The spoils of oil

Venezuelan President Hugo Chavez, who was just sworn in for a third term, is acting like a supremely confident leader. Last week, he declared the country's telecommunications and electricity utilities would be nationalized, to the astonishment of international investors. He has demanded — and is likely to receive — congressional authority to rule by decree for one year, which should facilitate his goal of installing "21st century socialism" in Venezuela.

Chavez's vision of leftist governance is not confined to his nation's borders. Over the past year and a half, he has helped allies in Ecuador, Bolivia and Nicaragua win the presidency. He has also promised a major aid package for newly sworn-in Nicaraguan President Daniel Ortega, which will deepen the Venezuelan's ties to a leader the Bush administration futilely tried to keep from office.

It's not hard to see why Chavez feels emboldened: He thrashed his opponent in the December presidential election by more than 20 points. Still, he may want to take note of the trajectory of the last Venezuelan president who had the good fortune to serve during a sustained oil boom. Like Chavez, former President Carlos Andres Perez demanded autocratic powers, nationalized key industries and flexed his muscle on the international stage when he was first elected to a five-year term in 1973.

High oil prices helped persuade Venezuelans to look past Perez's self-aggrandizing tendencies. He spread the oil windfall widely, doling out subsidies to domestic businesses and beefing up social programs. (Chavez has pursued a populist agenda, as well, spending heavily on antipoverty programs in particular.) Memories of the go-go '70s helped Perez win a separate term in office in 1988. During that second tenure, however, oil prices were at a low point, and Perez found that even his vaunted charisma could not save him from being prematurely forced from the presidency.

Chavez has announced he would like Venezuela's constitution to be amended so he can remain in office indefinitely. Given his tight grip on all branches of the government, his wish is likely to be granted. But like Perez, he may find that the length of his tenure depends heavily on how long a notoriously fickle commodity commands a high price on the international market.