BOSTON-- Now comes the dangerous stage in Venezuela.

In a chronicle of a collapse foretold, the economy is failing; corruption and crime rage. As he runs out of clever ways to manipulate his people, Hugo Chavez becomes more repressive -- jailing at least 40 political opponents. Several hundred union leaders, journalists and critics have disappeared or been murdered, according to the Inter-American Commission on Human Rights.

The military is divided and restless. The end may be messy.

The growing question is: What should the United States do? The Obama administration has been holding internal policy reviews. Some in Congress and the media are calling for action -- if not in defense of democracy, then as a means to punish Chavez for his support of Colombian terrorists, his blind eye to drug trafficking or just to shut up his non-stop mouth.

The answer is that we should do nothing or, better said, nothing major for now. We should not allow Chavez the opportunity to cloak himself further in anti-American nationalism and escape an implosion of his own making.

Much is at stake. Venezuela is a major provider of oil, joining us at the hip: A sudden break would send oil prices sky high. Most large American companies have left Venezuela. But a few, including Chevron and Halliburton, remain exposed. Chavez, meanwhile, commands enough sympathy in the hemisphere that any clumsy action risks making him into a martyr at home and abroad.

Acting forcefully in the name of principle may feel good, but the higher principle is achieving the right outcome. Patience and wisdom are required, along with a little, gentle nudge here and there.

In the latest example of Chavez's failed economic policies, the government instituted new foreign exchange controls last week. But its multiple exchange rates already are disastrous for business and are draining the treasury. A parallel free market rate for the dollar is nearly four times the lowest official rate. The new controls are designed to narrow the gap but likely will only fuel a dollar black market and inflation running at more than 30 percent.

Chavez has managed to stay in office for 11 years by using government largesse, nationalistic expropriations and his considerable charisma to win elections and referendums on constitutional changes that consolidate his power.

His government's seizure this month of the ranch of Diego Arria, a former diplomat popular in Washington, was posed as another strike against the "oligarchy," as is his latest pressure on Polar, a huge beer and food company. But the many nationalized telecom, steel, cement, supermarket, energy and other companies suffer from mismanagement and losses, and the expropriations are losing their popularity.

Chavez's popularity runs well below 50 percent in the polls. He faces the very real possibility of losing congressional elections in September and the presidential vote in 2012. One fear is that he might cast off all democratic veneer and cancel the elections, especially if he has the excuse of American threats.

His more immediate concern, however, is to avoid a popular or military insurrection. Months of daily electrical blackouts -- in an energy-rich country -- have been restricted to the interior, clearly for fear of the anger they might stir in Caracas.

The military leadership, meanwhile, is said by informed Venezuelans and American officials to be resentful of the Cuban advisers placed in its midst, of a parallel militia created by the Cubans, and of the possibility that soldiers might be called on to shoot their countrymen during an uprising.

To maintain order, intelligence agents over the last year have increasingly jailed opposition leaders and critics on charges of "insulting" the president, or in the case of a judge, for issuing an everyday ruling involving a businessman that Chavez said he didn't like. Obviously trumped-up charges are also used and then dropped months later. Many critics have fled.

Limited press and political freedoms remain, but self-censorship is the rule.

Chavez now ranks in hemispheric polls as the region's least admired president. Even the Venezuelan opposition agrees that the goal for the Obama administration should be to further isolate him so that if Chavez does something egregious, the U.S. won't be alone in imposing sanctions.

The Obama administration has been quietly doing just that. In major countries such as Mexico, Chile, Peru, Colombia and even Argentina, there is no love lost for Chavez. Elections later this year in Brazil may determine if it stays on the fence concerning the Venezuelan leader.