Source: Corporación Latinobarómetro, Informe Anual 2010 (Santiago de Chile, December 2010).

Steven Levitsky’s recent article in the Journal of Democracy explains why Humala won the Peruvian elections last summer. He points to a mix of campaign particulars  — most importantly the divisions within the center-right – Humala’s effective shift from the left to the center, and most fundamentally, state weakness (which tends to push voters toward anti-establishment candidates). The Peruvian state has always been weak – as Hillel Soifer’s work has shown.

This weakness means Humala faces a huge challenge — and not just from the Lima-based political and economic establishment that voted against him. As the graph above shows, Peruvians in generally have little faith in their government, their parties, their political institutions in general. This hints at Humala’s bigger problem. He has few tools – especially outside of  the country’s larger urban centers – to do much to drastically improve Peruvians’ standard of living. Even if economic growth continues and can pay for it, delivering social programs, better schools, and safer streets  will require building a stronger state (almost from scratch) – quite a tall order.

Still, Humala is off to a decent start – he appointed a “market-friendly” cabinet that pleased even Alan Garcia,  then raised the minimum wage without upsetting the economic elite too much, and most recently passed a prior consultation law many years in the making. Whether he can build and strengthen the Peruvian state will define his presidency. If he can’t, it will lead to Levitsky’s most likely scenario – a mediocre government.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.

Members of Venezuela's militia and supporters of Venezuela's President Chavez attend a ceremony in Caracas (Jorge Silva/Courtesy Reuters).

Today, chances are Hugo Chávez will face off against Henrique Capriles Radonski in the 2012 October presidential elections. The 39-year-old former mayor of Caracas’s Baruta Municipality (2000-2008) and current Miranda state Governor is leading the opposition candidates, and polling just 2 percentage points below Chávez. He is a lawyer who entered politics at the age of 26 to become the youngest member of the Chamber of Deputies until it was dissolved in 1999.

Capriles appeals to the non-Chavista Left. Following in Lula’s Brazilian footsteps, he has poured money into education and social programs, drawing strong support among the lower classes as well as from a growing contingent of independent voters put off by the Chávez-centered polarization of Venezuelan politics. Comfortable among slum dwellers and businessmen alike – and unafraid to don Chávez’s signature Veneuelan flag jacket– the young candidate has won hearts and minds with his intensity and obvious passion. He has also attracted Chávez’s ire. In 2004, he was arrested for “trespassing, intimidation and ‘violating international principles’” for his involvement in a protest outside the Cuban embassy in the wake of the 2002 attempted coup. The charges were eventually thrown out and two months after leaving prison he was reelected to his post as mayor with 80 percent of the vote.

Yet while a rising star, he faces three major challenges. The first is the divisions within Venezuela’s anti-Chávez opposition. There are other worthy competitors — Leopoldo López, the former Mayor of Chacao Municipality and Pablo Pérez, another young and dynamic governor of the state of Zulia. While one of these — probably Pérez — may give him a run for the nomination, the real test will be whether the opposition can remain united. In the past, their divisions have weakened them perhaps as much as any moves Chávez has made.

The opposition’s track record has gotten a lot better. In the 2008 regional elections they were able to come together, winning governorships in 5 of Venezuela’s 22 states (including the two most populous, Miranda and Zulia). The 2010 Congressional run was their best showing yet. By uniting behind candidates chosen either by consensus or in local primaries, they managed to win the popular vote (52%) — though only  40% of the legislature due to gerrymandering. Signs look good for this coming year, as last month the three major opposition parties signed a pact promising to support the winner in February’s primary.

A second challenge is Chávez’s electoral machinations. While the ballot box itself has not yet been in question, the Chávez administration has repeatedly tilted the electoral playing field —  arresting prominent opposition leaders, silencing independent media outlets, and undercutting autonomous institutions such as the National Electoral Council (CNE). The meddling for 2012 has already started, beginning with moving up the election date from December to October 2012. This is likely just the first of many measures to take the wind out of opposition sails.

The third, less analyzed challenge is Chávez’s health. At first brush his potential inability to run for reelection should boost the opposition’s chances. But it could make it all the much harder. Left without a popular candidate, hard-line Chavistas might pull the plug on elections all together. Hugo’s brother Adán has already suggested as much, saying recently, “It would be inexcusable to limit ourselves [PSUV] to only the electoral and not see other forms of struggle, including the armed struggle.” Instead of opening up Venezuela’s political system, Chávez’s absence might put an end to Venezuela’s democratic trappings altogether.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.

U.S. Republican presidential candidate Michele Bachmann gestures beside Mitt Romney during the Republican presidential debate in Ames (Courtesy Reuters).

As primary election season gets underway, the Republican hopefuls have had little to say about Latin America. But there have been a few hints though from the leading candidates as to what they see when they look south – particularly with regard to Mexico.

Michele Bachmann is the most cut and dry so far. She opposes immigration and the legalization of undocumented migrants, and calls for the deployment of troops in south Texas. The Minnesota congresswoman wants to wall the border off completely, saying “As president of the United States, every mile, every yard, every foot, every inch will be covered on that southern border.” When Bachmann felt the need to strengthen her foreign policy chops last spring, she flew to Colombia and Mexico with the House Intelligence Committee – her first trip abroad to a country other than Israel (which she has visited multiple times courtesy of pro-Israel interest groups). Upon returning, she expressed strong support for the drug war.

Mitt Romney and Rick Perry have more nuanced takes – in part because they have more extensive experience in and with the region. Romney has a long history working in Latin America, as his firm Bain Capital invested extensively in Central and South America. On the campaign trail, he lauds those governments with business friendly policies, pointedly contrasting them to those with less open markets (e.g. Venezuela and Cuba).

During the 2008 electoral race Romney became increasingly tough on immigration , and even tougher on border enforcement, running ads attacking John McCain for his “soft” stances. His hardened views have caused somewhat of a family drama as many of his relatives (no, not from the Huntsman branch) live in northern Mexico and have openly criticized him, saying that “I don’t think Mitt understands the causes of illegal immigration.”

Rick Perry, the newest addition to the field and the now front-runner has little interest in Latin America, but does have a long history with Mexico. On immigration, the Texas governor is considerably more progressive than many of his peers.  Perry’s record suggests that he supports the DREAM act and similar reforms, given that he approved a law allowing undocumented high school graduates in Texas to pay state tuition. He has even thrown his weight behind a guest worker program for Texas.

But Perry is increasingly vocal and tough on border security. Among the most outspoken critics of Obama’s border policy, he has repeatedly raised alarm bells about violence spilling over from Mexico into the lone star state, and asked for the deployment of military troops and predator drone in response. Unlike Bachmann, Perry has remained firmly opposed to the border fence, calling the idea “ridiculous on its face.”

This early in the season, most candidates and campaigns are focused on domestic issues. Those foreign policy issues at the forefront – Afghanistan, Libya, or Syria – aren’t necessarily a club Latin American nations would want to join. But many do bemoan the lack of interest and understanding of the rest of the Western Hemisphere by these presidential hopefuls.

Latin America should  in fact matter more. The region is among the U.S. fastest growing trading partners, creating American jobs with each purchase. With over half a trillion dollars worth of goods going back and forth, Latin America is second only to Asia – and growing much faster – in terms of total trade with the United States. Its largest nations play important roles in multilateral organizations from the G20 to the United Nations Framework Convention on Climate Change (UNFCCC), helping the United States and others resolve difficult global challenges. And finally, according to the latest census 50 million Americans – 1/6 of the population – are descendants of these nations, many still with close ties to their original homes. Ignoring Latin America or alienating Latin Americans only adds up to a missed opportunity, both for the Republican Party and for the country.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.

Peru's new President Ollanta Humala is sworn in to office in Congress in Lima (Mariana Bazo/Courtesy Reuters).

As President Ollanta Humala assumes office today, it looks as if he has chosen to emulate Lula rather than Chávez. His cabinet is full of moderates, and some even see it as leaning center-right. While growth is expected to continue at about 6 percent, the new administration will face many challenges, in particular security and the increasing presence of transnational crime, as well as high levels of inequality.

This week the Obama administration released a new directive on combating transnational organized crime (TOC). Among its 56 “priority actions” are new and deepened efforts to stop the money laundering and flows supporting these crime networks. New tools include barring TOC members entry into the U.S., freezing assets and other financial sanctions. The document also expands the role of the Justice Department and FBI in investigating transnational crime more generally. Still, many of the nearly five dozen items seem little more than aspirations– such as the commitment to “stop the illicit flow from the United States of weapons.” But generally, this revamped strategy and more focused game plan is welcome.

Finally William Rempel’s new book, At the Devil’s Table, showcases the role one individual can play in the fight against drug cartels. This gripping read chronicles the life of Jorge Salcedo, a Colombian engineer that rose to be head of security for Miguel Rodriguez Orejuela, a godfather of the Cali cartel during its heyday. The tale tells the true story of Salcedo’s introduction to crime, his rise within one of the most powerful drug cartels in the world, and the actions he ultimately took to help bring it down. It shows the power of one courageous individual, but also the challenges of going it alone in the belly of the criminal underworld. While the Cali cartel is now gone, others have willingly taken its place, and Colombian coca and cocaine continue unimpeded.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.

Venezuelan President Chavez looks on as his Brazilian counterpart Lula da Silva speaks during their meeting at Miraflores Palace in Caracas in July, 2010 (Jorge Silva/Courtesy Reuters).

Jorge Dominguez’s recent testimony before the Senate Subcommittee on Western Hemisphere gives an overview of Latin America’s progress toward democratic consolidation in recent history, and the role the international community has played in this slow, but steady, march.

Time and America’s Quarterly have two good pieces on Mexico’s state level elections last weekend. While both rightly focus on the PRI’s strength coming out of the election, it didn’t win everywhere. The party lost nine municipalities it previously held in the state of Hidalgo, due in large part to successful alliances between the PAN and PRD. Meanwhile, the PRD mayor of Mexico City urges that these ties must become stronger to give his party and its allies a fighting chance in the 2012 presidential elections.

A recent New York Times article looks at the current state of  illegal immigration from Mexico to the U.S., highlighting how changing dynamics within both countries dissuade Mexicans from crossing the border illegally. This discussion addresses issues I raised in the past, namely changing demographics and new economic realities, including the rise of the middle class in Mexico and the region more broadly.

Lastly, for readers worried about Brazil’s overheating, this Economist graph won’t calm your fears.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.

Argentina's President Cristina Fernandez de Kirchner waves as she enters Congress for the inauguration of the annual ordinary sessions in Buenos Aires (Marcos Brindicci / Courtesy Reuters).

By the end of next week, Argentina’s current president Cristina Fernández de Kirchner will have to decide whether she’s in or out of the upcoming presidential race. According to recent polls, if the Peronist leader runs, she will win reelection, likely in the first round. Nearly half of Argentines say they would vote for her if the election were today, and her overall approval ratings top 60 percent.

Her opposition is divided and as a result more easily conquered. Ricardo Alfonsín, the Unión Cívica Radical (UCR) candidate and son of former President Raúl Alfonsín, leads the pack, but his support is just under 20%.  So far he has been unable to bring other opposition figures into his fold, likely dooming his rise.

Argentine presidential races often come down not to a contest between political parties but between different factions within the Peronist party. Here Kirchner’s best-known challenger is Buenos Aires province political boss and former president Eduardo Duhalde. Once an ally, now a fierce opponent, Duhalde has the support of some breakaway Peronist factions. But with political patronage flowing (boosted by a strong economy), it will be difficult to entice many other party leaders away from the Kirchner fold.

In the end, assuming Cristina jumps in to the race, it is hers to lose. The challenge will be maintaining her current momentum through October. A bumper soya crop and a booming Brazil should help. Most expect Argentina’s economy to continue growing at a fast clip – 5 to 6 percent — over  the next four months.  Energy could pose a problem, as years of (government mandated) low prices have both increased demand and limited investment. A cold winter could expose the cracks in the system, causing a (politically challenging) energy crisis. But if Argentina can muddle through without any large shocks,  Cristina looks to remain in the Casa Rosada for another term. The markets seem to have come to this conclusion as well and are voting with their proverbial feet: capital flight increased during the first 5 months of the year.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.

A shaman performs a ritual in front of a photograph of President Barack Obama in Lima (Mariana Bazo/Courtesy Reuters).

Between March 19 and 23, President Obama will take his first foreign trip this year – and his first ever to South America. He will kick it off in Brasilia and Rio de Janeiro, then head to Santiago, and finish up in San Salvador. The trip’s goal, as announced in his State of the Union address, is to “forge new alliances across the Americas.” Alongside the obvious meetings between presidents, in the works are business roundtables, a visit to one of Rio’s favelas, an Egyptian style speech to “all Latin Americans” in Santiago, and educational activities for his daughters, who, along with the First Lady, will accompany him.

Why these three nations?

Brazil is the obvious choice. It has grown into an economic and diplomatic powerhouse, weighing in on world issues from financial reform to climate change. Under Lula, it flexed its muscle at times to the discomfort of the United States – on nuclear proliferation and Middle East politics, U.S. bases in the region, and the Honduran standoff. With newly installed President Dilma Rousseff’s openness to deepening U.S.-Brazil ties, there are high hopes on both sides that the trip will open a new chapter in the relations between the two largest economies of the Americas.

On the table will be trade and investment, particularly on clean energy and Brazil’s infrastructure needs in the lead up to the World Cup and the Olympics games. Also up for discussion will be China and its currency, as companies in both countries struggle to compete with Chinese imports and investments.

The other two nations are less obvious stops. Important as nations with which the United States maintains strong friendly ties, they are also examples of pragmatic and progressive governments from across the ideological spectrum. Chile’s Sebastián Piñera is leading one of the region’s most prosperous and stable nations from the center-right– the first elected conservative leader since the end of the Pinochet dictatorship. Obama’s visit will put the finishing touches on a nuclear pact, and the two leaders will work on clean energy and intellectual property issues (in particular the steps to get Chile off the U.S. priority watch list for failing to protect IP rights). Both leaders are keen to discuss innovation and entrepreneurship – part of their domestic political platforms.

El Salvador’s Mauricio Funes rules from the other side of the spectrum. A reformed revolutionary, he is the United States’ strongest partner today in Central America. The presidents will focus on security– Funes presented a $900 million plan to Hillary Clinton last fall, which would quadruple U.S. commitments under the Merida Initiative to Central America – as well as issues of economic cooperation and poverty reduction. The future of the 2.5 million Salvadorans (roughly one of every four) living in the United States will also be on the table, as Funes hopes to replace the Temporary Protected Status under which most live with a path to permanent residency.

What is also interesting is who is not on the list. The President, First Lady, and family will not be stopping in Buenos Aires, Argentina; a decision said to upset President Cristina Fernández de Kirchner. Behind the scenes, many feel that the old aphorism once attributed to Brazil is perhaps now more applicable to Argentina, that it is “not a serious country.” Also not on the itinerary is Colombia, in part because Obama has no good news to bring his counterpart on the long-delayed free trade agreement.

Though timed to coincide with the 50th anniversary of the Alliance for Progress, nothing so grandiose will be in the works. Nevertheless, as the heads of state meet and talk about an array of issues, Obama has the opportunity to make a significant change. In addition to the usual bilateral and regional topics, it is important that Obama bring Latin America into his thinking about global challenges. This shift, though subtle, would be the start of a real transformation in U.S.-Latin America relations.

Published in conjunction with Latin America’s Moment at the Council on Foreign Relations.

Right-leaning Alianza candidate Sebastián Piñera won the first-round December vote, outpacing Concertación candidate Eduardo Frei by nearly 15 percentage points. Sunday, by a closer margin, Piñera pulled another victory, making him the first elected conservative Chilean leader in several decades.

This was not an election driven by issues or ideology: Both candidates promised to continue Chile’s market-friendly macroeconomic policies and its popular social welfare programs. Instead it was driven by personal stories. Piñera presented himself as an entrepreneur who would foster greater innovation and competitiveness; Frei as a wise, experienced former president (he led the country from 1994 to 2000).

Piñera’s victory suggests a new era for Chile’s politics. It signifies that the right has finally emerged from the shadow of Pinochet’s military dictatorship to become a viable electoral alternative once more, able to lead an open and dynamic country without a fear of backsliding into the past. It is the end of the pro/anti Pinochet political divide–the guiding cleavage of Chile’s politics since the 1970s.

The Concertación’s loss is also in some ways the result of its successes. While many talk of the economic growth and stability brought by Pinochet’s reforms, it is the policies and actions of the governing Concertación coalition that have truly transformed Chile into a modern state. These successive governments–through sound macroeconomic management combined with the creation of a broad social safety net–succeeded in reducing Chile’s poverty rate from nearly 40% in 1990 to just under 14% today (nearly equivalent to U.S. rates). Chile’s now much larger middle class is more politically independent, and Piñera openly wooed this cohort–ultimately successfully.

While highlighting the diminishing role of Chile’s old political fracture, this election also highlighted a new divide–that between the old and the young. While Frei and Piñera came firmly from the old guard, the spectacular rise of Marco Enriquez-Ominami, a 36-year-old filmmaker and former congressman with the Socialist party, upended politics as usual. He became the most successful independent candidate in Chilean history, winning 20% of the first round votes. His strength lay in an emerging middle class focused on the future and open to political change. Whether we see an Enriquez-Ominami candidacy again in four years, this will surely be the last election where the leading candidates’ formative years occurred under the Pinochet regime.

But Chile’s future political challenge will be how to engage its younger generations. Unlike their parents, seared by the turmoil of the 1970s and 1980s, Chile’s youth is politically apathetic. Less than 10% of 18- to 29-year-olds are even registered to vote. Many older citizens are also disillusioned. Polls show that 60% of the population believes that none of the candidates–or their parties–represent their ideas well. As the leftist Concertación tries to recreate a winning strategy and the right Alianza looks to deepen its victory, opening up the political system is vital. Chileans are demanding new approaches and more diversity. This election shows us that after decades of dominance by first the right and then the left, Chile’s politics are now up for grabs.

This op-ed first appeared on Forbes.com

What Venezuela and Bolivia do share is the weakness of their political institutions which results in large part from their history with democracy. Democracy emerged in Venezuela in the late 1950s and Bolivia in the early 1980s after elites joined together to form a “pact” that established the rules for the new governments.

These pacts brought stable democracy to both countries no easy feat in Latin America. But, these agreements left many policy issues particularly economic issues permanently off the agenda. They also encouraged the development of cartel-like political parties, more interested in staying in power than truly representing their own populations.

These dynamics excluded large percentages of the population in both countries from politics. In the face of economic turmoil, these poorer populations searched for someone to represent their interests and found outsider candidates Hugo Chavez and Evo Morales. Their elections ended the cozy arrangements between the traditional political parties  and challenged the rules of the political game.

But here is where the outcomes in each country diverge. Due to Venezuela’s oil wealth, Chavez has vast resources to satisfy his heterogeneous political base – creating new schools, health care clinics, affordable housing, and food subsidies. Morales, in contrast, does not have the public resources to provide so abundantly for his supporters. Instead, divisions within his own coalition are emerging, questioning his ability to balance campaign promises with the country’s economic realities.

Politically, Chavez has successfully consolidated power retaining control now over the judiciary, the public bureaucracies, and the Congress. In Bolivia, we see a political standoff between the Morales’ political coalition and his opposition. The opposition including the traditional political parties – retains control of several governorships, and for the last six months has stymied any substantive debate within the Constituent Assembly. These political divisions are now leading to social unrest and violence. In short, the battle between these two sides has yet to be won.

These separate outcomes in Venezuela and Bolivia are both worrisome for democracy. But since they result from domestic factors, their spread throughout Latin America is unlikely. It shows that to counter these trends, however, we need to pay more attention domestic institutions, and less to the grandstanding of particular political leaders.

Chavez’s ability to carry out these nationalizations rests on the confluence of political and economic power he holds. In recent years he consolidated political power in Venezuela by undermining the independence of the judiciary, the national electoral council, the bureaucracy, and he gained complete control of the Congress. On the economic side, high oil prices provide Chavez the resources to compensate the private owners of these or even other companies in Venezuela. Venezuela now holds over $50 billion dollars in international reserves, providing a war chest for not only his social programs but for expenditures like nationalizations.

What is important to understand is that it is unlikely his efforts will spread to other Latin American nations. Most of the recently elected leaders in Latin America (there have been twelve elections in as many months) are turning toward free markets, not away from them. Leftist leaders in countries such as Chile, Brazil, Uruguay, and even Argentina are opening their markets while also instituting broader social protections, including social security, health care, and assistance programs. Even those leaders who may be more ideologically inclined toward state intervention in the economy, such as the presidents of Bolivia and Nicaragua, don’t have the luxury of strong oil revenues. So large-scale nationalizations are unlikely outside of Venezuela. In many ways this is an isolated, anachronistic turn to socialism, ironically buoyed by global capital markets and the increasing demand for oil due to globalization.

Finally, some commentators are pointing to the Iranian President Ahmadinejad’s visit to Venezuela (his second in five months) as a threat to U.S. interests. These meetings, and strategic agreements signed at them, are less important than many fear. While there are several reasons why the United States should worry about its relationship with Iran, the alliance with Chavez will not seriously influence these foreign relations. We should keep or foreign policy strategies and decisions toward each country separate, as their shared anti-Americanism shouldn’t negate their vast differences.

For more thoughts on Chavez’s announcements, please check out my interview with Mike McKee from Bloomberg earlier this week about this development:

Bloomberg interview