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Cablegate: Brazil's Congress Prepares to Rein in President's Decree

VZCZCXRO0814
RR RUEHRG
DE RUEHBR #0390/01 0801850
ZNR UUUUU ZZH
R 201850Z MAR 08
FM AMEMBASSY BRASILIA
TO RUEHC/SECSTATE WASHDC 1253
INFO RUEHRG/AMCONSUL RECIFE 7828
RUEHSO/AMCONSUL SAO PAULO 1785
RUEHRI/AMCONSUL RIO DE JANEIRO 5938
RUEHBU/AMEMBASSY BUENOS AIRES 5376
RUEHMN/AMEMBASSY MONTEVIDEO 7271
RUEHAC/AMEMBASSY ASUNCION 6652
RUEHSG/AMEMBASSY SANTIAGO 0203
RHEHNSC/NSC WASHDC
RUEAIIA/CIA WASHDC

UNCLAS SECTION 01 OF 02 BRASILIA 000390

SIPDIS

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: PGOV KDEM BR
SUBJECT: Brazil's Congress Prepares to Rein in President's Decree
Authority

REF: A) Brasilia 160, B) 07 Brasilia 1670

1. (SBU) Summary. Angered by an alleged overuse of decree-making
authority that has caused legislative gridlock, Congress will try to
limit the president's ability to dominate the legislative agenda and
implement policy through issuance of "provisional measures" (MPs).
President Lula's unprecedented use of MPs, which have blocked the
legislative agenda since late last year, has served to erode
congressional independence and initiative in a system that already
heavily favors the executive. With broad multiparty agreement that
MPs must be reined in, if legislators can agree on the details of a
constitutional amendment on MPs they will reclaim control of the
legislative agenda, a change that would significantly enhance the
legislative branch's autonomy and power. Congress could approve a
constitutional amendment bill by next September, which would take
effect immediately. End summary.

- - - - - - - - - - - - - - - -
Special Committee Takes on MPs
- - - - - - - - - - - - - - - -

2. (U) Since last December, the Chamber of Deputies agenda has been
completely blocked by MPs, with the plenary constitutionally barred
from voting on any other business. The situation was similar in the
Senate. As a result, congressional frustration has welled up
because legislators were unable to debate bills of their own
authorship in the plenary, instead being forced to vote on one MP
after another. In February, Chamber of Deputies President Arlindo
Chinaglia (Workers' Party, PT, government; of Sao Paulo) appointed a
special committee to propose changes to the constitution governing
the use of provisional measures (MP), one of the important
policy-making tools available to Brazilian presidents.

3. (U) MPs have been around in one form or another since 1937, but
their use grew rapidly under the 1988 constitution, which gives the
president carte blanche to issue an MP, provided it deals with an
"urgent and relevant" matter. The 1988 text on MPs was taken
directly from the 1947 Italian Constitution, and was intended for a
parliamentary system, but Brazilians afterwards chose to retain the
presidential system in a national referendum, leading to a poor fit.
The text was amended in 2001 to force congress to vote on MPs after
45 days, at the same time removing the president's right to renew
MPs without limit. President Lula has used MPs more than any other
president in modern times: 311 MPs in five years; his predecessor
issued 365 in eight years.

- - - - - - - - - - -
The Trouble with MPs
- - - - - - - - - - -

4. (U) An MP takes effect immediately on issuance and remains valid
for 60 days. It is automatically renewed once for 60 days. If not
voted into law within 45 days of its issuance, an MP "locks" the
congressional agenda and the plenary cannot vote on anything else.
If rejected by a vote in Congress, or if the MP is not voted on
within 120 days, it becomes invalid and the Congress must prepare
legislation to deal with any residual effects of its period of
validity.

5. (SBU) This system has effectively allowed the executive to
dominate the legislative agenda by issuing a constant stream of MPs
and forcing congress to focus on executive priorities almost to the
exclusion of all else. President Lula's reliance on MPs has been so
great that he got tangled in his own web last December (ref A).
Desperate to have the congress renew the tax on financial
transactions (CPMF), the executive branch was actually forced to
revoke several supposedly urgent MPs to clear the path for the CPMF
legislation. Still later in the game, when the critical CPMF
legislation was before the Senate, pro-government legislators in the
Chamber of Deputies went into "obstruction" so as not to vote on any
MPs, because passage of MPs would have had the effect of forwarding
them to the Senate, thereby locking its agenda. Such shenanigans
only heightened legislators' perception that it was time to reform
the MP rules. Federal Deputy Leonardo Picciani (Brazilian
Democratic Movement Party, PMDB, government coalition; of Rio de
Janeiro) pointed out another problem: he believes MPs degrade
congress, since at present some interest groups make their case
directly to the executive in hopes of obtaining an MP, instead of
working with congress to seek a legislative result. He added that
this process hurts the legislative branch by distancing it from the
people.

BRASILIA 00000390 002 OF 002

- - - - - - - - - - -
What Congress Can Do
- - - - - - - - - - -

7. (SBU) Recognizing the utility of MPs in certain cases, most
government and opposition legislators agree that MPs should not be
eliminated, just reined in. Senator Eduardo Suplicy (Workers Party,
PT, government; of Sao Paulo) told Poloff on March 17 that "everyone
agrees something must change." Deputy Picciani, the rapporteur of
the special committee on MPs, will present a draft constitutional
amendment in the week of March 24. Poloff asked him on March 19 why
MPs should not be eliminated entirely and he said that was
"culturally impossible because they have been around for so long."
Picciani, opposition leaders, and even some pro-government
legislators want to eliminate the 45 day provision, but President
Lula is strongly opposed, convinced that without it, there is no
incentive to bring MPs to a vote, giving congress the equivalent of
a pocket veto. Lula is reportedly fighting hard ensure that MPs
will not lose their force of law, stating in a speech on March 18
that it was "humanly impossible" to govern without MPs, and that
"The time and agility that things need to happen many times is
faster than the time for democratic discussion." This power
struggle between the legislative and executive branches will likely
strengthen democracy, and this is a rare moment when a single
constitutional change will significantly rebalance the two powers.
But nobody is pretending this is a win-win situation. The executive
branch is going to lose power, and congress will gain power, which
is why Lula and his team have been working so hard to minimize the
damage.

8. (SBU) Picciani said some sort of compromise will be arranged that
will probably eliminate the 45 day rule and send MPs to the top of
the congressional agenda on issuance, but without actually locking
the agenda. He said congress will probably retain the limits on
renewal, but might change the length of validity for MPs before they
are voted on. A provision to have the Constitution, Justice and
Citizenship Committee screen all MPs to ensure that they are
"relevant and urgent" would probably also pass. Some opposition
deputies want budget and tax matters off limits for MPs, but
Picciani said the final version would probably allow the president
to continue using MPs for budgetary purposes, but not tax matters.

- - - -
Comment
- - - -

9. (SBU) Eliminating the 45 day rule will make it more difficult for
the president to dominate the legislative agenda in the way Lula
does now. Removing the requirement to vote on MPs first would place
more power in the hands of party leaders, as the legislative agenda
is set by congressional party leaders in consultation with the
president of the Chamber or Senate. And new rules limiting the
president to one renewal of an MP would force the president to build
stronger alliances with other parties. Picciani said it would make
a president use MPs more sparingly, since getting them passed would
always incur a political cost and rejection of legislation backed by
the executive has political downsides for the president.

10. (SBU) Comment, continued: The reforms would also introduce
additional incentives for corruption akin to those that led to the
mensalao vote-buying scheme revealed in 2005 (ref B). But this
potential negative effect will be counterbalanced by a more
significant and beneficial democratizing effect. Whatever the
details of the reforms, they will increase congress's power and
provide more equilibrium to the three-branch system. The executive
will undoubtedly learn to govern with the new restrictions - the
media have pointed out that governors and mayors do so already
without any MP-type powers - and congressional business will be more
representative of congressional, not executive, interests.

HENSHAW

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