Latin American countries alarmed at the potential return of US military intervention in Venezuela are fearful of the dark old days of the Monroe Doctrine. Regional mediation—not threats from the White House—is the key to solving the crisis.

US meddling is not the way out of Venezuela’s political deadlock.

Political confrontation in Venezuela reached new heights as the newly “elected” Constituent Assembly started its first sessions last week after a vote boycotted by the opposition, and a lower turnout than the government had hoped for. 

This Assembly is now responsible for amending the Constitution and de facto denies any power to the legitimate parliament in which the opposition holds a comfortable majority. Its first decision was to remove the moderate pro-Chavez attorney general, Luisa Ortega from office. 

Once a convinced supporter of the regime, Ortega had started to distance herself from the Maduro regime by publishing homicide statistics kept secret for years and condemning the shutting down of the parliament over the summer. 

Despite strong condemnations from western powers, Maduro has strengthened his authoritative grip over a country which continues to slide further into chaos and poverty. Condemnation from the Vatican and the UN on persistent and ongoing human rights violations has had little impact on Maduro’s determination to maintain his hold on power, at any cost.

While Venezuelan citizens struggle with food shortages, lack of medicine and an explosion of homicides, this renewed denial of democracy further drives away any hope for the institutional stability needed to ease every day strains. The country is on the verge of bankruptcy despite sitting on the largest proven oil reserves in the world. 

Venezuelans spend hours in food lines, regularly skipping meals and the weakest of them die of malnutrition. A recent survey confirmed that 75 percent of the population lost an average of 10 kilograms in 2016 due to a lack of proper nutrition amid the economic crisis. The GDP shrunk an estimated 18.6% last year and inflation reached 800%.

The Venezuelan crisis took a geopolitical turn last week when neighboring countries suspended Venezuela from the South American Mercosur Common Market with little impact on Maduro. As diplomatic contestations compound with limited success, thousands of Venezuelans have fled to nearby capitals of Lima, Quito or Brasilia in the hopes of finding security and a sustainable economic future.

The United States has ramped up their response towards Caracas. The US Treasury Department extended its Venezuelan list of financial sanctions, targeting eight additional Chavist officials, including Adan Chavez, brother of former President Hugo Chavez (1999-2013). 

President Nicolas Maduro was also officially blacklisted as a "dictator" joining the restricted group of presidents-in-office sanctioned by Washington. 

The US Treasury Secretary Steven Mnuchin initiated martial rhetoric by proclaiming that the United States would “stand side-by-side with the opposition against tyranny in Venezuela”. 

Donald Trump gave a kick in the anthill by confirming a military intervention was not off the table. In yet another uncalculated display of aggressiveness, the American President might have however offered an unexpected gift to the Venezuelan regime. 

Indeed, the Chavist government has clearly leveraged US threats to consolidate his power and play up the "US Empire’s" supposed plans for Venezuela’s oil reserves. 

According to Maduro, Washington is behind an economic war against Caracas fought through the Venezuelan opposition in the streets and responsible for Venezuela's humanitarian crisis. Trump’s declaration is thus a godsend for Maduro as it fits perfectly with the narrative—what many would rightly call propaganda—his regime has made a living on. 

In truth, the tensions between the two countries never put an end to economic and trade exchanges. The United States continues to import 740,000 barrels of Venezuelan crude per day. Last May, the White House was remarkably silent when Goldman Sachs, the very bank which employed Steven Mnuchin for 17 years, acquired 2.8 billion dollars of Venezuelan bonds. 

If Washington is putting on a diplomatic show by sending Vice President Mike Pence on a Latin American tour this week – visiting Chile, Colombia, Panama and Mexico with an unprecedented advance party of 700 people – this will have little impact, if any, on a solution to the Venezuelan crisis. 

A return to democracy in Venezuela will never come from American military threats but could only be achieved through two channels: global economic pressure and regional political mediation.

On both dimensions, the lack of unity is likely to benefit Maduro in the short term but it likely won’t last. Economically, Venezuela is bleeding left and right. Venezuela's state oil company PDVSA, ensnared in the current political crisis was forced to ask bond investors for a temporary waiver from financial reporting requirements. 

The company, which represents Maduro’s largest source of income, also had to reduce its sales to catch up on overdue deliveries to Russia's oil conglomerate Rosneft, securing a last advance from Moscow of six billion dollars. The Kremlin was however clear that this would be the last breath of financial fresh air it would concede. 

In parallel, large institutional banks such as Credit Suisse finally prohibited their traders to make deals on Venezuelan debt. As Moscow slowly runs out of cash and investors become wary of reputational risks, Maduro’s wallet will run dry and the corrupted supporters of his administration will forget their allegiances.

Establishing the conditions for successful regional mediation will take time. While twelve Latin American countries signed a declaration denouncing the suspension of democracy in Venezuela, four others (Bolivia, Ecuador, Nicaragua and Cuba) voiced their rejection of any international interference. The continent is ailing from a structural divide between right wing leaders who fail to achieve an inclusive and fair development of their country and populistic left wing movements whose reactionary politics prevent any international cooperation.

But there is still room to build consensus and opportunities for new leaders to affirm their support to a democratic Latin America devoid of ideological biases. Such mediation will not be led by discredited Brazilian President Temer mired by a corruption scandal or by Colombia plagued by a traditional animosity towards Venezuela. Similarly, likely future Chilean president Pinera and Argentinian president Macri are two far on the right of the political spectrum to be potential mediators. 

The hope for change might come from Quito and Lima. In Ecuador, newly elected President Lenin Moreno has surprised by moving swiftly away from his predecessor Rafael Correa’s shadow. Although the country’s diplomacy is still in the hand of leftist ideologist Maria Espinosa, Moreno has shown his capacity to emancipate himself by ousting the corrupt vice president, and Correa’s man, Jorge Glas earlier this month.

In Peru, the centre right President Kuczynsky, a seasoned veteran with international stature has shown the will to be firm against Caracas by expelling the Venezuelan Ambassador last week. Both Moreno and Kuczynsky emanate from opposite aisles of the political divide in Latin America but enjoy a good relationship. Both called for a peaceful resolution to the Venezuelan crisis during Moreno’s first international visit. 

Venezuela’s hope for a peaceful return to democratic development can only rely on regional mediation, not on empty threats from the White House. Whether regional politicians are willing and able to move beyond rhetoric and bridge ideological differences, will be the key to moving away from the existing stalemate.