Washington funds activities including human rights seminars, training possible future leaders, advising political parties and giving to charities in the South American country.
However, the administration in Caracas led by Hugo Chavez is suspicious of the intentions of the US as it refuses to disclose exactly who receives the money.
Details of the spending are contained in a 1,600-page document of 132 grant contracts, released under the Freedom of Information Act. But names and details of nearly half of those who received money have been blacked out.
US officials say this was done because the Chavez government would harass or prosecute the grant recipients if they were identified.
Chavez, however, believes the US is using both overt and covert methods to undermine his government.
“The empire pays its lackeys, and it pays them well”
“The empire pays its lackeys, and it pays them well,” he said recently, accusing some of his opponents of taking “gringo money”.
While the US Agency for International Development (USAID) oversees much of the US public spending on Latin America, George Bush’s government has also increased covert efforts in the region. This month, Washington named a CIA agent as the “mission manager” to oversee US intelligence on Cuba and Venezuela.
The Bush administration has an $80 million plan to hasten change in Cuba, where Chavez has sworn to help defend Fidel Castro’s communist system.
The US also is spending millions on pro-democracy work in Bolivia, where Bush has warned of “an erosion of democracy” since the socialist Evo Morales, was elected in December.
Much of the spending is overseen by USAID’s Office of Transition Initiatives, which also works in such “priority countries” as Iraq, Afghanistan, Bolivia and Haiti.
Chavez makes no distinction between the programmes supported by US funds and the secret effort he says the CIA is pursuing to destabilise his government.
It appears a crackdown on the US aid is imminent as he runs for re-election in December.
The National Assembly, dominated by allies of Chavez, is preparing to force non-profit groups to reveal their funding sources and the president has threatened to expel the US ambassador, William Brownfield, accusing him of causing trouble by giving USAID donations to youth baseball teams and daycare centres.
The US also funds pro-democracy
Venezuelan prosecutors have brought conspiracy charges against the leaders of Sumate, a US-backed group that frequently criticises the voting system.
Sumate acknowledges getting $102,120 for voter education programmes since 2003 from the Washington-based National Endowment for Democracy, although it says it has not used any direct aid from the US government.
The US State Department granted Sumate $300,000 last year to help review the voter rolls, but the group returned the money in July.
This month, an inquiry by the National Assembly concluded Sumate appeared to have violated other laws.
Prosecutors are investigating whether to charge members with treason, tax evasion and other crimes, said Sumate’s leader, Maria Corina Machado, who has met Bush at the White House and is a Chavez opponent.
“It’s an organisation that promotes and builds democracy. Those who do that are persecuted under governments that stop being democratic”
Maria Corina Machado, Sumate
She denies accusations by Chavistas that her group is in effect an opposition political party, and insists Sumate has broken no law.
“It’s an organisation that promotes and builds democracy. Those who do that are persecuted under governments that stop being democratic.”
Other groups that have received funds through the USAID include Leadership and Vision, which got about $45,000 in 2003 to organise 10 seminars aimed at promoting dialogue among opposition and pro-government camps.