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Issue 33, December 1998

A Safe Pair of Hands?

AT THE IMF meeting in Washington, spontaneous applause greeted the announcement of Cardoso's first round re-election. A stronger vote for Lula (candidate of the Partido Trabalhadores - PT) would have raised the spectre of default on Brazil's loans, so this was a sincere feeling of genuine relief on the part of these financial vampires. If Cardoso had got 5% less than his 51% final vote, there would have been a second round run-off.

During the weeks before, applause of a different kind had erupted as Lula was endorsed at factory-gate meetings held by the metal workers union in the ABC industrial area, hard hit by firms moving to cheaper-labour regions, and where the left CUT union has a strong base. A run-off in the midst of an economic crisis, with the IMF 'seeking assurance' of cuts, could have mobilised Lula's 30% vote and added the other 10% protest vote into a close-fought second round.

Even in the factories of Sao Paulo, where the yellow union dominates the metal workers, the leaders did not have the guts to go against the mood for Lula. As they went around the factories - the bosses allowed work time meetings to promote their candidate for congress - support for Lula was greeted with spontaneous and general applause. And that is after the bosses have spent 10 years systematically hounding out PT and CUT militants from the factories to keep the right-wing union in power. Lula also had the support of the landless rural workers' movement.

When Cardoso was elected in 1994 there were still illusions in the market. He privatised dozens of companies without mass opposition (most of Brazil's state sector had been nationalised by the military dictatorship). The media now claim he has a mandate to maintain the Real Plan (which reduced inflation and stabilised the currency).

The lowest-paid and unorganised workers did get some benefit from the Real Plan. With inflation at 80% a month by 1993, they were reduced to buying rice, beans, cooking oil and maybe some sausage on pay day. Then with currency stabilisation chicken sales doubled. More people were able to buy a TV or fridge, on long-term payment schemes not possible before.

  But from October 1997 people began to pay for the 'Asian contagion'. Unemployment almost doubled in six months. Cardoso's initial sheen as a reformer wore off. There were pay-offs and shady dealings with corrupt political bosses in an unsuccessful attempt to push through so-called 'reforms' - pension cuts and public sector lay-offs. Cardoso presided over murderous police attacks on the landless labourers' movement (attacks he criticised but effectively did nothing to stop).

In May of this year polls had Cardoso and Lula neck-and-neck. Part of the bourgeoisie bought air time for Ciro Gomes, who had been a minister in the government before Cardoso. He played a two-way tactic by draining off voters crossing from Cardoso to the PT while preparing for a future alliance with the PT on a nationalist platform. He got 10% of the vote after appearing with Lula in the last week of the campaign, denouncing the media and capitulation to the IMF.

The worsening economic crisis and fears for employment, brazen media manipulation and an unclear alternative offered by the PT, pushed the undecided behind Cardoso. Even so, Lula got a higher first-round-vote than in 1989 or 1994. His campaign programme was marked by support for land reform and an end to the privatisation process. At one stage he was committing himself to creating millions of jobs but then dropped that in favour of a general 'more social justice' approach, to be paid for by tightening up on tax evasion.

Some PT advisers wanted to go for a Blair-type campaign but it wasn't feasible. How could Lula not be seen to support the struggle of the landless workers? There were few mass meetings, but on TV Lula attacked the elite and the bankers: 'If I have to choose between paying the interest on the foreign debt or starving the Brazilian people, there's no doubt that I will choose the people'.

Cardoso is president but he has no party majority in congress. With the difficulties he has in getting the venal and weak right he depends on to support unpopular measures without expensive pay-offs, he will attempt to look to part of the PT for 'national unity'. There are undoubtedly some PT leaders who would like to move in this direction. But the mass movements of the landless labourers, led by the MST (Movimiento Sem Terra), indicate that at least part of the PT and CUT would resist moves in this direction, raising the possibility of a crisis, even a split, in the PT.

Primo Diaz

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