FPI Bulletin: Venezuela’s Maduro Moves to Grab More Power

November 1, 2013

Nicolás Maduro, strongman Hugo Chavez’s handpicked successor, has asked Venezuela’s National Assembly to grant him special decree powers, allegedly to counter corruption and improve the country’s economy.  Yet six months into his term, there are few indications he’s ready to take the meaningful actions needed to improve Venezuela’s long-term outlook.  Rather, Maduro’s record suggests he’s more likely to use expanded governing authority to undermine Venezuela’s fragile democratic institutions and to advance his own political agenda.

Maduro is in political trouble.  While Chavez’s death left Venezuela deeply divided, the divisions worsened after Maduro refused to allow a full audit of the contested April 2013 presidential election.  What’s more, Maduro lacks the charisma of his predecessor, a shortcoming that undermines his ability to corral competing political factions within the country’s government, military, and party ranks.  Criticism has grown in recent weeks after a series of public gaffes highlighted the vast personal differences between Maduro and Chavez.

Maduro’s greatest challenge, however, remains Venezuela’s stagnant economy and distrusted government institutions.  The country is plagued by shortages of basic household goods, such as cooking oil, toilet paper, and rice.  Power blackouts are frequent and on the rise.  The country now suffers a 49 percent inflation rate—the highest in South America.  Meanwhile, after years of mismanagement, government institutions are dysfunctional and corrupt.  Indeed, Transparency International’s recent Corruption Perceptions Index ranked Venezuela the ninth most corrupt country in the world.

The worry is that Maduro would abuse expanded decree powers to maintain his hold on political power, and further discredit and marginalize members of the country’s opposition.  Since taking office, Maduro has repeatedly sought to distract the public, limit criticism, and exert control.  For example, Maduro’s government has blamed widespread power outages on political opponents.  It has expelled three U.S. diplomats on bogus charges that Washington was attempting to wage an “economic war” against Caracas.  It has jailed and frozen bank accounts of news editors.  It has ordered the arrest of a close advisor to opposition candidate Henrique Capriles on unspecified corruption charges, and has also stripped at least one opposition lawmaker of legal immunity that government officials are entitled to possess while in office.

Maduro’s pattern of abuse could continue if the National Assembly passes the aptly-named “Enabling Act” in the near future.  The proposed measure would grant Maduro the special authority to fast track laws and implement policies by decree for a 12-month period.  Chavez was granted such expansive powers on four separate occasions, including an 18-month period beginning in 2010.  As Bloomberg reported, Chavez “ruled by decree for four and a half of his 14 years in power,” using “those powers in 2008 to strip the legislature’s oversight of government borrowing, give him control of appointing regional officials and allow for a wide range of economic intervention.”  Currently, Maduro’s United Socialist party of Venezuela (PSUV) holds 98 out of 165 seats—one vote short of the three-fifths majority needed to pass the controversial measure. 

A number of rogue state and non-state actors are watching Venezuela closely.  China and Russia have invested billions in energy-related infrastructure projects.  Cuban agents have allegedly meddled in Venezuela’s internal security and defense matters.  Iran has signed a number of memorandums of understanding on energy, finance, and technology.  Even drug traffickers have used Venezuela’s lawless jungles and corrupt government officials to make the country a major transit hub for global narcotics shipments.

At the same time, Venezuela’s stability, long-term prosperity, and hoped-for movement towards genuine representative democracy are important to the United States.  The country shares borders with Colombia and other key U.S. partners, and holds the world’s second largest proven oil reserves.  Caracas is also an important U.S. trading partner.  During the first seven months of 2013, U.S. imports of crude oil and petroleum products from Venezuela averaged 805,000 barrels per day, according to the U.S. Energy Information Administration.  This represented roughly 8.2 percent of total U.S. imports. 

For years, America’s reliance on Venezuelan oil has limited Washington’s policy options towards Caracas.  When Venezuela’s state-owned oil company Petróleos de Venezuela defied U.S.-imposed Iran sanctions to deliver two cargoes of a gasoline component known as reformate to Iran between December 2010 and March 2011, the U.S. response amounted to a largely symbolic slap on the wrist.  What’s more Venezuela’s expanded ties with the narco-terrorist group Revolutionary Armed Forces of Colombia (FARC) during the Chavez regime did not dramatically alter U.S. policy.  While the U.S. Treasury Department did take steps during the Chavez era to punish individual Venezuelan officials for providing arms and assistance to the FARC, the larger U.S.-Venezuela economic relationship did not suffer.

Venezuela’s continuing economic downturn means Maduro does not have the luxury of time.  In the near term, Caracas will continue to depend upon revenues from oil exports to the United States in order to fill its dwindling cash reserves.  Moreover, Venezuela’s declining domestic oil production and aging refineries mean the country will become increasingly reliant on various energy related imports.  

Moving forward, Washington should work with like-minded democracies in the region to take the following actions:

  • Remind Caracas of its responsibilities and commitments under Venezuela’s constitution and the Inter-American Democratic Charter.   In particular, this should include ensuring a representative government that is elected through free and fair elections, independent government institutions, and the protection of civil society groups.  Already, lawmakers in Chile and Peru have expressed concerns regarding voting irregularities and the treatment of opposition parties in Venezuela.  In May 2013, Colombian President Juan Manuel Santos met with Venezuelan opposition leader Henrique Capriles in Bogota.  In October, the U.S. Senate, led by Senators Robert Menendez (D-NJ) and Marco Rubio (R-FL), passed a resolution expressing concern about Venezuela’s deteriorating political situation. 
  • Privately coordinate diplomatic pressure with Brazil.  To be sure, the United States and Brazil will continue to disagree on a number of geopolitical and security-related matters.  However, both nations seek a democratic Venezuela that is stable and prosperous in the long-term.  Brazil is a growing force in South America, and as one of Venezuela’s largest trading partners, it has the unique ability to influence lawmakers in Venezuela.  While Brasília has been reluctant to criticize Caracas in the past, mounting economic troubles at home and payment delays from Venezuelan state-run companies could slowly alter Brazil’s demeanor.   
  • Begin to discuss, either directly or indirectly, Venezuela’s future standing at key regional forums.  For example, leaders of the Pacific Alliance, a regional economic integration bloc composed of Chile, Colombia, Mexico, and Peru, could make clear that future membership in the alliance be contingent upon—in addition to economic requirements—maintaining democratic institutional structures and respecting basic human rights.  Lawmakers and government officials in Caracas would be hard-pressed to ignore being further left behind during Latin America’s economic expansion.  Of course, such action is not without precedent.  The Union of South American Nations suspended Paraguay in 2012 after lawmakers impeached the country’s president.   Likewise, the Organization of American States suspended Honduras in 2009 after the military removed President José Manuel Zelaya from power. 

Venezuela’s economy and government institutions are in desperate need of reform.  But the very real danger is that Maduro, in the absence of serious domestic and foreign protest, will avoid implementing needed reforms, and instead consolidate political power.  Given what’s at stake, the United States and its democratic partners in the region should work together to persuade Venezuela to choose a more promising post-Chavez path.

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The Foreign Policy Initiative seeks to promote an active U.S. foreign policy committed to robust support for democratic allies, human rights, a strong American military equipped to meet the challenges of the 21st century, and strengthening America’s global economic competitiveness.
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