Venezuelan President Nicolas Maduro unveiled yet another measure restricting the autonomy and/or powers of the National Assembly, a day before opposition politicians, who defeated Maduro loyalists in recent elections, are to be inaugurated. Though the measure was dated a week ago, it has only now been released; Maduro’s decree takes away the legislature’s powers to name and fire directors of the Venezuela’s central bank. “Maduro made the central bank his personal minting ministry, in a country where the constitution establishes an independent central bank,” a Venezuelan economist told the Financial Times. “The full discretional presidential control over the central bank is the ultimate tool for sliding into hyperinflation in Venezuela.”
The U.S. State Department heavily criticized the move: “We are concerned by the Venezuelan government’s efforts to interfere with the newly elected National Assembly exercising its constitutionally mandated duties,” it said in a statement. Maduro’s office shot back that it would “not accept imperialism” from the United States.
Arguably, South America is the one arena where President Obama’s hands-off strategy has worked. Obama has consistently refused to respond to the provocations of Latin American leftist regimes, particularly that of Venezuela. As a consequence, when Venezuela’s economy did eventually collapse, the regime’s inevitable attempts to blame the trouble on American interference and plots fell flat. Obama’s abstention removed the United States as far as possible from the arena of Venezuelan politics, and allowed what Obama would regard as the “natural” consequences of Venezuelan poor policies to take their course. Yet even in Venezuela, where Obama’s strategy appears to be bearing fruit, things could get very ugly very soon. As we’ve noted before, Maduro controls the military but will have minority representation in the National Assembly. That’s a recipe for civil conflict, and even—possibly—outright war.