Hugo Chavez has been waging a war against the free market and rule of law. And as if guided by an invisible hand, the Venezuelan economy is responding rationally:

Capital flight out of Venezuela established a record during 2007, the Central Bank of Venezuela has reported, despite strict currency controls adopted in 2004 by President Hugo Chávez's government to limit the outflow of money...

According to recent Central Bank statistics, nearly $19 billion in private Venezuelan capital was transferred offshore during 2007 -- a record since Chávez was first elected president in 1998...

''This is only the official figure,'' said José Guerra, the Central Bank's former chief economist. '"There is an escape of capital investments that the Central Bank cannot account for.'"

It's becoming more difficult for Chavez to hold onto power, seemingly by the day. And with the United States considering designating Venezuela a state sponsor of terror--with encouragement from Members of Congress--things may get even harder for the Venezuelan strong man.

And how does Chavez respond? By announcing plans to build more weapons.