Venezuelans are upset, and Maduro knows it

 

Foreign Policy

On Dec. 8, Venezuelans will head to the polls to elect mayors and local council members. On paper, the election would seem to be of little consequence. However, both the government and the opposition have increased the stakes by transforming it into a virtual referendum on the fragile government of President Nicolas Maduro.

Maduro has not had a good year. In spite of winning the presidency last April on the heels of Hugo Chavez’s death, the new president was inaugurated with lead on his wings. Most people believe Maduro squandered the significant political capital left by Chavez, barely squeaking out a win in an election marred by controversy. His main challenger, Henrique Capriles, has yet to concede the election because of numerous voting irregularities, and a full audit of the vote never took place.

The president faces enormous financial and economic difficulties as Venezuela labors under a large budget deficit. Due to slumping local production and an overvalued exchange rate (the black market exchange rate is 10 times the official one), the nation is basically importing all it consumes. This is still not enough: Scarcity of basic staples has shot up, and the problem has persisted all year long.

Maduro’s problems are partly a direct consequence of Chavez’s policies in the oil industry. A combination of lack of maintenance in local refining facilities together with a policy of giving away gasoline for free means that Venezuela now imports millions of dollars in refined products from the United States at market prices. Furthermore, a shift in Venezuela’s customer base has negatively affected its balance sheet.

Years ago, Chavez decided to sell less oil to the United States and more oil to emerging economies such as China and India. Venezuela is now a close-to-marginal supplier of crude to the United States, and sales of oil to India and China have surged. This shift has come at a cost: Sales to China are used to pay for generous Chinese loans, and sales to India are affected by large shipping costs. According to the local oil consultancy Subaeshi, the shift in markets has meant foregone revenues for Venezuela of about $9 billion, or 3 percent of its GDP.

Public opinion polls are showing Venezuelans are upset, and Maduro knows it. That is why he has declared Dec. 8, the day of the municipal election, as the “Day of Loyalty and Love toward Supreme Commander Hugo Chavez and the Homeland.” By blatantly linking the election to the still-popular Chavez, he hopes to equate a vote against his government to treason.

If Chavez’s United Socialist Party gets trumped at the ballot, as several polls seem to suggest it will, then Maduro may face calls to change course from within his own party, or worse, from members of the military. Grumblings about a needed change in course are still muted at this point, but it is telling that Maduro does not figure in the ads of many of the government’s candidates. Only one person does – Hugo Chavez himself.

For Venezuela’s opposition, key mayoral positions are necessary for their broader struggle to unseat Maduro. Capriles has hinted that he intends to go after Maduro via a referendum sometime in the near future. In order for this plan to work, he needs the knowhow on getting out the vote that only local leadership provides. He also needs his base to turn out and start believing in the vote as an instrument for change.

The opposition is set to do well in major urban centers. It is on course to win easy reelection in the Caracas districts of Sucre, Chacao and Baruta, and is favored to win the Metropolitan Caracas Mayor’s office as well. It is also likely to hold on to Maracaibo, the country’s second largest city.

One place where they are probably going to come up short is in Libertador, the central Caracas district home to most of the government. Holding on to this post is do-or-die for the government, and the incumbent chavista mayor there looks relatively safe.

The Dec. 8 election won’t change Venezuelans’ lives. The underlying problems affecting Venezuela will remain in place. But if the opposition scores a big win, change will be in the air. Maduro is likely to face calls for significant change. The political dynamics will have shifted in favor of the opposition, and Capriles will see his chances of unseating Maduro boosted. If, on the other hand, the government spins it as a win, opposition voters may decide to shun the electoral strategy for good, opening the door to other, more radical approaches.

After the void left by the death of Chavez, Venezuela’s political and economic scenes remain unsettled. Regardless of the outcome, this first local election of the Maduro era hints at the turbulence ahead.

Juan Nagel is the Venezuela blogger for Transitions, co-editor of Caracas Chronicles and author of “Blogging the Revolution.”

© 2013, Foreign Policy

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