How Chavez Does Business
Twenty-First-Century Socialism and Venezuela’s Soaring Stock Market
Article Summary and Author Biography
For more than a decade, Chávez’s popularity has remained high because of his strong support from the country’s poor. But his strategies to entice the neediest have reached their limit. Now the socialist president's future depends on his counterproductive and schizophrenic relationship Venezuela's private sector.
JAVIER CORRALES is a professor of political science at Amherst College and co-author of the forthcoming book U.S.-Venezuela Relations: Coping with Midlevel Security Threats.
Capsule Review
Easily the best scholarly treatment of Hugo Chávez's hybrid electoral autocracy, Corrales and Penfold's book courageously refutes orthodox explanations -- from the right and the left -- for this unique caudillo's rise and resilience.
Snapshot
Venezuela's United Socialist Party is already facing a succession battle between two prospective successors to Hugo Chávez: Nicolás Maduro, an avowed communist and close friend of Cuba, and Diosdado Cabello, a former military official with ties to the country's business community. Whichever man wins, he will have to remember that Chávez has skillfully relied on a mix of both strategies to win the love of his people -- strident anti-americanism and largess for the poor on the one hand, and kickbacks to big business and billions of dollars in oil sales to the United States on the other.
Chávez duking it out on the campaign trail. Click here to see an interactive graphic explaining how Venezuela's economy has fared under his rule. (Courtesy Reuters)
After almost 14 years in office, and with an impressive record of electoral victories behind him, Venezuelan President Hugo Chávez now faces the most challenging campaign of his political career. Venezuela's economy is weak, and, for the first time since 1998, Chávez, who has cancer, could suffer defeat when the country goes to the polls, on October 7.
The conventional wisdom is that Chávez's prospects will depend, as they have in the past, on his strong support from the country's poor. He has spent years developing social programs to dole out state funds to those in need, and the tactic has made him wildly popular. But that strategy alone might not work this time around. Chávez's electoral fortune today depends not so much on his connections to the poor but on his approach to Venezuela's private sector.
Chávez has long undercut private enterprise, which has resulted in a weak economy that is hurting his appeal to voters. (Click the image to the right to see how.) But he can also use economic troubles to demonize the private sector and rally ideological voters. This complicated relationship to the private sector explains why, this this time around, Chávez's candidacy is damaged but still afloat.
PROBLEMS TO THE PEOPLE
