Reelected, Rousseff Promises She Will be “A Better President”

October 28, 2014

Paulo Sotero – Brazil Institute, 10/27/2014

A narrow victory after a divisive campaign leaves a weakened leader with few options to revive Brazil’s slowing economy

President Dilma Rousseff’s narrow reelection last Sunday gave her a political victory without a clear political mandate. A highly negative and bruising campaign marked by personal attacks and allegations of corruption exchanged between Rousseff and her challenger, senator Aécio Neves, left a divided and angered public wondering whether the government and the opposition, which includes the vast majority of the business community, will be able to reconcile their differences and work together to reignite a paralyzed economy and put Brazil back on a more promising path than it has been on in recent years.

Rousseff received 51.65% of the votes, or 54.5 million, against Neves’ 48.69%, or 51 million, in the narrowest victory by a candidate in the seven presidential elections Brazil has held since the 1980s. Her triumph became clear only after 80% of the votes were counted.

Speaking to supporters, she said she did not believe the elections had left the country divided and called for dialogue. “Sometimes in history, tighter election results produce stronger and faster changes than ample victories,” she said, expressing hope that this will be the case in Brazil. In her victory speech, Rousseff promised to be “a better president” in her second term and move aggressively to promote a political reform she first proposed but failed to advance after the massive street protests of June 2013. It is improbable, however, that the proposal will be welcomed in Congress, where Rousseff’s Workers’ Party has lost ground and will have to deal with stronger and more demanding partners in the PMDB.

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Paulo Sotero is the director of the Brazil Institute at the Wilson Center.

Photo courtesy of Flickr user Rede Brasil Atual.


Brazil’s Exhausting Election

October 30, 2014

Vanessa Barbara – The New York Times, 10/30/2014

It was a typical election in Brazil. Jesus and Osama bin Laden were running for Congress, as well as Barack Obama, Bob Marley, Santa Claus and Battman (with two Ts). The self-styled “Hamburger Face” unfortunately wasn’t elected, nor was a candidate just called Congresswoman. (When the results were released, it turned out she didn’t get a single vote — not even her own.) But a famous clown named Tiririca won a second term in the House, after starring in a kitschy TV campaign. Next year, 35 percent of our members of Congress will be millionaires.

In São Paulo, which is proving to be more conservative than most of Brazil, the number of legislators in the so-called Bullet Caucus will increase by 30 percent. They are usually former military police officers, with a right-wing posture and a belligerent discourse; they stand for lowering the age at which teenagers can be tried as adults (currently 18); for increasing police repression; and against gun control. Their mottos are: “the only good thief is a dead thief” and “human rights are for right humans.”

The second-most-voted-for congressman in my state was an evangelical Christian ex-cop who recently produced his own comic book. In 32 pages, he describes “two brand-new police cases.” In one, an angel supposedly helped him during a chase so he could catch two fugitives. (In real life, however, three suspects were killed by the police.) After the elections, he urged independence for the wealthiest states from the poorest ones that “preferred charity over work.”

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Dilma Rousseff has a second chance to invigorate Brazil’s foreign policy

October 30, 2014

Bianca Suyama and Gonzalo Berrón – The Guardian, 10/30/2014

After an election campaign that was more unpredictable and nerve-wracking than Brazil’s popular soap operas, President Dilma Rousseff will lead the country for another four years.

Brazil’s government has defined its foreign policy as “active and prominent”. This is a legacy of former president Luiz Inácio Lula da Silva, who wanted to lead Brazil towards greater autonomy and relevance in the global order. He wanted Brazil to contribute to a more democratic and multipolar world; diversify its partnerships – with particular focus on countries in the global south and the Brics (Brazil, Russia, India, China, South Africa); and promote South American integration.

However, these initiatives were not without their tensions and contradictions. Rousseff appeared to give less priority to foreign policy and some of the achievements of Lula’s administration stagnated under her. What should she focus on now the election is out of the way?

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Another emerging markets crisis looms as Brazil opts for the politics of stagnation

October 29, 2014

Jeremy Warner – The Telegraph, 10/28/2014

The definition of an emerging market, it was sometimes said – in the days before Goldman Sachs led the stampede of Western money into the developing world – is one from which it is impossible to emerge in a crisis. Investors will know the feeling as they survey the damage to their wealth inflicted by the re-election of the centre left Dilma Rousseff as president of Brazil this week.

In dismay, the Brazilian Ibovespa was down a stomach churning 6.2pc and the Real, in precipitous decline for some years now, fell another 3pc. Investors had hoped for a return to the “Plano Real” and the pro-business agenda of Fernando Henrique Cardoso in the mid-90s to early noughties; instead it’s at least another four years of Workers Party interventionism they have to look forward to.

Brazil is not yet in fully-blown crisis mode, of the type which Latin America seems perennially prone to, but it is self-evidently already on a very slippery slope. Growth has slowed to a virtual standstill, inflation is again climbing towards double digits, and investment has slumped.

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Rousseff says Brazil will recover, avoid credit downgrade

October 29, 2014

Walter Brandimarte – Reuters, 10/28/2014

Newly re-elected President Dilma Rousseff said on Tuesday that the Brazilian economy will recover in her second term and avoid a downgrade of its credit rating.

In television interviews two days after narrowly defeating market darling Aecio Neves, Rousseff repeated her offer to sit down with business leaders to hear their views on the state of the economy and discuss changes in policy.

Earlier on Tuesday, a senior analyst at Moody’s Investors Service said the ratings agency was in no rush to decide whether to cut Brazil’s rating but could act quickly if it determines that Rousseff is not making significant changes in her second term.

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Can Brazil’s Socialist Iron Lady Defy The Markets?

October 29, 2014

John Cassidy – The New Yorker, 10/28/2014

I know, I know, there’s a lot going on: Andrew Cuomo and Chris Christie are busy making jackasses of themselves; the midterms are next week; Rex Ryan’s Jets are imploding. I wouldn’t blame you if you overlooked the news that Dilma Rousseff, Brazil’s socialist “Iron Lady,” was reëlected as the President of the world’s fifth most populous country. From what I saw, the broadcast networks barely covered it. Monday’s Times relegated the story to an inside page.

No surprise there, you might say. It’s nearly five thousand miles from New York to São Paulo, and Americans got their fill of Brazil during the World Cup. Who cares that Rousseff came from behind in the polls to defeat her opponent, Aécio Neves? Does it really matter to people outside Brazil?

It does, for at least two reasons. First, Rousseff’s victory has significant implications for the world’s financial markets. And, second, it extends Brazil’s decade-long effort to reduce poverty and inequality, which, despite great skepticism among the country’s business community (and free-market economists), has gone some ways towards spreading the wealth in what has long been one of the world’s most inegalitarian countries.

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At Brazil auto show, industry wonders if it can get any worse

October 29, 2014

Brad Haynes and Albert Alerigi – Reuters, 10/29/2014

Automakers in Brazil are facing the sharpest slowdown since 1999 and it could be a year or more before things turn the corner.

It is tough to find a sunny 2015 forecast at the Sao Paulo Auto Show this week, where companies accustomed to a market growing by double digits are now considering three straight years of declining sales.

“It looks like the market is in for a difficult time until 2016,” said Koji Kondo, Toyota Motor Corp’s (7203.T) chief executive in Brazil, citing labor costs, rising taxes and infrastructure bottlenecks as a persistent problem. “It’s hard for Brazil’s economic conditions to recover in the short term.”

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Brazilians close their eyes and hope for the best

October 29, 2014

Rogério Simões, CNN – 10/27/2014

Uncertainty normally comes with the new. This year’s Brazilian presidential elections, though, have been like no other. After Sunday’s polls gave President Dilma Rousseff, from the left-wing Worker’s Party (PT), another four-year term with a narrow margin of victory, Brazilians embarked on a guessing exercise about what her next government will look like.

On the surface it doesn’t seem a vote for change, but the President knows it should be. There were exuberant celebrations in the PT camp and frustration in the faces of supporters of the defeated centrist candidate, Aecio Neves, from PSDB. But no one could say for sure what the result means for the next four years.

Since massive street protests in June 2013 called for change in Brazilian politics and economy, that word has been around in almost every political statement — including Rousseff’s victory speech on Sunday night. As she addressed supporters in Brasilia, the President said she had not forgotten the message from the streets. “The most repeated word in these elections has been ‘change’. And I know that I have been re-elected to make the big changes the Brazilian society demands.”

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