Lula Leads Ahead of Brazilian Election

Paulo Sotero
Director, Brazil Institute of the Woodrow Wilson Center
Friday, September 29, 2006; 1:00 PM

On Sunday, Oct. 1, Brazilians head to the polls to elect a new president and congressional members as well as state governors. Incumbent President Luiz Inacio Lula da Silva has dominated the polls, despite an investigation into allegations of corruption by members of his government and the ruling Workers' Party.

Paulo Sotero , director of Brazil Institute of the Woodrow Wilson Center, was online Friday, Sept. 29, at 1 p.m. ET to answer questions about the presidential election and Latin American politics. Sotero is the former Washington correspondent for Estado de S.Paulo, a leading daily newspaper in Brazil.

Get more background on Paulo Sotero as well as background and recent headlines on the election.

The transcript follows.


Northern Va.: Bolivia's Evo Morales is intending to nationalize its gas fields, where Brazil has sizeable investments. Lula was criticized a lot by his own countrymen for being so weak with Morales, whom considers Lula as an equal ideological partner and a "big brother." Now Lula barely speaks with Morales, if at all.

Is there a true rift between Lula and Morales, or is Lula just playing to the crowd because of the pending election?

Also, what does Lula think of Venezuela's Chavez and Argentina's Kirchner? There has been historical animosity between Brazil and Argentina, and Chavez wants to be considered South America's "leader."

Paulo Sotero: The personal relationship between Lula and Morales has clearly soured. This is made clear by comments Lula made in private meetings with staff and businessmen that were leaked to the press. How that will impact decisions regarding Petrobras and other Brazilian interests, vis-a-vis Bolivia, is still to be determined. It is safe to say that Brazilian diplomacy will continue to be very careful when dealing with Bolivia and any immediate neighbor. Opinion polls suggest, however, that there is a clear expectation that a reelected President Lula gets tougher with both Morales and Chavez. Since the relationships and troubles between Brazil and its neighbors did not play much of a role in the presidential campaigns, I don't believe that Lula was playing to the crowd in the very few instances that the subject became a part of the electoral discussion.


Washington, D.C.: Mr Sotero,

It appears that the Brazil has fallen into the trend of recycling the same candidates for high levels of office. I believe that Lula's apparent reelection will pave the way for Serra, in four years. Do you think this is hindering Brazil as it continues the process of her young democracy?

Paulo Sotero: It could pave the way for Serra, or for Aecio Neves, or for a Lula-designated successor if he is a successful president in his second term.


Arlington, Va.: With the PT expected to lose seats in the legislature, which party do you expect to be the big winner?

Paulo Sotero: The PMDB is very likely to emerge as the most important political force from Sunday's elections. This is not particularly beneficial for the reforms that Brazil continues to need in order to maintain its hard-won economic stability. President Lula will be very dependent on the PMDB to form a governing coalition. Unfortunately, the PMDB is the party of the most traditional, conservative, and, as far as change is concerned, some of the most reactionary forces in Brazil.


Washington, D.C.: Dear Paulo, how do you think the absence of Lula last night in the Globo debate will affect his performance? So far, his strategy of "pretending" that nothing is happening, that there is no major corruption scandals going on and to keep himself "above" accusations, has proved to be working in his favor. However, the decision of not going to a debate that became classic in Brazilian presidential elections may lead some people to think that he is either too certain about his victory (which may cause disgust among the electorate) or so involved in large scale corruption that he would not have convincing explanations to give when faced by direct questions from his opponents. In this case, the debate was a step towards a second round or not?

Paulo Sotero: It is difficult to say. The latest polls indicate that there is some nine percent of undecided voters. If two thirds of them would move to one of the three challengers, it could be enough to force Lula into a second round. Right now, however, all indications suggest that the President stands a very good chance of wrapping up the elections this Sunday.


Rio de Janeiro, Brazil: Is Brazilian Media fair when presenting corruption news regarding Lula's Government and FHC's and Alckmin's Governments?

Paulo Sotero: Yes. Journalists in Brazil work very hard to expose the misdeeds of those in power and have contributed mightily to making Brazil a better, more democratic country. The frequency and quantity of corruption scandals revealed by the media may be discouraging at times, but it is much better to have the wrongdoings exposed to the people than the alternative--which would be continuing to sweep scandals under the rug. The fact that most Brazilian journalists were said to be PT-sympathizers four years ago, and that the media is now exposing allegations of wrongdoings by petistas, makes clear in my view that Brazilian journalists are, by and large, fair in their reporting.


Arlington, Va.: I recently read that Brazil's homicide rates are comparable to civilian death rates in war zones. How important of a priority is violent crime for the candidates, and in voters' minds? Is Lula seen as being effective in fighting crime?

Paulo Sotero: The information you referred to comes from reports of one week in May, when more people were killed in the city and state of Sao Paulo in a confrontation between organized crime and police, than in Baghdad during that same week. Although paramount in the public mind, the subjects of public safety and crime were not an important part of the electoral campaign. Geraldo Alckmin, who received good ratings in Sao Paulo for getting tough on crime as governor, was put in a very vulnerable position by the violent prison riots and assassinations ordered by incarcerated leaders of organized crime groups. President Lula initially tried to use the issue politically, but hesitated and ended up not taking advantage of the situation in Sao Paulo for political gain.


Pittsburgh, Pa.: Boa tarde! What are Brazil's chances nowadays for snagging a potential permanent seat on the United Nations Security Council? How might the outcome of Sunday's election make a difference?

Paulo Sotero: The chances now for Brazil gaining a permanent seat are smaller than they were when Lula was first elected. The reason is that the subject is not at the top of the current agenda of the United Nations. The historic rift between China and Japan remains the main obstacle for Security Council reform. China has vetoed the inclusion of Japan in the Security Council, which is supported by the United States and many other nations, including Brazil. Until that issue is resolved, the discussion over Council expansion (and Brazilian membership) will remain in the backburner. For Brazil to go back to this issue, I believe we are going to have to revisit the question over regional leadership. Although Brazil claims the right to a seat on its own weight, it is clear that the support of the rest of Latin America remains a key element for success.


Washington, D.C.: I understand that the corruption scandal hasn't affected Lula, but that isn't that surprising given his personal popularity. What about the seats the PT holds in congress, though? Are those in danger?

Paulo Sotero: The President, who is a very good politician, has been able to separate himself from the accusations by blaming his party. Actually, he blamed the president of the PT and some close aides as being personally responsible for the "dossier" scandal that erupted last week. I believe that the reason the President was successful in this political maneuver has to do with the fact that he delivered on his main promise to poor Brazilians. Under his government, the poorest 10 percent of the population saw their income increase by more than 23 percent. The poorest 20 percent by 15 percent. Poverty levels fell by 19 percent, which is the largest poverty reduction in Brazil in three decades. All indications are, however, that voters will make the PT pay in the polls. Current projections suggest that the party will lose a significant portion of its delegation in the Chamber of Deputies. Of Lula's 11 former ministers running for either governor or senator, not a single one is expected to win. If you consider the parties that formed the political base of Lula's government since 2003, their representational weight in state governments will decrease from 20 percent of Brazil's population and GDP to about 9 percent of population and 4 percent of GDP.


Washington, D.C.: What happened to Fome Zero?

Paulo Sotero: After a false start it was restructured and consolidated with other income transfer programs that President Lula inherited from President Cardoso. It was renamed Bolsa Familia, and from all accounts it became a much more comprehensive and better program. It now reaches 70 percent of eligible beneficiaries. There are questions about how efficiently it is being run, but the program now seems to be successful--at least from the perspective of its many beneficiaries. Can it be maintained? It probably can, but it runs the risk of being turned into one more paternalistic program of permanent assistance, which was not the original objective. A point of clarification. Bolsa Familia started as Bolsa Escola in the Federal District of Brasilia under Governor Cristovam Buarque, a former petista who is now running against Lula. President Cardoso made it a federal program, and President Lula expanded it even further. This is one of many examples showing that continuity works in Brazil.


Atlanta, Ga.: Paulo-

Can you tell me how much support Lula may have gotten from State Governor's? Here we can understand that a Republican Governor will support a Republican Presidential candidate. Is this the case in Brasil? For example have Aceio Neves, the Governor of Minas Gerais, supported a candidate publicly?

Paulo Sotero: Governors have a vested interest in establishing a good, working relationship with Brasilia. Until the latest scandal, which involved a smear campaign against Jose Serra, the PSDB candidate who is likely to be elected governor of Sao Paulo this Sunday, there was an expectation that Serra himself and Governor Aecio Neves of Minas Gerais--who is certain to win reelection--would work out some sort of pact of governability with President Lula. This is not in doubt, particularly as far as Serra concerned. Regarding other states, the President will have less problems, since many of them will be governed by politicians of the PMDB, that is bound to develop good relations with the Planalto. On the campaign trail, it is worth noticing that the governor of Ceara, who is from the PSDB of Serra and Neves, abandoned his party presidential candidate Geraldo Alckmin and threw his support behind Lula. Ironically, he is now fighting for his political life as his challenger, supported by Lula, has made a strong comeback and is now threatening his bid for reelection.


Fortaleza, Brazil: The U.S. media have given scant attention to the Brazilian elections, aside from an occasional feature story such as the recent one in The Post, which was very favorable towards Lula, but the interest of the American public in elections overseas is pretty small unless it involves a war and/or a picturesque radical such as Chavez. I¿d guess that most Americans think Brazilians speak Spanish and have no idea of its economic impact on the U.S. (e.g., oranges), nor what role the U.S. has played in Brazil's history (e.g., backing the 1964 military coup). How important is the election to the U.S.? Has the American government pretty much accepted Lula as a relatively moderate counterweight to the more extreme leftist leaders in Venezuela and Bolivia?

Paulo Sotero: The U.S. media does not normally pay attention the elections in other countries, unless it directly involves U.S. interests. Considering that Brazil represents less than one percent of the world economy and one percent of world trade, I believe that the coverage has been quite adequate. I would disagree with your views on what Americans think about Brazil. They know what we project as a nation: the good and the bad. Many Americans know that they now travel on planes built by Embraer, a leading Brazilian company. The idea that most Americans think that Brazilians speak Spanish is cliche. When I hear questions like yours, I am always tempted to ask how much Brazilians really know about the United States and the rest of the World. Probably much less than we should! Our election will be as important for Americans interested in international affairs as we make it to be. One aspect of the election that is likely to be highlighted is the fact that, thanks to American technology and Brazilian ingenuity, we will again have a very orderly day of voting and that in the end, 90 percent of the 125 million votes to be cast will be counted that evening. Because of the decentralized voting system in the United States, this is a problem Americans continue to struggle with.


Silver Spring, Md.: Corruption scandal? Shouldn't that be scandals? There have been several, from menselao to the latest attempt to one official caught at an airport with his underwear stuffed with money to the latest attempt by PT officials to buy material damaging to their opponent in a state election. What of the view that the worst result of the scandals has been the discouragement on the part of the general populace, who thought that Lula would be different than past corrupt politicians, but now feel that everyone does it so nothing can change. Some feel that Lula is a nice guy and, since every administration is crooked, his is no worse so why note for for him (reminds me of Ronald Reagan).

Paulo Sotero: The apparent apathy of Brazilians in the face of so many scandals may have to do with another challenge we face as a country: impunity. Having benefited from Lula's first term, the majority of Brazilians may have concluded that it would be somewhat hypocritical to get serious on corruption right now, especially when a man that looks and talks like a regular Brazilian is in power. I also believe that the opposition made a huge mistake last year when it decided to use the scandals politically against the president, and let him bleed instead of openly pursuing the cases based on their merits. Putting the scandals in the political instead of judicial arena gave Lula the chance to deal with them politically. Being an adept politician, Lula bested his opponents.


Curitiba, Brazil: Was FHC cleverest than Lula in "sweeping his scandals under the rug", to use your expression? Or what's the difference between the two on this matter (scandals)?

Paulo Sotero: Under President Cardoso there were only two serious allegations of corruption. The first one was the so-called Cayman Dossier, which was pursued by parts of the media for two years and proved to be rubbish. There were also allegations of buying the support of two congressmen to approve a constitutional amendment to allow the president to run for reelection. This was investigated but never proven. The amendment was approved by a margin of much more than two votes, with overwhelming public opinion support. Another allegation involving Finance Minister Pedro Malan and an investment bank Banco Marka was completely disproved. I believe that FHC's mandate was not paralyzed by allegations of corruption because, simply, they were almost non-existent when compared to what Brazilians learned in the last 18 months.


Atlanta, Ga.: Sir, can you tell me of Lula's support apparatus and how it works delivers in the father reaches of rural Brasil (i.e., northeastern, Acre, etc.). How can a candidate from Sao Paulo possible compete there?

Paulo Sotero: The PT, which started in Sao Paulo, is becoming a party like any other that governs Brazil. By dispensing government benefits they were able to expand their base of support in the poorer areas of the country, especially the North and Northeast.


Sao Paulo, SP, Brasil: Mr. Sotero,

What do you think if the President Lula win this election amid so many cases of corruption? Can he has succeed in manage a huge government to sustain himself and an allied base?


Paulo Sotero: This will be precisely the challenge President Lula will face. The shadow of corruption will be over him and his administration. The President has suggested in some speeches that his victory should resolve the allegations of corruptions. He actually said that the voters would respond to the accusations in the ballot box. I believe, however, that the voters will mainly be responding this Sunday to the positive news that President Lula brought to the majority of poor Brazilians, ironically, by keeping and continuing and deepening the policies of his predecessors relating to economic stability. I doubt that the voters will be rewarding the populist posture that the President has recently assumed as the scandals have worsened.


Naugatuck, Conn.: What is the current Brazilian fiscal standing, deficits, foreign debt, inflation, interest rates? Can the value of the real be sustained? Can a victory by the opposition put in place policies to put it in danger? How significant is the recent declaration of independence from foreign sources of oil?

Paulo Sotero: Inflation is lower than in the United States. The fiscal house is in relative order, but the quality of the fiscal adjustment has worsened. Brazil now has one of the highest tax burdens in the hemisphere--higher than in the United States. As far as external vulnerabilities, the situation has improved. The net external debt is around 70 billion. The dollar-indexed instruments of the domestic debt represents a very small portion of the total, but the growing public indebtedness remains a huge constraint. It has limited the capacity of the Central Bank to lower interest rates, which although declining remain among the highest in the world in real terms. In order to get out of this track, Brazil needs to continue to pursue structural reforms in its social security, labor laws, tax system, etc. The difficulty is that the political arrangement likely to emerge from Sunday's elections does not bode well for the success of those reforms. Although less vulnerable to external shocks, the Brazilian economy is much more globally integrated that it used to be and a worsening of the international global market would certainly be felt within the country. President Lula has been lucky in the sense that he governed so far under very favorable international economic conditions.


"The idea that most Americans think that Brazilians speak Spanish is cliche.": Is the Brazilian government involved in any way (read: financially) in promoting the teaching of Portuguese in American high schools? I believe Portugal (or at least the Azores) has done a little. After all, Portuguese is more spoken in the world than the more commonly-taught French, German, Russian and Italian.

Paulo Sotero: Many U.S. universities offer Portuguese language programs. More importantly from the perspective of someone that lives in Washington is that the Brazilian Embassy, with support of the Brazili Institute of the Wilson Center, has just launched an initiative to promote the study of the United States in Brazilian universities.


Sao Paulo, Brazil: That's a shame! The promising country, once more in the wrong hands. When we going to learn? I am afraid of the answer because they are the people in charge to get us educated, to make investments and create conditions to us, from the people, to be able to have our own thoughts. Pit to be under such fraud as a person, as someone who likes to be known as a humanist (self-declared), with socialistic-tendencies, honest (close your mouth), has show him self as a truly incapable to run this massive country called Brazil, a coward (for not coming to the debate occurred yesterday) since I was an innocent child I remember hearing this very man appearing in all opportunities in TV, but not now, he is not doing nothing for our future, but his own and his family, blood is thicker than water. No education bases had been restructured, no political reforms or one legacy, at least from the good. What is really painful is to do not have anyone to trust in, is sad but true. People get less than US$ 30,00 per month, people can finance the furnish of their "houses" and that is enough to them to vote for Lula. It is no news that the most of Brazilian are poor, that explains a lot, doesn't it? In any moment I would wish to had born in same other country, maybe to be colonized by an Anglo-Saxon country, but I desire with all my of my soul we could have people enough decent to trigger out changes in the system to it not can be called evil anymore. For now that is all we can do, blame the system.

Paulo Sotero: I disagree with your evaluation. Brazil is a democracy facing the challenges of a democracy. Think for a moment about what is going on in the United States in relation to the War on Terror and the conflict in Iraq. In 2003, most Americans supported the invasion of Iraq. Today, most Americans are convinced that it was a bad idea. The United States prides itself on being the country of democracy and freedom. And it is. But just this week, the U.S. Congress approved legislation sanctioning acts and behavior that would be construed as torture under the Geneva Conventions. This issue has generated serious criticism from Congress and in the press. It is not a good week for democracy in the United States, but it is democracy at work.


Salvador, Brazil: Given Lula's storied history as a campaigner for human rights and a person of the people, oftimes against the abuses of the government, why hasn't Lula been more forceful in taking on this issue and combating corruption? It would seem to me that he could go down as a truly great President if he were to begin to put the system in place to reverse the rot of the political system here that is corruption. He surely knows that corruption is the undertow that prevents the implementation of policies that will benefit all Brazilians and increase living standards here over the long term.

Paulo Sotero: Corruption is a consequence of arguably more pressing concerns, such as lack of the rule of law and virtual impunity. You are right. The President, if reelected, still has the opportunity--and I would add--the responsibility to face those difficult questions. If he does, he can still salvage his reputation and leave a positive legacy for Brazil. But he could also go the route of another famous union leader turned politician: Lech Walesa. Like Lula did for Brazil, Walesa helped democratize Poland. Later, like Lula again, he became president of Poland, but did not govern well. Today he is seen as some sort of joke.


Anonymous: Why do candidates with 1% or less support, such as Ana Maria Rangel, keep running? Do they not get discouraged? By the way, who IS she (I just saw a brief mention in a poll).

What is the role of the PRONA party? Does it really have ties to Lyndon Larouche?


Paulo Sotero: One positive development in the current election is the adoption of a minimum threshold for political parties' representation in congress. The parties that are unable to reach five percent of the national vote will not be allowed to have representatives as chairmen of congressional committees. It is estimated that this law will force the current 25 plus political parties to coalesce into six or seven major national ones. This is a positive development for democratic deepening in Brazil.


Cleveland, Ohio: How do you rank the program that fund poor families with some monthly stipend in providing Lula a 70% intention of vote from the Northeast population? On the one hand, this program can be great for the country, in that it come with family incentives for health and education goals, but, on the other hand, at least in election times it is hard to dissociate it from the old plague of "assistencialismo".

Paulo Sotero: I share you concern about assistencialismo. Programs like Bolsa Familia are good to the extent that they offer a way out of poverty. They open doors and include people in the economy. But only a growing economy capable of creating sufficient jobs will guarantee social mobility in the long run. That is what Brazil needs.

_______________________ Thank you all for joining us today.


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