President Lula da Silva of Brazil is not stupid.

After a softie performance in the first week after Bolivia “nationalized” Brazil’s $1.6 billion in investments there, downplaying any opposition against the taking of it, or any animosity against Bolivian President Evo Morales, he unexpectedly came out and laid the blame for this mess right where it belonged: at Hugo Chavez of Venezuela.

Lula is a gentle man, but in this case he came on uncharacteristically strong: He demanded that Chavez stop meddling in the Southern Cone, and warned the Venezuelan dictator that there would be consequences.

Lula knew very well what was going on. On the day of the surprise nationalization in Bolivia, hundreds of Venezuelan state “technicians” were down there in La Paz, securing Brazil’s property for themselves. That’s right, a Venezuelan state company was helping itself to Brazil’s state property! In Bolivia!

Bolivia doesn’t have much of a state oil company so the figurative storm troops in taking the state assets of Brazil were Venezuelans! Bolivian troops supplied the muscle on the outside of the facilities but inside, the Venezuelan state oilmen were helping themselves to the Brazilian goodies inside!

Lula knew very well what was happening and called Chavez to come to the emergency summit in the first few days of May. On the outside, they were all smiles (but notice Lula’s strained smile) but on the inside, Lula now says he was warning Chavez.

This comes as quite an international blow to the dictator of Caracas. Miguel Octavio points out that the anger of Lula follows Peru’s and Mexico’s anger at him, and Uruguay’s interest in just bailing out of the regional trade alliance, MercoSur, that Chavez is trying to crash as a member. Uruguay is tired of all this rigamarole and just wants to sign free trade pacts, something Chavez won’t tolerate. In short, Chavez’s thuggery directed at Brazil is challenging Brazil’s leadership in the region, and given the extensive public anger at this nationalization against Brazil in an election year, Lula has started to fight back.

Miguel writes:

The result of all this is that Lula is looking North more than ever, as he realizes he can not count on his supposedly ideological partners to go along with him, Uruguay is mad at Argentina, Peruvian candidates now all attack Chavez, Lopez Obrador seems to be losing not first place but now even second place in the Mexican Presidential race thanks to Chavez and the President of Guatemala tells Chavez not to meddle, even before he has.

All in all not a very good week for someone that wants to be the leader of this southern hemisphere. A lot of the work Chavez had done regionally to integrate was lost this week because of the style Venezuelans have seen in the last seven years: confrontation, intolerance and ignoring others opinions.

Francisco Toro at Caracas Chronicles has translated beautifully another superb essay that appeared in El Universal:

Though it hasn’t come to a head yet, the continental polarization between Bush and Chavez has accelerated. On the one hand, the Chavez-Castro-Morales block decided to launch the socialist revolutionary triangle through pressure tactics on the energy front. Its space (for now) is the Americas, without national exceptions. The polarization pressed by Cuba, Venezuela and Bolivia puts an end to the interamerican institutional transition stage, because it clashes with its strategic interests, which are geared to establishing socialism on a continental scale.

and Daniel at Venezuela News & Views has still more here:

Poor Chavez, he is not going to be helped much from his own ministry. Then again, he sees it only as a cheer leading squad, little bit better than to make sure that adoring crowds are wherever he sets foot overseas.

All of this represents a seismic shift in Latin American affairs. Sides are being taken. Thugs are being identified. And people are increasingly tired of being pushed around by Venezuela’s power-mad dictator, none other than Hugo Chavez.

The region is starting to have had enough of him.

UPDATE: Via Miguel, I learn that Globovision is reporting (in Spanish) that Brazilian officials are taking umbrage at Chavez’s insulting statements. This may go downhill fast. Read it here.

Thanks, Miguel!