Sunday, September 16, 2007

Mr. Chavez's Neighborhood

"He is widely recognized--and widely mistrusted--throughout Latin America."

Mr. Chavez's Neighborhood
He's not very popular there.
by Duncan Currie
09/24/2007, Volume 013, Issue 02

Venezuela's cocksure president, Hugo Chávez, might take a sobering glance through the latest Pew Global Attitudes Survey, conducted this spring and released over the summer. Of the seven Latin American nations polled, large majorities of Chileans (75 percent), Brazilians (74 percent), Peruvians (70 percent), Mexicans (66 percent), and Bolivians (59 percent) express little or no confidence in Chávez "to do the right thing regarding world affairs." As Pew puts it, "He is widely recognized--and widely mistrusted--throughout Latin America." Even in Argentina, perhaps the most anti-American country in the region, a full 43 percent of respondents have little or no confidence in Chávez.
That's not all. Majorities in Brazil (65 percent), Chile (60 percent), Mexico (55 percent), and Bolivia (53 percent), along with a plurality in Peru (47 percent), agree that "most people are better off in a free market economy, even though some people are rich and some are poor." Indeed, a whopping 72 percent of Venezuelans agree with that statement. "There is broad support for free-market economic policies across Latin America," Pew reports, "despite the election in the past decade of leftist leaders.
"The term "leftist," though often used to describe authoritarian radicals such as Chávez, is also appropriated for left-wing democrats like Michelle Bachelet of Chile and Luiz Inácio Lula da Silva of Brazil. The leftward drift of many Latin American countries in recent years should not be confused with a massive shift into the Chávez camp. Most Latin governments, whether center-right or center-left, have upheld the institutions of democracy and embraced responsible fiscal policies.
"I don't see this big, looming, radical lurch to the left," says Carol Graham, a senior fellow at the Brookings Institution. She points to the emergence of "market-friendly reformers" in Brazil, Chile, Peru, Uruguay, Paraguay, El Salvador, Costa Rica, and elsewhere. The conservative Otto Reich, who served as a senior diplomat for Latin America under Presidents Reagan and George W. Bush, stresses that Washington need not fear the "democratic left," epitomized by Bachelet and Lula, which Reich separates from the "extreme," antidemocratic left, epitomized by Chávez. Since 1990, Reich notes, the Chilean economic miracle has been piloted by a center-left coalition, with stunning results. "Chile is a true Latin American success case," which should caution against viewing the Latin left as monolithic.
Chávez may be a throwback to the old South American caudillos, who blended populism, authoritarianism, and military rule. But even his two supposed protégés, Evo Morales of Bolivia and Rafael Correa of Ecuador, are hardly carbon copies. In Nicaragua, Sandinista leader Daniel Ortega regained power with less than 40 percent of the vote, thanks to election rules that make it possible for a candidate to win the presidency with just 35 percent. But a majority of Nicaraguans voted for one of the two center-right candidates. Thus far, Ortega has accepted the Central American Free Trade Agreement.
Talk of a populist surge in the region contains some truth. But Bolivia, Ecuador, and Nicaragua are three of Latin America's weakest, poorest countries, never fully integrated into the global economy. As Christopher Sabatini, senior policy director at the Americas Society and editor in chief of Americas Quarterly, points out, the elections of Morales and Correa were based less on ideology than on practical grievances. And Ortega's victory was certainly "not a triumph of leftism," but rather "a triumph of electoral manipulation."
While Argentine president Néstor Kirchner has also cast his lot with the Chávez forces, the post-2002 Argentine economic recovery owes much to "neoliberal" policies charted by former finance minister Roberto Lavagna, whom Kirchner sacked in late 2005. Kirchner is not seeking reelection next month, hoping instead to be succeeded by his wife, the Argentine first lady. Opponents lodge credible complaints about their autocratic tendencies.
Argentina may now be part of the Chávez orbit. But Mexico and Peru are not, demonstrating the very real limits of his appeal. During the 2006 Mexican presidential race, center-right candidate Felipe Calderón repeatedly associated his populist opponent with Chávez and wound up rallying to victory. In the 2006 Peruvian election, Chávez lent full-throated support to a radical nationalist named Ollanta Humala. This allowed the more moderate Alan García to frame the election as a choice "between Hugo Chávez and Peru." Thanks in part to the Chávez albatross, García defeated Humala in the runoff. His center-left regime has pursued a sound economic agenda and backed a free trade agreement with the United States.
Indeed, the regional climate as a whole is relatively encouraging, given the financial crises of the 1990s and early 2000s and Latin America's history of coups and political upheaval. The Pew survey found that Latin publics are, on balance, more satisfied with their quality of life and family income than they were five years ago. The Economist reckons that many Latin economies are experiencing their best performance "since the mid-1970s," with solid growth rates and a burgeoning middle class in countries such as Brazil and Mexico. "Economic management has really never been better," says Peter Hakim, president of the Inter-American Dialogue.
This is not to paint an overly sanguine picture. Poverty is still a serious problem. Judicial systems need reform, as does education. Corruption, cronyism, and crime remain widespread. Drug cartels are raising havoc in Mexico, murdering journalists and triggering bad memories of Colombia. Guatemala's recent presidential campaign was marred by bloody violence and a raft of political murders. Panama just elected to lead its national assembly a pro-Noriega radical, who has been indicted in the United States for the 1992 killing of an American soldier.
Meanwhile, as the Pew survey notes, "The image of the United States has eroded since 2002 in all six Latin American countries for which trends are available." A breakdown in hemispheric cooperation could yield a power vacuum for Chávez to fill with his oil-soaked "Bolivarian" revolution. Resource-hungry China is also competing for influence. Sabatini worries that a failure by Congress to approve the U.S.-Colombia free trade pact would "signal that the United States is abdicating its leadership in the region." In a recent conversation with Reich, a high-ranking Latin American security official expressed alarm over the consequences of isolating Colombia, whose center-right government is a strong U.S. ally.
Finally, a windfall of petrodollars has given Chávez influence beyond Latin America. Using his vast oil wealth, he has moved closer to Iran and Russia, signing energy and arms deals. This summer Chávez agreed to sell Iran cut-rate gasoline; in 2006, he bought fighter jets and helicopters from Moscow. Among others, former Republican senator Rick Santorum has drawn attention to the potential threats posed by the Tehran-Caracas axis.
Chávez-style radicalism may be present in the Andes, but it is not sweeping the region. "There's a lot of reason to be very optimistic," says Sabatini, especially "about the most powerful countries." Whether Latin governments are left or right is ultimately less important than whether they adopt policies that are forward-looking and modern. "Democratic politics is really very healthy in Latin America," says Hakim. "This is a good period for the region."
Duncan Currie is managing editor of the American.
© Copyright 2007, News Corporation, Weekly Standard, All Rights Reserved.

Thursday, September 13, 2007

Gustavo Coronel: A possible political scenario for Latin America, 2007-2012

Gustavo Coronel: A possible political scenario for Latin America, 2007-2012

Most of the political scenarios for Latin America are drawn in traditional ways, using mostly politically correct ingredients. Because of this cautious approach some possible futures for the region remain insufficiently discussed. One of them has to do with the region becoming the site of active destabilizing plots against the United States. We all know that anti-American sentiment in Latin America has been growing during the last ten years, although not as strongly as advertised by some interested parties. In fact, Latinobarometro and Pew, two credible polling agencies dealing with the Western Hemisphere have recently shown (1) that, even in Venezuela, the U.S. is viewed favorably by over 55% of the population and that the attacks of President Hugo Chavez against this country are rejected by 75% of the population.

Still, there is no doubt that there are strong efforts being made by some Latin American political leaders to harass the United States. If these efforts intensify and take root, Latin America could become a geopolitical hot spot in the mid-term.

The starting point of the anti-U.S. Alliance.

Essentially the current threats against U.S. national security originated about nine years ago with the political alliance between Fidel Castro, the Cuban dictator and Hugo Chavez, the Venezuelan strongman. This is a symbiotic relationship that has been providing Fidel Castro with money and Hugo Chavez with brains.

The strategy chosen by this alliance is based on two facts and one very partial truth. The two facts are: extreme poverty and extreme inequality in the region. The very partial truth is that these two afflictions are the result of U.S. exploitation of the region’s natural resources aided by the systematic political intervention of this country in the internal affairs of the countries of the hemisphere. To blame our own misfortunes and inadequacies on someone else has been an old and proven method to gain adepts and to stir hate and xenophobia among Latin American societies. This is what Fidel Castro has done for the last forty years and this is what he has recommended to Hugo Chavez , a line of action that the Venezuelan strongman has embraced with enthusiasm.

Hugo Chavez’s strategies.

To do this he has been aided by significant amounts of money derived from oil exports. During the last nine years about $220 billion of oil money have entered the Venezuelan national treasury while national debt has tripled to about $65 billion.

This amount of money has been mostly spent in three areas: (a), social programs of a temporary nature, really handouts, to the Venezuelan poor; (b), the acquisition of weapons; and (c), subsidies, donations and promises to Latin American countries in order to consolidate political alliances and establish political IOU’s. At least $40 billion have gone into the third category, an amount roughly equivalent to 2-3% of Venezuela’s yearly GDP during the last nine years.

As a result of these strategies the Fidel Castro/Hugo Chavez axis has been able to make some progress in its political objectives of eroding the political standing of the United States in the hemisphere and, even, of gaining supporters in the U.S. political scene. By financing the presidential campaigns in several countries they have been able to help Evo Morales, Daniel Ortega and Rafael Correa win the presidencies of Bolivia, Nicaragua and Ecuador. At the same time they saw their favored candidates Ollanta Humala, in Peru, and Andres Lopez Obrador, in Mexico lose close elections while remaining politically strong, especially Lopez Obrador. In parallel Hugo Chavez’s major injection of money into Argentina has helped President Nestor Kirchner to join the anti-U.S. club, a move for which he did not need strong incentives.

This is all well known although generally perceived with indifference, sympathy, and tolerance or, even, amusement, in hemispheric political circles. Many celebrate secretly the harassment of such a strong power by smaller, weaker countries.

Others are sitting on the political fence, receiving political and material benefits by playing one side against the other. Still others have a weak spot in their ideological hearts for authoritarian regimes and resent the hard sale of democracy being done by the U.S. all over the world. A few even laugh at the colorful antics of President Chavez and have a hard time taking him seriously.

However, political harassment of the United States represents just one aspect in a possible wider plan. Later stages might include actual economic aggression and, even, physical action against the northern “empire”. For the time being the main efforts are directed towards the consolidation of the alliance. To do this:

• Chavez is providing money to members of the Armed Forces of Bolivia and to city mayors, in order to increase political control over these important Bolivian sectors (2);

• Chavez could be funneling money into Argentina to promote the candidacy of Mrs. Cristina Kirchner (3);

• The aid given by Chavez to Nicaragua already amounts to about $500 million and, if he follows through in his promise, will include the financing of a $2 billion refinery;

• The economic ties of Venezuela and Ecuador are increasing via the oil industry, although President Correa’s ideology already includes a significant component of resentment against the United States.

• Chavez is conducting a strategy of alignment with political sectors in the United States that oppose the current government policies. For some of these sectors the desire to erode the current administration has proven greater than their love for democracy. The enemy of their enemy has become their friend (4).
Almost all of these strategic initiatives by the Castro/Chavez alliance show an alternative, unfavorable outcome.

• Bolivia is in the threshold of a major political crisis, due to the reluctance of important sectors of the country to roll over and play dead to Morales’s pretensions to impose the Venezuelan Constituent Assembly model that ended with the Venezuelan democracy becoming an authoritarian regime.

• Mrs. Kirchner, even if she won, as it seems to be the case, might decide to go her separate ways. She has already given some indications that Argentina should not become a simple pawn of Castro/ Chavez in the struggle for hemispheric political leadership. Recent events have convinced her that Chavez’s support probably represents a kiss of death for her political future.

• In Ecuador, Correa is already looking at the Bolivian political turmoil with caution, as he does not want to repeat Morales’s errors and realizes that Chavez’s success in Venezuela has been due to his deep pockets rather than his charisma. Correa does not have the money or the charisma of Chavez.

• In the United States the individuals and groups that support Chavez are doing so out of personal material or political interest and have been largely rejected by public opinion.

It seems improbable that the alliance of these countries, almost entirely based on money and resentment against the United States, could last for long.
What if this alliance falters?

The main motors of the anti-U. S alliance, Castro and Chavez, understand that this strategy of progressive political harassment of the United States might not succeed. The defeat of Lopez Obrador in Mexico robbed them of a major ally in this strategy. In power Lopez Obrador would have promoted illegal immigration into the U.S. creating numerous points of social and political conflict along the weak U.S.- Mexican border. As it stands today The United States has several ways to weaken Castro/Chavez strategies. In fact, the imminent death of Fidel Castro has practically eliminated much of the brain component of this axis. Hugo Chavez is in need of an alternative plan.

The alternative is an alliance with fundamentalist groups or countries that share Hugo Chavez’s resentment against the United States. This explains the approximation of Hugo Chavez to Iranian President Ahmadinejad. Both leaders have an anti-U.S. global alliance as one of their main objectives. Their main weapon is oil or, rather, what they can do to the international oil market, in case they decided to suspend exports of this resource. Some 4 million barrels of oil per day would be out of the supply system, causing a major disruption in the world’s economy. They figure that in such a situation they have less to lose than the United States and its industrialized allies.

But oil is not their only weapon. They also have a political weapon to resort to. It has to do with the concerted action of terrorist groups such as Hezbollah and FARC, assisted by violent indigenous groups such as those in Bolivia, Peru and Ecuador and socially turbulent groups like the illegal immigrants already living in the United States.

By promoting the action of these groups against the United States and its Latin American and European allies these groups can do much harm to global political stability. In this scenario one the main promoters of this action would not be located in the Middle East or in the Far East but in Latin America. This would be the first time in history, as far as we can tell, that a Latin American political leader becomes a major threat to world stability.

In summary.

Political scenarios based on traditional assumptions such as the existence of a dormant and orderly hemisphere and on the existence of international bodies like the Organization of American States, where political controversies and imbalances can be rather easily adjusted, do no longer seem to fit Latin American reality. Violent scenarios with global implications should also be considered. Scenarios are not only attempts at visualizing the future but, also, warning signals that will serve to act now, in order to mold desired outcomes.

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Venezuelan Money Launderer slated to plead guilty in Argentina

Venezuelan Money Launderer slated to plead guilty in Argentina
9 September 2007

Fugitive Venezuelan-American "bagman" Guido Alejandro Antonini Wilson, wanted by Argentina in connection with the US$800,000 he attempted to smuggle into Buenos Aires, will reportedly plead guilty, and serve a six-month jail sentence in Argentina for his crime. If you are looking for a reason why he would leave his comfortable Key Biscayne, Florida residence, to serve time, sources inside Venezuela advise that he will reportedly receive a large sum from the Chavez government in exchange for falling upon his sword, and refraining from disclosing any information to Argentinean and Venezuelan authorities. If this happens, will the truth never be known?

Impeccable sources from Venezuela have now supplied heretofore unknown details about the bulk-cash smuggling operation which has created a major scandal in both Argentina and Venezuelan politics:

Although US$800,000 was indeed seized from Antononi's suitcase, $2m was previously brought into Argentina by the President of PdVSA. A figure of $3m was stated to be the total amount of illegal campaign funds, meaning that there is a discrepancy. Did Antonini divert for his own purposes the missing $200,000? He only had $800,000 in his suitcase. Where exactly is that cash?

The Venezuelan and Argentinean passengers reportedly consumed five expensive bottles of Johnnie Walker Blue Label (for a total cost of US$500-750) on the flight. Eyewitnesses report they were obviously under the influence of strong drink upon arrival at Buenos Aires' Jorge Newberry Airport.

Antonini was reportedly quite rude to the customs staff, and is said to have told the inspector that just one of the "books" he was carrying was worth more than the official's annual salary. Remember, when asked what he was carrying, he replied libros, meaning books. Did the alcohol cause him to become careless?

Confirmation has been received from several sources that all the $3m being bulk-cash smuggled into Argentina were destined for the presidential campaign of Sra. Kirschner.

Antonini was regularly moving illicit cash into Argentina, Uruguay, and Bolivia, and took a total of 15 trips, all for the alleged purpose of paying off and corruptly influencing government officials in those countries.

Antononi is reported to have placed an urgent telephone call, whilst at Argentinean customs, to the President of PDVSA, precisely when the $800,000 was found and seized. He was allegedly told to solve the problem at all costs.

The source of these illicit funds is rumoured to be a combination of narcotics profits and money illegally diverted from PdVSA.

Antonini has been reportedly debriefed by the US Federal Bureau of Investigation. Has he been offered immunity from prosecution for crimes committed in the US, and what were they?

In an obvious attempt by Antonini's business partners, Franklin Duran and Carlos Kaufmann to disassociate themselves from him, he has been recently removed as an officer from Foxdelta Investments Inc., a Florida corporation. The entity had already filed its Annual Report in June, naming Antonini, but in an unusual step, the company filed another Report in August, removing him from office.

Another Florida company Antonini was associated with, Venuz Supplies Inc., an active entity that is engaged in business with the Venezuelan petroleum industry, has been mysteriously dissolved. We do not know whether his title of Vice President at the Venezuelan petrochemical company, Venoco, has been terminated.

There are is more incriminating information surfacing in this case, and in our next article, we expose additional links and relationships which may put the matter into a proper global perspective.

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Global credit crunch batters Venezuela

Global credit crunch batters Venezuela
Overnight lending rate climbs as high as 90% after central bank suspends open market operations

By Polya Lesova, MarketWatch
Last Update: 2:28 PM ET Sep 6, 2007

NEW YORK (MarketWatch) -- In a fresh example of how the global credit crunch is hitting emerging markets, Venezuela's overnight lending rate climbed to as high as 90% Thursday after the central bank said it has suspended open market operations meant for pumping liquidity into the market.

The average overnight rate had been at an average of 22% on Wednesday. Venezuela's central bank said it has suspended open market operations, but added it would maintain credit assistance operations, according to a statement published on its Web site Wednesday.

"The squeeze in the Venezuelan money market is yet another example that the global credit crunch is becoming visible in emerging markets, especially in the most imbalanced economies and in countries with a weak financial architecture like Venezuela," said Lars Christensen, senior analyst at Denmark's Danske Bank.
"This story is not an isolated Venezuela story, but rather a developing trend," he said, adding that money markets in both developed and emerging markets aren't functioning well at the moment.

"While the developed economies in general have a strong banking sector, this cannot be said for many emerging markets, and hence the risk of banking and financial distress is much larger in emerging markets than, for example, in euroland and the U.S.," Christensen said.

Deepening trouble in the U.S. subprime-mortgage market has spilled over into global credit and equity markets, causing turmoil and prompting some investors to slash their exposure to risky assets, including those in emerging markets. See Emerging Markets Report.

Russia is another example of an emerging market that's suffering from the global credit crunch, Christensen said. "There's no or very little liquidity in the market. That has led smaller banks to halt their lending activity."
In Latin America, imbalanced economies such as Venezuela and Argentina are the most vulnerable, while Brazil looks much healthier, he said.

More trouble ahead for Venezuela

Venezuela, a founding member of the Organization of Petroleum Exporting Countries, was the world's eighth-largest oil exporter in 2005. The huge oil revenues have fueled the country's rapid economic growth.

Venezuelan President Hugo Chavez, a vocal critic of the U.S., has pledged to nationalize assets in important industries such as electricity, oil and mining. Chavez has consolidated his power over the country, controlling Congress, the judiciary and the army.

"The squeeze in the Venezuelan money market also has to be seen in the light of investors reducing exposure to high-risk markets," Christensen said. "Despite increasing political and economic problems in Venezuela, money has been pouring into the Venezuelan markets. This might very well be coming to an end."

Christensen said he has a bearish view of the Venezuelan economy and markets for several reasons, including Chavez's authoritarian regime, reckless and pro-cyclical fiscal policies, very high inflationary pressures and a rapidly shrinking current account surplus.

Polya Lesova is a MarketWatch reporter based in New York.


Sunday, September 2, 2007

Hugo Chavez: The Definitive Biography of Venezuela's Controversial President

Outside Venezuela, few people know who Hugo Chavez really is and how he got to be president. Read this bio to learn more.

September 1, 2007
'Hugo Chavez: The Definitive Biography of Venezuela's Controversial President' By Cristina Marcano and Alberto Barrera Tyszka

CHAPTER 1 The Revolution Has Arrived

On the night of december 6, 1998, a large crowd gathered in front of the Teatro Teresa Carreño, close to the center of Caracas. The atmosphere was festive. Moments earlier, the National Electoral Council had read the first official bulletin of the day's election results. With 64 percent of the votes counted, there was no longer room for doubt. Fifty-six percent of the Venezuelan electorate had voted for Hugo Chávez, while his principal opponent, Henrique Salas Römer, a coalition candidate representing the traditional political parties, had garnered only 39 percent of the vote. Venezuela now had a new president, a man who had tried to reach the presidency scarcely six years earlier by attempting to overthrow the government. What had been unattainable by military uprising in 1992 became reality via the democratic process. He was not a career politician, nor did he have any experience in the public sector. And he was barely forty-four years old, much younger than the average age of the presidents who had preceded him. Invoking the memory of the Latin American liberator Simón Bolívar, Chávez vowed to end corruption and democratize the oil business, and he expressed his dream of a country free of poverty. And from deep within the shadows, he dragged out one of Latin America's mustiest ghosts: revolution.

Though on the surface it may have seemed otherwise, December 6, 1998, marked the fulfillment of a deeply rooted obsession of the newly elected president. As his childhood friend Federico Ruiz recalls, on December 31 of 1982 or 1983, Hugo Chávez decided to take a day trip from the city of Maracay to Barinas, some 525 kilometers from Caracas, to visit their mothers and give their families a surprise New Year's hug. Five hours there and five hours back, at least. "It was just the two of us, in a Dodge Dart he had, passing a bottle of rum back and forth," Ruiz recalls. Of their very lengthy conversations, one moment remains crystal clear in Ruiz's memory. "He said, 'You know something? One day I'm going to be president of the republic.' And I said, 'Damn! Well, you can name me minister of, of . . . I don't know!' And then we joked around about it." Clarifying that this was not an idle comment made during a lull in the conversation nor due to an alcohol-infused bravado, Ruiz adds, "Hugo was very serious when he said that."

Of course he was serious. He was dead serious. This wasn't the first time the idea had popped into his friend's head. As a nineteen-year-old cadet in the military academy, Chávez had marched in a procession shortly after Carlos Andrés Pérez had been elected to his first term as president of the republic (1974–79). The moment established an unforeseen link between the two men, though it is entirely probable that Pérez walked past the young Chávez without giving him a second thought. Why on earth would Pérez have bothered to think that this cadet, who hadn't even graduated from the military academy, would one day conspire against him during his second term as president by staging a violent military coup against his government? How on earth could Pérez have ever imagined that this young soldier would become president of Venezuela one day? Young Hugo, on the other hand, had a very different experience of this moment. On March 13, 1974, he wrote in his diary, "After waiting a long time, the new president finally arrived. When I see him I hope that one day I will be the one to bear the responsibility of an entire Nation, the Nation of the great Bolívar."

Twenty-four years later, he had finally done it. Most Venezuelans, however, were probably not aware of the fervent determination that had driven him for so long. Chávez had taken care not to publicize these aspirations. In a 1999 interview, Mempo Giardinelli and Carlos Monsiváis, two renowned Latin American writers, asked him, "Did you ever imagine that you would be sitting here today, in the presidency and in the seat of power?" Chávez's simple response: "No, never. Never." Perhaps, on this December 6, the deeply personal meaning of this achievement was something he would celebrate on his own, for Venezuela was celebrating something else entirely: the triumph of antipolitics. The people of Venezuela had brought an outsider to the presidency, delivering a severe blow to the traditional political machine. A substantial sector of the middle class, fed up with the incompetence and corruption of the previous administrations, had fashioned a kind of revenge through the figure of this former military officer and coup leader. The media, dedicated as always to criticizing anything and everything in politics, were satisfied. The poor also identified with this message of "getting even," with this man who spoke of Venezuela's age-old debt to those who had always been excluded from the system. Chávez's victory, in this sense, was a new version of an old product, wrapped up in a bright, shiny package: Great Venezuela, the kingdom of magical liquid wealth;
the paradise from which so many Venezuelans had felt themselves marginalized; the fantasy of instant success.

The candidate representing an alliance known as the Patriotic Pole won the election with an unprecedented majority. According to the final count, he earned 56.44 percent of the vote. But who was Hugo Chávez, really? Where did he come from? Where was he going? How would his dreams and those of his country merge into one? On that victorious night in Caracas, after his rivals and the official institutions had formally acknowledged him as the new president-elect of Venezuela, this is what he had to say: "My dear friends: very simply, what happened today had to happen. As Jesus said, 'It is accomplished. What had to be accomplished was accomplished.' " And beneath the long shadow of the early dawn hour in Caracas, Chávez began to sing the national anthem.

Scarcely six years earlier, when Hugo Chávez had appeared on television to claim responsibility for attempting to overthrow the government, all his family could possibly feel were shock and embarrassment. At that time, nobody thought that Hugo Chávez was on his way to a meteoric political career. One of his friends from secondary school said, "It's something very difficult to digest. You have to take into account the significance of never having been a councilman, a congressman, a [political] leader, never having been a goddamn thing in politics . . . and then suddenly ending up president."

Indeed, nothing indicated that this would be Hugo's destiny. Many people probably would have said that simply being born in Sabaneta was a great disadvantage. On the other hand, it was also the ideal beginning of a grand myth, that of the humble man who rises to achieve untold powers—a potent, emotional dream for anyone with a melodramatic vision of history. There may have been presidents before Chávez who had risen to the pinnacle of power from simple, humble beginnings—in fact, none of the presidents from Venezuela's democratic age had come from Caracas. Just like Chávez, all of them had come from the provinces—the majority from poor families, as well. Yet Hugo Chávez, the first one from Barinas, in the far reaches of the Venezuelan plain, was the first president to transform his geographic circumstances into a symbol.

Regionalism is a tricky thing. The simple recipes that use geographic ingredients to define cultural traits are so very easy to believe and are repeated over and over again: people who live near the ocean or sea are open, honest, spontaneous people, whereas those who hail from the Andes, who live in the cold, vertical silence of the mountains, are taciturn, withdrawn. These kinds of classifications are hard to avoid. According to the Venezuelan stereotype, the llanero, the man from the plains, is a reserved, skeptical type who, once you break the ice, reveals himself to be a loyal, talkative person who loves to tell a good story. They say that there is something about the plains, with their converging horizons and interminable, flat terrain, that produces an odd combination of silences and long musical corridos, filled with protracted screams and counterpoints. It is a territory that is also a climate of the interior, a place where cattle, ghosts, horses, and apparitions

Manuel Díaz, also known as "Venenito"—Little Poison—worked for some thirty years as a chemistry teacher at the Daniel Florencio O'Leary secondary school in Barinas, where Hugo Chávez was his student. According to Díaz, the llaneros "are hard to understand. They are very suspicious people. Always thinking about what people want from them. But once they know you, they are genuine. . . . They offer their friendship when they see that it is reciprocal." He also adds another bit of insight: "They are marked by machismo. The man is the one who does everything." According to a common maxim that the people of the plains often use to describe themselves, "The llanero is as great as the task he sees in front of him." Obviously, there is nothing terribly specific about this refrain: a multitude of regional identities could easily jibe with this definition.

Of all Venezuelan presidents, however, Chávez has most consistently invoked the spirit of the region from which he comes, frequently peppering his speeches with personal anecdotes, cultural references, and songs relating to the plains and its inhabitants. He loves to regale his public with childhood memories, and when he speaks of his retirement, he talks about going back to his roots and spending his golden years on the banks of a river, in some faraway outpost of those vast plains.
Efrén Jiménez, Hugo's childhood playmate and next-door neighbor, says of those days, "Sabaneta was made up of about four streets. At that time I think there must have been about a thousand people, maybe a little more. We all knew each other, we were all like one big family." There was no regular electric light, but the village had a generator that delivered electricity every day from 6:30 p.m. to 10:30 p.m. Hugo's father, Hugo de los Reyes Chávez, taught at the Julián Pino school, the only one in the village. Another childhood friend recalls the elder Chávez as a good educator, "strict, demanding, and disciplined, but not arbitrary."

Hugo Rafael Chávez Frías was born in Sabaneta, in the state of Barinas, on July 28, 1954, the second of six brothers. His mother, Elena, has admitted that during those years "my work was all family. I couldn't do anything else." They lived in a house with a roof made of palm leaves. That was where all her boys were born: "With a midwife. Like a pig, because back then there was no hospital, no doctor, nothing. It was just you in childbirth. And the pain was the same with all of them. All of them."
The Chávez family finances were very precarious; the money disappeared as fast as the children appeared. Perhaps for that reason, Rosa Inés Chávez, Hugo's paternal grandmother, would become an important figure in his life. Because of the family's strained budget, she was the one who raised young Hugo, and Chávez has openly acknowledged the tremendous role his grandmother has played in his life. When his second wife bore him a daughter, she was baptized Rosa Inés. Those close to Chávez's grandmother confirm that she influenced Chávez in a way that would have been all but impossible in his parents' home.

Elena Frías de Chávez was eighteen years old when she gave birth to Adán, her first son. A year and three months later, she gave birth again, to Hugo. Another year and three months later, she gave birth to yet another baby. At that point, her mother-in-law offered to lend a hand, and it was agreed that Adán and Hugo would move to their grandmother's house. Economically, it was probably not much of an improvement, but at least the responsibilities were spread around. In her kitchen, Rosa Inés would prepare arañitas, papaya sweets, and Hugo would go out and sell them in the street. In a diary entry dated June 12, 1974, Hugo recalled, "Around here, in the area nearby, there was lots of mountain broom and just looking at it brings back the distant but indelible image of my life as a child, in the fields of Sabaneta, with Adán and my grandmother, gathering handfuls of that plant to sweep our modest house with the dirt floor." Chávez's many fond references to his grandmother clearly reveal that her affection and love were and are of paramount importance to him. As far as anyone knows, she was a quiet, good-humored woman. Her death, in 1982, was a terrible blow to the two brothers whom she raised.

Elena eventually decided she wanted her children to return home, but by then it was already too late. "Afterward, when I wanted to get my children back, my husband said to me, 'Elena, if you take those little boys away from her, my mother will have a heart attack. And if my mother dies it will be your fault.' And so I didn't say anything, because if she died, they were going to blame it on me. . . . After a while I brought it up again, I said, 'Hugo, I want my sons to come back here with me.' " The verb "take away" may sound harsh, but that is precisely what they would have been doing. The years went by, and the two little boys would never return to live in the home of Hugo and Elena. They would often spend much of the day at their parents' house, but at night they always went back to sleep at their grandmother's. According to Elena, her house was home for the two boys "until Hugo went to the Academy and Adán left for college."

The influence of his grandmother and the early separation from his mother have served as fodder for many hypotheses regarding the evolution of Hugo Chávez's personality and character. Some people feel there is a connection between the circumstances of his early life and the incendiary tone of his political rhetoric. Some people sense in him a perpetual aggression that they believe stems from a deep-seated resentment regarding his early childhood experiences. This would be supported by a related theory suggesting that Chávez harbors muted feelings of ill will toward his mother.

Herma Marksman, the history professor who was Chávez's lover for nine years, says, "I felt that he loved his father more than his mother. I think that he really missed the warmth of his mother during those early years. That is my personal perception." Marksman also recalls a heated discussion they once had as a couple, which ended with the following exchange. " 'So you don't love your mother?' I asked him. And he said, 'No. I respect her.' On two separate occasions," she says, "he brought up this distance from his mother. It was so extreme that, for a time, if the two of them crossed paths on the street, they would avoid each other so they wouldn't have to say hello. That's what he told me." According to Marksman, there was a period of two years when Chávez did not speak to his mother at all.

In an interview with the magazine Primicia, in 1999, a confession from Elena added more fuel to the fire: "I didn't want to have children . . . I don't know, I didn't like them, it didn't seem appealing, but since God told me, 'That is what you are going to do,' I got married and a month later I was pregnant." She also admits that she was very strict, and would often hit her sons to keep them in line, a common practice in Venezuela in those years.

When Chávez entered the military academy in 1971, the very first letter he wrote was to his grandmother Rosa Inés, and she was the person he would write to again and again after that, his letters filled with expressions that confirmed their closeness: "Dear Mamá," he often wrote to her, and he also referred to her on occasion as "mamita." His words reflect genuine warmth and affection, a strong, profound emotional bond. At the end of one of these letters, dated August 31, 1971, he said as much: "Finally, I want you to know that I have always felt proud to have been raised by you and to be able to call you Mamá. And I ask you to bless me, your loving son." This deep-seated devotion contrasts a bit with the feelings he expressed in letters to his birth mother. The correspondence with Elena de Chávez was also loving and affectionate but far more sporadic, which does seem to suggest that young Hugo's maternal bond was with his grandmother. That, at least, is how he put it on the eve of his graduation from the military academy: "I have been alive for twenty years, sixteen of which I spent with you. I have learned so many things from you: to be humble but proud, and the most important thing, which I inherited from you, was that spirit of sacrifice that I hope will take me far, although perhaps, if I am unlucky, it will cut my illusions short."

While some believe that the circumstances of his childhood were extremely traumatic, others feel the exact opposite is true: one childhood friend remembers Hugo as a happy child and points out that this type of family arrangement, in which grandparents or uncles and aunts raised grandchildren or nieces and nephews, was quite normal in the rural Venezuela of those years. In general, Chávez himself has also tended to recall his childhood as a happy time in his life; he has never spoken of his early years as a hell from which he needed to escape. On his Sunday radio show of October 17, 2004, he remarked that his early years had been "poor but happy," and he has often delighted in telling stories about his two great childhood passions: painting and baseball. Elena also remembers the talent and skill her son demonstrated: "He liked to draw a lot. He painted everything. He would sit down right here and look at a little dog, and in a flash he'd paint it. He would make drawings of his brothers, his friends . . . anyone who came his way would say, 'Huguito, make me a drawing.' And right away he would draw a little something. Just like that."

His other great passion was el juego de pelota: baseball. Almost all little boys in Venezuela, at one time or another, dream of being baseball players, and around that time, a Venezuelan pitcher whose last name also happened to be Chávez had made it to the American big leagues with a promising future. His first name was Isaías, though thanks to his superlative pitching skills, he became known as "Látigo"—the Whip. Huguito took an immediate shine to the Whip, who was ultimately more than just an idol—he was a model, a dream that Hugo could aspire to. Whenever Hugo played in the streets or in one of the empty lots in his village, he would daydream about one day becoming a real-life baseball player, a celebrity who could command ovations from the crowds in a massive stadium somewhere.

Others from Sabaneta who were close to the family during those years also agree that Hugo Chávez's childhood was not a wretched experience that warped his personality and made him resentful, aggressive, and vengeful. Aside from speculations about what went on inside the family nucleus, there seems to be only one distant story offering any suggestion of a childhood marked by humiliation. His aunt Joaquina Frías describes it: "The first day Hugo went to school they wouldn't let him inside. He was wearing an old pair of canvas slippers, the only ones he had. His grandmother Rosa Inés cried and cried because she couldn't afford to buy him shoes. It was heart-wrenching to watch that woman, so strong-willed in general, break down like that. I don't know how she managed to buy another pair of slippers, but the boy was able to go back to school." This scene hardly seems like something that could define the totality of a man's character, but yet again it does underscore the importance of his grandmother: after all, it was Rosa Inés who accompanied him on his first day of school, and it was Rosa Inés who confronted even the tiniest of everyday mishaps and troubles.

Edmundo Chirinos is a nationally renowned psychiatrist. Associated with leftist politics, he is the former rector of Venezuela's Central University and was once a candidate for the presidency. After the 1992 coup attempt, he became acquainted with Hugo Chávez. When he was imprisoned in Yare, he didn't know many people in the civilian world. He called some of us who had a certain prestige or were known by people. That's how he called the current vice president [at that time, José Vicente Rangel], his mentor, Luis Miquilena, and many others that have come into his government. He called me because I had been a presidential candidate and had political experience; second, he had family problems, and required my services as psychiatric counselor. He was not perturbed; he only had common problems anybody could have had with wives or children. That's how I became his friend and counselor.
When Chirinos describes Hugo Chávez, he does not single out the president's relationship with his grandmother, but he does highlight some notable personality traits that are clearly linked to his life experience, including his childhood: "Chávez feels genuine scorn for oligarchic people, not only in the sense of possessing money but of affectation, through gestures, language . . . and so in that respect, he exhibits an evident bipolarity, of an affinity for the humble and a rejection of the all-powerful."

As time goes by, it will become more and more difficult to study the facts of Hugo Chávez's journey through life. His story already has an "official version," a party line that has been reconstructed and retold from his position of power. Any anecdote about his childhood, any distant event, is now seen in a different light, either magnified or diminished, reinvented or dropped. This is almost part of the natural process by which power invents a new kind of memory. When Elena was asked if she had ever known of her son's intentions of becoming president, she replied, "We hadn't planned anything, anything at all. Look, all this has come to us by the work and the grace of the Holy Spirit. Nothing more."

But it was more than the Holy Spirit that shook the country on December 6, 1998. It is no coincidence that the person running Venezuela today came of age in the army. Nor is it anything new: between 1830 and 1958 the country was governed by civilians for a scant nine years. In 1958, the demise of General Marcos Pérez Jiménez's dictatorship marked the beginning of the longest period of democracy Venezuela has ever known. During this era the main parties opposing the military regime came together and, with the exception of the Communist Party, drafted an agreement of governance, later known as the Punto Fijo Pact. Ultimately, Democratic Action (the Social Democratic party) and the Christian Democrats' Independent Political Electoral Organizing Committee (known as COPEI, from its initials in Spanish) took control of the public sector in Venezuela. During four decades, the two parties took turns in the presidency. The adecos, as the Social Democrats are called, governed for
five terms, and the copeyanos, as the Christian Democrats are known, led the government on three occasions. By 1998, this model was so deeply in crisis that Hugo Chávez's main promise to the country was to end "forty years of corrupt democracy." This was the central theme of his campaign: to do away with the past.

On December 7, 1998, the editorial page of the newspaper El Nacional neatly summarized the sentiments of the majority of the voting public: The results of this Sunday's election speak very clearly about Venezuelan society, not just about the great hopes for change that have been evolving at its core, but also about the tremendous levels of frustration that have turned the majority against the old political leadership. It is absolutely clear that the entire country has chosen an option that is different from that which the traditional ruling class was trying to impose. It was clear that the punishment vote had worked, and that democracy—at least the kind that the Venezuelan elite had engendered—was no longer a promise that people felt they could believe in. In 1998, everyone in Venezuela, even those who did not vote for Hugo Chávez, wanted a change.

This evaluation of the immediate past, however, may be unfair. It may also be influenced by the way Venezuelans relate to their own reality, to the culture of a country that has never quite figured out how to assimilate its oil wealth. There is little doubt as to how or why, in scarcely forty years, Venezuela's civilian-democratic project became so warped and so corrupt, dissolving in a debilitating crisis that touched every area of society and its institutions, from the economy to political representation to the delivery of justice and beyond. On the other hand, it is also important to recognize that, at least in the beginning, the democratic experience modernized the country and served to interrupt the militarist tradition—and temptation—of Venezuelan history, introducing educational reform, agrarian reform, the decentralization process, the nationalization of the oil business, the creation of scholarships and specialized study programs abroad. No legitimate assessment can overlook the country's very deep complexities during this period. Even in economic terms, the verdict always requires a good deal of qualification.
In 1997, a group of academics and researchers decided to undertake a serious and exhaustive analysis of poverty in Venezuela. In 2004, they published the results of their study:

By the middle of the twentieth century, there was already a deeply rooted conviction that Venezuela was rich because of oil, because of that natural gift that does not depend on productivity or the enterprising spirit of the Venezuelan people. Political activity revolved around the struggle to distribute the wealth, rather than the creation of a sustainable source of wealth that would depend upon the commercial initiatives and the productivity of the majority of the Venezuelan people. Under democracy (starting in 1958), the income from oil (which represented almost 90 percent of exports and 60 percent of the national budget) was distributed more broadly, but this distortion in the mentality and the economic dynamic became a permanent factor in the country. Politicians rested on their promises—as well as some successful initiatives to expand public services—of distributing the wealth that was in the hands of the state.

More and more, the country harbored the illusion that it could advance toward modern consumer habits (through imports purchased with its petrodollars) without having to develop a diversified production through a modern culture of productivity. To a certain degree, this was possible for 10 percent of the population in a Venezuela of less than 5 million inhabitants, but there is no way that in Venezuela today, with 25 million inhabitants, 11 million workers will enjoy decent, steady jobs while clinging to the oil dynamic and the culture of easy money. Twenty-five years ago, after sixty years of growth from 1918 to 1978, a period in which the gross national product grew more than 6 percent annually and Venezuelans experienced the sensation of social mobility, the country fell into decline, and poverty began to grow at an alarming and sustained rate.

Hugo Chávez was born in that Venezuela of less than 5 million inhabitants. He benefited from the advantages of that first democratic, modernizing impulse of the governments that succeeded the Pérez Jiménez dictatorship. But he also witnessed and lived through the decline. In this sense, he was a link between these two countries: one captivated by the quest to build a fairer, more evolved society with solid institutions and enterprises, the other in thrall to the great national illusion, a utopia in which the state is the providential benefactor, all structure and rules are dispensable, effort is a distraction, and destiny is not a future to build but a heaven that already exists, a treasure already won that needs only to be meted out properly.

Those who worked on Chávez's presidential campaign took brilliant advantage of the widespread desire for a clean break with the system. "The country had expectations for Chávez," says Juan Barreto, a journalist close to the president. "[This was] because he was the person who, in the most frontal way imaginable, had stood up to the symbolic forms of political power: the central government and Carlos Andrés Pérez, who at that moment was the living incarnation of corruption." Though the people who designed his electoral campaign say that Chávez did not let people advise him and "created his own image," it is clear that they did have to fix certain things along the way. For example, Chávez often sounded extremely aggressive when he made speeches. He also had a tendency to use a confrontational, macabre vocabulary—the word "death" frequently popped into his speeches, which led people to think of his candidacy as something frightening. In addition, the many groups that supported him, which were lumped together in an alliance called the Patriotic Pole, included the Communist Party and other leftist organizations with extremely radical postures. His campaign strategists soon realized that the real debate and the real issues were more than just a repudiation of the past and of the country's traditional parties and their corrupt practices. Nobody, they realized, could win an election without offering hope.

Rafael Céspedes, who served as an adviser to Dominican president Leonel Fernández on two occasions, played a key role in fine-tuning Chávez's public image. One of his principal strategies was to use Marisabel Rodríguez, the candidate's second wife, in the campaign. Marisabel was part of an elaborate plan intended to soothe the Venezuelan populace by softening the candidate's image. Marisabel is well educated, kind, attractive, and spontaneous. Her type of beauty was especially useful to the campaign because there is something about her that recalls the stereotype that so many people seem to adore: she is white, she has blue eyes, and in fact, she had even participated in a competition sponsored by Revlon to find the most beautiful face in Venezuela. At the side of the unpredictable, aggressive soldier, suddenly there was a real-life Barbie doll who even made sense when she talked.

All through 1998, Chávez and his team plugged away, and his campaign went from strength to strength. The statistics are overwhelming: in January the polls reported a 9 percent approval rating, whereas by October, just two months away from the elections, the same polls revealed that 48 percent of the electorate was on his side. It hadn't always been smooth sailing. In June, Bandera Roja (Red Flag), one of the leftist groups that had supported his candidacy, dissociated itself from the campaign and accused Chávez of working a "double discourse": "In front of the nation he acts like an avenger who wants to sweep the decks and start with a clean slate, turn the country upside-down, but when he is among the powerful he shows his true colors and confesses his true intentions, which are to carry out nothing but superficial changes." Also that month, Teodoro Petkoff, the leader of the Venezuelan leftist opposition and founder of MAS (Movimiento al Socialismo, the Movement Toward
Socialism party) and an internationally renowned activist, called him a populist and compared his demagogy to that of Carlos Andrés Pérez. Chávez did not even flinch.

On July 24, the date on which Simón Bolívar's birthday is celebrated, Hugo Chávez registered his presidential candidacy with the National Electoral Council and declared, "Let the whole world know that in Venezuela, a true social revolution is now under way. Nothing and nobody will be able to stand in the way of the triumph of the democratic revolution." The parties that made up the Patriotic Pole and supported his candidacy were the Movimiento V República (Fifth Republic Movement), an entity founded by Chávez himself; Movement Toward Socialism; PPT (Patria para Todos, or Homeland for All); the Venezuelan Communist Party; and the Movimiento Electoral del Pueblo (People's Electoral Movement). This was not a massively organized machine by any stretch of the imagination—quite the opposite, in fact. It was a collection of relatively small leftist parties, united behind the personal figure of the candidate. With his unusual talent for communication, Chávez capitalized on the collective desire for change by cultivating and promoting the idea that his election, in and of itself, already represented a rupture in the historical continuum, a transformation.

Jimmy Carter, who attended the election, who attended the elections that Sunday, December 6, 1998, as an observer, confirmed this by stating that he had witnessed a democratic and peaceful revolution.

Chávez's campaign chief, the retired general Alberto Müller Rojas, suggests a less heroic version of that election day: "The campaign won pretty easily. The victory had more to do with his adversaries' political errors than the quality of our own electoral campaign, which was relatively disorganized because that was the only way it could be. The elections were won more because of what the opposition didn't achieve than because of what chavismo [the Chávez movement] actively achieved. I am absolutely convinced of that." Anyone who studies the performance of Chávez's opponents will undoubtedly discover a number of grave miscalculations. First, his opponents seemed unaware of the fact that the country was changing. They never seemed capable of reading the reality of what was going on—neither in the very beginning, when Irene Sáez, a former Miss Universe without much substance, enjoyed tremendous popular support, nor at the end, when a number of parties and organizations, in desperation over Chávez's imminent triumph, came together far too late in support of Henrique Salas Römer, the only candidate with a chance of beating Chávez, according to the polls. The opposition simply had not offered any coherent political alternative for the Venezuelan voters—not even in their electoral demagogy was there the glimmer of a serious proposal. Their only objective was to avert a Patriotic Pole victory. Quite aptly, the press labeled the movement the "anti-Chávez front."

Nedo Paniz, another close Chávez collaborator during this period, clarifies that the campaign was not all improvisation and guesswork. It was very expensive, and Chávez doggedly pursued the strategy of nothing but ferocious, constant criticism of those in power. He also refused to take part in a broadcast debate with his main opponent, and it was this aloof, fierce attitude that ultimately brought the traditional political parties and the entire political class to their knees.

The rest of the country, however, was jubilant. It had been years since so many Venezuelans had come together to celebrate a victory like this. When he assumed the presidency, Hugo Chávez enjoyed 80 percent of the population's support. Müller himself confirms that Gustavo Cisneros, the wealthiest man in the country, supported the Chávez cause with cash donations and free airtime on Venevisión, his television channel. This gesture of confidence is an interesting example of the enigmatic and ambiguous relationship that has always existed between the president and the magnate. Cisneros has long since been the emblematic enemy of the Venezuelan left as well as the living image of the reactionary far right. Some years later, Chávez would say Cisneros was conspiring against his government. On a radio program in May 2004, Chávez bristled when he spoke of Cisneros: "The day will come, and hopefully it is not far off, when we will have a body of judges and prosecutors who are
afraid of nothing and who will act according to what the Constitution says, and send capos like this Gustavo Cisneros to prison." Shortly thereafter, however, a private meeting was held between Chávez and Cisneros under the stewardship of Jimmy Carter. The Chávez camp claimed that Cisneros was involved in drug trafficking and had been one of the masterminds behind the April 2002 coup to remove Chávez from the presidency. Apparently, things have always been like this between the two men. Müller recalls that at one dinner together, both men were surrounded the entire time by their respective aides, who acted as intermediaries because the two refused to speak to each other directly. "The compromise that Chávez reached with Cisneros was that he would give [Cisneros] a monopoly on educational television in Venezuela," says Müller Rojas. If that was the case, Chávez never made good on his promise.

With respect to support and alliances, this was far from the only bit of unexplained business on the path to electoral victory. In 2002, the Spanish newspaper El Mundo reported that Banco Bilbao Vizcaya had donated $1.52 million to Chávez's electoral campaign. Luis Miquilena, the head of finances for the Patriotic Pole, was involved in this relationship. One of Venezuela's veteran leftist leaders, Miquilena was Chávez's mentor and his first interior minister. He and his business partner Tobías Carrero were rumored to have accepted money from a foreign institution for an electoral campaign, which is a crime in Venezuela. This revelation led to another bit of information that raised even more eyebrows: on January 11, 1999, during his first trip to Spain as president-elect of Venezuela, Hugo Chávez met with Emilio Ybarra, president of Banco Bilbao Vizcaya, and then with Emilio Botín and his daughter Ana Patricia Botín, of Banco Santander. At first, the new administration
denied everything, but the situation soon became unmanageable: according to the Spanish daily El País, the central bank of Spain reported that BBV (which has since merged and is now Banco Bilbao Vizcaya Argentaria) had diverted funds of "more than $1.5 million through two payments to the Chávez campaign with the intention of protecting itself in the event of a possible nationalization of the finance industry in this Latin American country." On April 6, 2002, General Müller acknowledged the BBV donations, adding that the majority of international banks operating in Venezuela had also contributed to the Chávez campaign.

A few days later, however, on April 25, Hugo Chávez said on the Spanish TV station Telecinco, "I have not received one dollar from these people, this bank . . . what is it called? . . . Bilbao Vizcaya." It is also rumored that the campaign had received $1.8 million from Banco Santander. In Spain, on June 20, Emilio Ybarra, the former copresident of Banco Santander, admitted to Spanish magistrate Baltasar Garzón that in fact he had donated money to finance the Chávez campaign in 1998. Müller has said that "Luis Miquilena handled these resources in a secret manner. Nobody—neither the parties that comprised the Patriotic Pole, nor the apparatus I had in place at campaign headquarters—knew how much money was there, what it was spent on, or how much was spent on each individual item." Venezuelan justice sank into these shadows. The charge against Chávez of illegal campaign financing, which was filed with the attorney general of the Republic, never went anywhere.

On the night of December 6, 1998, however, the country was in the throes of euphoria and had little interest in such details. In the gathering in front of the Teresa Carreño Theater, Hugo Chávez began to speak. The cameras of every media organization in the country were firmly fixed on the new president's face, and the entire country anxiously awaited his words. William Izarra, a retired military officer and the secret protagonist of many a military conspiracy, watched as if he couldn't believe it was really happening. As he walked past Izarra, Hugo Chávez stopped to embrace him. And in the middle of this emotion-filled moment, the president-elect whispered, "We did it, brother. After all those years, the revolution can finally begin."