By SIMON ROMERO and ALEXEI BARRIONUEVO
Published: July 7, 2008

CARACAS, Venezuela — President Hugo Chávez of Venezuela and President Luiz Inácio Lula da Silva of Brazil clasped hands here at a summit meeting late last month, as employees of Venezuela’s state oil company raised their fists and shouted Cuban-inspired socialist slogans before the cameras.

It was an image of solidarity that might once have alarmed Washington, which has seen the United States’ standing steadily eroded by a shift toward left-leaning, populist leaders across the region in the last decade.

But the carefully orchestrated event disguised a more recent turn in Latin America that presents new opportunities for the United States: Mr. da Silva has steadily peeled himself away from Venezuela’s leader and quietly supplanted him as he nurtures Brazil into a regional powerhouse.

Today the two leaders, often partners but sometimes rivals, offer starkly different paths toward development, and it is Brazil’s milder and more pragmatic approach that appears ascendant. Amid the decline of American influence in the region, the Brazilian president is discreetly outflanking Mr. Chávez at almost every turn in the struggle for leadership in South America.

Mr. Chávez has been nationalizing foreign companies and trying to assemble an anti-American bloc of nations. His regional credentials suffered last week, though, when his ideological rival, President Álvaro Uribe of Colombia, organized a dramatic rescue of 15 hostages held in the jungle by Colombian rebels.

Mr. da Silva has diversified Brazil’s already strong industrial base and created an ample political coalition with almost a dozen neighbors. Huge recent oil discoveries in Brazilian waters have allowed him to blunt Venezuela’s efforts to use its oil largess to win influence. Venezuela’s economy has shown signs of stumbling, while its dependence on trade with Brazil has intensified.

The key to Brazil’s success has been a lucky confluence of global economic trends, like rising demand for commodities like soybeans and sugar-based ethanol, but also the quiet stewardship of Mr. da Silva, a former auto plant worker. He has raised Brazil’s profile across the region in part by adopting a less confrontational approach to Mr. Chávez than that of the United States.

Instead of publicly squaring off with Mr. Chávez, even when he has threatened Brazilian interests, Mr. da Silva taps into the kinship of the left and lavishes praise on him. Mr. da Silva went so far as to describe Mr. Chávez recently in the German magazine Der Spiegel as Venezuela’s “best president in a century.”

“The pragmatic side of Lula, the union leader who was always a negotiator, has paid off,” said Kenneth Maxwell, a historian at Harvard University and a columnist for the Brazilian newspaper Folha de São Paulo.

“While Chávez grabs the headlines, the debate over whether Brazil is becoming a regional power is moot,” he said. “Brazil has actually made it to that level, but in a very nonbombastic way.”

While high oil prices have bolstered the theatricality of Mr. Chávez’s maverick policies, Venezuela’s most pervasive influence remains limited to a handful of the region’s poorest nations — Bolivia, Cuba, Dominica and Nicaragua — members of ALBA, a trade alliance championed by Mr. Chávez. Another Chávez ally, Ecuador, is not a member. Meanwhile, Mr. da Silva’s unexpected embrace of the market-friendly ideas begun by his predecessor, Fernando Henrique Cardoso, has emphasized how heterogeneous political thinking has become in Latin America, even on the left.

Publicly, the Brazilian president has been quick to defend Mr. Chávez, even as privately he has sought to temper the Venezuelan president’s sometimes inflammatory remarks.

In an interview in September, Mr. da Silva said that the rhetoric “worked with the reality of Venezuelan politics” and that Mr. Chávez’s anti-Americanism was rooted in the Venezuelan leader’s unshakable belief that the Bush administration was behind a 2002 coup attempt. “He has his reasons,” Mr. da Silva said.

But while Mr. Chávez turned harder to the left after his brief ouster in 2002, Mr. da Silva shifted to the center once in power, surprising many skeptics. His lighter touch has greased the way for Brazil in countries as varied as Cuba, the Socialist bastion to which Venezuela provides a lifeline of subsidized oil, and Colombia, a top United States military ally whose relations with Venezuela have been frosty in recent months.

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Brazil will be the most important geopolitical factor in South America.  Going forward, Petrobras is likely to overpower both PEMEX and Chavez's socialized oil resources (that are refined mostly in the US).  Given Brazil's resources and population, I cannot see anyone else in the role. 

Edited by pikeshot1600 - 07-Jul-2008 at 17:51

The good fellow of today can be the "Goodfella" of tomorrow.  No guarantees of Best Friends Forever.   

Originally posted by pinguin It is likely as well that in a not too far away future, South America become a single political entity. That's something every country desires in here, but we haven't figure it out as yet how to do it (just see how long has taken to the EU). If that happens, it is very likely we won't need to worry more about some friendly "amigos" and throublemakers from up north

Wow that seems very very ambitious.

For one thing, unlike much of Europe in the 1990s and 2000s, there are many Latino states which have ongoing serious troubles with eachother. We saw this in the Ecuador-Colombia-Venezuela conflict earlier this year. There are also longer term rivalries and conflicts such as that between Argentina and Chile - though I am not sure how much that would affect future plans for unity. And then there are historical conflicts - has Bolivia and Peru ever truly forgiven Chile for their losses in the War of the Pacific.

South American unity seems nice enough on paper, with a common geography and at most only two major languages to negotiate. But we have to ask ourselves how ready these states are to put old conflicts behind them, and whether some wealthy states like Argentina are really ready to give material help and sponsorship to poorer ones like Bolivia. Then there are the problems caused by the usual domestic worries, such as Bolivia nationalising the Brazilian owned gas resources in their country.

Originally posted by Constantine XI Wow that seems very very ambitious.

Pinguin:

Edited by pikeshot1600 - 08-Jul-2008 at 13:20

What about the Chaco War?  What were the geopolitics involved there, and what issues were, or remain to be, resolved?

I certainly think a unity of Latin American states comparable to the EU is feasible in theory, but it would take a lot of patient hard work and long term vision on the part of member states. Governments in these states are likely to abandon Latin American Unity policies that are unpopular domestically in their own nation if that is what stops them being voted out of office. Even the EU has a difficult challenge at times, as the recent referendum in Ireland shows.

Originally posted by Constantine XI I certainly think a unity of Latin American states comparable to the EU is feasible in theory, but it would take a lot of patient hard work and long term vision on the part of member states. Governments in these states are likely to abandon Latin American Unity policies that are unpopular domestically in their own nation if that is what stops them being voted out of office. Even the EU has a difficult challenge at times, as the recent referendum in Ireland shows.

I was not so much referring to the sense of separate identities within certain European countries, but I was addressing the point made earlier by several others that South American countries still have their differences and squabbles.  I was pointing out that European countries do, too.  That fact did not stop them from working towards unification, so why would such minor differences be brought up as a major obstacle towards South American unification?