US Policy Toward Hugo Chávez's Venezuela Teaching Notes By

US Policy Toward Hugo Chávez's Venezuela Teaching Notes By

Council Special Report Living with Hugo: U.S. Policy Toward Hugo Chávez’s Venezuela Teaching Notes By Richard Lapper Latin America Editor, Financial T...

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Council Special Report Living with Hugo: U.S. Policy Toward Hugo Chávez’s Venezuela Teaching Notes By Richard Lapper Latin America Editor, Financial Times; Author, Living with Hugo: U.S. Policy Toward Hugo Chávez’s Venezuela

The radicalization of the Hugo Chávez government in Venezuela has presented U.S. policymakers with one of their most difficult challenges in the hemisphere. Chávez took office in January 1999 on a program of cleaner government and moderate social reforms. His policies were aimed at improving the lives of low income groups sidelined from the benefits of development achieved since the 1950’s. Although he initially sought to present himself as a follower of the “third way” of Britain’s Tony Blair, his government has pursued a much more traditional state-centered socialist approach to development. Chávez has increased control over Venezuela’s oil resources—imposing tough new terms on foreign oil companies—and has nationalized privately owned telecommunications and electricity utilities.

The Council on Foreign Relations Academic Outreach Initiative is designed to connect educators and students at the college and graduate level with CFR’s research and nonpartisan analysis. For more information, visit

This has been combined with a nationalist and increasingly anti-American foreign policy. In spite of extensive trade ties with the United States, Chávez has been fiercely critical of George W. Bush, and has made common cause with the U.S. administration’s most bitter foes, forming an alliance, for example, with the government of Iran. These tendencies have become more pronounced after an ultimately unsuccessful right-wing military coup against Chávez in April 2002. The recognition by the United States of a short-lived military government combined with the widespread perception that U.S. diplomats had given tacit encouragement to the coup planners led to a sharp deterioration in relations between the two countries. Subsequently, a general strike, led by right-wing business sectors and supported by managers and technicians from state-owned oil company PDVSA led to further political polarization and plunged the country into a deep recession, leading to a decline in Chávez’s popularity. Three factors have helped Chávez recover. First, in the aftermath of the coup and strike, he cemented his control over the army and PDVSA, expelling opponents from positions of influence. Second, he strengthened links with Cuba, in particular, with doctors from the Caribbean country who staff an extensive health care programme directed at marginal sectors. Third, helped by sharp rises in the oil price, he stepped up social spending, especially in areas such as education. With his popularity boosted by these measures, the president scored important election successes in 2004 and 2005. In 2006, he won a second six-year term in office, extending his government until 2012. These triumphs were accompanied by the electoral victories of Chávez allies in three countries: Bolivia, Ecuador, and Nicaragua, and the development of especially friendly relations with the center-left government of Argentina. Although Chávez’s allies were narrowly defeated in Peru and Mexico, the Venezuelan leader has continued to talk about extending his Bolivarian Revolution (named after Simón Bolívar, the nineteenth century liberator) in Latin America, an enterprise explicitly designed to undermine U.S. influence in the region. Living with Hugo was published at the height of Chávez’s popularity. However, since publication, matters have become considerably more complex. The main development in Venezuela has been an unsuccessful bid by Chávez to win popular backing for a plan to change the Venezuelan constitution. The plan would have removed term limits on the presidency and effectively allowed him to stay in office for life. Venezuelans voted down the proposal in December 2007. Although oil prices remain high, a decline in private investment and economic mismanagement has combined to lead to rising inflation and extensive shortages of many basic foodstuffs. These shortcomings lost Chávez support among the urban poor in 2007, a fact which partly explains his electoral reverse. In 2008, the nature of Chávez’s foreign policy has become more controversial, principally because he has made explicit his sympathy for the left-wing Colombian guerrillas, the FARC. After an attack in March by the Colombian army against FARC camps inside Ecuador, Venezuela mobilized troops and aircraft, increasing tensions with the pro-U.S. Colombian government.

The report and these teaching notes are appropriate for use in the following types of courses at the undergraduate or graduate level: • •

Courses on Latin American studies Courses on U.S. foreign policy

Discussion Questions Courses on Latin American Studies 1. As recently as the early 1990’s Venezuela’s two-party democracy was viewed as a model for Latin America. What factors contributed to its breakup? 2. Why did Chávez emerge from political obscurity to win a landslide election victory in 1998? 3. Chávez views himself as a Bolivarian and claims to be leading a Bolivarian Revolution. Who was Simón Bolívar and why has his legacy proved so enduring in Venezuelan society? 4. Has Chávez moved to the left since he took office in 1998? To what extent were the nationalisations and attempted socialist constitution of 2007 an inevitable result of Chávez’s ideology? 5. What are the main characteristics of Venezuelan social policy under Chávez and how has Chávez been able to bolster his popularity through spending on health and education? 6. Oil prices have risen nearly tenfold since Chávez came to power. Would Chávez have been able to introduce radical reforms without the oil windfall? To what extent are these reforms vulnerable to a future fall in oil prices? 7. How healthy is Venezuelan democracy? Courses on U.S. Foreign Policy 1. Can the United States further diversify its dependence on Venezuelan oil? Can Chávez follow through on his threats not to sell oil to the United States? 2. Does the expansion of Venezuelan interests in Latin America represent a strategic threat to the United States? If so, what actions should the United States take?

Additional Materials Buxton, Julia. The Failure of Political Reform in Venezuela (Ashgate, 2001). Ellner, Steve, and Daniel Hellinger. Venezuelan Politics in the Chávez Era (Boulder: Reiner, 2003). Gunson, Phil. “Chávez´s Venezuela,” Current History, February 2006. Lynch, John. Simón Bolívar, A Life (New Haven: Yale University Press, 2006). Marcano, Cristina and Alberto Barrera Tyszka. Hugo Chávez (New York: Random House, 2007). Rodriguez, Francisco. “An Empty Revolution: The Unfulfilled Promises of Hugo Chávez,” Foreign Affairs, March/April 2008. Shifter, Michael. Hugo Chávez: A Test for U.S. Policy, Inter-American Dialogue Report, March 8, 2007. Weisbrot, Mark. “An Empty Research Agenda: The Creation of Myths about Contemporary Venezuela,” Center for Economic and Policy Research Issue Brief, March 2008.