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Cablegate: Brazil Municipal Elections: Belo Horizonte Race Will Test

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RR RUEHRG
DE RUEHBR #1290/01 2732023
ZNR UUUUU ZZH
R 292023Z SEP 08
FM AMEMBASSY BRASILIA
TO RUEHC/SECSTATE WASHDC 2530
INFO RUEHRG/AMCONSUL RECIFE 8498
RUEHSO/AMCONSUL SAO PAULO 2809
RUEHRI/AMCONSUL RIO DE JANEIRO 6659
RUEHBU/AMEMBASSY BUENOS AIRES 5826
RUEHMN/AMEMBASSY MONTEVIDEO 7532
RUEHAC/AMEMBASSY ASUNCION 7085
RUEHSG/AMEMBASSY SANTIAGO 0600
RHEHNSC/NSC WASHDC
RUEAIIA/CIA WASHDC

UNCLAS SECTION 01 OF 02 BRASILIA 001290

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: PGOV BR
SUBJECT: Brazil Municipal Elections: Belo Horizonte Race Will Test
Presidential Waters

REF: (A) Sao Paulo 285 (B) Sao Paulo 225
(C) Sao Paulo 142(D) Sao Paulo 94 (D) Brasilia 674

1. (SBU) Summary: Although all Brazilian cities elect mayors and
city councils on October 5, the municipal elections in Belo
Horizonte and Sao Paulo have the most potential to affect the
national political situation. In Belo Horizonte, Brazil's sixth
largest city located in the state of Minas Gerais, a controversial
informal alliance between President Lula's PT party and the Social
Democrat (PSDB) party (center-left party in opposition) has formed
to back Marcio Lacerda, a Socialist (PSB, leftist party in the
governing coalition). This PT-PSDB alliance is significant because
these parties are traditional national-level political rivals. If,
as projected, Lacerda wins easily--he might even do so without a
second round run-off--the success of the PT-PSDB partnership in Belo
Horizonte will bolster the prospects of its architect, Minas Gerais
Governor Aecio Neves (PSDB) as a presidential candidate for 2010.
Neves, who is clearly positioning himself as a candidate for 2010,
has been carefully working with President Lula and other PT leaders
in an effort to build his reputation as a politician who can work
with rivals to get things done. End summary.

THE RACE IN BELO HORIZONTE

2. (SBU) In a municipal election that is among two in Brazil (the
other being Sao Paulo - see reftels) to have potential national
implications, an alliance of the PT, PSB and informally, the PSDB,
as well as other smaller parties, supports Marcio Lacerda, who leads
in recent polls with 45%, twenty-five percentage points ahead of his
nearest rival. Lacerda, a wealthy businessman, is the candidate of
popular Belo Horizonte Mayor Fernando Pimentel, and the even more
popular Minas Gerais Governor, Aecio Neves. Lacerda recently served
as Neves's State Secretary for Economic Development. The locally
popular, cooperative and productive relationship formed between
Pimentel and Neves, despite their parties' national level rivalry,
should easily carry Lacerda to victory, possibly without a run-off.
Although Lacerda was running third in the polls with only 6% as
recently as mid-August, Marcus Coimbra of the polling firm Vox
Populii, predicted correctly to APPoff that as soon as the
television campaigning started in late August and the public
understood that Lacerda was the candidate of Pimentel and Neves, he
would shoot up in the polls, as the public wants to continue their
legacy. Although the national PT directorate forbade a formal
alliance between the PT and the PSDB, despite public statements made
in support of it by President Lula and his chief of staff, Dilma
Rousseff, the informality of the alliance has not hurt Lacerda as
the public clearly understands that Neves supports his candidacy.

THE ORIGINS OF THE ALLIANCE AND NATIONAL INVOLVEMENT IN THE BELO
HORIZONTE RACE

3. (SBU) According to State Deputy and PSDB party leader in Minas
Gerais, Lafayette de Andrade, the unusually cooperative relationship
between the PT and the PSDB in Belo Horizonte is the result of both
President Lula and Governor Neves having an interest in good
relations that would facilitate implementation of their agendas.
When elected in 2002, President Lula's governing coalition in the
Brazilian Congress was fragile and Neves's standing as the former
Speaker of the Chamber of Deputies, and his good relations with many
in Congress, made him a potentially useful resource to Lula,
according to Andrade. As the newly elected governor of Minas Gerais
in 2002, Neves needed to form a good relationship with the federal
government in order to obtain the resources needed to carry out his
ambitious agenda. The good relationship that eventually developed
naturally included PT Mayor Pimentel, especially given his close
relationship with Dilma Rousseff, formed when they worked together
to oppose the military dictatarship. As a result, Neves has been
able to obtain federal support for his projects, which he has
implemented efficiently by cutting bureaucracy and focusing on a
results-oriented style of management.

4. (SBU) Political columnist Marcio Fagundes of Hoje Em Dia, Belo
Horizonte's second-most read daily, told APPoff that when it came
time to unite behind a candidate, Pimentel went to Brasilia to
personally get the blessing of President Lula and Rousseff for the
alliance. Luiz Dulci, Secretary General of the Presidency and a
personal friend of Fagundes who is also from Minas Gerais, told
Fagundes that Pimentel may have made a big mistake by not consulting
two other key national PT figures also from Minas Gerais - Dulci
himself and Minister of Social Development and the Fight Against
Hunger, Patrus Ananias de Sousa, who runs President Lula's popular
Bolsa Familia program. According to Fagundes, Dulci and Ananias

BRASILIA 00001290 002 OF 002


were furious with Pimentel for not consulting with them. Despite
Lula's and Rousseff's public support, the PT national party
leadership eventually forbade the alliance with the PSDB, and the PT
in Minas Gerais has split into a pro-Pimentel camp that is
supporting Lacerda, and a pro-Ananias camp that is supporting
current third-place candidate Maria do Socorro "Jo" Moraes, a
federal deputy from the PCdoB (communist/leftist party in the
governing coalition). Fagundes and others in Belo Horizonte believe
that this situation could hurt Pimentel's prospects for being
elected governor of Minas Gerais in 2010, despite the support he
will undoubtedly receive from outgoing governor Neves. Ananias, as
well as Minister of Communications Helio Costa, also from Minas
Gerais, is also rumored to be interested in the governorship of
Minas Gerais. Although Lacerda's victory appears to be certain at
this point, if he were to stumble as mayor, Ananias or Costa could
use that against Pimentel, as well as the fact that for the first
time in 16 years, a non-PT mayor was elected in Belo Horizonte.

WHAT DOES THIS MEAN FOR A NEVES PRESIDENTIAL CANDIDACY IN 2010?

5. (SBU) In describing how the Belo Horizonte Mayor race may affect
the 2010 Presidential race, sociologist Ruda Ricci recently quipped
in a Veja (popular weekly news magazine) article on the race that
"In Minas Gerais, we are already in 2010." According to Andrade,
Lacerda's almost certain victory could bolster a Neves candidacy by
showing him to be a candidate who can attract cross-over PT and
other voters and one who unites diverse parties in order to get
things done. Coimbra has dubbed Neves "a uniter, not a divider," and
has suggested that this could make him an attractive candidate
versus the more combative style of politics practiced by PSDB
leadership in Sao Paulo. State deputy and leader of the PSB in Minas
Gerais Wander Borges called Neves's style "a new form of politics in
Brazil...that allows us to sit at the same table and talk and to be
evaluated on the goods and services delivered." According to
Borges, this cooperative and results-oriented leadership style is
spreading to other cities in Minas Gerais. Borges believes that
Brazilian society will eventually demand more consensus-based
leadership on the national level and that this will help a Neves
candidacy, particularly after a Lacerda victory.

6. (SBU) As Sao Paulo Governor Jose Serra is currently the leading
prospect for the PSDB in 2010, there is speculation that Neves will
switch parties to run in 2010. It is also possible that, if Lacerda
wins, the PT/PSDB alliance could serve as a model for a similar
alliance behind Neves in 2010. Most commentators find the latter
scenario highly unlikely, but the former scenario a strong
possibility. Fagundas believes Neves may run as a PSB candidate with
Ciro Gomes. Highly respected Globo columnist Miriam Leitao told
APPoff that switching to the PMDB would be a natural for Neves, as
his grandfather, Tancredo Neves, who was elected president in 1985
but died before taking office, was one of the PMDB's founders.

7. (SBU) COMMENT. Neves is definitely positioning himself to run for
president in 2010, either as the PSDB candidate or possibly as the
candidate of another party if he fails to win the PSDB nomination.
Through his cooperative relationship with PT Mayor Pimentel and by
backing Lacerda in an informal alliance with the PT, he is trying to
portray himself as a new kind of candidate for Brazil who can work
with rivals to get things done for the people. By electing Lacerda,
voters in Belo Horizonte will signal their support for this style of
politics. If this trend toward a less partisan, results-oriented
style of politics catches on in other parts of Brazil, it would
further bolster a Neves candidacy for president in 2010. END
COMMENT


KUBISKE

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