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Chavez, Venezuela

The results of Sundayâ??s National Assembly elections in Venezuela were not announced until well past midnight early Monday morning: The opposition won over 52% of the vote but did not win the majority in the National Assembly. However, the opposition won 60 seats, ending the two-thirds super-majority Hugo Chávez needed to slide his projects through.

Chávez was hoping for a crushing win that would propel him to a victory in next yearâ??s presidential election. Instead, his party kept only 94 seats, in spite of extensive gerrymandering that favored candidates from Chávezâ??s party, Chávezâ??s unlimited use of state funds for their campaigns, and his constant television access.

By Tuesday morning, Chavez was claiming that his party beat the opposition by a slight margin in the overall vote, contradicting early reports. The Wall Street Journal points out,

The different interpretations of the nationwide vote count are likely explained by the fact that the opposition includes the political party PPT. The PPT, a leftist group that only won a couple of seats Sunday, has traditionally supported Chavez, but had a falling out recently.
With the economy in a deep recession, one of the highest inflation rates in the world (30% in the last year), soaring violent crime, and electricity shortages, voter turnout reached 66%. The opposition had sat out the prior National Assembly elections in 2005. This time they were able to gather the majority of the vote, if not the National Assembly seats. Currently holding barely 10% of the National Assembly seats, they now won over 33%.

The new congress will probably not rubber-stamp laws that increase Chávezâ??s power, but this does not mean Chávez will take it as a defeat. He has stripped of power the office of the mayor of Caracas when an opposition politician won two years ago and jailed the general who returned him to power after a coup; he still controls the courts and the majority of the states; he has nationalized private industries and the media; and the new National Assembly members wonâ??t be seated until January, affording him time to push changes through.

Goldman Sachâ??s Alberto Ramos (link by subscription only) expects that Chávez â??will probably resort to govern even more by decree which jointly with a friendly judiciary can contribute to debase the importance of the Assembly in the countryâ??s institutional balance of power.â?

Yet another factor is oil: Venezuela is the U.S.â??s fifth-largest oil supplier. As its oil production continues to decline, Chávez may not have the financial muscle to back his thirst for power.

Will this strengthen the opposition and possibly lead to a more democratic outcome in the 2012 elections?

It is too soon to tell.