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Foreign Affairs
Will Chavez Lose His Luster?
By Kurt Weyland
Kurt Weyland is Associate Professor of Government at the University of Texas at Austin and the author of the forthcoming The Politics of Market Reform in Fragile Democracies: Argentina, Brazil, Peru, and Venezuela.
The Ticking Clock
On December 6, 1998, Venezuelans stunned the world by electing as their president Hugo Chavez, a firebrand who six years earlier had sought to overthrow the country's long-standing democracy in a bloody but unsuccessful coup. Fifty-six percent of voters cast their ballots for the daring outsider and his promise to dislodge the thoroughly corrupt political elite. These hopeful citizens saw a political housecleaning as the way to halt the country's prolonged economic decline, restore growth, create employment, and overcome escalating social problems.
The good life seems to have eluded Argentina once again. Unable to shake a deep recession triggered by Brazil's currency devaluation in January 1999, a country that once enjoyed emerging-market status is looking more like the same old underachiever. Three years of recession have led to an unemployment rate of nearly 17 percent, adding misery to a labor force already hard hit by deep economic adjustment in the early 1990s and rising joblessness after Mexico's 1994-95 currency crisis.Chavez has made bold moves to overhaul politics, and for a while his actions seemed to justify his nation's hopes. In nearly three years, he has transformed Venezuela's political institutions and greatly weakened the old guard. In his first year in office, he engineered a new national constitution that significantly strengthened presidential powers. One revision, for example, allows the president to run for immediate reelection rather than wait the previously mandated ten years after leaving office. Chavez took advantage of the change by holding new elections in July 2000, this time winning 59 percent of the vote. The new constitution also abolished the Senate, creating a unicameral National Assembly with limited oversight of the president's decision-making. Chavez has used this weakening of the checks and balances of executive authority to his advantage, notably by using military promotions for political gain.
These new powers, combined with the charismatic leader's own political prowess and the current dominance of his supporting coalition, suggest that Chavez enjoys a broad mandate to govern. As of the middle of this year, he continued to command high approval ratings of between 59 and 63 percent. In the July 2000 elections, parties friendly to the president captured 60 percent of the seats in the National Assembly. Opposition parties and movements are now divided and confused, having failed to contain Chavez's advances. Meanwhile, Chavez is in the process of debilitating, marginalizing, or taking over major interest groups that might otherwise oppose him, notably trade unions and business associations.
And yet, strong as his current position seems, Chavez is standing on political quicksand. He has failed to fulfill the hopes of economic rejuvenation that his election raised. The economy's meager growth since 1999 has been a particularly noteworthy disappointment, having coincided with high international oil prices that should have given Venezuela — the world's fourth-largest net petroleum exporter in 2000 — a big economic boost. The state has sought to compensate for the limited private investment in the stagnant economy by spending wildly, but its programs are poorly designed and contribute little to long-term development. Such spendthrift tactics are also short-sighted: the government's ability to prime the pumps depends on its highly volatile income from oil exports, and this flow of stimulus spending will dry up once petroleum prices drop substantially. Compounding the damage caused by misguided policies, Chavez's "revolutionary" efforts to restructure the public administration and purge the old political elite have further impaired the already feeble public sector. So the economic malaise continues, unemployment and crime rates . . .