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Cablegate: Brazil: Sao Paulo Mayor Wins Landslide Reelection, Set Up

VZCZCXRO5894
RR RUEHRG
DE RUEHSO #0581/01 3011625
ZNR UUUUU ZZH
R 271625Z OCT 08
FM AMCONSUL SAO PAULO
TO RUEHC/SECSTATE WASHDC 8660
INFO RUEHBR/AMEMBASSY BRASILIA 9821
RUEHRG/AMCONSUL RECIFE 4229
RUEHRI/AMCONSUL RIO DE JANEIRO 8902
RUEHBU/AMEMBASSY BUENOS AIRES 3303
RUEHAC/AMEMBASSY ASUNCION 3550
RUEHMN/AMEMBASSY MONTEVIDEO 2794
RUEHSG/AMEMBASSY SANTIAGO 2550
RUEHLP/AMEMBASSY LA PAZ 3958
RHEHNSC/NATIONAL SECURITY COUNCIL WASHDC

UNCLAS SECTION 01 OF 02 SAO PAULO 000581

SIPDIS
SENSITIVE

E.O. 12958: N/A
TAGS: PGOV PINR ECON EFIN EINV ETRD BR
SUBJECT: Brazil: Sao Paulo Mayor Wins Landslide Reelection, Set Up
Serra for 2010

SENSITIVE BUT UNCLASSIFIED--PLEASE PROTECT ACCORDINGLY

1. (U) Summary: Democrats (DEM) Party candidate and incumbent Sao
Paulo Mayor Gilberto Kassab capped off an extraordinary political
comeback with a 61-39 victory over Workers Party (PT) candidate
Marta Suplicy in the second round of the mayoral race on 10/26.
Kassab's convincing win represents a victory for his principal
political benefactor, Sao Paulo Social Democrat (PSDB) Governor Jose
Serra, who finds himself in much-strengthened position as the likely
PSDB presidential nominee for 2010. End Summary.

The Kassab Comeback

2. (SBU) DEM Party candidate and incumbent Sao Paulo Mayor Gilberto
Kassab capped off an extraordinary campaign comeback with a 61-39
victory over Workers Party (PT) candidate Marta Suplicy in the
second round of the mayoral race on 10/26. The incumbent mayor
began the race in August with his popularity in the single digits.
His main challengers were PSDB candidate Geraldo Alckmin and PT
candidate Marta Suplicy. Kassab came from behind to narrowly win
the first-round mayor's race and then to go on and crush Suplicy in
the final 10/26 contest. Several factors contributed to Kassab's
win:

-Programs: Kassab has been a good mayor, promoting very practical
programs -- the expansion of clinics, youth centers and a highly
popular anti-graffiti ("Clean City") campaign -- that voters like.

-Image: Marta Suplicy, while popular with the poor who live on the
Sao Paulo periphery, also has high negatives from her earlier term
as Mayor. Kassab's image is completely different. While not
particularly charismatic, he is appealing in an unassuming of way.
In the words of a Sao Paulo psychologist and commentator, Kassab
possesses a "good boy" image that makes him hard to attack.

-The PT Went Negative: Part way through the campaign, Suplicy went
negative. Her campaign ran ads that appeared to question Kassab's
sexual orientation. (A TV spot asked the question, "Does he have
children, a wife?" Kassab is single.) Suplicy, a former TV
sexologist and longstanding defender of gay rights, made a poor
cultural warrior and the ads were quickly pulled.

3. Kassab's sizable win represents a victory for his principal
political benefactor, Sao Paulo PSDB Governor Jose Serra, who finds
himself strengthened position as the favorite to be the PSDB
presidential nominee for 2010.

The Limitations of the Lula Factor

4. (SBU) As Suplicy's fortunes waned, President Lula came to the
aid of her campaign. He clearly hoped to translate his own sky-high
approval ratings (80-plus percent) into support for the PT mayoral
candidate. The Lula Factor, however, did not affect the race.
Opinion polls indicated that while Sao Paulo voters continue to
approve of Lula, they voted for Kassab.

5. (U) Although Lula did not turn the tide for Suplicy, he did
help elect former Labor Minister Luis Marinho Mayor of San Bernardo
do Campo -- one of Sao Paulo's so-called ABC communities, the key
industrial suburbs of the city -- and the area where Lula started
as a union leader in the 1980s. While Marinho won by a wide margin
(58 percent), his victory did not come easily. Even with Lula's
support, Marinho had to go to the second round and the PT wound up
spending a record amount of money on the San Bernardo do Campo
mayoral campaign, an estimated 15 dollars per vote.

6. (U) The PT elected mayors in two of the other ABC suburbs, but
lost in a third, preventing the party from locking down this key
area. The PT also won in smaller cities, of under 100,000, but did
not capture a single state capital nationally in the second round.

The PMDB: The Party to Court

7. (SBU) While the PT did well in smaller cities, its coalition
partner, the PMDB, performed best in the larger cities. The party
now governs 1,203 cities, six state capitals and 29 million
Brazilians. Among the state capitals and key cities won in the
second round were: Florianopolis, Salvador, Porto Alegre, and Rio de
Janeiro. Though the PMDB has no likely presidential candidate for
2010, it remains an attractive coalition partner for its relatively
strong grassroots showing, a role it performed during PSDB President
Fernando Henrique Cardoso's government and that it performs today as

SAO PAULO 00000581 002 OF 002


Lula's major non-PT coalition partner.

Comment (SBU): Lessons of the Races

8. (U) The results of the Sao Paulo mayoral race set the stage for
2010, which will feature a contest between likely PSDB presidential
nominee and Sao Paulo state incumbent Governor Serra and whomever
President Lula supports. At the moment, Lula's candidate appears to
be his Chief of Staff Dilma Rousseff.

9. (SBU) Sao Paulo voters appeared to render a sober judgment
during the election, one that would appear to confirm recent
statistics that indicate that Brazil is now a majority middle class
country. They ignored Lula's endorsement, Suplicy's attempted
populism and personal attacks, and favored Kassab's moderate style
and solid accomplishments, including initiatives to open more health
clinics and youth centers and to clean the city of graffiti. All of
this would indicate that Sao Paulo voters are increasingly
interested in accomplishments within the system rather than in
taking chances on system-changers, a posture consistent with the
high approval ratings President Lula receives for economic growth
based on highly orthodox macroeconomic policy.

10. (U) This cable was coordinated/cleared by Embassy Brasilia.

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