Bloomberg Businessweek
By Jeffrey Tayler
May 17, 2012

Courtesy of: Meridith Kohut for Bloomberg Businessweek

In the ramshackle town of Anaco in eastern Venezuela’s oil-rich Anzoátegui state, three yellow-shirted bodyguards rush a trim, perspiring, boyishly handsome 39-year-old in a baseball cap from house to shabby brick house through 500 cheering, flag-waving fans. Most in the throng are visibly poor, some are young women with tears of joy running down their cheeks. All are sweaty under a hot April sun.

The man they want to touch, Henrique Capriles, is the governor of Miranda state and the candidate selected in February by the Coalition of Democratic Unity to challenge incumbent President Hugo Chávez, 57, in elections scheduled for Oct. 7. Capriles’s strategy is to build a following among the poor — Chávez’s longtime supporters — with visits to private homes and small shops, meeting Venezuelans face-to-face. He’s made personal interaction with the electorate casa por casa (house by house) the pillar and slogan of his campaign. He has few alternatives: The national airwaves serve Chávez, and the few outlets that don’t are so openly hostile, most Venezuelans tune them out.

As Capriles’s hectic procession moves down the heat-warped main street, a group of 30 Chavistas in red T-shirts, shouting “Chávez! Chávez!” and waving posters depicting El Comandante, as Chávez is known, appear at a street corner. This is not much of a showing, given that Anzoátegui’s governor is a Chávez ally. Even so, Capriles’s inner circle tenses up. At many casa por casamarches, Chavistas have fired shots in the air or hurled tomatoes, rocks, and bottles at the candidate and his followers; Chávez himself has warned Capriles that someone is plotting to kill him. The bodyguards hurry Capriles safely past the protesters and into another welcoming home. The Chavistas roll up their posters and leave.

Capriles’s campaign, which invites Venezuelans to climb aboard his “autobús del progreso,” has a slick website, makes extensive use of social networking, and recalls that of candidate Barack Obama, as does his message of unity. Venezuela has seen nothing like it before: For the first time since Chávez came to power, the country’s notoriously fractious, unpopular opposition is rallying behind a single candidate (Capriles beat his closest contender by almost 1 million out of close to 3 million votes cast in February primaries). Capriles’s youth, energy, and record of competent governance in Miranda make him a credible challenger to the charismatic Chávez, Venezuela’s chief political figure for 13 years.

Courtesy of: Meridith Kohut for Bloomberg Businessweek

Since February, Capriles has emerged from relative obscurity to achieve a technical tie in a poll conducted by Consultores 21 in Caracas, while other surveys grant the incumbent a double-digit lead. Chávez has acknowledged Capriles in disparaging, dismissive, or caustic terms, calling him among other things a “petty bourgeois,” a lackey of the U.S., and even a fascist — his favorite, all-purpose moniker of contempt. Because of Chávez’s revolutionary regime, Venezuela is allied with Cuba, Iran, and Nicaragua, even as it continues to play a vital role in the U.S. economy as the fourth-largest supplier of oil.

With elections five months away, Capriles has time to rise. Chávez has an undisclosed cancer. Although he has tweeted from the Cuban hospital where he underwent surgery, he has refused to go public with a diagnosis or prognosis, fueling speculation that he’s gravely ill and may not survive the summer. Not surprisingly, rumors swirl that Chávez is no longer in control and that the military is plotting to oust him, cancel elections, and impose a state of emergency. Such scenarios could lead to further violence and chaos in a country that has seen plenty — including, most famously, the Caracazo incident of 1989, when the armed forces killed hundreds of protesters in Caracas who were marching against then-President Carlos Andrés Pérez’s austerity measures.

Should the military intervene in this election, Venezuelans “would not likely accept indefinite military rule,” says Shannon O’Neil, a Latin American expert at the Council on Foreign Relations in New York. “Any regime would have to promise elections and keep the oil revenues flowing, including to the United States. The generals couldn’t control the country for long.” Such an outcome, however, could be life-threatening for Capriles. “The situation would be too volatile to predict,” says O’Neil, “though [the military] might not want to make a martyr of him. He might have to leave the country for his own safety.”

As he moves about the country, Capriles security forces comprise three teams of five lightly armed men. Asked if he ever fears for his life, he answers with unwavering intensity, “Not at all. I sleep soundly at night. My Catholic faith helps me face this situation with calm.”

At first glance, Capriles’s background and light skin would seem a disadvantage with the voters he needs most: Venezuela’s majority, the poor and working class who are predominantly of mixed race and have traditionally stood by Chávez. Capriles was born in Caracas to a family he modestly describes as “hardworking” but which includes the owners of the country’s largest chain of movie theaters. He completed his studies in law at the capital’s Andrés Bello Catholic University in 1994.

As his second surname, Radonski, would indicate, Capriles has Eastern European roots. His maternal great-grandparents died in Treblinka; his mother arrived in Venezuela from Poland as a refugee during World War II and married a Sephardic Jewish immigrant from Curaçao. Although he freely talks of his ancestry, Capriles stresses his Christian upbringing, a matter of no small import in a mostly Roman Catholic country.

Capriles, who is unmarried, introduces himself as a professional politician and often announces he has been elected to every post he has held, including mayor of Baruta, a suburb of Caracas, and governor of Miranda, which has the second-largest industrial and agricultural sectors in the country. Back in 1998, he was the youngest ever vice president of the Parliament. While he lacks Chávez’s magnetism and can come off more fidgety than composed, Capriles seems like a normal person hoping to engage his compatriots in a discussion about Venezuela’s future.

The government tried to tie him to a failed coup attempt against Chávez in 2002 and incarcerated him for 20 days. Capriles says he was trying to quell violence. He stood accused of inciting rioters outside the Cuban Embassy. He successfully defended himself and was released. “I believe the leftist-rightist labels are outdated,” he says aboard his campaign bus. “I’m left of center. That is, I’m a progressive oriented toward protecting private property.” This puts him at odds with Chávez, who has made property expropriations a key feature of his political agenda.

In other critical ways, Capriles has displayed a conservative side. Last year he joined Chávez in condemning U.S. sanctions against the state-owned Petróleos de Venezuela (for doing business with Iran); he’s said he’d leave in place (at least initially) many of the economic policies, such as currency controls and subsidies, that orthodox economists criticize; and he’s careful to say he’d improve but not discontinue Venezuela’s welfare state.

Capriles professes to be a uniter. “There are millions who belong to no party,” he says. “I want to include them.” His political idol, he replies without hesitation, is Nelson Mandela. “We need unity, not revenge,” he says.

His conciliatory strategy stands in contrast to the bluster and governing style of Chávez, who pioneered master-of-ceremony politicking in South America. He launched a weekly television and radio show, Aló Presidente, during which he regaled Venezuelans for hours with accounts of his daily doings, his plans, and his policies for the country. (The program has been suspended while he undergoes medical treatment.) He often provided his audience with crude yet riveting entertainment. Memorably, in 2006, against a background of foraging cattle, he taunted and maligned then-President George W. Bush, calling him a “donkey,” a “drunk,” a “psychologically sick man,” and a “genocidist,” among other things, and finished by daring him to invade Venezuela.

Yet Chávez has reserved most of his invective for foes among his own citizens and has designated Capriles “Enemy No. 1.” In Caracas, on the cloudy afternoon of April 13, the 10th anniversary of his return to power after the bungled coup d’état, Chávez stood on the balcón del pueblo of the Miraflores presidential palace and addressed thousands of red-shirted supporters. Dressed in a blue-and-white track suit and apparently bloated from drugs used to help him combat his cancer, Chávez spewed venom at Capriles, calling him El Majunche — slang for “insignificant thing or person” — 27 times. Not once did he refer to Capriles by name. He accused him of working for the Yankee Imperio. Then he dropped a bombshell: El Majunche, he claimed, was plotting to overthrow him. “Ojo pelao [keep your eyes peeled]! A conspiracy is under way!” he shouted hoarsely.

“The only ones talking of a coup or attacks are in the government,” Capriles says. “In order to carry out a coup you need the military behind you, and I don’t have that.”

Violence remains the scourge of Venezuelan life. In 2009, according to the Caracas-based Venezuelan Violence Observatory, the country’s murder rate was three times higher than Iraq’s. Caracas during the Chávez years has consistently ranked as one of the most dangerous cities in the world. On highways in the countryside, brigands have been known to erect roadblocks and, when vehicles pull over, rob and sometimes even murder passengers. Venezuela’s beautiful coastal waters aren’t safe either, with frequent reports of drug running and robberies aboard yachts. To top it off, the travel advisory of the U.S. Department of State reports that Colombian guerrillas enjoy refuge in the western provinces, where they engage in extortion and kidnapping.

Chávez has rarely mentioned the crime rate. Capriles dwells on the subject and pledges to make restoring order his top priority, even as he takes a long view of the problem. “The way to end violence in our streets lies with education and schools,” he said in April, after inaugurating the Inés María Bolívar school in Santa Lucía, a town in Miranda.

As violent as Venezuela has become since Chávez took office, more chaos is likely to follow should he depart the scene. The rank-and-file armed forces, the Fuerza Armada Nacional Bolivariana (FANB), are not entirely Chavista or sufficiently socialist for the president. So Chávez has overseen the establishment of “Bolivarian militias,” whose ranks — there are 300 battalions — he plans to increase to half a million men, which would outnumber the troops in the Venezuelan army. Although formed by decree in 2008 to complement the FANB, the Bolivarian militias function as a praetorian guard, loyal to Chávez, who has dubbed them the “solid nucleus of the nation’s political power.”

“Militia” may connote amateurism, but its recruits — civilians drawn from teeming barrios where Chávez support is strongest — are trained professionally, even in the use of heavy arms, and are overseen by Chavista officers. They carry Russian shoulder-mounted antiaircraft missiles in addition to automatic rifles, and a tank battalion is expected later this year. Ostensibly, the militias are meant to defend against an invasion, but Venezuela has no external enemy. A document circulating within the Chavista Socialist Party, the PSUV, notes that the enemy of the revolution may be either external or internal and can be fought with methods and means of combat that are “limitless.”

In Santa Lucía, after a bruising tour of the school (Capriles’s few bodyguards couldn’t restrain the surging crowd of supporters), the candidate takes questions from reporters about the military, the militias, and his own safety. Asked if top-ranking officers would present a threat should he win in October, he replies, “I do not believe there are Chavista generals. We have constitutionalist generals.” And the militias? “They exist because they are financed by the state. If we cut off their funds, they will cease to exist.”

This is either an overly optimistic assessment of the situation or a statement calculated to avoid stirring anger. Many in Chávez’s circle have amassed illicit fortunes and considerable power, and their liberty will be at stake — hardly the sort who would willingly cede to a loss at the polls.

In Capriles’s swing through Santa Lucía and the state of Anzoátegui, journalists question him insistently about how he plans to confront what are known as the narco-generales or narco-militares working with Colombian FARC guerrillas. Capriles labels FARC a “criminal terrorist organization” and pledges to fight it on Venezuelan soil. But he needs proof before accusing anyone. He dismisses as “rumors” and “distractions” reports that General in Chief Henry Rangel Silva and his cronies are preparing to oust the ailing Chávez and take over. He also refuses to discuss what might happen if Chávez dies before October. “My only scenario is facing Chávez as a candidate in elections. I want him to recover and reach the elections.” When pressed further, Capriles snaps, “In any case, there will have to be elections. And we are focused on winning them.”

Some of Venezuela’s closest allies could see their influence diminished if Capriles eventually succeeds Chávez. During his tenure, Chávez developed and strengthened commercial, military, and political ties with an array of repressive countries. In 2003 he rescued the communist regime led by Fidel and Raúl Castro, agreeing to supply their nearly bankrupt dictatorship with oil in exchange for doctors stationed in Venezuelan barrios. He’s brought in thousands of Cuban military and intelligence officers to train their Venezuelan counterparts and, according to one local press account, even deployed Cubans to issue the national identification cards on which electoral rosters depend.

The Castros, of course, have an interest in keeping their privileged relationship with Caracas. Asked what he would do about Venezuela’s oil to Havana, Capriles says, “We will not be cutting off oil to anyone … but nor will Venezuela be giving away its natural resources.” Does that mean that Cuba will pay market prices? Armando Briquet, Capriles’s campaign manager, says only that “announcements will be made in the coming months.”

Chávez has also forged ties with Russia and China. Moscow has provided at least $13 billion in weapons to the Chávez regime and signed a $2.6 billion contract to prospect for petroleum in the Orinoco delta. China has locked in major supplies of petroleum by signing oil-for-credit deals with Venezuela valued at up to $32 billion, with $20 billion in loans offered in the past year and a half alone, apparently to bolster the government as elections approach. Chinese traders have prospered throughout the country, taking the place of many Venezuelans forced out of business by Chávez.

The most worrisome Chávez ally, at least from the U.S. perspective, is Iran. According to the State Department, Iran has used Venezuelan banks to launder $30 billion and has been mining for uranium on Venezuelan soil. For its part, the Venezuelan government says it supports Iran’s nuclear program for civilian purposes. The two countries are collaborating on car- and tractor-assembly projects and a Venezuelan cement factory.

“We have gained nothing from our alliance with Iran,” Capriles says. “Our orientation must be toward democracy and democratic countries.” This would indicate a shift away from the predominantly leftist bloc ALBA, the Bolivarian Alliance for the Peoples of Our America. Comprising 13 member countries, with Iran and Syria enjoying observer status, ALBA was founded in 2004 in Cuba by Chávez and Fidel Castro.

Asked how he plans to improve relations with the U.S., surely a prerequisite for confronting Chávez’s allies abroad, Capriles replies, “The question isn’t how we repair relations with the United States. It’s how the United States will act.” He adds: “We believe the United States has been wrong to focus so much attention on the Middle East. It should look south. We want relations [with the U.S.] based on respect and the principles of noninterference.”

As a candidate, Capriles’s first two trips overseas beyond Colombia will not include the U.S. Instead, he will visit Spain and Germany. Foreign affairs will concern him only if he wins the elections, and the path to Miraflores runs not through Washington or other foreign capitals but through Venezuela’s barrios. There, millions depend on branch offices of Chávez’s signature aid programs, the 23 oil revenue-financed missions that offer everything from subsidized food to microfinancing to free medical care and literacy classes. Capriles has repeatedly pledged to keep the missions running. But during a televised interview in Anzoátegui, he emphasized that the “missions are not enough. To prosper, people need more than aid from the state. I like the Brazilian model. Brazil has created 16 million jobs over the past 10 years. What people need is employment, quality employment. We need to work with the private sector, not follow a statist model.”

Chavistas accuse Capriles of practicing the “politics of deceit” with regard to both the Bolivarian missions, which they say he will abolish, and Petróleos de Venezuela (PDVSA), which they contend he will privatize. But to win elections and maintain himself in office, he can do neither. State ownership of PDVSA is a matter of national pride. Moreover, Capriles knows that without oil revenue, Venezuela’s economy would collapse. Income from oil covers 45 percent of the government’s budget and makes up 95 percent of export earnings. “We depend 100 percent on oil revenues,” he says. “Imagine what would happen if we took them away.”

Capriles is confident that Venezuelans, even the Chavistas, have had enough of El Comandante — a belief supported by the largely jubilant reception he has gotten during the many casa por casa marches, if not all the opinion polls. “Henrique’s victory will open a rare window of opportunity and also mean a huge challenge,” says Rostislav Ordovsky-Tanaevsky Blanco, a prominent Venezuelan businessman based in Russia. “Provided he surrounds himself with an ethical team [and] manages to rein in the army, he could bring back the sense of trust … and with time, prosperity.”

“No one expects Chávez to do in the next four years what he has not done in 13,” Capriles says often on his trip. Weakened by corruption and incompetence, Chavismo will crumble without its flamboyant founder, he says, and Venezuelans will turn to his solutions. He doesn’t expound on Venezuela’s growing economy. After two years of recession, it grew 4.2 percent last year, which will increase Chávez’s spending power.

With Chávez ailing, however, Capriles’s greatest challenge may not be defeating El Comandante but the very real possibility of armed resistance from those who care little about Chavismo and a great deal about their fortunes, their status, and staying out of jail.

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