How Venezuela Keeps Low Income Americans Warm

So what's in it for Venezuela? Professor Eric Hershberg, director of Latin American and Latino Studies at American University, says it's extremely unusual for a developing country to send this type of donation to an industrialized nation--and that it's pure petro-diplomacy. Although Venezuela has always used oil as a diplomatic tool, President Chavez has taken the practice to the next level. Hershberg says that Chavez's style of leadership has been built in large part around denunciations of the United States as an imperial power.

"[The heating oil program] is meant to be a stick in the eye of the Americans to show that the empire doesn't even take care of it's own unfortunate people," he said. He added that "it's also a way for [Chavez] to gain some degree of affection from sectors of the left in the United States."

According to Hershberg, the cost of the CITGO-Venezuela Heating Oil Program is relatively small in the grand scheme of Venezuela's international economy. During the years of the program, CITGO says it has helped more than 1.7 million people stay warm during the coldest months of winter by donating more than 200 million gallons of heating oil. That oil has a value of more than $400 million. Currently, Venezuela is the United States' fourth largest supplier of imported crude oil: in 2011, they provided the United States with $42 billion in mineral fuel and crude oil.

But the idea that this is small change for a country that still struggles with poverty gets under the skin of many Venezuelans who oppose this and similar foreign-aid ventures the Chavez administration has embarked on. Despite World Bank estimates that poverty levels have decreased significantly under Chavez, as of 2011 the Venezuelan poverty rate still stood at 31.9%. That's double the poverty rate of the U.S.

According to blogger Francisco Toro, "This is a small part of a much larger strategy by Chavismo…to create international alliances and give support to the Bolivarian revolution through oil and its revenues." The strategy, Toro adds, "has had a high cost for Venezuela and has been murky." Toro is referring to the numerous foreign-aid programs Venezuela is engaged in, which includes programs to provide aid to Nicaragua and Cuba. Venezuela sends Cuba an estimated 115,000 barrels of oil a day, for instance. Cuba pays Venezuela back in the form of doctors, intelligence and security experts stationed in Venezuela.

Venezuela, however, continues to be a poor country, one that is plagued by issues like electricity shortages. Toro says it's simply unacceptable for his country to be donating any money abroad. "A country where you have families, many families who still can't eat three times a day, that's not a country that should have a foreign-aid program," he said.

Venezuela's aid programs may be on precarious footing as the cancer-stricken Chavez continues to battle for his life. Venezuelan Vice President Nicolas Maduro has said that, if Chavez dies, elections will be held within 30 days. If Chavez fervor grows after his death, as Hershberg believes it will, his administration's aid programs will continue undeterred. But the opposition has vowed that, if it wins the next election, one of the things it will tackle is what it sees as excessive spending on foreign aid.

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