WASHINGTON -- The overwhelming mood across this city is that if you're thinking of the future, "Think Iraq." I would strongly suggest, to the contrary, that you "Think Venezuela."

Events in that oil-rich state on the northern coast of Latin America are, day after turbulent day, becoming an invaluable case study of the breakdown of nation-states across the world, particularly in Latin America.

Consider the confusion in the institutions of the society:

As Venezuelan society has disintegrated over the last months, the media have become the new political parties; the staid oil companies have become the centers of rebellion; the labor unions have become the shock troops of the upper middle classes; and the generals, who traditionally would have been ready to overthrow a populist leftist leader such as President Hugo Chavez, are now his defenders.

There are empty shelves in the once-filled supermarkets (as in Cuba); at the banks, long lines of Venezuelans try vainly to get their savings out (as in Argentina); and an increasingly mercurial and out-of-touch leader sits in the presidential palace, offering screwy "reasons" for the chaos he was elected to control four years ago (a Simon Bolivar at the end of his wars for liberation).

In his regular television address to the nation this week, President Chavez attributed all of Venezuela's problems today to a "small group of coup leaders" -- then portrayed himself as the nation's Santa Claus and invited children to sit on his lap, where he kissed them and promised them dolls of the baby Jesus.

And the terrible thing is that this may be the way the Venezuelan story ends -- not with solutions, but with ongoing absurdity.

What we are witnessing in Venezuela is, as The Washington Post put it recently, the result of the degree to which "Chavez's campaign over the last four years to remake the political landscape in Venezuela has reduced key government institutions to a shambles, leaving Chavez and his opponents without trusted legal bodies to resolve their dangerous standoff."

But if there are no national referees inside, so are there no effective referees outside. Cesar Gaviria, the secretary general of the Organization of American States, has been camped in Caracas for weeks now, but Washington has shown little interest in the much-needed oil nation, which produces 20 percent of the world's oil and 14 percent of the oil used in the U.S.

Yet there may be still another part of this new paradigm in national development (or de-development). As the Petroleos de Venezuela has become the epicenter of the huge national strike of oil workers, labor unions and business leaders who are determined to oust Chavez, there is some talk of the oil company acting like, or even becoming, a "state within a state."

As a matter of fact, this pattern is beginning to be seen across the world. (In Angola in southwestern Africa, after its independence wars in the mid-1970s, the foreign-owned Cabinda oil company virtually became for some years the governing entity of the country. There are increasingly other examples, particularly in Africa and Asia.)

Washington doesn't seem to notice that the chaos in Venezuela has brought oil prices up to $30 per barrel. Oil analysts warn that if the Venezuelan chaos continues without resolution, and if at the same time the United States invades Iraq, the world will see oil prices forced sky-high.

In the end, this sobering breakdown in Venezuela is due to a number of factors.

Hugo Chavez was elected president four years ago because of 40 years of a phony two-party system, supposedly the "most democratic in Latin America," squandering the oil wealth. At the same time, unlike countries such as Taiwan and South Korea, which invested their wealth in education, Venezuela let its education system rot along with everything else.

The idea that globalization was spontaneously going to work miracles everywhere in the world was emasculating any sober intention to develop in a balanced manner. (Actually, globalization works in countries such as Taiwan and South Korea, where serious governments controlled the evolution of investment and change.)

Finally, in these last four years, and even before, America got out of the Latin American "business." The one initiative put forward over the last 10 years by Washington, the Washington Consensus that only free trade will develop Latin America, has been found wanting. And the region didn't develop the accoutrements and bases for true free enterprise to blossom.

Message to President Hugo Chavez this holiday season? Dear Hugo, there is no Santa Claus.

-- Anonymous, December 25, 2002