We are now less than two weeks away from an election that could either save or destroy what remains of Venezuelan democracy.
Hugo Ch谩vez has already acquired over Venezuela's public institutions. He has already established an over most broadcast media content. And he has already created a heavily armed pro-government militia that is tasked with defending his Bolivarian revolution.
Yet despite all these obstacles, opposition presidential candidate Henrique Capriles has been able to mount a serious challenge. As of late August, the 40-year-old Capriles led Ch谩vez by roughly 2 percentage points (48.1 percent against 46.2 percent) in polling conducted by the Caracas-based firm Consultores 21. "If we were to make a linear projection for the election," Consultores 21 president Luis Christiansen told an audience in New York last week, "it would be that Capriles will maintain an advantage of 2.5 percent over Ch谩vez."
Of course, even if Capriles garnered a majority of the vote, Ch谩vez might simply and steal the election聴in which case, Venezuela could easily descend into post-election street violence. "The closer the race, the greater the temptation for Ch谩vez to cheat," Heritage Foundation scholar Ray Walser.
Concerns over possible election fraud are well founded. In 2010, Henry Rangel Silva, a fierce Ch谩vez loyalist and the current Venezuelan defense minister, that "the armed forces are not going to accept" an opposition-led government. Meanwhile, Barinas state governor Ad谩n Ch谩vez, Hugo's brother, has emphasized that there is more than one way to preserve the Bolivarian revolution: "It would be inexcusable to limit ourselves to only the electoral and not see other forms of struggle, including the armed struggle," he last year. Venezuela is already among the "top four or five" most murderous countries in the world, according to a by Venezuelan criminologist Luis Bravo, and senior military officials are heavily involved in the .
A Ch谩vez victory would be a devastating setback for democracy and the rule of law, and it would push Venezuela closer to a financial catastrophe. Indeed, Morgan Stanley analyst Daniel Volberg has that Ch谩vez's economic and fiscal policies "may be taking Venezuela towards a crisis and potentially even a debt event that could come as early as the second half of 2013."
Venezuela is not the only large Latin American nation that is entering a critically important period. In Colombia, President Juan Manuel Santos has launched peace negotiations with the FARC, a narco-trafficking terrorist organization that has been at war with the Colombian state since the mid-1960s. His predecessor, 脕lvaro Uribe, has warned that these negotiatons carry a high risk: "We all want peace, but there can't be a negotiation while the terrorists are continuing their criminal activities," Uribe recently Reuters. "It creates investor panic and in turn creates difficulties in financing social policy."
The last major peace talks between Bogot谩 and the FARC began in 1999 and ended disastrously in 2002, with the guerrillas ramping up their violent attacks. If the current talks fail, Colombia could encounter a fresh wave of bloodshed. But if they succeed, the nation would receive a massive economic boost. In an last week with Bloomberg News, Colombian finance minister Mauricio C谩rdenas predicted that a successful peace deal with the FARC could enable his country to grow at an annual pace of 6-7 percent "for decades." Even without such a deal, C谩rdenas said, Colombia could still achieve a long-term growth rate of 4.5-5 percent. After all, the FARC has been greatly weakened since 2002, and its ongoing activities have not prevented Colombia from enjoying an economic boom. (There is a good reason why investors view the South American nation as a potential ".")
In Mexico, President Felipe Calder贸n is set to leave office in December, and he will be replaced by Enrique Pe帽a Nieto, who represents the same party that ruled Mexico autocratically for 71 years. Many Mexicans are nervous that the Institutional Revolutionary Party (PRI) hasn't really changed its political character since losing power in 2000. They will be looking for Pe帽a Nieto to affirm, unequivocally, the PRI's commitment to democracy.
As I in this space before the July 1 presidential election, the PRI of Pe帽a Nieto is not the same PRI that ruled Mexico for most of the 20th century. It is "truly different," in the of former U.S. ambassador to Mexico James R. Jones. Yet many PRI dinosaurs are nostalgic for the old system, in which a "" made corrupt deals with drug cartels. We will soon find out whether Pe帽a Nieto, 46, is serious about continuing President Calder贸n's security policies in hopes of reducing drug-related violence. We will also find out whether he is serious about opening up the and . Such reforms would improve Mexican competitiveness and help close the GDP gap with Brazil, a country that has been celebrated for its economic rise but is now dealing with a . (Last month, President Dilma Rousseff introduced a .)
Finally, there is Argentina, where President Cristina Kirchner seems determined to wreck Latin America's third-largest economy. It is experiencing and , and the government's strict currency controls are causing major . Argentine GDP in the second quarter of 2012 (compared with the first quarter), and the International Monetary Fund has unless Kirchner stops doctoring official economic data.
"Even as evidence of economic crisis continues to mount聴the latest sign being that supermarket shoppers are limited to one bottle of cooking oil per customer聴the government gives no indication of concern," investor Sin-ming Shaw. Kirchner continues to embrace Ch谩vez-style economic policies and wage war on the opposition media. For example, her government has Grupo Clar铆n, the country's biggest media conglomerate, that December 7 is the deadline for selling most of its broadcast outlets to comply with a that dramatically reduced press freedom. She is increasingly unpopular, and Argentines have been to vent their frustrations.
Unless Kirchner changes course聴--and soon--聴it is hard to imagine how Argentina will avoid disaster.