American countries will prefer these forums to those that include the United States. Furthermore, the Bank of South is not expected to become fully functional until sometime in 2013, so again it is hard to say whether it will offer a robust alternative to World Bank and the Inter-American Development Bank.

Chavez’s influence over Latin America declined after 2006. While most of Latin America bounced back after the 2008-09 world economic slow-down, Venezuela did not (Now for the reckoning, 2013). Chile, Brazil, Peru, Mexico and Colombia all followed different economic models and are now relatively well-off. Chile, Peru, Colombia, and Mexico all support free trade, while Brazil’s economic model is consider to be middle-of the-road.  Brazil provides many social services though respects private enterprise. Many analysts feel that Brazil’s model may spread across the continent, as few believe socialists models supported by Morales or Correa will succeed since neither have the clout nor the largesse to lead a socialist revolution across South America (Hugo Chávez’s rotten legacy, 2013).

US-Venezuelan relations Post-Chavez

Relations between the United States and Venezuela were rocky during the Chavez years. On the one hand, Chavez spoke often harshly about the United States leaders and befriended U.S. foes, such as Iran. On the other hand, the United States is the biggest importer of Venezuelan oil, importing about one million barrels of crude per day (Ladislaw and Verrastro, 2013). Chavez worked behind the scenes to keep the trade relations strong between the two countries (Neuman and Thompson, 2013).

U.S. officials reached out to Maduro over the past year and held three informal meetings with him. However, soon after Chavez was declared dead, Maduro expelled two American military attaches, claiming they plotted against the country. Many view Maduro’s move as a way to strengthen his own position in the upcoming elections, rather than a true denunciation of the U.S.-Venezuelan relationship (Neuman and Thompson, 2013). Analysts do not expect any major breakthroughs in the U.S.-Venezuelan relationship in the immediate future.

Conclusion

Chavez was undoubtedly a figure of historic proportions. The changes he put in place in Venezuela are unlikely to change in the coming years. Changing these policies will require major structural modifications to the country’s economic and political system, which are unlikely because of the economic hardship it will cost the average Venezuelan.  Making painful concessions are not easy when a politician is seasoned and well-liked, and even more difficult for a new leader that has not yet gained the trust of his or her constituents. Prediction: Venezuela faces a bump road ahead.

Works Cited
da Silva, Luiz Inacio Lula. (2013, March 6). Latin America after Chávez. The New York Times. Retrieved from: http://www.nytimes.com/2013/03/07/opinion/latin-america-after-chavez.html?hp&_r=0

Hugo Chávez’s rotten legacy (2013, March 9). The Economist. Retrieved from: http://www.economist.com/news/leaders/21573106-appeal-populist-autocracy-has-been-weakened-not-extinguished-hugo-ch%C3%A1vezs-rotten

Kraul, C. and Mogolon, M. (2013, March 6). Hugo Chavez successor inherits goodwill, hard times. Los Angeles Times. Retrieved from: http://www.latimes.com/news/nationworld/world/la-fg-venezuela-maduro-20130307,0,1324669.story

Ladislaw, S. and Verrastro, F. (2013, March 7). Post-Chavez outlook for Venezuelan oil production. Retrieved from: http://csis.org/publication/post-chavez-outlook-venezuelan-oil-production

Neuman, W. (2013, March 7). On eve of his funeral, debating Chávez’s legacy. The New York Times. Retrieved from: http://www.nytimes.com/2013/03/08/world/americas/on-eve-of-his-funeral-debating-chavezs-legacy.html?hpw

Neuman, W. and Thompson, G. (2013, March 6). A leader cries, ‘I am Chávez,’ as U.S. seeks policy clues. The New York Times. Retrieved from: http://www.nytimes.com/2013/03/07/world/americas/a-leaders-cry-in-venezuela-i-am-chavez.html?hp

Now for the reckoning (2013, March 5). The Economist. Retrieved from: http://www.economist.com/blogs/americasview/2013/03/venezuela-after-ch%C3%A1vez

O’Grady, M. A. (2013, March 6). Venezuela after Chávez. The Wall Street Journal. Retrieved from: http://online.wsj.com/article/SB10001424127887324128504578344620552736516.html?mod=djemEditorialPage_h

Weisbrot, M. (2013, January 4). Continuity likely even without Chávez. The New York Times. Retrieved from: http://www.nytimes.com/roomfordebate/2013/01/03/venezuela-post-chavez/venezuelans-will-vote-with-their-wallets

* Pictures: http://www.flickr.com/photos/quecomunismo/2070631844/sizes/z/in/photostream/
http://www.flickr.com/photos/wdm/7687254226/sizes/z/in/photostream/

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