Tracking Hurricane Hugo

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Chávez, 50, who led a failed coup in 1992--he still wears his red army beret at rallies--was elected on a wave of anger at Venezuela's epic corruption. Since then he has faced a coup attempt, a general strike and a recall referendum--all of which, he says, were aided by the U.S. But he survived them, thanks to an inept opposition and Venezuela's legions of poor, whose barrios now get schools, bodegas, potable water and free clinics. Chávez, who grew up in the poor rural state of Barinas, holds that base with his earthy and confrontational llanero (cowboy) touch. During last year's referendum campaign he employed a Venezuelan folk song in which a llanero beats the devil in a singing contest. Chávez cast himself as the llanero and Bush as Satan. "He has enormous communications talent," says Alberto Barrera, co-author of a biography of Chávez. "He has created his own populist myth, and the U.S. can't figure out how to discredit it."

The myth does deserve some puncturing. To U.S. and opposition critics, Chávez is a polarizing would-be dictator who has subordinated institutions like the courts. Thousands of public employees claim they were fired last year for signing petitions to recall Chávez, and his new media law contains a broad definition of slander that opponents say is meant to stifle dissent. Still, Venezuela's opposition can freely rail at Chávez. And it's harder for the U.S. to demonize Chávez as an oil autocrat when Washington's main oil ally, Saudi Arabia, has a far worse record.

Oil is the U.S.'s major anxiety. Chávez led the drive to raise crude prices by urging OPEC, of which Venezuela is a founding member, to rein in production. Venezuela's state-owned oil industry can't afford to cut off the U.S., but Chávez, to reduce dependence on the American market, is inking delivery deals with oil-thirsty giants China and India. That leads pols like Indiana Senator Richard Lugar to wonder if the U.S. can mitigate the effects of a possible Venezuelan shortfall. Oil analysts say Chávez may be pushing prices higher by dramatically raising taxes and royalties on U.S. and multinational oil firms, which in the 1990s received unusually generous contracts to help pump Venezuela's heavy crude. Such companies are "vultures watching meat," Chávez said last week. (The firms will not comment.)

Of course, his influence could dry up if oil prices fall. Like the profligate élite he defeated in 1998, he has presided over soaring increases in public spending. Nonetheless, unemployment remains high. However, Chávez prefers to play up the specter of U.S. aggression and how he will stand up to it. He says, for example, he will have to "reconsider" diplomatic relations with Washington if the U.S. does not extradite suspected terrorist Luis Posada Carriles, who is wanted in Venezuela for the 1976 bombing of a Cuban airliner that killed 73 people. Francisco Arias, a former army officer who took part with Chávez in the 1992 coup, says it is that doggedness that explains why, "for better or worse, people follow Hugo. They know he'll cross the Rubicon for them." And from now on, he's likely to make a bigger splash each time he does. --With reporting by Brian Ellsworth/Caracas