SYNERGY WITH THE DEVIL.(The Talk of the Town)

A year ago, progressive activists and policy wonks descended upon Caracas, Venezuela, for the World Social Forum, a kind of Davos conference for the global left. People packed into the Caracas Hilton to listen to panel discussions on the evils of neoliberalism and the threat posed by U.S. hegemony, and Hugo Chavez, the President of Venezuela, gave a speech to a crowd of some ten thousand in which he called for "socialism or death." It was a striking demonstration of Chavez's importance as an anti-capitalist symbol. And yet, only six months earlier, in the very same hotel, Chavez's government had hosted a rather different meeting of international luminaries. The attendees were American businessmen, and the meeting was a trade fair intended to convince American companies that Venezuela was friendly to foreign investment and eager to expand trade with the U.S.

To people on both the left and the right, Hugo Chavez is a kind of modern-day Castro, a virulently anti-American leader who has positioned himself as the spearhead of Latin America's "Bolivarian revolution." He calls for a "socialism of the twenty-first century," and regularly floats radical economic ideas; during his recent campaign for reelection, he suggested he might move Venezuela to a barter system. When he spoke in front of the United Nations General Assembly in September, a day after President Bush, he said, "The devil came here yesterday." And, just last month, after he was overwhelmingly reelected to the Presidency, he dedicated the victory to Castro and proclaimed it "another defeat for the devil who tries to dominate the world."

Chavez's rhetoric might not be out of place in "The Little Red Book," yet everyday life for many Venezuelans today looks more like the Neiman-Marcus catalogue. Thanks to the boom in the price of oil, many Venezuelans have been indulging in rampant consumerism that might give even an American pause. In the past year, auto sales have doubled, property prices have soared (mortgage loans are up three hundred per cent), and, thanks to this buying frenzy, credit-card loans have nearly doubled. And while Chavez has done a good job of redistributing oil revenue to the Venezuelan poor, via so-called misiones, designed to improve education, health care, and housing, and has forced oil companies to renegotiate contracts, there has been no nationalization of industry, relatively little interference with markets, and only small gestures toward land reform. If this is socialism, it's the most business-friendly socialism ever devised.

Even stranger, Chavez's demonization of the U.S. has had little or no impact on business between the two countries. The U.S. continues to be Venezuela's most important trading partner. Much of this business is oil: Venezuela is America's fourth-largest supplier, and the U.S. is Venezuela's largest customer. But the flow of trade goes both ...