The Assassination of Hugo Chávez
An extract from Greg Palast's new book
By Greg Palast
Clearing House" -- -- On August 26, 2005, the Lord
spoke to His servant on cable television and His servant told the
faithful watching in TV land: "Hugo Chávez thinks we're trying to
assassinate him. I think that we really ought to go ahead and do
Reverend Pat Robertson has a tough time with the separation of
church and hate. But Pat Robertson is not crazy. He is, in fact, one
of the most ingenious, un-crazymen I've ever met. And the most
calculating and viperous. Those who dismiss him as some cornpone,
Bible-thumping Elmer Gantry fruitcake have dangerously
underestimated him and his reach into political and financial power
centers in Washington and abroad.
He never speaks for himself. Whether he speaks for God, I can't say,
but certainly Dr. Robertson uses his television platform to preach
the evangel of the elite to which he was born. His father, U.S.
Senator Absalom Willis Robertson, was the mentor of Senator Prescott
Bush. "I am not a 'televangelist,'" he told me. "I am a
And when he spoke of taking down Hugo Chávez, President of
Venezuela, Robertson was all business. The hit the Reverend proposed
was calculated for risks and rewards like any investment: "It's a
whole lot cheaper than starting a war, and I don't think any oil
shipments will stop. This is a dangerous enemy to our South
controlling a huge pool of oil that could hurt us very badly ... We
don't need another $200 billion war ... It's a whole lot easier to
have some of the covert operatives do the job and then get it over
When I met with President Chávez in Caracas, in April 2002, he
offered to write the introduction to the Spanish translation of my
last book. I'm not crazy about politicians endorsing journalists,
but I agreed on condition he meet the deadline: He'd have to write
it before he's dead. Chávez wasn't overly concerned. "It's a game of
chess, Mr. Palast. And I'm a very good chess player."
He's more than that. He is, as Robertson says, a dangerous man. But
dangerous to whom? Mr. Beale, the Arabs have taken billions of
dollars out of this country, and now they must put it back. It is
ebb and flow, tidal gravity.
In October 2005, Hugo Chávez defied gravity and withdrew $20 billion
of Venezuela's petro-dollars from the United States Federal Reserve
and deposited the money in an account with the International Bank of
Settlements for investment in Latin America. There is no Third
World, there are no nations, Mr. Beale, there is only IBM and Exxon.
At the beginning of 2001, Venezuela instituted a new "Law of
Hydrocarbons." Henceforth, Exxon, British Petroleum and Shell Oil,
the major oil extractors in Venezuela, would get to keep only 70% of
the sales revenues from the Venezuelan crude they sold.
The oil majors had grown accustomed to their usual take - 84%. The
reaction to the reduction in Big Oil's share of the Venezuelan pie
was swift. Otto Reich, Assistant Secretary of State for Western
Hemispheric Affairs, met with Venezuelan "dissident" billionaires
and shortly thereafter, on April 11, 2002, Chávez was kidnapped. The
President of Venezuela's Chamber of Commerce, an oil industry
lawyer, declared himself President of the nation - giving a whole
new meaning to the term "corporate takeover."
The coup d'état against the elected president, Chávez, was endorsed
by The New York Times. On April 12, banking and oil industry chiefs
held an inaugural party in Venezuela's Presidential Palace. The U.S.
Ambassador rushed down to have his picture taken with his arms
around the partying coup leaders. But within twenty-four hours, the
party was over.
I learned later that Chávez, geopolitical grandmaster, had expected
the coup and planted commandoes inside secret passages of the
Presidential Palace. When informed that Chávez had secretly moved
his knights into kill position, the partygoers took off their
custom-made Presidential sashes and costumes and returned the real
President to his desk, without bloodshed, within 48 hours of his
The Times apologized. But not the White House. Bush's spokesman
conceded Chávez "was democratically elected," but, he added,
"legitimacy is something that is conferred not just by a majority of
the voters." I see.
Chávez was just warming up. Exxon had begun tapping into Venezuela's
heavy tar oils in the Orinoco Basin. Despite rising oil prices,
Exxon figured the government should be satisfied with a 1% tax on
the profits. Chávez changed that to a 16.6% tax. Shell Oil and other
foreign extractors had made a habit of not paying taxes on their oil
Shell, when handed the back-tax bill, balked and was surprised to
find itself, in 2005, bounced out of a lucrative natural gas
project. Chávez redirected the gas, meant for export, back to
Venezuela's own consumers.
Venezuela has landless citizens by the millions. It also has unused
land by the millions of acres locked up in fallow plantations on
which a tiny elite had squatted for four centuries. In 2001, a new
law required selling untilled land to the landless. It was a program
long promised by Venezuelan politicians at the urging of John F.
Kennedy as part of his Alliance for Progress. Progress waited for
Heinz Ketchup's Venezuela division didn't like the new terms for
doing business and shut its plant in the state of Maturin. Venezuela
seized the multinational's property and put the workers back to
Pat Robertson was not the first to suggest terminating Chávez with
prejudice. In response to previous threats, the very good chess
player instituted a kind of "assassination tax" on U.S. oil
companies. Every time a new plot to shoot the President was foiled,
Chávez' tax authorities would send another bill for those "back
taxes." Shell was hit with a new $130 million tax bill and got the
In June 2004, neo-con Otto Reich, friend of the coup plotters, was
dis-employed by the U.S. State Department. And what does Chávez do
with Shell Oil's tax money? In Caracas, I met with a reporter for
the TV station whose owner is generally credited with having backed
the failed 2002 coup. She pointed to the "ranchos," the slums, above
Caracas where shacks, most made of cardboard and tin, were quickly
transforming into homes of cinder blocks and cement.
"He gives them bread and bricks, so they vote for him, of course."
She was disgusted. By "them," she meant the 80% of Venezuela that is
"negro e indio" (Black and Indian). This poor, dark 80% had, until
Chávez ran for President, left the running of government, and the
spending of the nation's wealth, to the minority white 20%. The
bread and bricks, and jobs and new health clinics, are intimately
tied to the "ebb and flow" of capital; and now Chávez was standing
in its way.
In early 2003, his government overturned the keystone of borderless
globalization and imposed controls on the movement of capital. The
Wall Street Journal reported, with surprise, that instead of
economic doom: "... the controls trapped liquidity within the
economy, which in part led to reduced interest rates and helped
boost economic activity."
Lots of economic activity. In 2005, their economy grew by 9.4%, the
highest in the Western Hemisphere, following a blazing 17.9% in
2004, with the biggest boosts occurring in the non-oil sector.
Government services for health, education and food subsidies didn't
drain the economy, as "flat world" globalizers predicted, but added
to economic demand and productivity.
Chávez then waded further into the rushing flow of international
finance to build another economic dam. His backers in Venezuela's
Congress voted to require all private banks to dedicate 20% of their
lending portfolio to "micro-loans" for small businesses and
small-plot farmers. As a result, a large portion of the oil wealth
in Venezuela would have to stay there, barred from flowing northward
as is the custom with petro-dollars. Most important, 20% of the
working class's savings would be channeled back to it rather than
rising upward to fund the extravagant high-rises in Caracas.
There's no question that Chávez's largesse to the "negros e indios,"
for the bricks and medicine and loans abroad, is made possible only
by wildly high prices of petroleum. That still makes Chávez one of a
rare breed. After all, the new oil riches of Kazakhstan ended up, at
least $51 million of it, in the Swiss bank account of its President
(according to the bagman who deposited it). At the same time,
pensions in Kazakhstan are half of what they were in 1993. Despite
the windfall of receipts from privatization of the Kazakh oil
fields, the Red Cross reports that the unequal distribution of the
nation's oil wealth has pushed "three-quarters of Kazakhstan's 15.7
million population below the poverty line." Tuberculosis is now
epidemic in the oil-rich nation. Kazakhstan's manufacturing
employment has fallen by 36% and its GDP has imploded. Other
developing oil states - Nigeria, Indonesia, Sudan - show just as
little interest in distributing their petroleum wealth to the mass
of their citizenry.
And, after all, Venezuela itself was a wealthy oil exporter long
before Chávez, without much to show for it except massive
international debts. Three decades ago, I wrote about the "peasants
under the bridges in golden Caracas in shacks made of packing
boxes." That was after the real price of oil hit $80 a barrel. Then,
in the 1970s, in Caracas, no one passed out bricks and bread.
Chávez is called a Marxist and a socialist. He is neither. His
reformist, cooperative and redistributionist program, and his
handling of oil wealth, is clearly "Norwegian-ist." Chávez is a
dramatist, calling his Scandinavian-style reforms the "Bolivarian
revolution." It seems to drive Washington just crazy that brown
people are demanding Nordic privileges. It's one thing to be kind to
poor folk, another to rearrange the global flow of petroleum.
After bouncing Shell from one project, Chávez signed major
development deals with the state oil companies of Brazil, China and
India. Now, for the first time, a flow of crude would bypass the oil
majors. Chávez was cruising for a bruising. And it was Chávez, of
course, who played Latin Lone Ranger to Ecuador and Argentina,
writing checks to support their bond sales. And when Ecuador's
indigenous population seized Occidental Petroleum's fields, it was
Chávez who arrived in Quito with two million barrels of oil products
in tow to keep the nation on wheels.
The point was clear: Petroleum and petro-dollars could ebb and flow
without Occidental or Chevron. And without the IMF and World Bank.
It was The Wall Street Journal that dubbed Chávez "a tropical
version of the International Monetary Fund, offering cut-rate
oil-supply deals and buying hundreds of millions of dollars of bonds
from financially distressed countries such as Argentina and
The un-tropical International Monetary Fund in Washington was not
amused, nor were money center banks of New York and London. Petro-dollars
are supposed to move from Venezuela to New York and only then return
to Latin America as loans carrying interest rates up to 16%. Chávez,
bypassing the side trip to New York, showed that the costly
financial cycle is not, Mr. Beale, "tidal gravity ... an immutable
And to underscore the point, Chávez traveled to more Third World
nations with gifts of low-cost oil: the Bronx, New York, and
Chicago's West Side. In September 2005, Chávez offered these poor
racial Bantustans within the USA (Hispanic neighborhoods in Chicago,
African-American 'hoods in the Bronx) discounted heating oil through
CITGO, the U.S. retail outlet of Venezuela's oil company. A public
relations gimmick? Undoubtedly. But Chávez is making a point: The
public, American public included, does not have to remain hostage to
the Saudi-Houston cartel.
Chávez is a wily gamester. He pushes only so far. He may tax the oil
majors, sell to their Brazilian competitors and spend oil loot in
Ecuador, but his state oil company has, at strategic moments, waived
most of the higher royalties and signed lucrative contracts with
Exxon and Shell to extract offshore gas reserves. His government
sells tantalizing morsels of concessions in the Orinoco Basin to
keep industry majors mollified. Nevertheless, Chávez has challenged
the great ebb and flow of international finance capital and petro-dollars.
If Chávez were president of Kazakhstan, he could play Robin Hood
with his nation's oil money without incurring the fanatic wrath of
the White House.
Venezuela is a different matter altogether. Chávez is, correctly,
seen as a class warrior, a crafty opponent of what George Bush calls
"the impressive crowd, the Haves and the Have-Mores." Chávez wanted
me to film him under the larger-than-life oil painting of Latin
America's "Great Liberator," Simon Bolívar. Chávez sees himself as
Bolívar, taking his class war beyond his borders, from Argentina to
the Bronx, tilting the flat world back to level.
Can he? The difference between a grandiose nut and a grand visionary
is the economic power to impose the vision.
Greg Palast is author of "Armed
Who's Afraid of Osama Wolf? China Floats, Bush Sinks, The Scheme to
Steal '08, No Child's Behind Left, and Other Dispatches from the
Front Lines of the Class War
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