A rough week further complicates Venezuela_s uncertain future

The twin moves created the sensation that Venezuela_s socialist administration is more out of touch and isolated than ever, analysts said. And it_s likely a fitting preamble to what will be a turbulent 2015 as the oil giant has fallen on tough times.

For many, the week was summed up by two images. On Monday, during a rally, President Nicol__s Maduro mocked the threat of sanctions, telling his followers that the Yankee Empire could _stick their visas where they have to stick them._

Two days later, Cuban leader Ra__l Castro was on national television announcing the communist island would restore full diplomatic ties with the United States for the first time since 1961.

As opposition leader Mar__a Corina Machado tweeted to her followers, _Two days ago Maduro was ordering everyone to burn their visas to the United States. Meanwhile, Ra__l Castro was applying for his._

It_s hard to describe Cuba_s role on the Venezuelan psyche. The late President Hugo Ch__vez often called Fidel Castro his political _father_ and treated him a like doting son.

In addition, Venezuela sends the island 100,000 barrels of fuel a day that Havana pays for in kind by shipping thousands of doctors, and military and political advisers to Venezuela, which only augments the island_s influence.

But as Venezuela struggles with falling oil prices and a deep economic crisis of its own, Havana is well aware that the largesse is at risk.

_Cuba, like the rest of South America, knows that the Venezuelan model isn_t viable,_ Miranda Governor and opposition leader Henrique Capriles said in a statement. _The Cuban government knows that it can_t live off the resources of our country anymore because of the economic deterioration._

And some wonder if Cuba_s step closer to the United States might have a ripple effect in Venezuela, which hasn_t had an ambassador in Washington since 2010.

_Nicol__s Maduro has an enormous dilemma,_ said Jesus Seguias, a Caracas-based political analyst and pollster with DatinCorp. _How is he going to justify his anti-imperialist politics when his principal ally has turned into an ally of the empire?_

While Maduro mocks the United States and squeezes the private sector with expropriations and draconian price and currency controls, Cuba is _not only extending a bridge but a freeway to the United States,_ he said.

_Nicol__s Maduro doesn_t have any options but follow Cuba_s path,_ Seguias speculated. _Cuba has given them the alert by saying _Look, you have to get along with the United States and come to an agreement with the private sector. The state run socialist economy is a failure everywhere.__

Cuba isn_t exactly embracing U.S. ideals. On Saturday, during his address to the National Assembly, Ra__l Castro said the island would remain firmly communist and a steadfast friend to Venezuela. Castro also pledged to defend Maduro against _destabilization_ efforts and U.S. _pretensions to impose sanctions on that sister nation._

Venezuela needs all the friends it can get, as it has become the hemisphere_s poster child for economic dysfunction. It_s saddled with a shrinking economy and skyrocketing inflation of 63.4 percent through August, according to official figures. Sporadic shortages of food and basic goods have led to massive lines that sour the national mood.

Falling crude prices have forced the government to slash its budget by 20 percent and scramble for revenue by selling assets _ including, potentially, its Citgo operations in the United States. The budget deficit is also threatening the popular social programs that underpin the administration_s support.

Some 82 percent of the population believes the country is headed in the wrong direction, according to a poll by Datanalisis. And a full 68 percent believe Maduro should step down or face a recall in 2016 _ rather than serve his full term until 2019.

Oliver Wack, the senior analyst and team leader of the Andean region for Control Risks, says he_s warning clients to be prepared for more street protests in Venezuela early next year after the holiday season is over, year-end bonuses have been spent and the mood turns surly.

_I think it_s going to be an extremely challenging year,_ he said.

And Maduro might have made things tougher by recently announcing that he would dedicate himself full-time in 2015 to _fighting the economic war,_ while delegating all other responsibilities to young Vice President Jorge Arreaza, who is married to one of Ch__vez_s daughters.

Maduro _is getting into an arena from which he cannot emerge victorious,_ said Wack, who speculated that forces within Chavismo might be trying to isolate Arreaza from the economic woes so that he remains a viable candidate in the future.

_It will be interesting to see how the relationship between Arreaza and Maduro plays out,_ he said. Will Areaza manage to _keep his vest clean of the big stain that will be Maduro_s managing of the economy next year?_

But Maduro_s new job description might also be savvy politics. Venezuela will see National Assembly elections next year where the battered opposition is expected to make gains.

Under the pretext of visiting farms and factories, Maduro will essentially be going on a nationwide campaign tour to drum up support for ruling party candidates, said Alfredo Croes, a Caracas-based analyst with Croes, Gutierrez and Associados.

_His new position will be particularly useful,_ he said. _It will provide the perception that the president is giving his undivided attention to the issue [the economy] that_s most important to the country right now._

Despite ruling-party weakness, the opposition, too, is in disarray, as longtime standard bearers have been sidelined. Former mayor and presidential candidate Leopoldo L__pez is in jail for his role in anti-government protests that rattled the nation in February; Mar__a Corina Machado, an opposition legislator, was stripped of her job and is facing charges for an alleged plot to kill Maduro; and Capriles, a two-time presidential candidate, seems out of touch with the national mood.

_The only thing that Venezuela_s opposition can do right now is make fun of Maduro,_ Croes said. _That_s all they have the power to do._

Seguias says the lack of leadership _ on both sides of the political spectrum _ makes Venezuela volatile.

_When the people don_t have confidence in any of their leaders they invent one,_ he said, noting that Ch__vez_s sudden rise to power in 1999 was a product of just such a crisis.

_This coming year is going to be one of outcomes,_ he said, _but they will be unpredictable outcomes._

Miami Herald | BY JIM WYSS

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