BRAZIL: Growing Criticism of Lula Within Left

By Mario Osava Reprint | | Print |

Mario Osava

RIO DE JANEIRO, Jun 16 2003 (IPS) - The leftist government of Luiz Inácio Lula da Silva in Brazil has begun to draw criticism from within the ranks of those who backed the election of the president, a former trade unionist, last year.

A group of more than 200 economists issued a statement Friday expressing disappointment in the economic policies followed by the president, known as Lula, and his economic team.

”Brazil is being led down a blind alley of stagnation and unemployment by an economic policy that has capitulated to the totalitarianism of the market,” states the document signed by the economists who met last week in Brazil, including many long-time militants of the leftist Workers’ Party (PT) founded by Lula in 1980.

But ”there is an alternative” that would lead to prosperity for Brazil, says the document, which was titled ”The Forbidden Agenda” due to what the authors called the ”suppression” of the debate on economic policy by the ”dogma of the wise and virtuous market” which ”does not discuss and debate, but only threatens.”

In order to overcome record-high unemployment in Brazil, which the economists described as ”the direct result of restrictive monetary and fiscal policies,” they proposed seven measures, starting with ”controls on foreign capital and controls to hold the exchange rate at a level that is favourable to exports.”

Other recommendations are fiscal restrictions, an increase in public spending with priority put on social questions, a ”significant reduction” of interest rates, more public and private investment in sanitation and infrastructure, and incentives for exports.

The proposals run counter to the economic policy followed by Finance Minister Antonio Palocci of the PT, and Central Bank President Henrique Meirelles, FleetBoston Financial Corp.’s former CEO of global banking.

The authors of the document said that moving towards full employment is key, because that would pave the way for solutions to extremely pressing social and economic problems like poverty, inequality, marginalisation and violent crime.

In addition, they challenged ”those who hide in the shadows, behind the omnipotence of the market-God,” to engage in open debate.

PT leaders in the government also came in for criticism when 20,000 public employees held a protest in Brasilia on Jun. 11.

The demonstration, in which PT leaders were the targets of catcalls and jeering, was held to protest a social security reform that is moving through Congress, which would severely cut the pensions of public employees.

The amendment would push up the minimum age of retirement by seven years, to 55 for women and 60 for men, and would put an end to the greatest advantage enjoyed by civil servants in Brazil: a pension that is equivalent to their last paycheck.

The likelihood that the pensions reform will be approved by Congress within the next few months has triggered a wave of applications for retirement, especially among public university professors who are old enough and have worked the necessary number of years to retire, and who want to do so under the current social security scheme.

Some university rectors fear they will lose up to 30 percent of faculty-members. They are also worried that the retirement of massive numbers of professors could drive their schools to the verge of collapse, given the serious difficulties already being faced after seven years of no wage hikes for public employees, with the exception of the armed forces and a few other sectors.

The proposed social security reform would aggravate a policy applied by previous governments that ”deteriorates the public services, and thus goes against the interests of the entire population,” Professor Anselmo Luis dos Santos at the State University of Campinas, a city near Sao Paulo, told IPS.

A number of PT lawmakers have announced that they will not vote in favour of the bill. Senator Heloisa Helena and parliamentary deputies Joao Batista Araujo and Luciana Genro have become emblems of the rebellion against the party line on that question, and have even been threatened with expulsion.

But at least 36 PT parliamentary deputies – one-third of the party’s representatives in the lower house – took part in the Jun. 11 protest against the social security reform, indicating the depth of the divisions within the ruling party.

A week earlier, on Jun. 5, several of the PT’s leading intellectuals said their hopes in the Lula government had died, during a meeting in the University of Sao Paulo, a traditional centre of political struggle and an institution that has produced many of the country’s leftist leaders.

The government ”has kissed the cross of orthodoxy” and ”was converted in 48 hours,” abandoning 20 years of PT principles, according to philosopher Paulo Arantes.

And in the view of sociologist Francisco de Oliveira, a member of the PT from the party’s earliest days, ”The struggle is over,” and the continuity of the previous government’s economic policies has won out, while calls for change have lost.

Dos Santos, on the other hand, told IPS that while there are economists and intellectuals who think that there will be no change in the country’s economic policies, ”I still believe that the door has not been closed to any alternative,” and that the options will become more clear over the next six months.