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Venezuela's fork in the road: socialism or capitalism?

This election acts as a referendum on Chávez.

By David D. Sussman / November 21, 2008

Caracas, Venezuela

As the dust settles after the US presidential vote, there is another important election that the world should watch. Venezuelan citizens head to the polls Nov. 23. At stake is the selection of governors for each of the country's 22 states, as well as mayors for 338 of the largest cities.

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President Hugo Chávez already controls the legislature, has stacked the Supreme Court in his favor, and now hopes to consolidate his power at the regional and local levels.

The American election appeared to serve as a referendum on two terms under George Bush. It signaled change to the rest of the world as much as it signaled it to its own people. Similarly, the vote in Venezuela provides such an opportunity for its citizens. In selecting their local officials, Venezuelans will also register their current level of approval for a decade of Mr. Chávez's policies.

Only last December a wide-ranging constitutional referendum to intensify the country's move toward socialism and enable Chávez to serve indefinitely as president was narrowly defeated.

Chávez has clearly announced his intentions – to continue transforming Venezuela into a model for socialism in the 21st century. And unlike spurious accusations in the US that an expansion in healthcare is a step away from democracy, a very real shift towards socialism is under way in Venezuela.

Major elements of the country's economy are already under state control. Through Petroleos de Venezuela (PDVSA) the government maintains a majority stake in all petroleum fields and it stands as one of the largest oil companies in the world. Its gas stations, where some consumers can fill their tank for the equivalent of $1 or less, are omnipresent, though at least a few British-owned BP stations remain.

Electricity is managed by the National Electric Corporation, which was responsible for a blackout in April that left over half of the country without power. In August, the government nationalized the largest cement producer, adding Cemex to a portfolio of businesses that includes the largest steel company and a major telephone network.

The telecommunications sector still maintains a number of private providers, but the recent launch of Venezuela's first satellite atop a Chinese rocket may give the government further control.

In addition, Chávez continues to promote a cult of personality. His government has, for example, essentially reduced expression of opposition opinion to one major national television channel. And his live talk program "Hello President" is broadcast nationwide every Sunday for six hours.

The image of Chávez in his traditional red shirt also looks out from posters of the United Socialist Party of Venezuela (PSUV in Spanish) that hang throughout the capital. Public employees are required to attend rallies in support of PSUV and records list those who voted against Chávez in the past, and who are therefore excluded from any public-sector jobs.