Latin America's Power Struggle
This story was written by CBS News Producer Alfonso Serrano .
The Bush administration fired a warning shot at Venezuela's Hugo Chavez this week when it banned arms sales to the South American nation for not doing enough to combat terrorism, a move Chavez quickly shrugged off. More than a measure to combat terrorism, the decision underscored Chavez's growing influence in Latin America.
Post 9/11 demands have veered U.S. attention away from its southern neighbors. Chavez has rapidly filled the power void, emerging as a highly influential figure throughout Latin America.
Fueled by enormous petroleum reserves and a revolutionary dream of uniting Latin America into one bloc, Chavez also has invested billions of dollars in South America in the last few years — far more than the United States. Chavez has helped Ecuador and Argentina pay off billion-dollar debts. He gives Cuba billions of dollars a year in oil, and other Caribbean nations have received Venezuelan oil at bargain prices.
"If the price of oil remains at current levels, Chavez's regional and global influence will keep increasing for years to come," said Jorge Capetillo, a Venezuela expert and professor at the University of Massachusetts. "And with anti-Americanism in the region, which will worsen with the United States' border politics with Mexico, the U.S. government has few options to replace Chavez."
Chavez, meanwhile, continues to capitalize on nationalist movements throughout Latin America, movements fueled by virulent anti-Americanism, especially among those most poor and marginalized who have not benefited from the free market and globalization. Flanked by Cuba's Fidel Castro and new Bolivian President Evo Morales last month, Chavez signed the Bolivarian Alternative for the Americas, an economic pact between the three nations that is being billed as an alternative to the U.S.-sponsored Free Trade of the Americas.
Promises of financial support from Chavez surely have inspired Morales. In a bold, symbolic move, Morales ordered armed forces to seize 56 oil and gas fields earlier this month and announced the nationalization of Bolivia's gas industry, a move that shocked foreign oil investors who have pumped $3.5 billion into Bolivia since the mid-1990s. Morales subsequently accused oil firms of acting illegally and declared that contracts signed with previous Bolivian government were "unconstitutional." Morales has since softened his tone, and at a European-Latin American summit last week in Vienna he promised foreign companies "genuine, long-lasting security."
If Morales' decision to nationalize industries has dismayed foreign investors and dignitaries alike, the move has been cheered in Bolivia. A poll conducted last year by a respected firm concluded that 75 percent of those polled favored nationalization of Bolivia's hydrocarbons. The move also has given Morales a needed boost.
"The reaction here has been very positive," said Gloria Carrasco, a Bolivian journalist who has covered Morales for several years. "The promise of nationalization was one of the pillars of Morales' electoral campaign, and he delivered."
Chavez's increasing mandate in Latin America has not come without backlash. Bolivian opposition leaders have branded the Venezuelan as an "interventionist." Large sectors of Bolivian citizens are weary of the power Chavez is exerting over Morales. Argentinean and Ecuadorian political leaders also have accused Chavez of meddling in their nation's affairs.
"Chavez is moving too fast on too many fronts," said Michael Shifter, vice president for policy at the Inter-American Dialogue in Washington. "He runs the risk of overreaching and going too far, and that could ultimately prove to be his downfall."
Moderate presidential candidates in Peru and Mexico have made the most of recent Chavez resentment in the region. In Peru, Ollanta Humala, the leftist former military commander and Chavez ally, has begun to slip in the polls. Humala won the first round of presidential elections with a sizeable lead but could not avoid a run-off with former leftist president Alan Garcia, who has recently surged ahead in presidential polls by criticizing Chavez and accusing him of meddling in Peruvian affairs.
Mexico's leftist presidential hopeful, Manuel Lopez Obrador, has suffered the same fate as Humala. The former Mexico City mayor was leading presidential polls until his conservative challenger, Felipe Calderon, recently began linking Obrador with Chavez. Now Calderon is the favorite to win presidential elections on June 2.