If they are spending our money there is some holy purpose; if we are spending our money it must be for dirtier purposes….

If so, bravo to Hillary. Once before, when she “kicked the can down the road” to the Arias mediation, we thought she had made a good move in creating space – space that was necessary to undo the damage from Obama’s catastrophic snap “coup” reaction. But then the US imposed additional sanctions on Honduras, presumably because of pressures from Caracas. Let’s hope that does not happen again.

The sun has broken through the clouds, and now the survival of strengthened Honduran democratic institutions suddenly is looking likely. There are three main risks remaining.

First, Chavistas may somehow pull a dirty trick with the Congress or Supreme Court. Recall that in Bolivia a key constitutional proposal was enacted when most of the opposition was unable to meet and vote. Similarly, just in the last month, Ortega finagled a supreme court decision in Nicaragua regarding his right to re-election. Again, this was accomplished with the tactic of arranging to have a vote while opposing justices were unavailable. Hondurans better post a whip at each door of the legislative meeting rooms.

Second, Chavez may somehow get inside Obama’s head again. At this point, Obama’s instincts for self-preservation must make him aware that his best exit is a successful election on November 29. Chavez may try to exploit the Obama/Hillary tension, or somehow demonize Shannon, who seems to be the grown-up in the room.

Third, the resort to more violence in the streets.

Minimal US support for elections makes all three tactics look like long-shots for Chavez now. So much grief could have been avoided if we had supported them earlier. Chavez will beat a tactical retreat and think about limiting strategic blowback against ALBA.

In the absence of this deal, the local institutions were on track to execute a highly credible election, one in which Zelaya’s Liberal Party was heavily trailing the National Party yet was supportive of the process. Micheletti (a Liberal) had only ever stated that he is anxious to stand down as soon as possible, and Elvin Santos (the Liberal candidate) was also supportive of the election despite his weak polling. Power was already transferring to the TSE (electoral tribunal) from the executive, including with respect to the armed forces. These institutions had already stated unequivocally their rejection of Zelaya and his methods, as did popular polling by a large margin.

But with this deal, the US has exposed the individuals in the Congress and Supreme Court to the severest of carrots and sticks. There have been 3 questionable political murders and disappearences of Hondurans in the weeks prior to the deal. We can expect this fact to weigh heavily on the minds of the Honduran representatives. In addition, there have been reports of very large bribes (the major of Tegucigalpa says he has already been offered $15 million to support a “constituyente”) that one must presume come from Venezuelan drug and petro-dollars. By leaving the implication that the Hondurans should vote yes “or else”, the US is declaring open season. Venezuela may use all her carrots and sticks at will. On this playground the US does not have her little brother’s back.

So there are several ways this will go, all of which will weaken Honduran institutions. For starters, the deal is ambiguous in several respects. Without going into detail, it is enough to note that any practical result that is not clear cut will be bad for the credibility of the Honduran government and lead to more conflict, including more “need” for foreign intervention.

Second, a vote in favor of the deal will by necessity undermine the previous decision of the Supreme Court and torpedo the Constitution. It will eliminate the moral high ground enjoyed by Hondurans in defending their sovereignty, and demoralize the public. The assault on Honduran institutions will redouble, not end.

Third, a vote in favor of the deal will by necessity undermine the previous action by the Congress and open the institution and its individuals to prosecution. The truth commission, weighted towards leftists and internationalists, is already in place. Allowing this weighting was an error by Michelletti in an otherwise heroic effort.

Fourth, if Lobo allows his Nationalist delegates to vote for Zelaya’s reinstatement, he will lose a great deal of support. The election will already become a much closer call. If the election is close this will be a very dangerous moment. An unambigous result will open the door for allegations of fraud and in any case will confuse any message that the electorate is trying to send. Zelayista’s will be able to claim moral victory out of any mess.

Fifth, if the Supreme Court recommends No but the Congress votes Yes, both institutions are undermined. A constitutional convention will be called for.

Sixth, if both Supreme Court and Congress vote No, more unsolved murders will occur. The international community will withhold recognition. The US will look bad and presumably will follow through on whatever actions it used to scare the Michelletti team.

In a previous post, we said that the fix was in, and that we expected a deal to reinstate Zelaya with “limited” powers. This limitation would then be challenged continuously and Honduran institutions remain on trial until they were destroyed. No recent developments have changed this view.

Chavez (if not necessarily Zelaya, who is still subject to sacrifice) is in a good position. He has been delayed 3 months, but he has accomplished several strategic goals. He has enhanced his international credentials, including strengthening his political petro-alignment with Brazil. He has covered his “Bolivarian Blowback” flank; the odds of reversals in Ecuador, Bolivia, and Nicaragua have gone down because Honduras did not break away cleanly. In fact, the ground is being laid for an international force that would be able to intervene and stop anti-Chavez counter-revolutions. He has succeeded in weakening the US strong-point in Central America, opening the way for complete domination of El Salvador and Guatemala as well. Ultimately, the removal of Palmerola and trouble-free drug trans-shipment are within sight.

Tactically, by installing Zelaya in Brazil’s embassy Chavez has enjoyed a propaganda victory, has undermined the authority of the interim government, and has stopped Zelaya from being the laughing-stock he had otherwise become. Most importantly, he has re-created a beach-head “in” the country through which he can pour money and resources. The OEA delegation will be coordinating this dispersal. November elections have been declared “illegitimate” absent the imprimatur of Honduras’ enemies. The clock has been reset.

Now, what will happen is remarkably close to the original plan. Different sectors will be bought off, and (although this is not yet explicit) the Constitution will be re-written to allow a Bolivarian take-over. We can see the preparation occurring as Arias yesterday stated that the Honduran Constitution is the “worst in the world” and “everyone agrees” that it must be changed (this despite the fact that it has so far fought off Chavism more vigorously than any others). Expect the following:

1) A deal is agreed in the near-term with Zelaya enjoying reinstatement but very limited powers;

(If a deal is not agreed, Zelayista violence increases undermining November elections and forcing Michelletti into more “damned if you, damned if you don’t” choices. The local regime is further demonized and splits emerge. A weaker deal for locals follows);

2) Zelaya broadens his mandate to include the re-writing of the constitution. He rejects constraints placed on him by citing a higher law and the justice of a Bolivarian appeal to the people. Zelayista violence is applied as necessary;

3) The “cuarta urna” is explicitly negotiated into November elections. In this case whatever Constitutional process ensues is driven by the OEA (Chavez) which patronizingly helps Honduras to adopt a “better” Constitution (one which, by the way, had probably been written in June already);

4) If an agreement to include the “cuarta urna” is not agreed in pre-negotiated fashion, it is snuck in at the last minute, much as Zelaya attempted to do with the Saturday addition to the national Gaceta the weekend of his removal. In this case Zelaya again appeals to higher callings as a justification for abnegating the prior limited-power deal. It is not about him; it is about justice for the people. The existing institutions are constantly on trial from now on.

Duly elected Honduran officials understand that they cannot trust Zelaya, but they may still over-estimate their ability to control events against the influence of Chavezian oil money. As the OEA presence consolidates, that power is trending to zero. Certain individuals will do ok, but the institutions have a knife to their throat.

External forces are using Zelaya’s presence as cover to become more aggressive. IMF monies withheld from the interim government are already in process of being appropriated to the Zelaya “counter-coup”, and the United Nations is about to listen to Brazil up the ante in support. The stage is being set for an explicit intervention at the request of the same Zelaya government that foreign powers are artificially erecting. In this light it was the right move for Honduras to exclude the OEA delegation; the organization by its actions has already shown its agenda and having local agents on the ground will only cause further mischief.

The placement of Zelaya in the Brazilian Embassy was a brilliant move by Chavez as it increased the value of a chess piece that he had always been willing to sacrifice. If events spin out of control and Zelaya is somehow martyred, Venezuela will still have succeeded in undermining the legitimacy of the regime (and a parallel government will allow the process to survive if Zelaya does not). Meanwhile, the presence of the deposed President within Tegucigalpa (but not within national jurisdiction) provides just enough cover for the major players to push events in the direction they would like them to go. Hugo Llorens, US ambassador to Honduras and long-time friend of Zelaya, is rumored to be involved in the planning to create the parallel government.

A parallel government, however, means little without an armed force. The initial force is coming from the paid agitators and gangs who thrive on chaos. But the permanent force will come from abroad, and it will arrive through the US airbase at Palmerola. Foreign powers are almost at the stage where they will be able to justify this second force with or without Zelaya. An assault on the Brazilian embassy would be enough to push them over the line, despite the un-diplomatic calls for insurrection emanating from within.

The interim government may have no choice but to undertake such an assault. Those who criticize the suspension of rights announced today do not realize the extent of the intervention by foreign powers. There are no good faith actors driving the process at the UN or in the international press. Honduran sovereignty is under a new kind of slow-motion virtual assault. It is a rape that other small countries would do well to watch closely.

Chavez has the disadvantage of being a foreign imperialist and deeply unpopular in Honduras, but money talks, and so a single flawed figurehead can be enough to rally properly motivated supporters. Chavez has successfully moved himself into the background and convinced Lula to take the lead (no small achievement). Now, having Zelaya “in” Honduras creates many ways to win.

As the UN-recognized leader of the country, for example, Zelaya might now invite in UN peace-keepers. Who knows, Venezuelan, Cuban, and Nicaraguan blue helmets may even fly in through Obama’s airbase in Palmerola. A small UN force with tacit or explicit US backing will be enough to face down the Honduran armed forces, or to at least turn a squadron or two.

Turning a subset of the heretofore unified establishment is crucial (and probably sufficient) for Zelaya and Chavez since it will undermine the November election. Even as of this evening a group of congressmen has declared that they do not support the Michelletti government. If any Lieutenants or Colonels decide the wind is changing, November elections are further undermined. If internecine violence among the establishment follows, all bets are off and calls for UN peacekeepers will especially increase. This is the scenerio that Chavez and Zelaya are moving toward; creating chaos works to justify international intervention, and it also works in the longer term to undermine the US strong point. Institutional relationships between the US and Honduras, and perhaps the airbase itself, will be wrecked in the fallout.

Members of the Honduran political institutions now face difficult choices, as they face enemies that are hard men and know how to destroy democracies. If the Hondurans crack down but ultimately lose, will the consequences be worse for them afterward? If they act with discretion and Chavez continues ratcheting up the pressure, will they then lose any chance to control events? It is hard to know, but without a figurehead inside of Honduras, their enemies abroad (and they have indeed now proven themselves to be mortal enemies) would have no case. They must get the Queen off the board.

Zelaya is:

• a drug runner
• an election rigger (and here)
• a public embezzler (update here) who abused his authority for personal gains
• contemptuous of the Constitution and of local democratic institutions as well as traitorously attempting to overturn them
• rejected by all arms of government including his own party as well as the Catholic Archbishop and Cardinal of Honduras, who has been on the short list for Pope
• negligent in performing his duties, having never submitted a 2009 budget
• constructing a hidden force of 300 no-show or ghost staff on payroll
• actively working with Venezuela, Cuba and Nicaragua to overturn the Honduran interim government by force and continues calling for insurrection
• megalomaniacal (Mel Statue, Return Apotheosis)
• the son of a convicted slaughterer of priests

Why does Obama still support him? Does he expect Honduras to accept back a man like this?

This small nation has relied on the support of a friend, a defender of democracy who is like a big brother protecting a little brother: The United States.

But now the small nation is worried that it may be abandoned by the United States, that it may be sacrificed.

Israel. Taiwan. Honduras.

Is it any wonder that the first two have been the first to recognize the interim government in Honduras?

1) Venezuelan agents are infilitrating tonite through neighboring countries to prepare for (a) attacking Micheletti and the presidential administration directly and (b) taking principal roads and bridges along with trade union supporters (which demonstrations have already been announced publicly).

2) Payments are being made to military officers to switch sides and to execute a “counter-coup”. Payments are also being made to politicians to switch sides.

3) Violence is to be instigated, and chaos, creating the opportunity for some military units to take over an airport and a border region to facilitate different options for Zelaya’s return to the ground. Such violence also is intended to undermine the legitimacy of the interim regime, which to date has created unexpected local unity of response.

Update: Variations on these email rumors hit the Honduran press  last night.

As discussed in our previous posts, these rumors are consistent with what we would expect given Chavez’s tactical and strategic goals (Chavez Chess, Queening his Pawn, Smoking Gun). First, as a tactical matter right now Zelaya is precariously close to becoming a joke, and his physical presence outside the country only emphasizes his cozy relationship with Chavez. Therefore Chavez must get him back on the ground, and a violent encounter turns him into a serious figure again. It also provides cover for the “international community” to send in more reinforcements; to date, Cuban, Nicaraguan, and Venezuelan citizens (or agents, if you will) have been sent out of the country in numbers — getting Zelaya back will allow for a reversal of this trend.

Chavez has calculated that the US is sidelined militarily under Obama; it is expected that the barest pretense of legitimacy for his offensive operation will neuter the possibility of defensive aid from Palmerola. Obama’s stance has become an invitation for aggressive behavior.

As we have pointed out in previous posts, Chavez oil revenues are such that it is trivial for him to flood the Honduran economy with bribes. He has already broadcast his intention to turn junior officers to his side, and of course he was a junior coup-ster himself in 1992.

Moreover, apart from his expansionist desires, it is now important to Chavez for defensive reasons that Honduras falls. The counter-example of a small country that can successfully push back is a serious threat both to ALBA and to his domestic flank (Castro has discussed the risk of more regional “coups” against leftists). Chaos is important for these reasons now; it will undercut the “success” of the Honduran push-back against Chavez even if Zelaya is not ultimately reinstated. Chaos also supports his general goal of weakening the American strongpoint in Palmerola. Last, it potentially derails the election process. For all these reasons, he is incentivized to be more aggressive rather than less.

Apart from the rumors, there are other indications that action is pending. Zelaya has publicly hinted that there will be unspecified “activities” by this weekend, and he has stated that insurrection is justified. Chile’s Bachelet has stated fears of a bloodbath. The curfew has been renewed. Costa Rican legislators have called for Micheletti’s arrest (further delegitimizing his status) if he re-visits Costa Rica. Most of all, the clock is working against Chavez and Zelaya as negotiations move forward; they have to reset the game and do it quickly.