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The different Lula who assume the presidency of Brazil this Sunday

This Sunday Luiz Inácio Lula da Silva assumes the Brazilian government for the third time. It is a historical fact because there is no record of a similar frequency in the power of the second hemispheric economy. But it is also, and especially, due to the importance of this continent country whose borders touch almost the entire region and is a headlamp for the fate of neighboring nations.

It is inevitable, then, to observe what happens here if one wants to intuit the future of the rest of the common space. But this novelty happens not in the best moment of Brazil, nor that of its environment. The range of ominous phenomena that hover over the next government is extensive and it is not clear if this political veteran you can control them.

The ceremony of the first of January is marked by this circumstance. Symbolic but eloquent, unlike in his two previous governments, Lula will take office surrounded by an extraordinary shield of security and forced to thank the crowd locked in an armored vehicle because the polarization in Brazil emerges with levels of terrorist danger.

The police have already deactivated a powerful bomb thrown towards the airport in a tanker truck, data only from these extremes. In this dystopian Brazil there are still important manifestations, in number and structure, of middle-class people who claim a hit that prevents the coronation of the former president.

Difficult to find antecedents of a society with minorities longing for the rupture of the institutional cycle as long as they don’t see a politician they hate in charge of the country.

For Lula, this scenario contains a serious question. Nobody knows if these desperate demonstrations are the death rattle of a cycle or the prologue of a time to come. Outgoing President Jair Bolsonaro created an environment of social fracture, modeled in detail on the one built in the US by Donald Trump, who attempted a coup on January 6 taking the Capitol with his militias to prevent the assumption of Joe Biden. coincidences.

Bolsonaro, like his New York friend, revolves around the complaint without evidence of an alleged fraud in the elections that toppled him from power and shares the populist contempt for alternative discourse. Like the North American tycoon, the former captain of the Brazilian army is not a liberal, nor a republican in the true sense of the term.

So he ignores the institutional importance of the transfer of command. That is why he will not be fulfilling the necessary symbols this Sunday. In the same way that Trump did not at the time or Cristina Kirchner in Argentina. For populist thought there is no significant other. Only their own have rights.

Equipment. Lula with his vice president Geraldo Alckmin and senator Simone Tebet, the liberal arms of his government EFE

Lula is aware that his most complicated government was born, which he arrived at with a scant victory of 1.8% of the votes. That absence of a determining difference it is a data of fragility and he is the one who supports the story of fraud of the street coup hordes.

At the same time, it explains the overwhelming need for strong back-and-forth negotiations with a voracious opposition that controls Parliament, a power that, due to its Brazilian peculiarities, It is central to guaranteeing the governance of the administration.

​strategy games

In all his electoral campaigns, Lula has followed a kind of recipe. He militated from a left-wing format, sometimes tumultuous, and then ruled from a pragmatic center. He did it on a campaign to convince the abandoned masses that he embodied the solution to their hardships. And he complied. But then he maintained an almost obsessive control of the numbers of the economy. It was Lula 1.

This time, however, things were reversed. Lula sought the presidency at the head of a broad center-right coalition and with a speech that rescued his eight years of fiscal surplus, high employment and growth that led to Brazil from 14th to sixth place in the world indicatorhe.

But since he defeated Bolsonaro by the minimum, his speech seemed to seek that anti-system Lula and provocateur of the first campaigns that evoked the ravages of the government of Dilma Rousseff. The Lula 2.

The radical Bolsonaristas in the camp in front of the army barracks demanding the coup.  PA

The radical Bolsonaristas in the camp in front of the army barracks demanding the coup. PA

This self-referential construction generated confusion, at times exaggerated, especially in the sensitive accumulation system of the country, the Stock Market, finances, companies and people, what we generally define as the market.

There was a shudder in stock prices and the dollar following every word of Da Silva, particularly when unnecessarily put the fiscal order in collision with social assistance programshim, as if one impeded the other.

In that order, less than a multi-party “Big Front” as proclaimed, it built a cabinet with an enormous presence of the hard core of the PT, which not necessarily modernized and from where he extracted his Minister of Economy, Fernando Haddad.

He did it by discarding his friend Henrique Meirelles, who was the one who was delighted with the markets. He was not going to allow the minister to be appointed who never questioned Bolsonaro’s fiscal untidinesshas reproached the PT in privacy.

Those sectors of the PT they do not recognize as a deficit the slight electoral difference that consecrated the government; They do not intend to cede shares of power to their allies, nor do they accept the idea that this present is so different from the one that accompanied the success of those two previous administrations.

They still assume, in this sense, that it should be the State that regulates and manages growth. That is why there are stock market tensions and some jumps in the dollar.

Lula’s radical offensive moderated when, just a few days ago, Parliament accepted his budget and authorized additional public spending of 145 billion reais, around 30 billion dollars, above the legal ceiling allowed.

Enough figure to finance social assistance to just over 20 million needy families, women heads of household and poor children under five years of age. A seat belt for a social bomb that had it not been guaranteed, it would have condemned the new government to stillbirth.

The Lula three

With these endorsements, Lula began to distribute signs and set up a corral for his own falcons. The Lula 3. Along these lines, he appointed the Ministry of Planning, which deals with the application of the budget, but has a wide range of intervention in matters of critical public spendingor, to the right-wing senator Michelle Tebet. A liberal, culturally conservative politician and farmer, well in tune with the powerful agribusiness sector and the financial system.

Lula da Silva raises the hand of Fernando Haddad who was fighting without luck for the governorship of São Paulo.  She is now his right hand in the Ministry of Economy.  Reuters

Lula da Silva raises the hand of Fernando Haddad who was fighting without luck for the governorship of São Paulo. She is now his right hand in the Ministry of Economy. Reuters

In Industry he placed his vice president Geraldo Alckmin, also a pragmatic liberal who has winked at banks and finance companies since he competed with Lula for the presidency in the first decade of the century. that closes a lock of counterweights in the economic equipment.

A construction of concessions that Haddad – say his relatives – still finds it difficult to defer despite the fact that he himself is also a pragmatist. But Lula likes to have the last word in any contingency.

All in all, just as no one knows the fate of far-right radicalism, it is also not clear whether the new government will have management space in a first year that It is announced difficult due to local circumstances but also international ones.

The new president sought to guarantee social assistance, because he deduces that he will have to balance the screws of the economy, among other things, by returning the taxes that Bolsonaro withdrew to improve his electoral image. That is called adjustment and it usually hurts those who are forced to exercise it.

Meirelles, who never attributed to the right-wing leader a minimum of liberalism as he claimed, denounced a couple of months ago that the fiscal debt left by this management is around 400 billion reaisalmost eighty billion dollars, more than 4 points of GDP.

The next government will not be able to escape that sword. That is why Meirelles has just suggested to Lula in a column in the press that urgently announce a fiscal anchor. That is to say that the new president does not fall into the error of believing that he is enough to reassure the past image of prolixity of him.

Correcting the equation will imply an impact that can be read in the wallet of the powerful Brazilian middle class who half voted for Lula only because he despised the misogynistic right-wing leader more. It will remind you when things hurt.

It is at this point that another instance of the panics of the money owners. If the government is cornered it may be tempted to try to amplify public spending and re-radicalize to achieve it.

If it does, it will produce an initial beneficial impact on productive activity, but it will be ephemeral, will trigger inflation, interest rates and debt with falling employment. The nightmare that destroyed the Rousseff government, whom Lula chose to succeed him and whom, not coincidentally, he never mentioned in the campaign. Difficult to assume that it was an oversight.
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