MARGARET WARNER: Venezuelans gave their president, Hugo Chavez, a huge victory yesterday, voting to eliminate term limits and clearing the way for him to run for re-election indefinitely. With 94 percent of the votes counted, official results showed the measure passing 54 percent to 46 percent.
The public reaction was as divided as the electorate.
VENEZUELAN CITIZEN (through translator): It’s great. I knew the “yes” vote was going to win. What else is there?
VENEZUELAN CITIZEN (through translator): Personally I don’t really agree. But if he won, what can I do?
MARGARET WARNER: Chavez said the vote would free him to complete the socialist revolution of Venezuela that he embarked on more than a decade ago. Since taking office in 1998, Chavez has used Venezuela’s vast oil wealth to finance social programs for the poor, including free health clinics and subsidized food stores.
He’s also made himself known by his verbal insults against the United States and former President Bush, though this weekend Chavez said he was ready to pursue a, quote, “rapprochement” with President Obama.
And for more on yesterday’s vote and its significance, we turn to Christopher Sabatini, senior director of policy at the Americas Society, a New York-based think tank focused on Latin America. He’s also editor-in-chief of its magazine, the Americas Quarterly.
And Shannon O’Neil, a fellow for Latin America studies at the Council on Foreign Relations. She recently directed a council-sponsored task force on U.S. policy toward Latin America.
Thank you both. Mr. Sabatini, let me start with you. How significant a victory is this for Hugo Chavez and for his agenda?
CHRISTOPHER SABATINI, Americas Society: It’s significant because, well, only a few months earlier, 15 months earlier, the exact same amendment to allow him to run definitely had been defeated. So this time, he came back and he won. So in that sense, it is very significant, in terms of his agenda to be able to stay in power, now potentially indefinitely.
But for the opposition, this is not the end of the road. They lost. They lost clearly. But, first of all, Hugo Chavez lost a certain percentage, just about 10 percentage of the vote, from when he won the election. So obviously he’s becoming less popular.
But, second, the opposition will get several more times to be able to compete in the elections. You’ve got the national assembly elections coming up, and then, of course, there will be the presidential elections of 2012. And with the way the economy is going, I think they’re going to be in a much better position to compete in those elections, especially if they have really a coherent front to compete electorally.
Free and fair vote?
MARGARET WARNER: Shannon O'Neil, how do you explain the fact that, as Mr. Sabatini just said, 14, 15 months ago, a similar measure went down to defeat and Chavez turned it around. What do you think explains it?
SHANNON O'NEIL, Council on Foreign Relations: Well, there are a lot of reasons. The last referendum wasn't just about this issue; it was about a lot of issues. And so people voted against it.
This particular referendum is just about the ability to be re-elected. And when they first put this on the table, it was about just Chavez's re-election. But about three, four weeks ago, Chavez opened it up so it was about re-election of all politicians, to allow every politician in Venezuela to be re-elected. And that really brought a lot of people on board, a lot of supporters in public office on board. And so there was a lot of movement and mobilization for the "yes" vote.
MARGARET WARNER: And saying with you, Ms. O'Neil, how free and fair, to use the phrase, was this election, both in the campaign leading up to it and election day?
SHANNON O'NEIL: Well, election day was very free and fair. Almost every observer, both critics and supporters say the ballots worked, the electoral machinery worked, and it was fair.
Now, the campaign is probably a different story. It was definitely skewed towards the "yes" vote. Mobilization happened both from the presidency, from Chavez himself, but also from the legislative branch, from the judiciary branch, and from state-owned enterprises, and particularly from PDVSA, which is the national oil company.
People in that oil company were really mobilized to bring out the vote. So we see a difference in terms of the campaign side, but when you come down to election day yesterday, it was fair.
MARGARET WARNER: Christopher Sabatini, we read that their inflation is something like, what, 30 percent now in Venezuela, that crime is up. What explains Chavez's enduring popularity? Yes, he only won by 9 percent, 10 percent, but that would be considered a landslide in most places.
CHRISTOPHER SABATINI: I think there are three things. First of all, he maintains about a 30 percent hard-core support, and those are people who really see Chavez as being a savior, who voted for him in 1998 originally and stuck with him, largely because they see him as an antidote to the corrupt two-party system that preceded him.
But there's also the issue -- and Chavez played on this very, very well -- that it's either Chavez or no one. There really is a vacuum, both underneath Chavez within his own movement, but also in the opposition.
And so, for many voters, even for the around 30 percent who reject Chavez but also reject the opposition, there's a real unknown. And so many people when they were voting just yesterday, they were voting because they simply don't know what comes next. With rising crime levels, as you mentioned, Margaret, with the issue of inflation, there's a sense of, what happens next?
Well, there's a third element, as well, and that has to do with just a sense that Chavez does control, as Shannon said, a large part of the economy and he basically controls the state. And that allows him to have huge access to patronage that really is able to turn out the votes and, also, for many people, threaten them that they would lose those benefits if he didn't win.
Drop in oil prices
MARGARET WARNER: Shannon O'Neil, we have seen, though, a precipitous drop in the price of oil, which has been the major source of revenue for this government. How has that affected Chavez's ability to deliver on his agenda? And what do you expect will be the impact going forward?
SHANNON O'NEIL: You know, it hasn't affected him yet, and that's part of why his popularity continues. But Chavez has really enjoyed a political honeymoon now of a decade, of 10 full years. He just celebrated his anniversary.
And, in part, that's because of high oil prices. There was a lot of money to support a vast majority of all types of social programs, ones you mentioned, health care, schools, basic food subsidies, oil subsidies, all sorts of things, gas subsidies.
But this is changing right now. He has some reserves, but those are going to run out during this year, and he's going to have to make some hard economic choices this year if oil prices stay low, which most people expect they will, at least for 2009, if not into 2010.
And that's where we're going to see a change, because, in Venezuela, economics drive politics. Economics so far in Chavez's term have been quite good, especially for the last few years, and they've led to high political popularity for him, as we've seen in this last referendum.
But economics has now changed in Venezuela, and so the politics, too, will change in 2009 and especially into 2010.
MARGARET WARNER: So, Mr. Sabatini, do you think that the drop in the price of oil will at all curb what Chavez has done in the region? In other words, he's sort of a self-styled leader of other poor countries with populist leaders?
CHRISTOPHER SABATINI: It certainly will. First of all, his own country is going to start to feel the pinch. As Shannon said, oil has declined from a high of about $100 a barrel to now about $30 a barrel, and they were banking on about $60 a barrel. So they're going to feel a real fiscal crunch.
But, second of all, as they do that, Chavez -- what the biggest hit is going to be in Chavez's own largesse outside the country. He gives away about 94,000 barrels of oil a day to Cuba. He gives over $120 million a year to Bolivia, as well as Nicaragua, and a whole series of projects throughout the hemisphere.
Those are going to be the first to be cut, especially when he confronts declining fiscal revenue, the need to cut subsidies, and also a very likely need to devalue his currency within the next couple of months.
And what people in Venezuela are going to start to complain about is basically his larger, extra-Venezuela ambitions in funding those things, and those will have to be cut.
MARGARET WARNER: And, Shannon O'Neil, what about the future of the relationship vis-a-vis the United States, with the new American president here? And Chavez said this week, you know, he might be interested in having a conversation. What do you expect to see there?
SHANNON O'NEIL: Well, as we all know, he had a very tense relationship with President Bush before. And so there is a personal animosity between the two of them and so that, of course, is gone with our new President Obama.
The other big difference is Obama has a much different personal profile and personal history, so it will be much more difficult to paint Obama as a Yankee imperialist the way he could with George Bush.
But that said, Chavez always needs a foil. He always needs some sort of opposition, so that often is the domestic opposition within Venezuela. But as we've seen, it's often the United States. It's international opposition.
So it will depend, but Chavez will always need some sort of opposition, and the United States makes an easy foil for him.
MARGARET WARNER: Christopher Sabatini, very short answer on that question? We're just about out of time.
CHRISTOPHER SABATINI: Basically, Obama is going to have much more legitimacy, will be much more difficult to turn into the sort of punching bag that Chavez turned President Bush into over the last eight years. It's going to be a different game.
MARGARET WARNER: All right, Christopher Sabatini, Shannon O'Neil, thank you both.
CHRISTOPHER SABATINI: Thank you.
SHANNON O'NEIL: My pleasure.