FOR NOW: CHAVEZ' POST-REFERENDUM OPTIONS

C O N F I D E N T I A L SECTION 01 OF 03 CARACAS 002403

SIPDIS

SIPDIS

HQSOUTHCOM ALSO FOR POLAD
DEPARTMENT PASS TO AID/OTI (RPORTER)

E.O. 12958: DECL: 12/27/2017
TAGS: PGOV PREL VE
SUBJECT: FOR NOW: CHAVEZ' POST-REFERENDUM OPTIONS

CARACAS 00002403 001.2 OF 003


Classified By: ACTING POLITICAL COUNSELOR DANIEL LAWTON,
REASON 1.4 (D)


1. (C) Summary. In the wake of his constitutional referendum
defeat, President Chavez declared his intention to continue
to pursue changes to the constitution, but he has not
specified how or when. Amending the constitution is required
to make major political changes, such as the elimination of
presidential term limits. He already has the authority to
move long-pending legislation that would adversely affect
state and local governments, university and private school
autonomy, civil society, and the Catholic Church. Chavez has
some options for using the existing constitution to re-launch
some or many of his proposals, including a "people's
initiative" or calling for a constitutional assembly. At the
same time, he will have to weigh the potential political
risks of pursuing changes to the constitution that voters
already rejected once. While preparing for state and local
elections by October 2008, opposition parties are also
expecting -- and bracing -- for another constitutional battle
before then.
End Summary.


--------------
For Now
--------------


2. (SBU) In his televised December 3 address to the nation,
President Chavez conceded that his proposed changes to the
constitution had been defeated -- "for now," the catch-phrase
that helped launch his political career after the failed 1992
military coup. In his speech, Chavez stressed that his ideas
for constitutional reform remain "alive." In recent days,
the government has sponsored billboards around Caracas that
simply state "For now." Chavez publicly pledged in a speech
to his supporters December 5 to launch a "second offensive"
to change the 1999 Constitution, but the Venezuelan president
has not specified how or when he intends to do so.


3. (SBU) Chavez retains significant authority to enact his
political program, including the Enabling Law that permits
him to issue decree-laws in twelve vaguely defined areas
until August 2008. Senior government officials are already
suggesting that either via decree or through the
Chavez-dominated National Assembly, the government will
pursue a 36-hour work week and the extension of social
security benefits to the informal sector, both proposed in
Chavez' constitutional package. However, Chavez has less
flexibility to make political changes within the existing
1999 Constitution.


4. (SBU) Most significantly, Chavez cannot run for
re-election in 2012 without changing the two-term limit set
by Article 230. According to constitutional experts, the
Venezuelan president also cannot legally:
-- create new vice-presidencies;
-- establish new local entities, such as federal cities;
-- make "People's Power" (community councils) an entirely new
branch of government;
-- politicize the armed forces in the manner Chavez
originally proposed; or,
-- assume a wide range of additional presidential powers.
Such changes would require specific changes to the existing
constitution, according to local constitutional experts.


5. (C) Chavez can still move long-pending, controversial
legislation through the National Assembly or issue decrees
that would:
-- create a National Police Force;
-- force NGOs to register with the government and allow the
government to regulate the flow of international
contributions to NGOs;
-- restructure the educational system at the expense of
private school and university autonomy;
-- eliminate the privileged legal position that the Catholic
Church enjoys, particularly with respect to state-subsidized
religious instruction.
Given the role that the student movement, the Catholic
Church, and many local governments played in defeating the
constitutional referendum, Chavez would appear to have fresh
incentive to press ahead in these areas.

--------------
Interpreting the Constitution
--------------


CARACAS 00002403 002.2 OF 003



6. (C) People's Initiative: The principal obstacle
confronting Chavez' desire to revisit his proposed changes is
that the 1999 Constitution states that a failed
constitutional reform initiative may not be presented again
to the National Assembly in the same constitutional period
(i.e. a presidential period of six years). Nevertheless,
Chavez and other BRV officials have publicly raised the
possibility of pursuing a similar reform via a "people's
initiative" that could theoretically be launched with a
petition signed by at least 15 percent of registered voters
(2.4 million voters). A National Electoral Council rector
recently suggested that with just minor word changes, Chavez
could move ahead with a "people's initiative." The decidedly
pro-Chavez constitutional tribunal would likely rule in
Chavez' favor against any legal challenges.


7. (C) Constitutional Assembly: Chavez could also purse a
Constitutional Assembly at his request, the request of
two-thirds of the National Assembly, or the petition of at
least 15 percent of the voters. A Constitutional Assembly
would require national elections to designate delegates to
draft the changes to the 1999 Constitution. Former Defense
Minister Baduel has publicly called for a Constitutional
Assembly, but opposition parties are generally wary of such a
vehicle. Opposition party leaders privately concede that the
BRV would be able to elect a super-majority to a
Constitutional Assembly and push Chavez' changes through.


8. (C) Amendment Process: The Venezuelan President, 30
percent of the National Assembly, or 15 percent of the
electorate can propose one or various amendments to the
constitution, as long as the amendments do not change the
"fundamental structure" of the constitution. Amendment
proposals approved by a majority of the National Assembly
must still be approved in a public referendum. While there
is no limit on amendment proposals, the amendment process is
designed for few, individual changes, while a "partial
revision" is supposed to be accomplished via the reform
process. Again, the decidedly pro-Chavez constitutional
tribunal would like uphold Chavez amendment proposals against
legal challenges.


9. (SBU) The Reform Process: Some BRV officials are
interpreting the existing constitution to allow other
branches of government to resubmit even failed constitutional
reform proposals. For instance, the National Assembly could
propose the elimination of presidential term limits
originally proposed by Chavez. Alternatively, the President
could resubmit the proposals attributed to the National
Assembly in the most recent failed constitutional reform
process. The National Assembly would still have to approve
any reform proposal by a two-thirds majority over the course
of three formal reviews and then submit the final proposal to
a public referendum.

--------------
Hard Political Choices
--------------


10. (C) With the help of a pliant judiciary, Chavez should be
able to overcome the constitutional obstacles to revisiting
some of his proposed changes. He confronts distinctly
tougher political choices, however. Trying to put much of
his constitutional reform proposal back on the ballot without
making significant changes risks a second consecutive defeat
at the polls. Opposition voters are likely to vote in
greater strength now that the myths of Chavez' electoral
invincibility and wholesale National Electoral Council (CNE)
fraud have been broken. Opposition parties would likely try
to frame such a move as a power grab against the will of the
people. Moreover, Chavez still needs to repair his normally
formidable electoral machine, and his United Socialist Party
of Venezuela (PSUV) remains a work-in-progress.


11. (C) While Chavez could reasonably expect to control a
Constitutional Assembly, the process of holding Assembly
elections and the subsequent Assembly session would likely
extend at least several months. Moreover, after boycotting
the 2005 parliamentary elections, the opposition has no
representation in the National Assembly. Obtaining even a
small percentage of Constitutional Assembly seats would give
the opposition a new platform. BRV officials have publicly
hinted that they are interested in pursuing a stripped down
versions of Chavez' failed constitutional reform package,
arguing that the package was too "complicated" for most
Venezuelan voters. There is no reason to believe, however,
that a pared down reform that includes the elimination of

CARACAS 00002403 003.2 OF 003


presidential term limits, a distinctly unpopular idea
according to pre-referendum public opinion polls, stands a
better chance than the original proposal.


12. (C) Chavez also faces political risks should he decide
not/not to pursue constitutional changes before the state and
local elections to be held by October 2008. Although even
opposition politicians believe that Chavez supporters will
win the vast majority of gubernatorial and mayoral seats,
they believe they can improve on the collective opposition's
current hold on two of 23 governorships and 67 of 337 mayoral
positions. Podemos, the pro-government party that opposed
Chavez' constitutional reform, has two governorships and ten
mayoral seats. Opposition parties are already negotiating to
field consensus opposition candidates and are anticipating
some local splits within Chavismo in some races.

--------------
Comment
--------------


13. (C) Although ill-defined, President Chavez' "For Now"
warning has allowed him to retain some political initiative,
even in the wake of the constitutional referendum defeat.
The opposition continues to plan for the 2008 state and
municipal elections, but also expects Chavez to "reassemble
his forces" and wage another battle over the constitution in
2008 before those elections. Local political analysts expect
Chavez to shake up his cabinet early in 2008 before
announcing how he proposes to revisit his ideas for
constitutional changes, much in the same way he rolled out
his plans to launch a "socialist revolution" in January 2007.
Chavez will almost certainly try to frame the re-launching
of any of his defeated constitutional changes as "the will of
the people," including any renewed effort to allow him, the
self-described "embodiment of the people," to run again in

2012.

DUDDY