Chaos in Venezuela

Key Points:

  • U.S. remains committed to diplomatic relations with Venezuela
  • U.S. military will not intervene in power disputes in Venezuela
  • Maduro’s connections with Iran, Russia, and China are significant considerations for the Trump administration

Background:

The once prosperous South American nation has been caught in a years-long downward spiral, leading to growing political discontent. Hyperinflation, power outages, and food and medicine shortages have fueled outrage. In response to deteriorating conditions, more than three million Venezuelans have fled the country. Venezuela’s President, Nicolás Maduro, was first elected in April 2013 after the death of his socialist mentor and predecessor, Hugo Chávez. Maduro won by a thin margin of less than two percentage points. His limited popularity has only waned since 2013 and his recent election is widely contested as a sham.

U.S.- Venezuela relations have long been strained. During the George W. Bush administration, Venezuela asserted that the U.S was behind a failed coup against Chavez. In 2008, Venezuela expelled a U.S. ambassador, and sanctions against Venezuela have been a regular element of diplomatic relations.

What Has Happened:

On January 23rd, Venezuelan opposition leader Juan Guaido, declared himself interim president, earning support from the U.S., Canada, Brazil, Argentina, Colombia, Chile, Peru, and other South American countries. Shortly after Guido’s announcement, President Trump formally recognized Guaido as the legitimate leader of Venezuela and praised his plan to hold elections – prompting socialist leader, Maduro, to rebuke the U.S. and break relations. U.S. diplomats have been given 72 hours to leave the country. However, the U.S. has refused to comply as the demand does not come from the legitimate head of state.

Mr. Guaido entered politics in 2011 when he was elected to the National Assembly. In 2016, he became a representative for his home state and in January of this year, opposition parties chose him to lead as a moderating candidate. Guaido, who attended college in the U.S., cited Venezuela’s constitution declaring a vacancy in the president’s seat is to be filled by the head of the national Legislature until new elections are called.

Despite the political unrest, it appears Maduro still has the military in his corner. Following the announcements, top military commanders showed their support for Mr. Maduro. Fellow authoritarian leaders in Russia, China, and Turkey followed suit.

Why it Matters:

Reasserting U.S. global influence is hard, complicated work. This should never be a surprise. The past couple of decades have provided ample opportunity for U.S. intervention and influence in a fledgling Venezuela. China and Russia were quick to oblige. Russia has been a strong military supporter of both Chavez and Maduro, and China has been generous in its economic support of Venezuela. Maduro also maintains close ties with Iran and Hezbollah. It is in the U.S.’ strategic interests to ensure this support and connection, in the Western Hemisphere, is severed. Perhaps unsurprisingly (though disconcerting) our NATO ally, Turkey stands firmly behind Venezuela’s corrupt socialist tyrant Maduro. Instability in Venezuela risks the rest of the continent. As Venezuelans flee, neighboring Brazil and Colombia will be burdened, and their developing infrastructure will be stressed to a potentially debilitating point. The recent events highlight the importance of continued diplomacy. It can be very hard to return to normal relations once you cut all diplomatic ties. Iran is a perfect example. Ordering “non-essential diplomats” out is not unusual when there is a perceived threat against the embassy. However, the president’s decision not to close the embassy is significant and signifies the U.S.’ desire to remain engaged diplomatically. A military intervention in Venezuela will only occur in the event that the U.S. needs to evacuate American citizens and personnel. Venezuela’s oil, proximity, and global partnerships ensure its vitality to U.S. interests. Continued engagement, albeit strained, will remain a priority for the Trump administration.

 

Original Post 1/25/2019

Saudi Arabia Issues Debt

 Key Points: 

How do you view the current political situation in the Kingdom of Saudi Arabia (KSA)? 

General Marks: Mohammed bin Salman (MBS) is the choice to succeed his father, King Salman. He is being propped up with more senior/measured advisors. The fallout from the Khashoggi murder has not ended but it will subside. MBS’s credibility was damaged both domestically and internationally, but time will repair it – provided he stays below the radar. 

General Petrenko: The royal family continues to close ranks to weather the storm, for example, recently replacing the Minister of the National Guard. 

Do you see KSA remaining stable for the next 1-3 months? 

General Marks: Yes. 

General Petrenko: Yes. 

Do you still view MBS as the (immediate) future leader or KSA? 

General Marks: Yes. 

General Petrenko: Yes. And even if they were to replace the Crown Prince, it should not upset anyone as it has been done in the past. 

What do you see as a possible (or most significant) destabilizer for KSA? Iran? Yemen? MBS? Internal unrest? Western opposition/anger? 

General Marks: Iran is the strategic competitor. No change. Yemen remains a tactical challenge and a point of international criticism. There will, however, be no change to current operations. 

General Petrenko: Iran and western opposition/anger. 

What is the general public missing when it comes to understanding KSA? 

General Marks: KSA is a complete autocracy. Its struggling with modernization but in tangible “bite-size” pieces. Fossil fuels will be the primary (85%) energy source through the next century. The KSA economy remains tied to the price of crude. It will vacillate but remain stable. 

General Petrenko: It is a sovereign nation and the decisions are focused on what is best for their country. If they were to make changes to appease the west, it would be presented as being best for KSA. They will continue to support the King and the Crown Prince, consolidate power for the Crown Prince, lay low and conduct a number of positive PR events, i.e., issue U.S. dollar-denominated bonds. 

General Kearney: The monarchy remains strong if it has tribal support. Not sure the purpose for their bond issuance but as long as there is oil, patronage is paid, and the monarchy is responsive to changing Saudi cultural demands, they will be sound. Yemen and Syria are giant challenges, but a U.S. withdrawal and potential lack of support give MBS and KSA the opportunity to save face, i.e., they can blame it on U.S. policy and it frees them to change strategy without losing face. Lastly, think monarchy and royal family versus MBS alone, the Monarchy will react in succession planning when and if it believes MBS threatens the monarchy and the Kingdom’s ability to maintain its stability. They have weathered the storm on MBS, and U.S. policy changes in response to the killing of Khashoggi may provide room for a KSA strategy change to save face in Yemen and Syria.

Major General (Ret.) James A. “Spider” Marks is Head of Geopolitical Strategy and Academy Securities’ Senior Advisory Board Member. General Marks is the Founder and President of The Marks Collaborative, an advisory for corporate leader development, education and training and has led entrepreneurial efforts in global primary research and national security. He served over 30 years in the Army holding every command position from infantry platoon leader to commanding general and was the senior intelligence officer in the LA Riots, the Balkans, Korea, and Operation Iraqi Freedom. He culminated his career as the Commanding General of the U.S. Army Intelligence Center and School at Fort Huachuca, Arizona. He has been awarded the Distinguished Service Medal, the Defense Superior Service Medal, Legion of Merit with Oak Leaf cluster, Bronze Star, and multiple combat, expeditionary and service ribbons. General Marks is a Master parachutist, authorized to wear Korean and Canadian Airborne wings, Air Assault qualified, and Honor Graduate of the U.S. Army Ranger School. General Marks is a national security contributor to CNN and member of the Military Intelligence Hall of Fame. 

Lieutenant General (Ret.) Frank Kearney served 35 years in the United States Army as an Infantry and Special Operations officer. Most recently, LTG Kearney served as the Deputy Director for Strategic Operational Planning at the National Counter-Terrorism Center in Washington, DC. In this position, LTG Kearney was responsible for whole-of-government planning with over 29 Inter-Agency partners to achieve the strategic end states outlined in the Obama Administration’s National Counter-Terrorism Strategy. LTG Kearney has been appointed to the U.S. House of Representatives House Armed Services Committee National Defense Panel, the U.S. Secretary of Defense’s WMD Threat Reduction Advisory Committee, and the Iran Project. Previously, LTG Kearney was the Deputy Commander of the United States Special Operations Command. He commanded all Theater Special Operations Forces in Central Command Area of Responsibility from 2005-2007, before which he served as commander of the Joint Inter-Agency Task Force-Former Regime Elements in Baghdad, Iraq. He sits on the Department of Defense Threat Reduction Advisory Committee (TRAC). LTG Kearney also chairs the board of Team Red White and Blue, a non-profit organization that seeks to reintegrate military veterans with traumatic brain injuries and Post Traumatic Shock Disorder back into their local communities using sports and outreach. LTG Kearney is a 1976 graduate of the United States Military Academy at West Point. 

Brigadier General (Ret.) Victor Petrenko began his military career as an ROTC student at Arizona State University. He was a distinguished military graduate at ASU, majoring in justice studies within the College of Liberal Arts and Sciences, and received a commission into the U.S. Army’s field artillery program. His initial assignment was with a battalion within the 3rd Armored Division in Germany. He served in field artillery command positions at Fort Bragg, N.C., and Saudi Arabia, the latter as part of Operation Desert Shield/Desert Storm in 1990 and 1991. Following studies at the Army’s Command and General Staff College at Fort Leavenworth, Kan., he received a master’s degree in public administration from the University of Missouri-Kansas City. In March 2000, he assumed command of a field artillery battalion in the 82nd Airborne Division at Fort Bragg. Upon his relinquishment of that command, he deployed to participate in Operation Enduring Freedom in Afghanistan. In 2003, he attended the Naval War College in Rhode Island and earned a master’s degree in national and strategic studies. He went to Fort Bragg again as the commander of the 82nd Division Artillery and 4th Brigade Combat Team, as well as chief of staff for the 82nd Airborne Division and Combined Joint Task Force 82 from 2006 to 2008, then served as the chief of staff of the Fires Center of Excellence at Fort Sill (Okla.) in 2008 and 2009. Petrenko then served as the deputy commanding general and chief of staff for U.S. Army Accessions Command at Fort Knox. Beginning in 2013 he served as the program manager for the Saudi Arabian National Guard Modernization Program in Riyadh, Saudi Arabia. Petrenko’s decorations include the Legion of Merit, the Bronze Star Medal, the Meritorious Service Medal, and the Army Achievement Medal. 

 

Original Post 1/14/2019