To withhold twenty percent of United States assessed and voluntary contributions to the Organization of American States (OAS) for every permanent council meeting that takes place where Article 20 of the Inter-American Charter is not invoked with regard to Venezuela's recent constitutional reforms, and for other purposes.

Summary: Directs the Secretary of State to: (1) withhold 20% of U.S. assessed and voluntary contributions to the Organization of American States (OAS) for every permanent council meeting at which Article 20 of the Inter-American Charter is not invoked with regard to Venezuela's recent constitutional reforms, and (2) resume making such contributions upon the invocation of Article 20 and the discussion of Venezuela's violation of the Inter-American Democratic Charter at a meeting of the Permanent Council of the OAS.

SECTION 1. FINDINGS.

    Congress finds the following:
            (1) Article 3 of the Inter-American Democratic Charter of 
        the Organization of American States (OAS) states that, 
        ``Essential elements of representative democracy include, inter 
        alia, respect for human rights and fundamental freedoms, access 
        to and the exercise of power in accordance with the rule of 
        law, the holding of periodic, free, and fair elections based on 
        secret balloting and universal suffrage as an expression of the 
        sovereignty of the people, the pluralistic system of political 
        parties and organizations, and the separation of powers and 
        independence of the branches of government.''.
            (2) Article 4 of the Inter-American Democratic Charter 
        states that ``Transparency in government activities, probity, 
        responsible public administration on the part of governments, 
        respect for social rights, and freedom of expression and of the 
        press are essential components of the exercise of democracy. 
        The constitutional subordination of all state institutions to 
        the legally constituted civilian authority and respect for the 
        rule of law on the part of all institutions and sectors of 
        society are equally essential to democracy.''.
            (3) Article 20 of the Inter-American Democratic Charter 
        states that ``In the event of an unconstitutional alteration of 
        the constitutional regime that seriously impairs the democratic 
        order in a member state, any member state or the Secretary 
        General may request the immediate convocation of the Permanent 
        Council to undertake a collective assessment of the situation 
        and to take such decisions as it deems appropriate. The 
        Permanent Council, depending on the situation, may undertake 
        the necessary diplomatic initiatives, including good offices, 
        to foster the restoration of democracy.''.
            (4) In December 2010, Venezuela's President, Hugo Chavez, 
        in coordination with a pliant legislature, passed a package of 
        laws, including the Enabling Act or Enabling Law, which 
        fundamentally altered the Venezuelan Constitution.
            (5) As a result of the legislation, essential freedoms are 
        impaired, including the freedom of speech through restrictions 
        on the internet and television, a breakdown in strong, 
        independent, and pluralistic political parties through 
        electoral reform that expels from parliament politicians who 
        change parties, vote against certain legislation, or align with 
        ideologically opposed ideas or people, separation of powers and 
        subordination of the state to the people through the removal of 
        the municipal and regional governments' constitutional mandate, 
        and fundamentally altering the ability of the people to govern 
        themselves, in addition to the president's ability to rule by 
        decree for eighteen months in nine broad areas such as social, 
        economic, territorial, and national security, and respect for 
        social rights through changes to the education sector by 
        controlling curriculum and ideology in universities.
            (6) The package of laws, including the Enabling Act, 
        therefore violate essential elements of the exercise of 
        democracy as stated in Articles 3 and 4 of the Inter-American 
        Democratic Charter.
            (7) Secretary General Jose Miguel Insulza stated in an 
        interview with Associated Press that he believed the Enabling 
        Act in Venezuela was ``anti-democratic, unconstitutional and a 
        violation of the Inter-American Charter,''.
            (8) Assistant Secretary of State for the Western 
        Hemisphere, Arturo Valenzuela, reiterated the description of 
        the Enabling Law as ``undemocratic''.
            (9) The most recent Worldwide Threat Assessment by the 
        Director of National Intelligence found that ``at the end of 
        the legislature's lame duck term, Chavez and his allies passed 
        legislation that gives more resources to his loyal community 
        councils, allowing Chavez to claim that he is both bolstering 
        participatory democracy and creating new means of funneling 
        resources to supporters.''.
            (10) According to the Inter-American Democratic Charter, 
        invocation of Article 20 may be made by the Secretary General 
        or any member state of the Organization of the American States 
        in the event of an unconstitutional alteration of the 
        constitutional regime that seriously impairs the democratic 
        order in a member state.
            (11) Also, according to the Inter-American Democratic 
        Charter, invocation of Article 20 signifies the calling of the 
        Permanent Council to determine next steps, through diplomatic 
        initiatives, to foster the restoration of democracy in a member 
        state. If such initiatives fail to restore democracy, Article 
        21 is employed to call a special session of the General 
        Assembly in order to take the decision to suspend such member 
        state from the exercise of its right to participate in the OAS 
        by an affirmative vote of two-thirds of the member states in 
        accordance with the Charter of the OAS. The suspension shall 
        take effect immediately.

SEC. 2. INVOCATION OF ARTICLE 20 OF THE INTER-AMERICAN DEMOCRATIC 
              CHARTER.

    (a) Withholding of Contributions.--For every Permanent Council 
meeting of the Organization of American States (OAS) that, beginning 
after the date of the enactment of this Act, meets without the 
invocation of Article 20 of the Inter-American Democratic Charter and 
the ensuing discussion with regard to Venezuela's violation of such 
Charter, as guaranteed in such Charter, the Secretary of State shall 
withhold 20 percent of assessed and voluntary United States 
contributions to the OAS for the fiscal year in which each such meeting 
begins (or, if 20 percent is not available for withholding in such 
fiscal year, the Secretary shall withhold the highest percentage 
possible in such fiscal year and the remaining percentage in the 
subsequent fiscal year).
    (b) Resumption of Contributions.--The Secretary of State shall 
resume making assessed and voluntary United States contributions to the 
OAS upon the invocation of Article 20 and the discussion of Venezuela's 
violation of the Inter-American Democratic Charter at a meeting of the 
Permanent Council.
    (c) Deficit Reduction.--Amounts withheld pursuant to subsection (a) 
shall be applied to reduce the Federal budget deficit, or, for any 
fiscal year for which there is no Federal budget deficit, to reduce the 
Federal debt.