The New Tehran-Caracas Axis

by Maria Anastasia O'Grady
The Wall Street Journal
January 13, 2006; Page A13

With Iranian nuclear aspirations gaining notice this week, it's worth directing attention to the growing relationship between Iran's President Mahmoud Ahmadinejad and Venezuela's President Hugo Chávez. The Reagan administration repulsed Soviet efforts to set up camp in Central America. Iranian designs on Venezuela perhaps deserve similar U.S. attention.

The warmth and moral support between Ahmadinejad and Chávez is very public. The two tyrants are a lot more than just pen pals. Venezuela has made it clear that it backs Iran's nuclear ambitions and embraces the mullahs' hateful anti-Semitism. What remains more speculative is just how far along Iran is in putting down roots in Venezuela.

In September, when the International Atomic Energy Agency offered a resolution condemning Iran for its "many failures and breaches of its obligations to comply" with its treaty commitments, Venezuela was the only country that voted "no." Ahmadinejad congratulated the Venezuelan government, calling the vote "brave and judicious."

Three months later, in a Christmas Eve TV broadcast, Chávez declared that "minorities, the descendants of those who crucified Christ, have taken over the riches of the world." That ugly anti-Semitic swipe was of a piece with an insidious assault over the past several years on the country's Jewish community. In 2004, heavily armed Chávez commandos raided a Caracas Jewish school, terrifying children and parents. The government's claim that it had reason to believe that the school was storing arms was never supported. A more reasonable explanation is that the raid was part of the Chávez political strategy of fomenting class hatred -- an agenda that finds a vulnerable target in the country's Jewish minority -- and as a way to show Tehran that Venezuela is on board. Ahmadinejad rivals Adolf Hitler in his hatred for the Jewish people.

It's tough to tell whether Chávez is a committed bigot or whether his anti-Semitism and embrace of the mullahs are simply a part of his calculated efforts to annoy the Yanquis. But it doesn't make much difference. The end result is that the Iranian connection introduces a new element of instability into Latin America.

In his efforts to provoke the U.S., the Venezuelan no doubt hopes that saber rattling against imperialismo can stir up nationalist sentiment and save his floundering regime. That view argues that the U.S. would do best to ignore him, but it's not easy to ignore a Latin leader who seems intent on forging stronger ties with two of the worst enemies of the U.S., Ahmadinejad and Fidel Castro.

That Chávez is making a hash of the Venezuelan economy while he courts international notoriety is no secret. There are shortages of foodstuffs that are abundant even in other poor countries. Milk, flour for the national delight known as "arepas" and sugar are in short supply. Coffee is scarce because roasters say government controls have set the price below costs, forcing them to eat losses. The Chávez response this week is a threat to nationalize the industry.

Property rights are being abolished. This week, authorities invaded numerous "unoccupied" apartments in Caracas to hand them over to party faithful, part of a wider scheme to "equalize" life for Venezuelans.

A bridge collapse last week on the main artery linking Caracas to the country's largest airport, seaport and an enormous bedroom community is seen as a microcosm of the country's failing infrastructure. Aside from the damage to commerce, it has caused great difficulties for the estimated 100,000 commuters who live on the coast, Robert Bottome, editor of the newsletter Veneconomy, told me from Caracas on Wednesday. The collapse diverted all this traffic to an old two-lane road with hairpin turns and more than 300 curves. It is now handling car traffic during the day and commercial traffic at night, with predictable backups.

With Venezuelan oil fields experiencing an annual depletion rate on the order of 25% and little government reinvestment in the sector, similar infrastructure problems are looming in oil. In November, Goldman Sachs emerging markets research commented on a fire at a "major refinery complex" in which 20 workers were injured: "In recent months there has been a string of accidents and other disruptions [of] oil infrastructure, which oil experts attribute to inadequate investment in maintenance and lack of technical expertise to run complex oil refining and exploration operations."

Chávez is notably nonchalant about all this, as if the health of the economy is the last thing on his mind. His foreign affiliations are more important to him. The Iranian news agency MEHR said last year that the two countries have signed contracts valued at more than $1 billion. In sum, Iranians, presiding over an economy that is itself crumbling into disrepair, are going to build Venezuela 10,000 residential units and a batch of manufacturing plants, if MEHR can be believed. Chávez reportedly says these deals -- presumably financed with revenues that might be better employed repairing the vital bridge -- include the transfer of "technology" from Iran and the importation of Iranian "professionals" to support the efforts.

Details on the Iranian "factories" -- beyond a high-profile tractor producer and a widely publicized cement factory -- remain sketchy. But what is clear is that the importation of state agents from Hugo-friendly dictatorships hasn't been a positive experience for Venezuelans. Imported Cubans are now applying their "skills" in intelligence and state security networks to the detriment of Venezuelan liberty. It is doubtful that the growing presence of Iranians in "factories" across Venezuela is about boosting plastic widget output. The U.S. intelligence agencies would do well to make a greater effort to find out exactly what projects the Chávez-Ahmadinejad duo really have in mind. Almost certainly, they are up to no good.