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Countering Chavez With Free Trade

To counter Chavez, the United States should approve existing free trade agreements and negotiate new ones as well as extend trade preferences to Bolivia and Ecuador.


On January 31, the Venezuelan National Assembly unanimously "voted" to hand absolute power over to Hugo Chavez by granting him the ability to rule by decree for the next 18 months. Shouts of "Fatherland, Socialism or Death…We will prevail!" rose from the crowd of Chavista legislators and supporters. The resemblance to events a half-century ago when Fidel Castro assumed control in Cuba is unambiguous and deliberate on the part of Chavez. And the nuance in his increasingly virulent rhetoric speaks to his true aspirations for the future of Latin America and the Caribbean.

No one doubts that Hugo Chavez is determined to lead Venezuela down a clear path toward socialism or that he will continue to nationalize the country's major infrastructure-related industries—especially those that are foreign owned. No one doubts that he will continue to erode judicial independence by packing the Supreme Court of Venezuela with loyalists and by requiring those not appointed by him to retire or that he will continue to limit the independence of the press and its ability to contradict the message of the state through his program of forced "self-censorship." The one thing that Mr. Chavez has purposefully hidden within his pointed language is his plan for the future of the whole Latin American and Caribbean region.


As Fidel Castro descended the Sierra Maestra, he repeatedly invoked the name, ideals, and teachings of Jose Marti. He attributed his "Revolution" to the spirit of Marti and expressed his desire to finish Marti' s planned integration of Latin America. Castro was unable to see his grand plan come to fruition because his reliance on the Soviets for economic survival enslaved him to their wishes. The Soviets believed that Castro should not taunt the U.S. in its own backyard because they were struggling to counterbalance U.S. power and influence elsewhere in the world.

Hugo Chavez invokes the name of Simon Bolivar with the same reverence and intention as Castro did Marti. He professes that modern-day Venezuela is reigniting the Bolivarian Revolution, and says he has been passed the torch from Marti, Bolivar, and Castro. Chavez, through his Bolivarian Revolution, has resigned himself to accomplish what Marti and Bolivar called for and what Castro could not: the unification of Latin America and the Caribbean as a counterbalance to U.S. hegemony.


Simon Bolivar was seen as the liberator of Latin America as he led independence movements in a number of colonies then under Spanish control. He soon saw his plan for Gran Colombia, a centralized Latin American government, face heavy opposition from those he had just liberated. They did not want to cast off one yoke to replace it with another. Bolivar subsequently named himself dictator to suppress opposition to his vision. This move only further mobilized his detractors, leading to an assassination attempt and dashing his plan for a united Latin America.

Chavez believes that he carries the torch of Simon Bolivar and will unite Latin America into a counterweight to U.S. hegemony, much like Castro sought to do. Unlike Castro, Chavez is not economically constrained; Venezuela is sitting on top of the world's fifth largest reserve of oil.

Recently, Hugo Chavez has stated that Venezuela is entering the "third phase" of the revolution. To most, this language might seem somewhat harmless; however, it was Fidel Castro, half a century ago, who used these same words before he informed his Soviet counterparts of his intention to incite revolution throughout Latin America. Chavez is communicating his plans for the future to the Socialist and Communist elements in Latin America. He plans to unite Latin America to counterbalance U.S. hegemony to fulfill the aspirations of Marti, Bolivar, and Castro.


Hugo Chavez, much like Fidel Castro, is not an ideologue but an opportunist. Fidel Castro developed into a Communist when he realized that he would need Soviet funding for his Revolution. Chavez has seen an opportunity in the vacuum left in the wake of decreased U.S. interest and influence in the region. Left alone, Chavez will continue to rail against the evils of the U.S. and free markets, to exploit the desperation of Latin America's poor through preaching about the perfection of the Socialist state, and to build his influence in Latin America and the Caribbean. To counter his message and influence, the United States should:

  • Ignore Chavez's taunts and threats. The U.S. message in Latin America should continue be one of good governance, belief in democratic principles, commitment to the liberating powers of the free market, and respect for the rule of law. Chavez has been spending vast amounts of oil revenue to finance his regional aspirations and preach about the evils of U.S. might while violence and poverty have increased in Venezuela. Answering his taunts will allow him to avoid the real problems of Venezuela.
  • Swiftly approve free-trade agreements with Peru, Columbia, and Panama. Free-trade agreements are one of the best tools the U.S. has to counter anti-American and anti-democratic forces in Latin America.
  • Extend trade preferences to Bolivia and Ecuador. These preferences are about to expire. The leftist leaders of these countries have personally embraced Chavez but distanced themselves from his actual policies. Free-trade agreements with these two nations may not be possible, and the U.S. does have disagreements with their governments. Nonetheless, extending trade preferences will be a gesture of cooperation to the people of these countries and the wider region.
  • Pursue additional bilateral FTAs. Through negotiating bilateral FTAs, the U.S. can ensure that individual countries are willing to play by the rules of the free market and are committed to upholding standards on labor practices and environmental issues. Linking trade agreements to commitments to good governance and free market practices allows the U.S. to deal with Latin American countries based on their actions and practices.
  • Enhance security cooperation in the region. The U.S. should actively work with neighbors and allies to combat threats to security through cooperative efforts to battle transnational terrorism and crime and illegal substances. This would create permanent working relationships and actively work to counter anti-American messages.

Like Marti, Bolivar, and Castro, Hugo Chavez aims to counter U.S. influence in Latin America and the Caribbean by uniting the region under one socialist regime. Chavez can be expected to continue to influence his neighbors through petro-diplomacy and rhetorical rants against the U.S. and free markets. Unless the U.S. increases its presence in the region through support for democratic institutions and market institutions, the aspirations of Marti, Bolivar, Castro, and now Chavez may come to fruition.

Helle C. Dale is Director of the Douglas and Sarah Allison Center for Foreign Policy Studies, a divi­sion of the Kathryn and Shelby Cullom Davis Institute for International Studies, at The Heritage Foundation. Matthew Willette, an intern, assisted with research for this paper.


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