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Thank you, Mr. Chairman, and members of the Committee for inviting me to present these facts and views. The Center for Economic and Policy Research is an independent, non-partisan policy institute. We are funded primarily by foundations, large and small, as well as some individual contributions from U.S. citizens. We do not receive any funding from governments, political parties, or corporations.

On the subject of this hearing "The State of Democracy in Venezuela," there is much public confusion. To set the record straight: Venezuela is a democracy, as much as any country in Latin America today. As Jimmy Carter said on a visit there: "I believe that freedom of speech is as alive in Venezuela as it is in any other country I’ve visited."

The same is true for freedom of the press, assembly, association, and other civil liberties. Anyone who calls the Venezuelan government "authoritarian" is in need of a dictionary, or perhaps needs to see the place. I was there during the oil strike in December 2002 and witnessed the government’s response to the destruction of its economy by less than one percent of the labor force -the management and some of the workers in the oil industry. They were not striking for better wages or benefits, but to overthrow the government. Even in the United States, which has perhaps the strongest tradition of protecting civil liberties in the world, a strike of this nature would be illegal. Here the leaders would have been subject to court injunctions ordering them back to work, and jailed if they refused. This did not happen in Venezuela. The strike lasted for 64 days and sent the economy into a deep recession.

It is true that there are human rights abuses in Venezuela. But these are not different from those in the rest of Latin America, and I have not heard any reputable human rights organization argue that they have worsened under the five years of Chavez’ government. Nor have they argued that the government has engaged in any systematic repression of political dissent.

What, then, are the major threats to democracy in Venezuela? The attention here has focused on the Venezuelan government. It is of course true, as Americans have long recognized, that any government can become repressive if its citizens are not vigilant. But Venezuelan democracy faces other challenges.

Some are from Washington. Our government has funded, and continues to fund, organizations headed by people who were leaders of the military coup of April 2002. (See Appendix 2). These leaders have received, and some continue to receive, funds from the United States Congress through the National Endowment for Democracy. These are people who signed the actual coup decree of April 12, 2002, that overthrew the elected President and Vice President, and abolished the General Assembly, the Supreme Court and the constitution, and established a dictatorship.

Should these people, and their organizations, be funded by US taxpayers’ dollars? Is this the proper function of the National Endowment for Democracy? These are questions that Congress should ask. I think that most Americans would be against such funding if they were aware of it.

The NED is also funding a group -called Sumate- that led the signature drive to recall the President of Venezuela. We do not allow foreign financing of electoral campaigns in the United States. Clearly we should not insist on violating the laws of other countries, and their sovereignty and democracy, in ways that we would not permit here.

Our government also undermines democracy in Venezuela by disregarding the rule of law in that country, and encouraging the opposition to do the same. It must be recalled that the Bush Administration, alone in this hemisphere, initially endorsed the military coup in April 2002. There was strong circumstantial evidence that our government gave prior approval or possibly even more support than this, in addition to the stepped-up NED funding to opposition groups in the months prior to the coup. Senator Dodd asked for an investigation, and the State Department’s Office of the Inspector General found that "U.S. warnings [to the opposition] of non-recognition of a coup-installed government, economic actions, and other concrete punitive actions were few and far between."

But the Administration made no attempt to repair relations with the elected government after it was restored. Rather it went on to tacitly endorse the oil strike - in spite of the fact that it was preparing for a war in the Middle East, likely to reduce oil supplies, at the time. In December 2002 the White House supported the opposition’s unconstitutional demand for early elections.

More recently, the Administration has made a number of statements that have encouraged the opposition not to respect constitutional processes. Before the results of the signature gathering process were decided last month, Roger F. Noriega, assistant secretary of state for Western Hemisphere affairs, declared that the "the requisite number of people supported the petition" and warned of "dire consequences" if Venezuela’s National Electoral Council did not arrive at the same conclusion.

These are very powerful signals to an opposition that clearly has some very strong anti-democratic leadership. Although the focus here is on the government of Venezuela as a threat to democracy, it is worth recalling that the opposition only agreed in May of 2003 to pursue an electoral strategy after all extra-legal means of overthrowing the government -including a military coup and several oil strikes- had been exhausted.

The most powerful opposition leaders have not expressed any regret for these strategies, but on the contrary, have continued to state openly that they will only respect the results of the referendum process if they win. By contrast, the government has consistently maintained that it will abide by the results, and has done so.

A Los Angeles Times reporter interviewed one of the country’s most respected pollsters, from the firm Datanalysis, Jose Antonio Gil. The firm’s polls are often cited in the US press. According to the L.A. Times, he could "see only one way out of the political crisis surrounding President Hugo Chavez. "He has to be killed," he said, "using his finger to stab the table in his office (...) He has to be killed."

It is hard to imagine an opposition of this type in the United States -they would probably be labeled "terrorist" here- but these are the people with whom our government has aligned itself. It is also difficult to conceive of a media like Venezuela’s, if you have never seen it. Imagine ABC, NBC, CBS, CNN, Fox News and the cable channels, USA Today and most major newspapers, as well as most radio — all controlled, in terms of their daily content, by the most fiercely partisan opponents of the government. They have also abandoned the norms of modern journalism, becoming organs of a movement to de-legitimize the government. Two months ago one of Venezuela’s most influential newspapers actually used a doctored version of a New York Times article to allege that the Chavez government was implicated in the Madrid terrorist bombing. (See Appendix 1) But the media has never been censored by the Chavez government.

Other arguments have been put forth to portray the Chavez government as anti-democratic, but they are not very convincing. Clearly Venezuela is nothing like Cuba, although Mr. Chavez does have friendly relations with Fidel Castro. It is not clear why this should be a reason for such bad relations with the United States. The President of Brazil, Lula da Silva, and his party have deeper and longer-standing relations with Castro and Cuba. The Bush Administration and Brazil have agreed to disagree on this issue, and that seems to be the end of this dispute.

Most recently, Venezuela’s General Assembly passed a law allowing the government to add 12 new judges to the Supreme Court, which currently has 20 judges. This would certainly alter the balance of the court in favor of the government. But this is also a Supreme Court that decided that the people who carried out the military coup of 2002 could not be prosecuted. In the United States, I am pretty sure that our Congress would use its power to impeach a Supreme Court that made such a ruling. And of course, the judiciary has never been independent in Venezuela — less so under previous governments than presently. It will not make much progress in that direction so long as the country remains deeply polarized.

This polarization is a very serious problem, and of course Chavez is a polarizing figure who has contributed to the problem. But Congress should not make it worse by allowing our government to take sides. We should normalize our relations with Venezuela, which is a democracy and has never posed any threat to US security; it has reached out several times to our government since the coup - only to be rebuffed. The first step would be to stop funding the recall effort and people who have participated in a military coup against Venezuela’s elected government.