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The U.S. Playbook for ‘Building Democracy’ in Latin America

Shockingly, it’s full of dirty tricks.

The U.S. government has long taken aim at leftist Latin American governments that have sought to challenge U.S. global leadership and U.S.-led global capitalism. Most recently, socialist Venezuela has witnessed explicit forms of U.S. intervention intent on economically destroying the country. Although U.S. intervention in the region precedes the Cold War, competition with the Soviet Union (and its accompanying anti-communist hysteria) heightened U.S. support for direct invasions, counter-revolutionary coups, and anti-communist, military regimes, particularly throughout Latin America and the Caribbean. With the end of the Cold War, though, U.S. aggression toward leftist governments has not abated, and, in fact, has in some ways intensified. It has also become more surreptitious with the proliferation of mundane-sounding U.S. government agencies focused on “democracy promotion.”

Amid the rise of the Pink Tide—that is, the leftist and often explicitly socialist governments that won elections throughout Latin American and the Caribbean over the past two decades—successive U.S. administrations have directed its complex of “democracy-promoting” agencies to furnish opposing political parties with economic and technical support so that they might best compete at the ballot box. These agencies include, for example, the National Endowment for Democracy (NED) and its associated groups; the U.S. Department of State’s Bureau of Democracy, Human Rights, and Labor (DRL); and the U.S. Agency for International Development (USAID), particularly its Office of Transition Initiatives.

The U.S. government also has a long history of working through international financial institutions (IFIs), namely the International Monetary Fund (IMF) and the World Bank (WB), to impede socialist and state-interventionist paths, and to enforce a free-market capitalist agenda. The conventional wisdom is that the U.S. government instrumentalizes the IMF and WB: in order to receive loans, low-income countries must demonstrate their commitment to servicing their debts and agree to free-market economic reforms, including the privatization of formerly state-owned industry, trade liberalization, and cuts to social services. While this story accurately captures the experience of many low-income countries, some governments have begun to reject and refuse relations with U.S.-dominated IFIs. In doing so, they have severed a key modality through which U.S. imperialism operates in the 21st century. 

Socialist Venezuela is one such country.

Enter Venezuela

Contemporary Venezuela traces its roots to the period of Spanish colonization, when Spaniards brought enslaved Africans to the region to perform mostly agricultural work. The colonists also decimated indigenous groups, and generally sought to enhance the power of the Spanish Empire. Following independence in the early 19th century, the country largely featured elite, military-controlled governments that failed to confront socioeconomic inequalities. Yet, even after the end of such military regimes and the discovery of oil, democracy as it emerged in the mid-20th century failed to bring an end to poverty, inequality, and hunger in the country.

In the 1980s, the Venezuelan government incensed the population following backstage agreements with international financial institutions that resulted in, most notably, cutting energy subsidies and raising  public transportation costs. Venezuelans took to the streets in protest, and the government violently repressed its citizens, resulting in hundreds of deaths. More than any other, this event radicalized the Venezuelan population and set the stage for an outsider candidate to break through the existing two-party system on a platform focused on combating poverty and inequality. That candidate was Hugo Chávez, who in 1998 won the Venezuelan presidency.

Over the past two decades, the Venezuelan government has provided both a hemispheric and global challenge to U.S. hegemony. Under former socialist President Hugo Chávez, who maintained the presidency until his death in 2013, the Venezuelan government exerted more control over the economy and expropriated businesses, some of which were formerly U.S.-owned; intensively aligned with U.S. foes, such as Belarus, China, Russia, and Iran; helped to establish regional organizations that excluded and attempted to reduce the regional influence of the U.S. (including the ALBA and CELAC); and recurrently condemned neoliberal capitalism and U.S. imperialism, particularly the Global War on Terror. 

Though Chávez has since passed, his chosen successor President Nicolás Maduro has continued much of Chávez’s policy agenda and continued to challenge the broad contours of U.S. global hegemony, albeit with increased authoritarianism at home, including raids on human rights organizations criticizing government policies and the extrajudicial murder of civilians.

Until recently, the U.S. government refused to pursue the nuclear option of prohibiting sales of Venezuelan state oil and other goods to the U.S., as many domestic U.S. citizens remained connected to the Venezuelan oil industry through refineries and gas stations, such as, most notably, Citgo. Under the Trump administration, however, the U.S. pursued this objective, although Venezuela already faced unprecedented economic calamity. Such sanctions have gravely exacerbated the situation for most Venezuelan citizens, who now face more difficulty than ever in obtaining life-saving drugs for conditions such as HIV/AIDS and diabetes, on top of continual food shortages and other deadly problems.

On a more regular basis, though—and with its hands proverbially tied by its inability to work through the IMF and WB—the U.S. government has worked through its “democracy promoting” government agencies in an attempt to foster a free-market capitalist ideology among Venezuelan citizens. In particular, the U.S. government has worked through the NED and the Center for International Private Enterprise (CIPE), the international arm of the U.S. Chambers of Commerce and an entity associated with and funded by the NED. Both the NED and CIPE were founded in the early 1980s under the Reagan administration to promote a U.S. vision of democracy abroad, including the promotion of free-market economics, all the while using U.S. taxpayer dollars.

Former ambassadors and members of the Department of State acknowledged their desire to promote free-market economics in socialist Venezuela in interviews throughout the course of my academic research. One former, high-ranking member of the Department of State who helped to develop policy towards the country told me that the “more capitalist countries there are, the better it is for the U.S. I had to remind people of this. We were using taxpayers’ money, and I had to remind them.” He further identified the structural issue with U.S. foreign policymaking in the country, telling me that “one of the major problems was that [the U.S.] couldn’t promote economic policies. We had no economic growth programs.” As a result, this limited U.S. ability to promote economic reforms, and this same State Department member saw this as a problem: “If [Chávez] didn’t have any money, fine. But he was sitting on the oil, and this was a problem for us … We would say [to the administration]: ‘It’s not the Middle East, but it’s not good to have that problem in our backyard.’”

In a similar, albeit crude voice, a former ambassador to the country told me quite plainly that the U.S. sought to promote free-market capitalist policies in the country. When I asked him if this was this case, he told me that it was “abso-fucking-lutely true,” adding that “I don’t how to tell you this, but the U.S. is a capitalist system, and that what’s we do, and that’s what makes our country great.”

Given U.S. government officials’ persistent understanding of Latin America as “our backyard” (ostensibly an entity to be uniquely managed and controlled by the U.S. government), U.S. diplomats have worked through the NED and CIPE to promote a capitalist mindset among the Venezuelan populace. I uncovered many of their programs through a Freedom of Information Act (FOIA) during the course of my research. Such programs have included financing a libertarian think tank named CEDICE to lobby the Venezuelan National Assembly, and continually write and publish legislative analysis, host workshops, and compose op-eds criticizing the socialist government; funding a libertarian radio show to run programs during weekly rush-hour traffic; creating a six-month long “educational program” explicitly designed for poor Venezuelans so they could ideologically combat socialist values; and financing the creation of Entrepreneurship Clubs across the country, along with an eight-week training program to promote free enterprise and create political agents to push back against socialist policies. 

As you can see, the scope of U.S. interference in Venezuela is staggering. The sheer number of “democracy-promoting” programs can make it hard to understand the effects of any one in particular.  With that in mind,  the descriptions of two programs below provide a more detailed look at how U.S. taxpayer dollars are used in Venezuela.

Free-Market Indoctrination Programs for the Venezuelan Poor

Beginning in 2006, the NED and CIPE initiated a program titled “Venezuela: Educational Program for Community Leaders.” In its initial program, CIPE planned a six-month-long series of workshops with an unnamed local university, explicitly designed for poor citizens “with limited formal education who nevertheless have an important impact in poor and middle income communities.”

In its policy documents, the U.S. government agency precisely lays out why it has sought to intervene in this particular manner, claiming that

Venezuela is going through one of the most challenging times in its history. The current government has 21stcentury socialism as its ideological orientation and expanded the role of the state to all realms of social and economic life. The nature of private property is being questioned and there have been a series of property invasions and confiscations. Businesses must operate with price controls, payroll freezes, and many other regulations that create a very difficult environment. The government has instituted an intensive information campaign that challenges concepts of capitalism, free trade, markets, decentralization, and many other fundamental components of modern, prosperous democracies.

In response, the group claimed that it must support a program to push back against the Chávez government and, in quite plain Orientalist language, to help to place the country on a “modern” path toward prosperity.

Under this program, CIPE set out “to educate” people in the country about the ills of socialism— particularly poor people, from whom Chávez drew much of his support. CIPE presented itself and its partner as a sort of savior who would properly educate the uneducated and help them to lead fellow Venezuelans out of the blindness imposed by Chávez and his alleged propaganda. Indeed, the group makes this explicitly clear, writing that 

…[w]ith this battle of ideas taking place in the country, it is unclear to the average Venezuelan how to improve his or her economic situation without relying on the state. Venezuelans must find a way to rise to this challenge by seeking out new concepts, ideas, information, and examples of what a better world can be. A way must be found to define and present a new vision for the country that incorporates a different set of values, practices and policies.

Throughout its course, CIPE sponsored sessions with titles such as “A Long Term Vision for Venezuela,” “Company Models,” and “Policies to Build a Better Future for Venezuela.” The focus of the latter’s session, for example, reads as follows:

This module concentrates on some of the critical decisions the country must make to establish a sustainable path of sound growth. Some of the policies discussed here include: a) redistribution of power in society to assure appropriate checks and balances; b) integrating into global markets; c) creating an appropriate business climate; d) opening the oil sector to all Venezuelans; e) reforming the social security system; f) imposing fiscal discipline; h) restructuring the state.

Such sessions belabored the superiority of free-market economics over socialism. And, although CIPE planned only “to educate” about a few dozen citizens in their initial courses, they planned to connect them afterward with “local partners” in poor neighborhoods. By doing so, CIPE claimed that “30,000 additional people [would] benefit from this program in the communities where the participants live as they bring to bear what they have learned in the course.” CIPE thus believed that this program would become a catalyst for free-market reforms and lead people away from their previous support for socialist policies.

Funding the Creation of Entrepreneurship Clubs for Political Ends

The U.S. government, through the NED and CIPE, has also financed the creation of newfound business groups for Venezuelan business owners. Once again, the specific aim was to create a group of political agents who would push back against socialist policies. In 2013, the NED and CIPE initiated a program titled “Venezuela: Fostering Entrepreneurship in Defense of Democracy & Free Markets,” totaling nearly $150,000 and intended to run until at least 2015 or thereabouts. 

Although the name of the organization is redacted, CIPE planned to fund “Venezuela’s most important business organization and provide it with an even larger platform to promote democratic and market oriented reform.” This “most important business organization” is most probably Fedecámaras. It is, indeed, Venezuela’s largest business organization, which generally aims to empower private enterprise and push for market-friendly reforms, and has also helped to set up Entrepreneurship Clubs across the country. The organization and its then-leader Pedro Carmona played a central role in the 2002 coup that temporarily displaced Chávez, with Carmona becoming interim president for a short-lived moment. At the time, the U.S. was the only country in the Americas to recognize the legitimacy of the Carmona presidency. Following thousands of Venezuelans taking to the streets of Caracas and demanding the return of their president, military members still loyal to Chávez removed the interim government from the halls of power and brought Chávez back to the presidency.

With funding from the U.S. government, CIPE planned to help the “business organization” establish three new Entrepreneur Clubs in three major cities across Venezuela and to help them monitor the progress of four additional clubs located elsewhere in the country. CIPE planned to help the business organization link up with national and regional media outlets to air interviews with the organization’s members in order to broadcast their development. The U.S. group also planned to help the new Fedecámaras-backed business clubs publish advertisements in national and regional newspapers. 

Throughout its eight-week training program for the clubs’ leaders, the group maintained four objectives:

• To develop skills to ensure the effectiveness of citizens starting a business

• To improve the chances of success of the business endeavors, helping owners enhance their business models, refine their business scope and development projections

• To facilitate networking of program participants, especially among themselves, with institutions and business associations, universities and organizations in the communities

• To instill the values of democracy, free initiative and free market, as well as ethical responsibility that should characterize all business formation.

The most interesting aspect of the objectives is the group’s desire to not only train successful entrepreneurs, but to develop political advocates for a free-market economy. Throughout its training, CIPE planned “to ensure that participants understand the importance of supporting democratic development … [and that] participants will also receive courses on leadership and democracy.” CIPE also claimed that “Entrepreneurship Clubs offer the possibility of functioning as space to strengthen the private sector’s voice to create democratic dialogue with the government.” 

Quite clearly, the NED and CIPE did not just imagine their programming as a way to help people start businesses, but rather as a means to shape those people into political voices that might advance a free-market political-economic vision within the country.

Working on Multiple Fronts for the Same End

The NED continues to fund programs and groups in Venezuela, despite a 2011 government prohibition on foreign funding for political groups in the country. What is more, USAID—a group historically focused on “economic development” but more recently involved in “democracy promotion”—also continues to operate programs in the country. 

There are no doubt democratic deficits within Venezuela, especially under the Maduro government. There are also no doubt serious deficits within the U.S. For instance, international observers have expressed alarm over Republican attempts to limit voting within many U.S. states. However, it is only the U.S. and its representatives who claim to hold global and absolute expertise on democratic matters. It is only the U.S. that wields its economic largesse to support groups and citizens who support an opposing political-economic program in sovereign countries across the world.

Indeed, the programs discussed in this article existed long before the arrival of current president Nicolás Maduro and long before serious concerns developed regarding electoral and democratic processes in the country. There are also plenty of important human rights and political rights groups focused on improving conditions in the country for those same people the socialist Venezuelan government has claimed to represent—e.g., poor and working-class citizens. Partisan U.S. funding in the country, however, allows the Maduro government to claim its entire civil society remains suspect.

Just as CIA funding sought to distort the playing field within the political arena of societies abroad during the mid-20th century through covert actions like funding pro-U.S. newspapers and political parties in Chile and Italy, so too do NED and other U.S. government agencies seek similar “returns on investment” for their funding. In fact, these programs are largely the formalized successors of these previous, informal CIA policies. Today’s tactics are a bit more sophisticated than delivering cash-stuffed suitcases to like-minded political parties, but the intention is the same. 

In the end, there is no question about what the U.S. government aims to accomplish with its democracy promotion programs: displacing governments that oppose U.S. global hegemony and to bring groups to power that embrace, or at least do not challenge, that hegemony. Such aid has never been designed to materially improve the lives of citizens abroad, but only to create a world more conducive to the perpetuation of U.S. global power. The U.S.’ track record in support of global democracy however is among the worst of any country in the world. We should never be fooled by any of the new gloss on this continuing history of self-interested intervention. 

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