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Patrick Bond © 2002


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On Sunday in Brazil, former lathe-operator Luiz Inacio da Silva--"Lula"--won the second most votes cast for an individual electoral candidate in history: 52.4 million. (Ronald Reagan won 54.4 million in the 1984 US presidential elections.)

Since 1980, Lula has been the charismatic leader of the Workers Party (abbreviated in portuguese as "PT"). Initially the party not only represented the urban masses, but also allied with rubber-tappers, landless people, feminists, gay activists, Afro-Brazilians and radical church people in the Catholic liberation theology current. This working coalition generated a social movement that, first, engaged in mass actions to unseat the military dictatorship in 1985, and then ran for the highest office.

I interviewed Lula in 1989 for a radio programme, and asked him how he felt about his visit to New York the day before, where he was hosted by the Brazilian-American Chamber of Commerce. Through a translator, Lula replied, "I told them that if they didn't give us their rings, we would chop off their fingers." He also committed to defaulting on the illegitimate debt, mainly inherited from dictators.

Lula's first presidential bid, later that year, was against a television mogul who, through crookery, won the vote by a tiny margin but soon was forced to resign because of corruption. During the 1990s, Lula lost two further elections to Fernando Henrique Cardoso, a former leftist intellectual who developed a close working relationship with South African leaders, especially Thabo Mbeki, after 1994. In the meantime, municipal elections won by the PT included many big cities, including the celebrated case of Porto Alegre, where participatory budgeting allows low-income people some measure of genuine power.

Like South Africa, Cardoso's Brazil suffered dramatic volatility during the late 1990s due to neoliberal economic policies and global economic turbulence. Privatisation, deregulation and the opening of the economy to foreign competition were handled poorly.

Some results: the currency crashed in early 1999 and again this year; foreign debt soon exceeded $250 billion; unemployment soared; and inequality is at heights achieved only by one other large country (South Africa). Interest rates have risen to 21%, in part because foreign investors fled earlier this year at the prospect of Lula's victory.

In order to calm investor nerves, Lula made substantial concessions to the ruling elite. He has committed to repaying Brazil's foreign debt, and to maintaining fiscal discipline.

What of Brazil's trade relationships? He once termed the Free Trade Agreement of the Americas--which is being pushed hard by George W. Bush--the "annexation of Latin America by the United States." But Paul O'Neill, the US Treasury Secretary, remarked the day after the election, "From what I know of Lula, I think they're going to be OK."

Under intense international pressure, will Lula adopt an economic model that meets ordinary people's needs? According to progressive US economist Mark Weisbrot at the Center for Economic and Policy Research, "Latin America is approaching the end of a 20-year, failed economic experiment. Lula's major obstacle is an International Monetary Fund agreement that tries to commit the new government to maintaining many of the failed policies of the past."

Under these circumstances, whereby Washington and Geneva multilateral institutions retain substantial power over nation-states, there is scepticism that Lula's massive electoral victory will translate into socialist policies.

Financiers note that Lula chose a member of the bourgeoisie as his vice president, textile tycoon Jose Alencar, and that he has stopped talking about socialism. As he once described his ideology, "You don't even need to call it a socialist project; call it a Christian project or an ethical project."

According to Marcelo Mesquita, equity strategist for UBS Warburg in Rio, "The investor is finally starting to understand the difference between the Workers' Party's campaign promises and how it plans to govern the country economically."

Lula himself recently stated, "20 to 30 percent of the PT is radical, but it's the 70% that support our party's policies".

But as always, the question is what the PT's lifelong activists--along with the Movement of the Landless and other progressives--can pressure Lula to do on behalf of the voiceless, against the interests of capital and the upper-middle class. In South Africa during the late 1990s, the adoption of the failed Gear policy above the heads of the masses is one indication that no matter how unlikely, a neoliberal alliance can get its way.

Still, this is the first ordinary worker to become president of a country since Lech Walesa. He will try to bring workers to the table, to meet big business in an attempt at a new social contract. As in most Third World settings where Washington sets the overall agenda, that too will fail. Then it will be up to the core activists to reassert the agenda of social justice and worker interests.




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