STAFF NEWS & ANALYSIS
South America After Chavez – Not What You Think
By Staff News & Analysis - March 05, 2013

Venezuelan President Hugo Chavez's breathing problems worsen, has severe new infection … "The president has been receiving high-impact chemotherapy, along with other complementary treatments … The 58-year-old socialist leader has not been seen in public nor heard from in almost three months since undergoing the operation in Cuba. It was his chemotherapy: fourth surgery since the disease was detected in mid-2011. "Today there is a worsening of his respiratory function, related to his depressed immune system. There is now a new, severe infection," Information Minister Ernesto Villegas said, reading the latest brief statement. – Reuters

Dominant Social Theme: South America is opening up and offering a wider spectrum of investment opportunities.

Free-Market Analysis: Not so fast. It certainly begins to look like Chavez is not going to recover from his long struggle with cancer and a surface analysis of South America without Chavez might conclude that the region will be less confrontational. But this may not be the case.

Chavez's death would not, for instance, soothe Venezuelan politics given the constituency that he has already built. There are millions of impoverished families throughout Venezuela that have benefited from Chavez's largesse, especially in the construction of schools and clinics. In fact, Chavez's legacy may be one of increased class struggle as the two halves of Venezuelan society – the landed elite and the impoverished peasants – offer competing social visions.

Not only will Chavez's death leave a vacuum in Venezuela but there will doubtless be a larger leadership vacuum that other leaders will struggle to fill. In fact, one could say that Chavez was as much a beneficiary of an Americas leftist resurgence as he was the leader of it. In aggregate, the movement has been called "The New Left."

Hugo Chavez in Venezuela, Rafael Correa in Ecuador, Evo Morales in Bolivia and Daniel Ortega in Nicaragua are among its leaders – and the methodologies of political rule are the same in all these countries. It is the prevalence of poverty that has allowed socialism to surge to the fore, overtaking traditional conservative/military leadership coalitions.

The equation has focused mainly on utilizing available resources to redistribute wealth via social programs and the creation of public infrastructure. At the same time, leaders have taken confrontational stances with the West, especially with the United States. Defaults and confiscations of corporate assets have been adopted as deliberate strategies. An article in the Economic and Political Weekly, "The Left in Latin America and the Caribbean," summarizes these trends:

The Bolivarian Alliance for the Peoples of Our America (ALBA, Spanish acronym) was inspired by the example of -Simon Bolivar, the most prominent freedom fighter of the 19th century, hailed as the liberator of Venezuela, Colombia, Ecuador, Panama and Bolivia. It took formal shape in December 2004 in -Havana, where Chavez and Fidel Castro signed an agreement to lower trade -barriers and barter Venezuelan oil for Cuban -expertise. The alliance was joined by Bolivia (2006), Nicaragua (2007), Dominica (2008), Ecuador, St Vincent and the Grenadines, and Antigua and Barbuda (2009).

ALBA was the brainchild of Chavez, who reacted ferociously to the US proposal for a free trade area of the Americas, mooted in 1994, but formally proposed at the Summit of the Americas at Quebec, Canada in 2001. Chavez succe-ssfully orchestrated regional opposition to the proposal. He was supported by the MERCOSUR bloc (Paraguay, Brazil, Argen-tina, and Uruguay, in addition to Venezuela) at the 2005 Summit at Mar del Plata, Argentina. The idea died a natural death. The US then sought, and concluded, such agreements regionally (Central America) and bilaterally (Chile, Panama, Colombia and Peru).

ALBA has moved to consolidate economic integration, centred on supplies of Venezuelan oil; technical expertise from Cuba; a virtual currency for intra-ALBA trade (SUCRE) to reduce dependence on the dollar; and social prog-rammes targeting low-income sectors. Near unanimity of political views and opinions lends strength to the bloc in -regional and multilateral forums. The Summit of the Americas, in April 2012 in Colombia, ended without a political declaration because of ALBA's insistence that Cuba be invited without preconditions.

This doctrine, which perhaps defines best the principal ideological currents of the Latin American left, was evolved by Heinz Dieterich Steffan, a German Marxist, and propagated in the mid-1990s. Chavez, a Venezuelan paratrooper, discerned, early in his career, the dynamics of politico-military domination in the region.8 He formulated his ideology of 21st century socialism broadly on Dieterich's tenets.

• Ethics and morality are essential to fight the demons spawned by capitalism, individualism, selfishness, contempt, privileges, and corruption. (Chavez claims Jesus Christ was the original socialist. He is unabashedly Christian, though he does not accept the authority of the Catholic Church in political affairs.)

• Participatory democracy seeks to reach the people directly. Representative democracy, prevalent in most countries, superimposes an elite between the -voters and political parties, frequently distorting the mandate given to the ruling class.

• Equality goes hand in hand with lib-erty. Chavez stresses that his socialism does not arrogate all powers to the state. It -respects private property.

• Cooperativism and association in the economic sphere. This implies priority to collectivism and instruments of public economic activity, as well as endogenous development.

Chavez applied this political recipe successfully and so have others in the region. It is naïve, perhaps, to believe that with Chavez's passing, this power-based recipe will diminish or be seen as less useful. Chavez has been struggling with cancer for a long period of time but the underlying volatility of Americas' politics – especially South American politics – has not appreciably diminished.

In Bolivia, Evo Morales remains a supporter of the New Left and a practioner of Chavez-style politics. In Ecuador, Rafael Correa has solidified his power and can be seen as offering his country a slightly less radical form of leftism – but one that has involved repudiating World Bank debt.

Brazil's Dilma Roussef, a former guerrilla fighter, has not been shy about engaging with the United States on an economic front. Brazil pursues programs like Fome Zero (Zero Hunger) and Bolsa Familia (cash transfer programmes to the poor). Additionally, her administration has actively managed Brazil's currency in opposition to US efforts to manipulate the dollar lower.

Argentina is another country, where the regime has been willing to confront Western powers-that-be. Christina Fernandez de Kirschner, re-elected in 2011 has furthered Peronism by nationalizing of the assets of the Spanish oil company Repsol and once again confronting Britain on the future of the Falkland Islands.

After Thoughts

Given the above, it would likely be unwise to conclude that Chavez's death will slow or halt the current rising tides of nationalism and leftism in the Americas generally and South America in particular. Rather, his passing may increase these trends as leaders compete to fill the power vacuum he's left behind.

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