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Peru elects former disgraced leader -

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Peru elects former disgraced leader

Reporter: Mark Simkin

TONY JONES: Few world leaders cast such a long shadow that they can dominate another country's
election campaign. But Venezuela's Hugo Chavez is one of them. Peru has just been to the polls, and
the disgraced former leader Alan Garcia was elected president, largely because his opponent was
associated with Hugo Chavez. The result reflects a backlash against Chavez's anti-American
populism. And confounds the image of a region 'lurching to the left'. North America correspondent
Mark Simkin prepared this special report for Lateline.

MARK SIMKIN, NORTH AMERICA CORRESPONDENT: Even in a region where political comebacks are common,
this one was simply extraordinary. One and a half decades after leading Peru into economic
collapse, Alan Garcia is back,... his legacy of quadruple-digit inflation, alleged corruption and
increased rebel violence apparently forgiven, if not forgotten.

ALAN GARCIA, PERUVIAN PRESIDENT (TRANSLATION): During this second opportunity we will do everything
in our power not to fail or deceive the Peruvian people.

MARK SIMKIN: Venezuela's leader, Hugo Chavez, publicly endorsed Garcia's opponent... and Garcia's
support surged. In Peru, at least, it seems it's better to be associated with financial disaster
than Hugo Chavez.

ALAN GARCIA: Today the majority of the country has delivered a message in favor of national
independence, of national sovereignty and they have defeated the efforts of Mr Hugo Chavez to
integrate us into his militaristic and backwards expansion project that he intends to impose over
South America.

MARK SIMKIN: To some, Hugo Chavez is dangerously undemocratic. To others he's the hero of a
regional revolution. Earlier in the year, the Venezuelan leader visited Europe, predicting the end
of the "American empire". This was his response when someone compared him to George W Bush.

HUGO CHAVEZ: HUGO CHAVEZ (TRANSLATION): This is the first time I've been offended like this in
public, being compared to the biggest genocidal criminal in the history of humanity. The president
of the United States: a killer, immoral, that should be taken prisoner by international criminal

MARK SIMKIN: The diatribes are almost comic, but Venezuela is very wealthy. It has massive oil
reserves and is one of America's biggest suppliers. Chavez wants to use his economic muscle to
create a regional coalition, a Latin American bloc to counterbalance US policies and influence.

HUGO CHAVEZ: This is an irrational government in Washington that threatens the whole world. I
always say to Europe that it can do a lot to stop the imperial craziness. We need to walk forward
towards a world of alternatives.

MARK SIMKIN: Chavez accuses the United States of planning an invasion, backing a coup attempt and
plotting an assassination. There's no evidence of any of that, but it is clear the US is
unimpressed by his rhetoric and his attempts to consolidate power.

DONALD RUMSFELD, US DEFENCE SECRETARY: You've got Chavez in Venezuela. He's got a lot of oil money.
He's someone who was elected legally just as Adolf Hitler was elected legally.

MARK SIMKIN: Michael Skol is a former US ambassador to Venezuela and an expert on the region. He's
seen Chavez up close.

MICHAEL SKOL, FORMER AMBASSADOR: I think the results of what he's doing are evil. He is an
extremist, he is a populist, he is a megalomaniac, he is charismatic. He is a true believer in what
he says and does and he is also deluded, in my opinion.

MARK SIMKIN: Hugo Chavez is working closely with the leaders of Cuba and Bolivia. They're
ideological soul-mates. Evo Morales was swept to power in Bolivia last year, calling himself
"Washington's'worst nightmare". He's now nationalised his country's extensive natural gas supplies.

EVO MORALES (TRANSLATION): This is the solution to the social and economic problems of our country.
Once we have recovered these natural resources, this will generate work. It is the end of the
looting of our natural resources by multinational oil companies.

MARK SIMKIN: The US is unpopular in the region, largely because its economic prescriptions,
privatisation, globalisation, deregulation have either hurt the poor or failed to deliver
prosperity. In country after country, left-wing governments are being elected, although only a few
of them could be characterised as extremist.

MICHAEL SKOL: Many politicians here in Washington, and many in the media, have gotten to talking of
the great drift to the left in Latin America, which is, in my opinion, I think this is a whole lot
of virtual nothing in terms of major movements. If they include Chile, the newly elected president,
the Socialist, she's about as socialist as you are.

MARK SIMKIN: The Peruvian results are further evidence of that. The country has moved slightly to
the left, but it's still rejected the extreme anti-Americanism of Hugo Chavez. Several other
countries in the region will hold elections later in the year and the left-wing candidates are
expected to continue their resurgence. Mark Simkin, Lateline.