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Venezuela Head Polishes Image With Oil Dollars

By Kevin Bogardus, The Center for Public Integrity

WASHINGTON, September 22, 2004 — President Hugo Chavez takes his case to America's streets. Using Venezuela's oil wealth to fund his social programs, President Hugo Chavez has divided his country largely along class lines, resulting in protests, strikes, and even a coup since his 1998 election.

Yet Chavez not only secured enough support in his home country to win this past August's recall election, but also found friends here in the United States—grassroots activists who have opposed the White House and now promote Chavez's cause.

The Latin American nation's welfare policies have reverberated with American organizers. "Venezuela, under Chavez, is using its oil resources to improve the lives of the poor," said Medea Benjamin, the co-founder of Global Exchange, a San Francisco, Calif., international human rights organization. "We here are obviously very excited about that."

Chavez has spent more than $1.6 million from mid-2003 through June 2004 on lobbying the federal government in Washington. The country also created its own Washington mouthpiece called the Venezuela Information Office in July 2003 and soon after hired a top U.S. protest organizer as its executive director.

The VIO tapped into a major U.S. activist network by contacting Global Exchange in early September 2003. The group has helped organize some of the world's largest protests, including demonstrations against Seattle's 1999 World Trade Organization summit and the 2004 Republican National Convention.

"We have been very careful to make sure we remain separate in our work," said Deborah James, the VIO's executive director, referring to Global Exchange. "I have not met with their people down there [in Venezuela]."

Yet the activist group and the VIO together posted an action alert online in May 2004 to voice concern over an editorial in The Washington Post.

"The Venezuela Information Office and Global Exchange is asking people to write publishable letters to the editor of The Washington Post, in order to provide factual information about recent events in Venezuela and point out the factual inaccuracies contained in the Post's editorial," read the notice on Global Exchange's Web site.

Global Exchange has been involved with Venezuela before. The group has also coordinated so-called "reality tours" of the Latin American country.

"We have been taking a lot of groups to visit Venezuela," said Benjamin. "They learn a lot about the social programs, which are run by the government."

With a $15 billion budget in 2004, PdVSA, Venezuela's state oil company, has been forced to set aside $1.7 billion to fund Chavez's social programs. Some critics have charged that Venezuela's welfare projects have compromised PdVSA's future, forcing the company to under-invest in its oil operations.

PdVSA is not a model of stability either. Chavez has appointed five different directors to run the company since he has come into power—even triggering the 2002 coup that briefly ousted the Venezuelan president.

Though not actively lobbying this year, PdVSA itself has contracted law firms in the past, including such powerhouses as Hill & Knowlton and Cleary, Gottlieb, Steen & Hamilton.

The VIO discussed with James, then a high-level organizer at Global Exchange, "ideas for strategizing on Venezuela" and the "need to begin conference calls of solidarity groups" in September 2003. One of James' current projects is a book on Chavez and the "Bolivarian Revolution" in Venezuela.

Soon after the VIO was founded, its American staffers began contacting activists and protesters, even appearing at events sponsored by the peace and social justice movements.

"When people see the incredible social transformation that is happening in Venezuela and in particular when they learn about the use of oil revenues to benefit all Venezuelans, people contact us so that we provide them with ways they can work against U.S. intervention," James told the Center.

At protests, conferences, and college campuses, VIO employees handed out literature and played The Revolution Will Not Be Televised, a documentary of Venezuela's 2002 aborted military coup. The VIO e-mailed several independent film theaters about showing the movie throughout the year.

The VIO also coordinated a "rapid response" team to combat news articles and editorials critical of Chavez. Eva Golinger, a writer at the pro-Chavez Web site,, was tapped to be a member of the team in September 2003.

"We encourage people to go their site because it is the most in-depth, comprehensive coverage of Venezuela in English," said James. "But we certainly do not have a structural relationship with them."

Golinger has since written heated opinion pieces on the Web site against U.S. policy towards Venezuela. In addition, Golinger wrote letters to editors critical of Chavez's government per the VIO's request. The VIO contacted over a dozen individuals to write letters, according to lobbying disclosure filings.

Some members of the VIO's "rapid response" team were officially connected to the Venezuelan government, such as Antonio Padrino, the press secretary in Venezuela's Miami consulate, while others were part of activist groups, such as Chuck Kaufman, a coordinator of the Nicaragua Network.

The VIO e-mailed reporters who covered Venezuela as well. The VIO's Communications Coordinator Nathan Converse spent days contacting journalists about their reporting, which he termed "inaccurate," "biased," or "unfair." In total, Converse sent over 50 e-mails in roughly half a year to reporters and editors who were critical of Chavez.

The VIO also coordinated activists' delegations to visit Venezuela in January 2004, including one sponsored by the TransAfrica Forum, a non-profit organization that researches U.S. foreign policy and how it affects Africa, the Caribbean and Latin America. One of the VIO's letter-writers, Edgard Hernandez, interviewed TransAfrica's president, Bill Fletcher, upon his return to the United States and wrote a glowing report of the trip on

The VIO abruptly ended operations at the end of January 2004, only to reconstitute itself a month later with a reshuffled staff and a budget of $660,000. James was officially put on the payroll and became executive director of the new VIO. She is currently on leave from Global Exchange. Converse has stayed on at VIO, working on media relations.

According to records, the new VIO is incorporated in Florida under the name VIO Investments Corp. and is owned by Isaura and Evelio Gilmond.

"[Isaura] does the majority of our administrative and accounting work for us," said James.

The reasons for the changes were not made clear in its filings with the Justice Department, nor in a James interview with the Center.

The same day the VIO re-registered with the Justice Department, a letter was posted on a Web site frequented by large donors to progressive causes. Authored by the Center for Economic and Policy Research, a nonprofit think tank, the letter appealed "to the progressive funding community to take an interest in this issue [democracy in Venezuela], and provide funding to groups that are working on it, before it is too late."

"That was not asking for money. That letter was saying to funders to pay attention to what is happening in Venezuela," said Marc Weisbrot, the co-director of the Center for Economic and Policy Research. "That letter had certainly nothing to do with the Venezuela Information Office."

"That's a total coincidence," said James. "That was not something we did."

Many of the letter's co-signatories had been contacted by the VIO beforehand though, even traveling to Venezuela on delegations organized by the office. Weisbrot himself has written several newspaper editorials against U.S. policy towards Venezuela.

Asked about whether he was in touch with the VIO, Weisbrot said, "Sure, I talk to them all the time. They are a great source of information."

The new VIO signed a $60,000 subcontract with Lumina Strategies in May 2004. Headed by Michael Schellenberger, a former Global Exchange employee, the group plans to oversee media relations and provide strategic counsel to Venezuela's government.

Global Exchange is one of Schellenberger's past clients. Several of their joint campaigns – encouraging balanced U.S. media coverage of Mexico and battling against Nike's use of "sweatshop" labor – are spotlighted in case studies on Lumina's Web site.

Despite its frequent contact with activists who oppose Bush, Venezuela has made overtures to the White House through Patton Boggs, one of Washington's largest legal and lobbying firms. For fees of $670,000 in this past year alone, Patton Boggs lobbyists advised the Venezuelan president to heat up his own war against drugs to find favor in the Bush Administration, according to a leaked memo.

Whether loved by the White House or not, Chavez and his oil remain vital to the American economy. Venezuela is the United States' fourth biggest source of the fuel.

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