Politics in Venezuela —Whose hand on the tiller?

Caracas | Screen Shot 2014-06-06 at 11.12.21 AM

Both government and opposition are in a state of paralysis

AN UNEASY calm has returned to the streets of Caracas and Venezuela’s other main cities after months of clashes between opposition youths, riot squads and pro-government gunmen. But the discontent that sparked the demonstrations—over inflation, shortages of basic goods, collapsing public services and violent crime, among other things—remains profound. So are the tensions within both government and opposition ranks.

The ruling United Socialist Party of Venezuela (PSUV) held its third party congress this week. The congress, which was scheduled to end as The Economist went to press, was carefully choreographed. As expected, President Nicolás Maduro was acclaimed as the new party chairman and the contentious issue of internal democracy was swept under the carpet. But the outward show of unity raises the question: united around what?

The radical left accuses Mr Maduro of betraying the legacy of the late Hugo Chávez. In June the president fired Jorge Giordani, the planning minister and the economic guru of the radical left. Mr Giordani, a close ally of Chávez, hit back with a long and bitter open letter, in which he accused Mr Maduro of lacking leadership and of ignoring his advice on how to avert the economic crisis.

In an unprecedented show of dissent, several prominent, left-wing chavistas called for the issues raised to be debated. Another long-serving former minister, Héctor Navarro, was summarily suspended from party membership for backing Mr Giordani, in what a former colleague described as a display of “pure Stalinism”. Mr Maduro hit back, saying he would not be “hogtied by the outdated left”.

The departure of Mr Giordani seemed to clear the way for some economic adjustments, including the simplification of the country’s byzantine exchange-rate system and a reduction in petrol subsidies, which the government says cost around $12.5 billion a year (some independent analysts say the cost is over $30 billion). The new economic supremo, Rafael Ramírez (who also holds the posts of energy minister and head of the state oil corporation), has for months been signalling his intention to move in that direction.

Screen Shot 2014-08-02 at 8.21.49 PMBut even if Mr Maduro has seen off the radical left, he still faces less visible opposition from other factions within the revolution. Exchange controls and subsidies have created vast opportunities for graft. Mr Giordani has alleged that in 2012 alone over $20 billion was fraudulently siphoned out of foreign reserves for imports that never arrived. Reform would threaten such gains.

Discontent in government ranks was underlined by the poor turnout on July 20th in elections for delegates to the PSUV congress. Of a supposed 7.6m party members, “almost two million, or more” voted, according to Mr Maduro. But most polling stations saw little movement all day, and dissidents put abstention rates at 85-88%. Enthusiasm was dampened not only by declining living standards and gloom about the future but by a widespread feeling that voting was a waste of time. The party leadership screened all candidates for election, and handpicked 40% of them.

The opposition Democratic Unity (MUD) alliance, however, is in no position to take advantage of the government’s unpopularity. In recent months its more confrontational wing, led from jail by Leopoldo López (whose trial is now under way behind closed doors), backed the youths on the barricades; the moderates held talks with the government. Neither tactic proved successful. This week the alliance’s executive secretary, Ramón Guillermo Aveledo, resigned amid a so-far inconclusive internal debate on the way ahead. For all the government’s problems, the MUD is a long way from taking the initiative.