Crackdown in Caracas - As President Hugo Chávez rounds up the opposition, many fear that Venezuela is slipping into dictatorship

www.time.com By TIM PADGETT WITH OWAIN JOHNSON | CARACAS

Carlos Fernandez and Carlos Ortega were history. For two months, Fernández, head of Venezuela's national business chamber, and Ortega, boss of the nation's largest labor union, led a loud but inept general strike meant to oust leftist President Hugo Chávez. When the strike ended earlier this month, they had succeeded only in crippling an already depressed economy, paralyzing Venezuela's all-important oil industry and exposing themselves as part of the corrupt oligarchy Chávez overthrew in the 1998 presidential election.

After outlasting and outsmarting this duo, Chávez could have focused on Venezuela's recovery. Instead, shortly after midnight on Feb. 20, Chávez's secret police arrested Fernández outside a restaurant in Caracas' posh Las Mercedes district on tenuous charges of treason and criminal conspiracy. They had the same warrant for the arrest of Ortega, who went into hiding. The two are "tumors we have to remove," Chávez declared, "coup mongers, saboteurs, fascists, assassins." But as Fernández was led away — and as diners leapt to rescue him, until the agents fired their guns in the air — Chávez had improbably turned the two into opposition heroes again.

Worse, Chávez has reinforced the fear that prompted the strike in the first place: that his erratic "revolution" is hell-bent on creating a dictatorship in the mold of his comrade, Cuba's Fidel Castro. The police action came only days after three dissident soldiers and an opposition activist were found tortured and murdered, their bodies dumped on the outskirts of Caracas. Police are still investigating those killings; but the victims' families insist that pro-Chávez thugs are responsible. In all, the events have derailed talks between Chávez and the opposition, which seemed headed toward a binding constitutional referendum on his presidency this coming August. (Chávez has rejected calls for an early election.)

And this time, diplomats involved in the process — as well as international human-rights organizations — aren't hiding their displeasure with Chávez. "His modus operandi is to always be at war with everyone and everything," says one diplomat. "We're losing a rare chance to help this country heal for a change." That's crucial not only for Venezuela. As a war in Iraq looms, global oil prices are volatile and rising, making an end to the crisis in Venezuela — which has the hemisphere's largest oil reserves but has seen the strike slash its crude output by more than half — an international imperative.

But healing is not a part of Chávez's political repertoire. His belligerent and authoritarian style has violently polarized the nation and wrecked the economy. Polls show that he would roundly lose a plebiscite — and observers worry that he may now be trying to squash the referendum. "Chávez has announced that 2003 will be the year of his total revolutionary offensive," frets independent political analyst Alberto Garrido. "Now we are seeing a much clearer Cuban model." Along with political arrests — and Chávez has hinted that many more are in the offing — analysts also point to his new, draconian currency-exchange controls, which are meant in large part to put the squeeze on his chief enemy, Venezuela's business sector. Says Chávez: "There will not be a single dollar for coup mongers."

Such displays have others worried that Chávez is not only dictatorial but delusional. Opposition legislators last year tried to evoke a constitutional article that defines "mental incapacity" as grounds for removing a President. In recent weeks, Chávez has accused his opponents of hiring warlocks to subvert his government, and charged Venezuela's commercial TV networks with planting subliminal messages of rebellion even in children's movies. A Chávez spokesman insists the opposition "simply wants to interpret his confrontational style as imbalance."

Thanks to the decades of larcenous governments that preceded him — and which are responsible for Venezuela's inexcusable 80% poverty rate — Chávez retains enough support among the nation's poor to stay afloat. But since, like Castro, Chávez seems to obsessively crave enemies to fight, it may not be long before he runs out of what few friends he has left.