The majority of Chaves' supporters live in and around Caracas, Venezuela's capital city. Photo: subcomananta (flickr)

President Hugo Chavez is a divisive character — on the international stage and within Venezuela. After 10 years in power Venezuelans and the world are reviewing his record and asking themselves, what has Chavez done for Venezuela? What has he done for the poor?

Although Chavez's government and the main opposition party Un Nuevo Tiempo (A New Era), may argue about the numbers and results of Chavez’s social programs, it goes undisputed that Chavez has placed a new emphasis on aiding the poor. The focuses of Chavez’s missions include; widespread free health care, soup kitchens, and literacy and education programs. The government reports lowering extreme poverty from 42 percent in 1998 to 9.5 percent today and a 50-percent decrease in unemployment, reports the BBC.

These numbers are impressive, but highly contested. The opposition has disputed these statistics, saying they are inaccurate because the government’s collection methods do not hold to international standards. Other issues include opposition reports of hospital closings, an increase in human rights abuses, and high inflation and crime rates. In fact, according to The Christian Science Monitor the inflation rate is 31 percent and food prices have risen by 50 percent in 2008. Inflation may be starting to outstrip salaries and could reverse some of the good achieved through Chavez's programs. In addition, Chavez’s critics insist they have been blacklisted, unable to work in the public sector or access passports and national ID cards.

Two BBC video interviews underscore the widely differing experiences under his presidency.

On February 15 the citizens of Venezuela will vote on whether to amend the constitution to abolish term limits on the presidency and other government offices. This vote will be the latest gauge of how people feel about Chavez and the success or failures of his programs and administration.

"Petro-authoritarianism." Now that's a mouthful.

New York Times columnist Thomas Friedman used the term to refer to oil-rich regimes in the developing world that funnel profits into the pockets of the powerful — and turn a blind eye to the needs of the poor.

Friedman puts Venezuela, Kazakhstan, Sudan and others in this category — countries where large oil and natural gas reserves lead to corruption, wasteful spending, military adventurism and instability.

U.S. Senator Richard Lugar (R-Indiana) includes Nigeria, the world's eighth-largest oil exporter, on that list. "Despite half a trillion dollars in revenues since the 1960s, poverty has increased, corruption is rife, and violence roils the oil-rich Niger Delta," he writes in the Christian Science Monitor.

"The Petroleum and Poverty Paradox," a report from Lugar's U.S. Senate Foreign Relations Committee, calls for improved financial transparency from governments and oil companies. It also requests international assistance to help resource-rich countries better manage their revenue.

Lugar argues it's up to the U.S. to set the standard by demonstrating its own accountability. The first step, he says, is to join the Extractive Industries Transparency Initiative (EITI), a voluntary program that audits each participating country's oil and gas royalties.

With oil prices guaranteed to eventually spike as rapidly as they've dropped, Lugar writes, "Reversing the [resource] curse is in everyone's interest."

Venezuelan President Hugo Chávez supported many social programs under "Socialism for the 21st Century" with oil revenue. Photo: Nueva Perspectiva (flickr)

Last week oil prices dipped under $70 a barrel for the first time in over a year. While the lower price may have Americans at the gas pump celebrating, it’s bad news for the leaders of oil-rich countries that made long term plans based on the high price of oil.

Venezuela, Iran and Russia went on a spending spree when oil hit $100 per barrel and then planned upcoming government budgets on the peak price.

The high price of oil allowed these countries to thumb their nose at the West with little risk of a response. Venezuela advanced its socialist agenda both at home and in the region. Iran ignored U.S. nuclear related sanctions, and Russia reasserted itself by invading Georgia.

But because they assumed the price of oil would stay high, they might soon be on receiving end of such gestures. The Washington Post reports that:

According to independent estimates, [Iran and Venezuela] need an average oil price of up to $95 a barrel to fund the populist subsidies and social programs they have launched in recent years — not to mention billions of dollars in arms purchases from Russia. Venezuela has been furiously importing food to fill empty shop shelves, while Iran heavily subsidizes domestic fuel.

Venezuelan President Hugo Chávez has gone on the record as unworried about the falling oil prices citing Venezuela's $40 billion in foreign currency reserves. However, Ricardo Hausmann, a Venezuelan economist who teaches at Harvard, doesn't share Chavez's confidence. “We’re in the same situation of people who have lost a limb but can still feel it. I don’t know how long it will take for Chávez to realize he’s lost a limb."

In response Iran and Venezuela pressured OPEC to cut production by 2 million barrels a day. OPEC members initially took a wait-and-see approach, wary of intensifying a global economic crisis or further decreasing global oil demand, before agreeing to cut production by 1.5 million barrels a day in an attempt to drive up prices.

But skeptics question whether significant production cuts won't simply decrease demand for oil — or whether it will influence the price at all. If OPEC can't drive prices back up to their historic highs, Venezuela, Iran and Russia may face a tough reality as they come off their own oil high.

Photo:whiffer (flickr)

In the latest issue of Foreign Affairs, the former chief economist of the Venezuelan National Assembly argues that Chavez has failed to live up to his pro-poor rhetoric, and that the policies of his administration have hurt both the national economy and the Venezuelan poor. While many observers outside Venezuela believe that Chavez has made the welfare of the poor his highest priority, the author notes that neither official statistics nor independent assessments show any evidence that Chavez's policies have helped combat poverty in Venezuela.

Food shortages, a weakening economy and outbreaks of dengue fever are fueling growing discontent among Venezuelans and Hugo Chavez and his socialist party are experiencing their greatest period of unpopularity. Beyond domestic problems, recent weeks have brought Chavez a heightened level of threats from his enemies, reports the New York Times.

In a daily analysis from last week, Council on Foreign Relations senior fellow Benn Still suggested that the United States is “exporting inflation worldwide.” The latest action by the US Federal Reserve may have staved off inflationary disaster domestically but only to the detriment of other nations who peg their currency to the dollar.

Venezuela struggled with inflation rates over 20 percent in 2007 (Bloomberg). Argentina and Bolivia face similar concerns. Official data puts Russian inflation for 2007 at nearly 12 percent (Forbes). Several Gulf Arab states also find themselves with inflation over or near 10 percent. In China, rates near 7 percent registered in December 2007 represent the highest inflation in over a decade. China’s Prime Minister Wen Jiabao recently announced Beijing would freeze short-term energy prices in an attempt to curb consumer price increases (NYT).