The Venezuelan businessman told inspectors there was nothing but books and papers in his suitcase. So imagine everyone's surprise when Argentine customs officers opened the suitcase - and found $800,000 in cash. The origin and destination of this money, which was being taken to Buenos Aires on Aug. 4, shortly before a state visit by Venezuelan President Hugo Chavez, is now the hottest mystery in South America. But what is clear is that the cash-filled suitcase is an apt metaphor for the way Chavez has been using petrodollars to build an anti-American network that includes the leaders of Cuba, Bolivia and perhaps Nicaragua.
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Chavez seized the moment to unveil a long-awaited package of constitutional "reforms." As you might expect, they are self-aggrandizing and threatening to what is left of democracy in Venezuela. They would extend the presidential term and abolish term limits so that Chavez could get himself reelected every seven years, starting when his current six-year term expires in 2012. His last opponent for the presidency was a state governor; the proposed changes would weaken governors and mayors. Most menacing, Chavez wants to establish a "popular militia" alongside the regular armed forces.
This latest power grab is of a piece with other measures taken by Chavez since his re-election to a third term in December. He has been undermining existing governmental structures by channeling public works and welfare funds through "communal councils" under his control, a process he promises to accelerate under the revised constitution. He has nationalized telecommunications, electricity and oil enterprises and established a new socialist political party. He has forced an independent television channel off the air while plastering the public spaces of Venezuela with his own smiling portrait.
In short, Chavez's "21st-century socialism" looks depressingly like the 20th-century version: a bloated, repressive state headed by a hectoring strongman. Chavez has adjusted the model by adding certain methods of Middle Eastern petro-states, such as the use of cash to purchase popular support, or quiescence, at home - and to buy allies abroad.
Though corrupt and corrupting, Chavez's militaristic formula is undeniably potent, and no doubt he relishes demonstrating its power in polarizing combat with the weakening Venezuelan opposition. Since the opposition unwisely boycotted the past election, the entire National Assembly supports Chavez and is likely to approve his constitutional plans. The next step would be a national referendum this year, which might be Venezuela's last chance to prevent Chavez from setting himself up as president for life.