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New dawn in Brazil

By electing Luiz Inacio Lula da Silva with a huge majority, the Brazilian people have overwhelmingly rejected the "Washington consensus" and given a huge boost to Latin America's burgeoning emancipatory movement.

December 1, 2002
6 min read

“Lula was elected with the highest number of votes [for a single candidate] in world history.” This was the opening statement of the edition of Fantastico broadcast on Brazilian TV on Sunday, October 27. Earlier in the day, more than 52 million people had voted for former metal worker Luiz Inacio Lula da Silva in the run-off in Brazil’s presidential election, thus electing Lula as the country’s leader for the next four years.

So, why did 62 per cent of the Brazilian electorate choose Lula? Simply because they are tired of becoming poorer, of seeing their purchasing power steadily decreasing, of living in a society ever more polarised by extremes of wealth and poverty. Brazilians have finally made the connection between their plight and an economic model that only benefits the rich and foreign enterprises. They are now rejecting the continuation of the neo-liberal reforms put in place by the administration of Fernando Henrique Cardoso during the previous eight years.

Brazil is a post-colonial country. Its population carries a heritage of 380 years of colonial domination and slavery. Its elite is racist, machista and very conservative. Its people are trained in submission and dependence. This makes Lula’s election even more significant. It corresponds to the triumph of a post-neo-liberal insurrection.

Former trade union leader Lula was born in the poor north-east of Brazil. At the age of 13 he travelled with his family in the back of a truck from Pernambuco to the city of Sao Paulo. He knows what poverty and hunger mean. And his deepest commitment is to the large numbers of Brazilian people who still suffer those ills.

Lula is the first worker-president. There has been no one like him in the politics of the Americas since Abraham Lincoln. He represents a re-opening of history, a break with the one-thought-one-way model that has prevailed in the globalised world over the last two decades. By electorally rejecting neo-liberalism, the Brazilian people have asserted their aspiration to regain control over their history and development. Social, political and ideological debate and intercourse are once more the variables of a history in the making. And Lula’s victory empowers the dream of liberation of other Latin American peoples.

Dangers and opportunities

Those who have reaped wealth and power from the denationalisation and decapitalisation of Brazil are now expressing their fears and concerns. These people and institutions are the national and international bankers and financiers, the trans-national corporations and large landowners, the politicians and controllers of the mass media and the upper-middle class who have been enriched by ownership and not by their working.

In the run-up to Lula’s victory, they tried to destabilise the Brazilian economy by massively withdrawing foreign currency from the country, forcing a quick fall in the value of the Brazilian real and blaming Lula’s popularity for the devaluation. But nothing could deter the expansion of that popularity.

These national and international elites may now attempt to compromise Brazil’s governability — quietly encouraging economic and financial destabilisation. They hate the idea that capitalism is incompatible with genuine democracy and respect of human and social rights.

In the meantime, Lula presents the essence of his mandate as transformation not through war and conflict but “peace and love”. He is working to build a broad social pact around this project. Those who gain through financial speculation as opposed to productive investment are convinced they will lose their privileges. Speakers for Lula’s Workers’ Party remark that those who are willing to respect the right of the Brazilian nation to run its own socio-economic development project and who wish to adapt their corporate strategies to the priorities of that national project will soon realise that the new Brazil is a hospitable and promising place to invest.

Lula’s first priority is to eradicate hunger and malnutrition. To do so, he will need to adjust the economy in innovative ways — moving away from the policy of making debt payments the government’s first economic priority. He will also need to affect the country’s deeply unfair income and wealth concentration by means of progressive tax and effectively participatory agrarian reforms. None of these measures is highly revolutionary. They can simply make capitalism more socially and humanly efficient. They also have the potential of fulfilling Lula’s promises for sustained economic growth and high employment. But he will need to build a broad political alliance in order to face down the inevitable pressure from the IMF and the international creditors. He will also need the support of organised society as a whole.

Brazil and the rest of the world will soon be reminded that finance and trade are not ends in themselves. Rather they are means of promoting the satisfaction of human needs and social and human development — ideally through sustainable production.

The Lula administration will soon have to engage in hard negotiation with the creditor banks (Morgan, Citicorp and a few others) that hold the main Brazilian and Latin American debt bonds. Creditors and investors have no moral right to lead a country to bankruptcy. And Brazil’s project of rekindling economic growth and satisfying social needs is incompatible with the annual transfer abroad of more than $50 billion and the payment of over $70 billion to internal creditors.

Increasing the purchasing power of wages, ending the seven-year freeze on public sector pay, granting incentives to the solidarity economy (the small and medium enterprises and family agriculture), promoting agrarian reform, launching social programmes such as zero hunger tolerance — these are all priorities. The new government must prove from the start that it will make social problems its principal target.

Lula’s administration will also be an inspiration for the massive emancipatory movement in Argentina and elsewhere in Latin America and the Caribbean. Its success will boost the hopes of an integration of the continent that is based on the respect for national sovereignty and cultural identity, co-operation and solidarity. And it will strengthen the large international movement against neo-liberal globalisation. To quote the motto of this year’s World Social Forum, “another world is possible”.Brazilian economist Marcos Arruda is a researcher, educator and consultant at the Institute of Alternative Policies for the Southern Cone of Latin America, and a fellow of Amsterdam’s Transnational Institute. His books include: “External Debt: Brazil and the international financial crisis” (Pluto and TNI, £12.99)

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