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Cablegate: Sao Paulo Mayor Serra's Six Month Record

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 03 SAO PAULO 000920

SIPDIS

NSC FOR SUE CRONIN

DEPT ALSO FOR WHA/PD

SENSITIVE

E.O. 12958: N/A
TAGS: PGOV KCRM KIPR KDEM ECON PHUM BTIO EINV SOCI BR
SUBJECT: SAO PAULO MAYOR SERRA'S SIX MONTH RECORD

REF: A) Sao Paulo 21
B) Sao Paulo 289
C) Sao Paulo 475
D) Sao Paulo 499
E) Brasilia 1874
F) Brasilia 1867
G) Sao Paulo 200
H) Sao Paulo 281
I) Sao Paulo 418
J) Sao Paulo 419
K) Sao Paulo 848

1. (SBU) Summary: At the conclusion of his first six
months in office, Sao Paulo Mayor Jose Serra (Social
Democratic Party of Brazil or PSDB) enjoys a more positive
public evaluation than any of his 5 predecessors, yet
reviews of his performance to date remain mixed. Of his 15
campaign promises made during his drive for the office, nine
have not materialized, five are in process and one has been
fulfilled. Serra argues that his lack of success in
achieving his stated goals is largely due to the
"administrative, financial, political and moral mess" that
he inherited from his predecessor, Martha Suplicy of the
Workers' Party (PT), and his priority has been to clean up
that "mess." He has managed to increase the municipal
coffers due to exacting collection of city fines. He is
generally believed to be honest and competent, but lacks
diplomatic flair when dealing with the public, and has not
yet produced the large-scale public projects and works so
popular with Sao Paulo citizens. Nevertheless, his
popularity with the people of Sao Paulo is rising, according
to recent polls. Furthermore, he enjoys a higher approval
rating at this point of his tenure than any of his five
predecessors. End Summary

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THE RECORD
----------

2. (U) Folha, the major liberal news daily, recently
reported that Serra's performance to date is mixed. Five
programs are in "process," including construction of
permanent buildings at schools that currently hold classes
in metal trailers; improvement and increase in hours of the
Unified Education Centers (CEUs), community-based education
centers which were the brain child of his predecessor; and
an exemption of electricity taxes for areas that do not
receive public electricity service. Nine other programs
have yet to see some "practical result" for the average Sao
Paulo citizen. The Sao Paulo Mother program, which existed
under the previous administration and provides pre- and post-
natal care for expectant mothers and free public
transportation passes for them, is currently under
reorganization with plans for implementation in the second
half of the year. The long-awaited "Unified Ticket" for
all buses, subways and trains in the city is still
undergoing a feasibility study, and will not likely go into
effect until next year. (Note: Currently, passengers on
public transport do not receive free transfers between the
various forms of public transportation in the city. The
"Unified Ticket" will be a considerable practical benefit
for millions of Sao Paulo's working class. End Note) Another
program still in the planning stages is the delivery of
medicine by mail. Currently, registration of participants
is underway, but delivery of medicine has not yet begun.
Folha stated that the one campaign promise that has been
"almost completed" is the resumption of 60 public work
projects that were interrupted due to lack of funds. The
contracts on 83 other works are currently under review.

3. (SBU) The clean-up of downtown Sao Paulo has received
considerable press attention. Serra and Deputy Mayor for
Central Sao Paulo Andrea Matarazzo are involved in a
widespread crackdown on crime in the dangerous center of Sao
Paulo. In recent months, post has reported on various
aspects of the clean-up program. The city has sponsored
public demolitions of pirated electronic goods, DVDs and CDs
and numerous police raids on vendors who sell contraband
goods in the center of the city (see Reftel C, D). The
police have been involved in the crackdown on drug dealers,
users and prostitutes in the area known as Cracolandia, or
"Crack Land." Police authorities have reported to Pol offs
that Serra is more cooperative in working with police on
crackdowns than the former mayor, Marta Suplicy (see Reftel
K). The Consulate enjoys better relations with the new
administration, compared to those with the administration of
Suplicy (see Reftel G).

PUTTING THE HOUSE IN ORDER
--------------------------
4. (U) Serra claims that he has not been successful in
fulfilling his campaign promises because he has been
involved in the "clean up" of the financial, administrative,
political and moral "mess" left by his predecessor, Marta
Suplicy. Press reports state that Serra has spent four
times more resources to payoff past administrations' debts
than it has spent on new investments (See Reftel A), and
claims that some of the city's major creditors will not
receive payment until 2012. While Serra's detractors claim
that the debt left by the previous administration has been
exaggerated and the municipal auditors claim that all fiscal
records from 2004 are in order, the Public Ministry is
currently investigating the books of the Suplicy
administration for over-spending. Due to an exacting system
of fine collection, Serra's administration has collected
five million Brazilian Reals in the first seven months of
his tenure, compared to 800,000 Brazilian Reals collected by
the administration of Suplicy in 2004. Fine collection
includes penalties for speeding on motorways, business
service taxes, penalties for illegal use of public space,
and fines for restaurant/bar irregularities. New toll lanes
on major beltways around the city will bring in revenue to
the city's treasury. Serra's administration has already
renegotiated the contracts of 12,000 city suppliers and cut
20 percent of city jobs, in an attempt to diminish nepotism.
His finance minister stated, "Our plan is to cut expenses
and increase revenue, but without raising costs to the
population." Despite the fact that Serra has yet to
institute all the reforms that he intended, the mayor's
popularity appears to be increasing.

POPULARITY ON THE RISE
----------------------

5. (U) Serra has enjoyed an increase in popular opinion in
the last few months. Datafolha, the Brazilian research
institute, indicates that Serra's approval rating has
improved since the last survey was taken by the agency in
April 2005. In April, 57 percent of those surveyed who
voted for Marta Suplicy (PT) in the mayoral race believed
that Serra's administration to date was "bad/terrible." The
more recent poll, however, indicated that only 36 percent of
those who voted for Suplicy evaluated Serra's administration
as "bad/terrible," a decrease of 21 points. And within this
group, the number of those who now believe that Serra is
doing a "great" job has doubled, from 6 percent to 12
percent of those surveyed.

DOING BETTER THAN HIS PREDECESSORS
----------------------------------
6. (U) Seven months into his mandate, Serra's approval
rating ranks above that of five predecessors. 30 percent of
those surveyed ranked him as doing a "great/good" job, while
23 percent of those surveyed stated that he was doing a
"terrible/bad" job. At the eight-month mark, Marta Suplicy
(PT) received a 20 percent "great/good" job rating, and a 35
percent "terrible/bad" rating. Her predecessor, Celso Pitta
(Popular Party of Brazil), received a 19 percent ranking and
a 36 per ranking, respectively, after 6 months in office.

THE PRESIDENCY IN 2006?
-----------------------

7. (U) The recent political scandal in Brasilia has
heightened the question of whether Serra will throw his hat
into the ring in the campaign for President in 2006. Last
week, Serra reportedly announced that a possible bid for the
Presidency is not a "priority," but neither did he deny it
as a possibility. Subsequently, he reiterated that he will
not campaign for the Presidency. Datafolha reports that 67
percent of those surveyed stated that they did not believe
that Serra should leave his post as Mayor to run for
President in 2006. (Note: Serra has served just over six
months of his four-year term as Mayor. End Note) According
to press reports, political scientist Fernando Abrucio
believes that if Serra leaves his current position to run
for President, he will lose credibility with those who
elected him and with members of his own PSDB party. He
promised during his campaign that if elected he would remain
in the mayoral seat for the duration of his term, and not
leave it to seek higher office. During the campaign, the PT
accused Serra of only seeking the office of Mayor of Sao
Paulo as a stepping stone to the Presidency. If he resigns
from his post to run for President, his Vice-Mayor, Gilberto
Kassab, of the Liberal Front Party(PFL), would assume
control over the city government.

8. (U) Recently, local media has emphasized Serra's
criticism of Lula's administration. Referring to the
monthly payments to Congressmen by the PT administration,
the heart of the current scandal in Brasilia, Serra
reportedly said that everyone has known about the payments
since 2003. This is Serra's strongest attack on the PT and
federal government since the crisis started. He is believed
to have said that the progress made by the former President
Fernando Henrique Cardoso's administration towards
strengthening democratic institutions in Brazil has been
pushed back towards "bygone sad years."

9. (SBU) Comment: Jose Serra enjoys a reputation as an
honest, hardworking and competent politician. He has spent
the first six months of his mayoral term in "putting the
house in order," and it is generally believed that he has
been successful in doing just that. He has not as yet,
however, developed large, "flashy" public projects and
programs, which the public generally greets with enthusiasm.
Serra lacks the personal charisma and grace of his
predecessor, Marta Suplicy (PT), and this deficiency has
received some negative press coverage by the Sao Paulo
media. Although he has not been able to institute all the
programs and reforms promised during the campaign, his
popularity among surveyed citizens appears to be increasing.
Serra's efforts to curtail the system of political favors
have made it difficult for him to get his programs approved
by Sao Paulo's City Council, and he failed to get a
political ally elected as president of the Council. Yet, it
remains to be seen if Serra will keep his oft-stated word
that he will not run for the Presidency and remain in the
mayoral seat for the duration of his three and half year
mandate, or if he will be again pulled into national
politics. End Comment.

WOLFE

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