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Brazil And The World Await Lula's Path

October 26, 2002

Brazil and the World Await Lula's Path

* New president is certain to adopt his own road, veering Brazil from its traditional dependence and deference to the U.S.

* Outside of Brazil, impact of election will affect U.S. most of all, but its results will also be registered in Mexico, Caracas and Havana, as well as in all of Latin America

Lula's almost certain victory in today's run-off election will doubtless jar the status quo regarding Brazil's standing in the region, as well as its traditionally deferential ties to the U.S. and the G-7 world. But its impact on the balance of forces could vary and will be a function of the country's objective circumstances as much as it might turn out to be of Lula's politics, ideology or personal charisma. Nevertheless, the ultimate story of Brazil's growing influence on the world scene during his term in office will depend upon the health of its economy, the clarity and realism of Lula's goals, and his ability to vend his priorities to the Brazilian public.

It also will be measured by his being able to convince the world community that there is a new Brazil that will be casting an increasingly long shadow and which will require the community of nations to take notice of its existence, like never before. But most of all, the historic payoff of a Lula presidency will be measured by the quality and breadth of his vision, his willingness to attack the stygian factors of corruption cronyism and sycophancy that has destructively compromised the merit of Brazilian political life, and the hapless environment policylong on promises and short on deeds.

The harm done to the country's traditional power structure may be one of the more important contributing factors to Lula's triumph and is likely to bring with it the casting of a more intense spotlight pointing to the country's long-tolerated system of crippling corruption and the basically derelict nature of many of its most important civic institutions.

Brazil's Dark Side

Such practices as cronyism politics and political deal-making based on self advancement rather than the forwarding of the common good, may also be one of the early political casualties of a Lula presidency. But such optimism also surrounded the election of Lula's predecessor, Fernando Enrique Cardoso, who also started off as a decent man of the left, but took the country on a drift to the center and then to the right while adapting to a series of harsh political realities. These eventually cost him his reputation and the affection of most Brazilians. At issue for Lula is not only can he effectively handle the core of good public policy - fiscal responsibility, development of export markets, attraction of overseas investment to aid in debt-servicing, along with the alleviation of poverty and inequity - but also his readiness to mobilize and do battle against the tainted political practices that usually have won the day over sound public policy and civic rectitude under all of the recent Brazilian presidencies.

While some members of the international financial community are apprehensive over the possibility that Lula's expansionist economic policies will open the door to inflation and instability, their numbers are far fewer than earlier in his campaign. It is much more likely that Lula will try to walk a narrow rope, whereby he will mix a drought of solid orthodox economics with an equal measure of well-developed social and anti-poverty initiatives in the fields of health, education and welfare, all aimed at trimming Brazil's huge segment of the population presently living below the poverty line.

This mix of liberal and conservative policies should largely satisfy both the left and the right, at least for the time being.

But most importantly, a relatively tranquil labor relations strategy and a policy defending the country's agricultural interests will buy Lula the space to address a whole range of issues bedeviling the international community as well as the hemisphere in which Brazil will be playing a much greater role. Whether it is seeking a permanent seat on the UN Security Council, or defining an FTAA which takes into account Brasilia's non-negotiable priorities, including the need to remain competitive with the US regarding its agricultural exports, Brazil will no longer be Washington's lap-dog, as it has been, more or less since the era of Baron Rio Branco in the early 1900s. Lula's presidency may turn out to be best remembered for his leading Brazil into international greatness, in an era when the hemisphere could be lead by a co-dominion of the US and Brazil, which could be the source for new institutions and policies that could radically depart from the cluster of attitudes and narrow current preoccupations of US policy makers, centering on Washington's narrow vested interests, which it attempts to market as good for the well being of the entire hemisphere. These could include favoring drug legislation, a solid bear hug for Hugo Chávez in Venezuela, leading the drive to legitimate the economic formulations of Fidel Castro (which have been very critical of the international lending agencies), and insisting that Castro be invited to participate in the FTAA talks and that Cuba be invited back to participate in the workings of the OAS.

Lula's Tasks, Including Mexico

The most important trait of the new Brazilian president could be his recognized ability to negotiate and to achieve consensus, characteristics which many observers of Brazil's national politics attribute to Lula.

Indeed, his choice of a conservative figure to be his running mate is suggestive of a desire to actively seek consensus. Lula advisors aspire to use the transition period and the office facilities that will be graciously provided by the current administration, as a base from which to encourage Congress to enact a number of Cardoso initiatives, which are currently stalled in Congress and which Lula would like to see made law before assuming office.

Brazil almost unquestionably will play an increasingly important role in inter-hemispheric affairs as Mexico becomes increasingly "NAFTA-ized" into the U.S. orb, a process that has been accelerated during the current disastrous tenure of foreign secretary, Jorge Castañeda. Due largely to his influence and personal animus, Mexico now appears to be more responsive to Washington's priorities - certainly its anti-Cuba strategy - than those of Latin America. A number of Latin American observers see Castañeda as a veritable lap dog for Washington's venomous anti-Cuban sentiment, with the Mexican minister's actions on Cuba, including the firing of Mexican ambassador to Havana, Ricardo Pascoe, as being more to the right than most Republican senators' current stand on relations with Cuba. This is why Castañeda is being seen throughout Latin America as Mexico's Otto Reich.

As President Fox's stature is being rapidly eclipsed by his failure to be able to move the most important items on his agenda with the Bush administration and transfroming Mexico into a veritable McMexico, Brazil is likely to be the major beneficiary of this process. Lula, who already has strong ties to Venezuela and Cuba, is likely to take the lead of a left-of-center arc of nations, which to a greater or lesser degree are characterized by populist and nationalist elements. A Lula electoral victory will allow Brazil, which is destined to become the main interlocutor of the region's interests, to replace a discredited Fox government with a genuine Latin American thrust vis-à-vis Washington.

Ultimately, Lula's prospects for a successful presidency will be contingent upon a conversion from any thought of dogmatic ideological rhetoric, to a more consensual, consultative approach to public policy, but still always preserving his political integrity. It is this quality that has earned him the growing trust of the Brazilian public. Meanwhile, Brazilian voters seem to have ignored international interpretations that prophesize a drastic economic decline for the country as well as its political isolation, in the wake of a Lula victory. If Lula is able to retain the confidence of Brazilians of various ideological convictions, as well as the financial markets and the international community, he will have decisively challenged the doomsayer's false prophecy of default and economic collapse under his presidency in South America's most important nation.

The Council on Hemispheric Affairs, founded in 1975, is an independent, non-profit, non-partisan, tax-exempt research and information organization.

It has been described on the Senate floor as being "One of the nation's most respected bodies of scholars and policymakers."


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