Taken as a whole and controlling for inflation, Latin America has grown little since the mid-1980s and hardly at all in the past seven years. With the entire region primed for social change, a new breed of populists and social democrats is coming to power. Brazil, Argentina and Uruguay, in addition to Venezuela, have leftist governments of some sort, while Colombia, Ecuador, Mexico, Nicaragua and Peru will hold presidential elections in 2006.

But a closer look at Venezuela reveals just how vexing and complicated a political and economic turn to the left can be, even in a country that is rich with oil and not deeply indebted.

Thus far, Venezuela's Bolivarian Revolution, named for South America's nineteenth-century liberator, Simón Bolívar, has deepened and politicized a pre-existing tradition of Venezuelan populism. Despite Chávez's often radical discourse, the government has not engaged in mass expropriations of private fortunes, even agricultural ones, nor plowed huge sums into new collectively owned forms of production. In fact, private property is protected in the new Constitution promulgated after Chávez came to power. What the government has done is spend billions on new social programs, $3.7 billion in the past year alone. As a result, 1.3 million people have learned to read, millions have received medical care and an estimated 35-40 percent of the population now shops at subsidized, government-owned supermarkets. Elementary school enrollment has increased by more than a million, as schools have started offering free food to students. The government has created several banks aimed at small businesses and cooperatives, redeployed part of the military to do public works and is building several new subway systems around the country. To boost agricultural production in a country that imports 80 percent of what it consumes, Chávez has created a land-reform program that rewards private farmers who increase productivity and punishes those who do not with the threat of confiscation.

The government has also structured many of its social programs in ways that force communities to organize. To gain title to barrio homes built on squatted land, people must band together as neighbors and form land committees. Likewise, many public works jobs require that people form cooperatives and then apply for a group contract. Cynics see these expanding networks of community organizations as nothing more than a clientelist electoral machine. Rank-and-file Chavistas call their movement "participatory democracy," and the revolution's intellectuals describe it as a long-term struggle against the cultural pathologies bred by all resource-rich economies--the famous "Dutch disease," in which the oil-rich state is expected to dole out services to a disorganized and unproductive population.

But for the moment, the Venezuelan battle against poverty is possible only because oil prices have been at record highs for several years, and the state owns most of the petroleum industry. All of Venezuela's oil and mining and most of its basic industry were nationalized in the mid-1970s. On average, oil sales make up 30 percent of Venezuelan GDP, provide half of state income and make up 80 percent of all Venezuelan exports.

Internal and often sympathetic critics of the reform process in Venezuela say it is one thing to "spend the oil" on social welfare; it is another altogether to "sow the oil" and create new collectively owned, productive, nonsubsidized industries that will generate wealth in an egalitarian and sustainable fashion.

"When the coup happened we realized we had to get involved or we would lose everything," explains Carmen Guerrero. She says she was always a Chávez supporter but was not very active until the April 2002 coup d'état against Chávez launched by Venezuela's main business council, its notoriously corrupt labor federation, dissident military officers and masses of middle- and upper-class Caraqueños. Declassified documents have since revealed that the CIA knew at least a week beforehand that a coup was planned, while other US government agencies, such as the National Endowment for Democracy, were channeling aid to the opposition.

"There is no going back now," says Guerrero. Then, very seriously, she adds: "I hugged Chávez at a rally. I don't know how I got through security. I guess because I am short. I can't explain the feeling, the emotion was so strong." She clutches her fists to her breast and looks away.

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