The Santa of the tropics

AFTER SEVEN years as president of Venezuela, Hugo Chavez’s brand of populism has produced social catastrophe and economic disaster for Venezuelans, including the poor he champions.

Despite hundreds of billions of dollars in oil revenue -- $49 billion last year alone -- and social spending that includes free medical services, the country’s poor are poorer, schools have not improved and the general standard of living has declined, according to a recent United Nations Human Development Report.

But even as things get worse in Venezuela, Chavez is engaged in an extraordinary effort to increase his influence elsewhere in the region, seeking to transform himself into a continental caudillo at a time when Washington is largely uninterested in Latin America. Toward that end, he has used his country’s vast oil wealth to launch what he calls a “Bolivarian Revolution” throughout the region.

Chavez traces the roots of this movement to Simon Bolivar, the 19th century leader of independence in South America -- as well as to the political writings of MIT professor Noam Chomsky and to what he calls the “socialism” of Jesus Christ.

Profoundly anti-American, his “revolution” seeks above all else to erase the region’s enormous economic inequalities by redistributing the wealth of the upper classes to the poor. His efforts have cost him quite a bit, and have earned him a reputation as the “tropical Santa Claus.”

Here is how he has spent some of his petrodollars:

* One of his more ambitious projects is the “Bolivarian Alternative for the Americas,” known as ALBA. It calls on Latin American nations to form their own regional bloc devoted to trade, investment and social programs, rather than join a U.S.-backed Free Trade Area of the Americas.

So far, Cuba and Venezuela are the group’s only members. But Chavez has signed some ultra-generous bilateral trade agreements with Argentina, Brazil, Uruguay and Bolivia in hopes of luring them into the bloc. In general, Chavez sells his oil to these countries at a discount and offers to buy their agricultural and manufactured exports at above-market prices.

* Chavez has tried to extend his influence into the Caribbean through the PetroCaribe partnership. The 2005 agreement allows cash-strapped Caribbean nations to buy Venezuela’s oil at reduced prices through preferential financing. Cuba is by far Chavez’s biggest customer, receiving 90,000 barrels of oil a day. In exchange for the oil, Havana supplies Venezuela with thousands of doctors, sports coaches and teachers.

* Chavez has bought debt in Ecuador, Argentina and elsewhere in the region. When Argentine President Nestor Kirchner said last year that he would pay off his country’s $9.8-billion debt to the International Monetary Fund, Chavez bought $2.1 billion in Argentine bonds to help finance the payback.

* In 2005, Chavez launched Telesur, a pan-Latin American, anti-American TV channel designed to compete against CNN and Univision. Based in Venezuela, the channel can be seen in Buenos Aires, Montevideo, Mexico City and other Latin American capitals. The governments of Argentina, Cuba and Uruguay are listed as partners, but Chavez alone is footing the bill.

* In July 2004, Chavez became a hero to Argentina’s shipbuilding unions after he signed a multimillion-dollar contract for eight oil tankers.

Chavez’s alliance with Fidel Castro is central to his goal of gaining influence in Latin America. They have hit on a strategy to build their “soft power” in the region: Venezuela’s petrodollars finance Cuban medical care for Latin America’s impoverished. Jamaicans, Bolivians and Ecuadoreans, among the region’s poorest, are regularly flown to Cuba for medical care and training.

As a result, Caracas has become the mecca of the international left, where leaders of the Brazilian “landless” movement, Argentine piqueteros and Bolivia’s indigenous leaders regularly meet. It is also where radical activists from Ecuador and Peru exchange tactical information with for-hire Central American guerrillas on how to disrupt politics in targeted countries.

But such pragmatic leftist democratic leaders as Luiz Inacio Lula da Silva of Brazil and Tabare Vazquez of Uruguay have not been taken in by Chavez’s largesse. They certainly welcome his investments in their countries and his calls for greater economic independence from the U.S. But never would they look to him for leadership in hemispheric matters.

Chavez has leverage with Bolivia’s newly elected president, Evo Morales, and he’ll remain a darling of old Stalinist leftist unions in El Salvador, Argentina and Brazil as long as he keeps his anti-American rhetoric at a high pitch.

The leading presidential candidates in Peru and Nicaragua, Ollanta Humala and Daniel Ortega, respectively, revere him, not least for his petrodollars, which they would expect to receive if they win.

The most obvious step the United States could take to counter Chavez’s influence in Latin America would be a bold initiative along the lines of President Kennedy’s Alliance for Progress. But that’s highly improbable because of the financial costs of the wars in Iraq and Afghanistan. Meanwhile, Washington should avoid reacting to every little provocation coming out of Miraflores, Venezuela’s presidential palace, lest it grant Chavez stature he doesn’t have and give credence to the Latin American perception that he is taking on the giant up north.

There are red flags for the United States. Chavez could cause serious trouble by openly joining forces with his buddies in the Revolutionary Armed Forces of Colombia, known as FARC, against Colombian President Alvaro Uribe, or by trying to cash in on his $2.5-billion debt investment in Cuba by attempting to play kingmaker in the transition after Castro dies.

Of course, if the price of oil drops to more reasonable levels, the hot air that keeps the Chavez balloon flying high in Latin America might begin to dissipate.