Chavez’s New Policies Divide Venezuela
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MARGARET WARNER: Lunchtime in La Vega, one of countless, huge barrios on the outskirts of Caracas. Every day here, 150 hungry mouths get a hot lunch from a home-based soup kitchen.
The government of President Hugo Chavez provides the raw ingredients and cooking equipment. But local resident Alicia Cortes and her friends cook and serve the meal from her kitchen.
It’s one of many projects that Chavez has established in shanty towns and across the countryside, with the estimated 60 percent of Venezuelans who still live in poverty and form the core of his support.
ALICIA CORTES, Soup Kitchen Manager (through translator): More than anything, he’s helped the people, and he’s looked for participation. Chavez is always asking people to take part in the various missions that are being created.
MARGARET WARNER: The missions, financed by Chavez with Venezuela’s booming oil revenues, take many forms. This government-run food store is one of 14,000 so-called Mercales, selling basic food stuffs at highly subsidized prices, a popular option for a family seeking rice at 45 cents a bag.
More than half of all food purchases in Venezuela today are made at stores like these. Most of the staples sold here, like pasta, flour, salt and margarine, are produced and packaged under the government’s own brand name, La Casa, and each bag carries political slogans championing Chavez’s Bolivarian revolution.
Mercedes Galarraga, who shops here for her family, still remembers the day the store opened four years ago.
MERCEDES GALARRAGA, Community Organizer (through translator): There were long lines of people. People were so excited, they never left. As soon as the store opened each morning, people were already in line waiting.
MARGARET WARNER: With government trucks making steady deliveries to areas where many people are also getting government stipends, local residents have no question who to thank.
MERCEDES GALARRAGA (through translator): The person responsible for all of this is our president. Thanks to our president, we’ve got the market. It’s the same with so many other things.
MARGARET WARNER: Other things, like free health clinics in the barrios, staffed by 20,000 doctors imported from Cuba who provide rudimentary community- based care. There’s an Internet center here to connect residents with the world, free public education, and high school equivalency courses for those who dropped out to work.
But only a short distance away, in a different part of the La Vega, open sewage still runs between the main foot path and people’s homes. Water is delivered on a four days on, four days off schedule.
And Zoraly Albarado, who lives with her family in a three-home house with curtains for walls, still has pressing concerns.
ZORALY ALBARADO (through translator): The insecurity and the sewage problem, we need better stability for our kids. When I think about my kids’ future, I think a lot of people have the same problem.
MARGARET WARNER: Felix Caraballo, a community organizer here, concedes that, after eight years under Chavez, much remains undone in basic government-provided services, like sanitation, water and security.
Nightly gang gun battles are a fact of life here. He acknowledges some residents have grown impatient, but he has big dreams for La Vega: a community center for kids, for example. And he’s confident the Chavez government will deliver.
FELIX CARABALLO, Community Organizer (through translator): Now, a lot of people say, “No, you’ll never be able to accomplish that. You’ve had eight years already.” Well, yes, we’ve had eight years. But that’s just eight years. And there’s a social debt to us that the state has built up over more than 40 years. We’re talking about a huge debt built up over time.
Middle and upper-class worries
MARGARET WARNER: But elsewhere in this polarized society, in the stylish malls of Caracas teeming with shoppers, one can hear quite a different tune: fervent concerns about the country's direction under Chavez.
The middle- and upper-class people enjoying the trappings of an Americanized consumer lifestyle worry about where Chavez is taking them.
CHAVEZ CRITIC: He's going to break down everything, every private process, everything that we have right now as a result of capitalism.
MARGARET WARNER: Some Venezuelans are voting with their feet. Requests for foreign travel documents are up from people like those standing in line outside the Spanish embassy last Friday. Maria Theresa Garcia de Herrera appears torn between her love for her native Venezuela and her desire to have an escape hatch afforded by claiming Spanish citizenship.
MARIA THERESA GARCIA DE HERRERA, Venezuelan Resident (through translator): This is what I call my Plan B. I've got an apartment in the Canary Islands, but only for use in extreme circumstances. For now, we're going to keep fighting here. We have Spanish veins, but we're Venezuelans, and we've got to fight for our country.
MARGARET WARNER: Older Venezuelans of means, like businessman Andres Sosa-Pietri, are staying, but two of his three children have moved abroad.
ANDRES SOSA-PIETRI, Businessman: Since no new jobs are really being created in the country, the young people, the younger generations, if they have a minimum of preparation, technical- or university-wise, and they have an opportunity outside of Venezuela, they will leave.
MARGARET WARNER: Once head of the state oil company, PDVSA, Sosa-Pietri saw his private valve manufacturing company expropriated two years ago. He predicts more nationalizations and expropriations and ever more state control over every aspect of life in Venezuela.
ANDRES SOSA-PIETRI: He just wants more control. In fact, what Chavez wants to have is an authoritarian regime that permits him to die in the presidency, to die by natural causes in the presidency. He wants to be a president for life. His example is Fidel Castro, and he wants to follow that example to the letter.
MARGARET WARNER: What tells you that?
ANDRES SOSA-PIETRI: He tells me that. He's been saying this consistently, well, since he became a public figure.
A new direction for Venezuela
MARGARET WARNER: Curiously, the object of these intense feelings hasn't been seen or heard in public for 10 days now, not since the February 4th celebration of the failed military coup Chavez led in 1992 which thrust him to prominence. All the country's broadcast networks carried the commemoration live.
He dominates the political landscape in many ways, on weekends with his Sunday television show, the hours-long "El Presidente," carried by the country's state-run channel, part of the larger-than-life image that has been reinforced constantly.
In the center of Caracas, Chavez's face is everywhere: on walls and on t-shirts, alongside images of historic socialist revolutionary figures like Lenin, Karl Marx and Che Guevara.
His government holds regular events for red-shirted Chavistas, this past Friday, handing out checks for local projects for newly created community banks, wealth redistribution that lies at the heart of what Chavez calls his 21st-century socialism.
Nicolas Maduro, Venezuela's foreign minister, says the president is charting a new direction for Venezuela and, he hopes, for a wider Latin America.
NICOLAS MADURO, Foreign Minister, Venezuela (through translator): A Latin America that can combat poverty, that can build a productive, diversified economic system that allows the building of internal wealth and the distribution of that wealth through social programs that create stability, with the most open democracy possible.
In Venezuela, we are bearing the flag of socialism for the 21st century, a new socialism, Bolivarian socialism, an Indo-American socialism drawing on our indigenous roots.
MARGARET WARNER: To speed up the process in Venezuela, Hugo Chavez is moving to consolidate his power after his landslide re-election in December. Privately owned companies in strategic industries, like electricity and telecommunications, are now prime targets to be nationalized, he says.
At his behest, the Chavez-controlled National Assembly just gave him special powers to rule by decree for the next 18 months in a dozen key areas. What's more, the president is threatening not to renew the license of a leading independent television network.
Journalists here say there's rising government pressure on all media outlets deemed sympathetic to the opposition. Newspaper editor and opposition intellectual Theodor Petkoff says the president's new powers and the fervency of his support are a dangerous combination. He compares Chavez to popular dictators of the past, like Hitler, Mussolini and Peron of Argentina.
THEODOR PETKOFF, Editor, Tal Cual (through translator): There has never been a president of Venezuela who had just powers. You can define this regime as an autocracy. All the powers of government are concentrated in one branch. They are all submitted to the will of Hugo Chavez.
MARGARET WARNER: But in Plaza Bolivar, named for Venezuela's founding father, Simon Bolivar, who freed the country from Spanish colonial rule, retiree Expedito Rivera describes Hugo Chavez in equally heroic terms. She says she's glad he's going to rule unimpeded by what she calls "corrupt politicians" in the legislature or the courts.
EXPEDITO RIVERA, Venezuelan Citizen (through translator): He's the only president that Venezuelans can call their highest authority, the greatest president and the leader of all Venezuelans. He's the only one who has helped the people with housing, education, resources and food stamps.
Chavez will continue governing. Who knows until when? Until we can realize the socialism of our great people, he must stay on as the head of the government.
Managing oil wealth
MARGARET WARNER: There is one thing on which Chavez's supporters and detractors agree. What's underwriting his moves to consolidate power and speed up this country's socialist transformation is the high global price of the resource Venezuela is richest in: oil. And Chavez is taking steps to tighten control over that, too.
The heart of Venezuela's oil industry can be found on coastal Lake Maracaibo, 300 miles west of Caracas. Oil was first struck nearly a century ago, and the fields nationalized in the '70s. Today, the lake's more than 1,500 oil rigs and platforms managed by the state oil company, PDVSA, generate a good chunk of the oil Venezuela produces each day.
But the most promising new fields lie to the east, where PDVSA has joint ventures with foreign companies, like Exxon, Chevron and B.P., to develop the hard-to-extract oil. Now, the Chavez government has told its foreign partners that they must agree by May 1st to give PDVSA a 60-percent stake in those joint ventures or see them nationalized altogether.
Robert Bottome, who edits the economic analysis newsletter and Web site VenEconomia, says it would be a disaster for Venezuela to have the joint ventures fall under PDVSA's control.
ROBERT BOTTOME, Editor, VenEconomia: He's not investing for the future, so he can spend the money on something else. And so you have a tremendous -- as you look around here, you say, "Gee, isn't this country doing well? Isn't it prosperous? Just look how much money is sloshing around, and everybody is rushing out to buy things."
MARGARET WARNER: Things like luxury, high-end motor cars. Auto sales doubled last year. But Bottome says this spending gives a false image of prosperity, because exchange controls and high inflation are what are driving Venezuelans to seek a domestic haven for their money.
ROBERT BOTTOME: The day the price of oil settles to a more reasonable level, which I think is soon, we're just in trouble. There's no way of sustaining the consumption. There's no way of sustaining the illusion of growth.
Chavez's grip on power
MARGARET WARNER: But for now, Hugo Chavez seems firmly in control. And those who are trouble by where their country is heading can see they lack the means to change its direction soon.
The political opposition is struggling after frequent electoral defeats. One of its new rising stars, the young mayor of Chacao in east Caracas, Leopoldo Lopez, says the opposition has a long way to go to communicate with the poor as effectively as Chavez against steep odds.
LEOPOLDO LOPEZ, Mayor, Chacao: The problem is that it's not a regular democratic system, a regular Democratic rules of the game. So we need to build an alternative with a lot of adversity. We need to build on alternative against, not a political party, against the entire state.
MARGARET WARNER: The Venezuelan government defends the state of democracy here, foreign Minister Nicolas Maduro arguing that the people who back Hugo Chavez form the foundation of a new system.
NICOLAS MADURO (through translator): In Venezuela, there is a new kind of democracy. We have a democracy where people are organized socially where they live, study and work. And there is no greater indication of democracy than when people are organized beyond political parties to defend their interests and to oversee the government.
MARGARET WARNER: Back in the barrio of La Vega, where the residents are indeed organized, it's clear the pressure is on Hugo Chavez to keep delivering. Community leader Felix Caraballo says he's not a die-hard Chavista, and his support for the president isn't absolute.
FELIX CARABALLO (through translator): I am a revolutionary. It's a distinction. I am with Chavez as long as Chavez is with the people. As soon as Chavez separates himself from the people, I separate myself from him.
MARGARET WARNER: For now, though, there is no indication that a parting of the ways between Chavez and his ardent barrio supporters is in the immediate cards.