Atabey previously said:

Now it will get interesting in Venezuela as the opposition will try and stall many of Chavez' reforms from becoming law. And of course the REAL WAR is the 2012 election for President. Chavez as the article states will try everything possible to help his re-election chances for another 6 years in the Presidency, and the opposition will try likewise to prevent this from happening. So get ready for even more craziness out of Venezuela during this period in time.

abc200 previously said:


I'm sure there will be good co-operation between the parties to move the country forward!
S.

Gringo_1 previously said:



JAJAJA
So now you are saying Hugo will cooperate to move country forward now he is losing his grip?

abc200 previously said:


I'm sure there will be good co-operation between the parties to move the country forward!
S.

Atabey previously said:



Bloomberg

Venezuela Opposition Pushes Back Chavez in Congressional Vote

September 27, 2010, 5:36 AM EDT
More From Businessweek

By Charlie Devereux and Corina Rodriguez Pons

Sept. 27 (Bloomberg) -- Venezuelan President Hugo Chavez suffered his worst setback at the ballot box since taking office and lost his two-thirds majority in a congressional vote as support for his rule wanes ahead of 2012 presidential elections.

Opposition candidates, who boycotted the 2005 congressional race, secured 52 percent of the overall popular vote, giving them enough seats to force Chavez to negotiate on key decisions, said Ramon Guillermo Aveledo, head of the Democratic Unity Table alliance. Election officials didn’t provide a tally of the overall vote.

Chavez’s party, while securing at least 90 of 165 seats in the National Assembly after redrawing electoral districts, fell short of the 110-seat threshold needed to be given decree powers, approve the national budget and pass new laws single- handedly. Opposition candidates won 61 seats and non-aligned indigenous candidates won 3 seats according to the results announced at 2 a.m. local time, eight hours after polls closed. Another 11 seats remain to be decided.

“This is a tremendous defeat of the Bolivarian project,” said Friedrich Welsch, political analyst at the Simon Bolivar University in Caracas. “Chavez built his campaign on a vote of confidence in his socialist project and the majority of the people gave their votes to forces opposed to it.”

Opposition candidates, whose boycott in 2005 on concerns of possible fraud handed Chavez near-absolute control of the congress, took advantage of voter discontent with rising crime and 30 percent inflation to make gains. Venezuelans are increasingly dissatisfied with the government’s management of the economy, now in its second year of recession, analysts said

Aristobulo Isturiz, the campaign manager for Chavez’s United Socialist Party of Venezuela, said the government party did not reach its electoral goals.

“We were aiming for 110 deputies, which was not reached by any political party,” Isturiz told supporters waving red flags outside the presidential palace.

Chavez on Twitter

Chavez called yesterday’s results a victory for his Bolivarian socialist revolution.

“We’ve obtained a solid victory, sufficient to continue deepening Bolivarian and democratic socialism,” he said in a message on his Twitter account. “We must continue strengthening the revolution. Another victory for the people.”

In 2007, Chavez suffered his only electoral defeat since taking office in 1999 when voters rejected 50.7 percent to 49.3 percent a referendum to change 69 articles of the constitution.

An opposition victory in the popular vote could “energize its ranks to mount a serious challenge to President Chavez in 2012,” Alberto Ramos, an economist at Goldman Sachs Group Inc. in New York, wrote in a Sept. 24 report. He said Chavez might boost spending and take steps to undermine key opposition figures to win a third six-year term in 2012.

Gerrymandering

Chavez retained control of the National Assembly after redrawing electoral districts last year to favor rural areas where he’s more popular, analysts said.

The changes mean that 20,000 people in pro-Chavez Amazonas state elected a single lawmaker, giving them the same representation as 350,000 people in the opposition-controlled capital of Caracas.

More than 66 percent of Venezuela’s 17 million registered voters cast ballots. That compares with 61 percent in 2007 and 70 percent in another referendum to lift presidential term limits in 2009.

Economic Woes

Venezuela’s flailing economy, the fastest inflation rate among 78 economies tracked by Bloomberg and sporadic blackouts from underinvestment in the nation’s power grid have caused Chavez’s approval ratings to fall below 50 percent this year.

A drop in foreign investment due to nationalizations and reduced government income from lower oil prices caused the economy to shrink 3.5 percent in the first half of 2010 while the rest of South America rebounded from the global financial crisis.

In a reflection of the country’s polarized political climate, opposition supporters heckled Finance Minister Jorge Giordani as he cast his vote in the capital. Oil Minister Rafael Ramirez was met by protesters banging pots and pans.

“Take your economic policies to Cuba!,” a group of 15 Chavez opponents shouted to Giordani as he left the voting center in Santa Monica, a middle class neighborhood in Caracas. Giordani called his opponents “the face of fascism.”

Also hurting the government’s approval rating are homicides that have more than tripled since Chavez came to power to a record 16,047 last year from 4,550 in 1998, according to the Venezuelan Observatory of Violence, a Caracas-based research group.

Revered by Poor

Still, the 56-year-old former paratrooper remains revered among many poor Venezuelans who benefit from free health clinics and subsidized food markets. As oil rose to about $76 a barrel Sept. 24 from about $12 when Chavez took power in 1999, poverty has fallen by half to 24 percent in 2009, government data shows.

“If we don’t continue, the opposition will take everything away,” said Carmen Carmona, a 48-year-old social worker, outside a polling station in the Caracas slum of Petare with a group of red-shirted female supporters of Chavez.

The president traveled across the country during the election campaign promising cheap loans for household appliances and blaming the opposition for alleged sabotage that has led to the blackouts and deteriorating public services.

Bond Performance

Venezuelan bonds, which have underperformed peers in the region in recent weeks amid supply concerns and political uncertainty over the elections, may gain after the vote, Siobhan Morden, a debt strategist with Royal Bank of Scotland Group Plc in Stamford, Connecticut, said in a Sept. 24 report.

The extra yield investors demand to own Venezuelan bonds instead of U.S. Treasuries has risen 75 basis points to 11.8 percent since the start of August, according to JPMorgan Chase & Co.’s EMBI+ index. The broader EMBI+ index has fallen 4 basis points to 2.83 percent during the same period.

The current congress has until Jan. 5 to pass measures benefitting the government. Among the legislation it may consider is a constitutional change giving greater power to community councils beholden to Chavez, said Luis Vicente Leon, director of the Datanalisis polling firm.

“We’re heading to a situation of further radicalization,” Leon said in an interview before yesterday’s vote. “Chavez has several elements at his disposal to ride out any result.”

--With assistance from Jose Orozco and Daniel Cancel in Caracas. Editors: Joshua Goodman, Leon Mangasarian.

To contact the reporter on this story: Charlie Devereux in Caracas at cdevereux3@bloomberg.net; Corina Rodriguez-Pons in Caracas at crpons@bloomberg.net

To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net