President Hugo Chávez of Venezuela had an especially good time baiting President Bush during their recent competing tours of Latin America. But demagoguery and showmanship will do nothing to solve Venezuela’s 20 per cent inflation rate — now the highest in Latin America — and growing food shortages that are punishing the poor whose interests Chávez so loudly declaims. Venezuela’s biggest problem is that there is no one to question Chávez’s erratic decisions. Instead of seriously addressing Vene-zuela’s serious problems, the showman has settled for more showmanship.

Government spending rose an extraordinary 48 per cent last year, and is one of the main forces driving inflation. Private-sector investment, meanwhile, has weakened since Chávez decided to nationalise utility companies earlier this year. Price controls intended to help the poor buy food and hold down rising prices have led to a scarcity of staples like beef, chicken and milk. Venezuela still has billions of dollars in foreign currency reserves. And Chávez has used some of the oil wealth to push social programmes - including for literacy and health clinics - to improve the lives of Venezuela’s poor. But we fear that any good is quickly being undone by the old strongman formula of cro-nyism, corruption and incompetence.