Andres Oppenheimer

As Venezuelans anxiously awaited news from ailing President Hugo Chavez and his ministers in Cuba in recent days, I received a tweet that stated, "This is the first case in history where a country subsidizes another, and is dominated by the latter."

Indeed, historians in the future will be scratching their heads trying to figure out what has led Chavez to give Cuba about $4 billion a year in oil and other subsidies, and - more important - to put his health, and his country's political future, in the hands of a small Caribbean island.

Chavez disclosed in June 2011 that it was former Cuban ruler Fidel Castro who first noticed that his health was failing, and urged him to undergo tests. After Cuban doctors diagnosed cancer, Chavez dismissed offers from Brazil to be treated there, where most medical experts agree he would have received much better treatment, and chose to continue his treatment in Cuba.

After telling Venezuelans in October 2011 that he had beaten cancer and that "there are no malignant cells in this body," Chavez spent more than 106 days in Cuba in 2012.

While Chavez remains hospitalized in Cuba and has not been seen nor heard from in more than four weeks, Cuban and Venezuelan officials have reportedly concocted a "Pacto de la Habana" (Havana Pact) among various Venezuelan government factions to rally behind Vice President Nicolas Maduro.

The agreement was brokered by Raul Castro and his Vice President Ramiro Valdes, who personally participated in the meetings with top Venezuelan officials in Havana, according to Venezuelan press reports. Maduro led the Jan. 10 ceremony in Caracas where Chavez was inaugurated in absentia for a new term, after a dubious interpretation of Venezuela's constitution that Uruguayan journalist Danilo Arbilla has called "magic constitutionalism."

Why has Venezuela, with a GDP of $316 billion, become so dependent on Cuba, a small country with a GDP of $60 billion? I can think of three major reasons:

First, for psychological/emotional reasons. As former Chavez mentor and interior minister Luis Miquilena told me in a detailed interview a few years ago, Chavez became mesmerized with Castro ever since he first met him - unexpectedly - in 1994.

At the time, Chavez was a 40-year-old retired military officer who had recently been released from jail after his 1992 coup attempt, and was living in Miquilena's house. Miquilena had planned to travel with his protege to Cuba and a meeting with Fidel Castro, but - upon learning that Castro would not be able to see them on the dates they had chosen - decided to send Chavez by himself for a series of meetings with lower-level officials.

But to Chavez's huge surprise, when he landed in Havana he was met on the tarmac by none other than Castro himself. From then on, Castro became a father figure, political guru and counselor to Chavez.

Second, for security reasons. Before Chavez became president in 1999, Castro convinced him that he would be the target of assassination attempts, and an increasingly paranoid Chavez accepted growing numbers of Cubans as his guards, according to several former Chavez ministers.

From then on, Chavez brought Cuban engineers to help restore Venezuela's oil exports after a devastating 2002 oil strike, invited more than 40,000 Cuban doctors and teachers to work in Venezuela, and imported Cuban managers to run the ports, the passport agency and several intelligence services.

Third, for political reasons. Chavez has followed Castro's model of creating a permanent "state of war" - creating confrontations with the church, the media, the business community or "imperial" powers - to justify his grab of absolute powers. It worked for the Castro brothers, and it worked for Chavez.

My opinion: For the next few months, Cuba is likely to run Venezuela's government like no other country has managed another's internal affairs in the region's recent memory.

Cuba will not only be the ultimate enforcer of the Pacto de la Habana, but will also try to ensure Latin American diplomatic support for Venezuela's government when Raul Castro takes over the Community of Latin American and Caribbean States regional bloc at a ceremony in Chile late this month.

But, barring a recovery and return to power by Chavez, Venezuela's dependence on Cuba may not last forever. Sooner or later, Venezuelan leaders will start asking themselves whether, amid growing economic problems at home, they can afford the current oil-for-counseling deal. With declining world oil prices, the answer will most likely be no.







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