What has changed after Lula?

To evaluate is to compare facts and values. In this evaluation of the first two years of Lula’s government, we chose as a term of comparison, the project for national construction. Using a synthetic and precise formula from Caio Prado Jr.: to what extent these two years of government have contributed to accelerate the transition between the “Brazil-Colony from yesterday into the Brazil-Nation of tomorrow”? Three aspects of this transition will be examined: reduction of inequality; increase in autonomy; and political organization of the people. As for the reduction of social inequality, it should be mentioned that: for the two year period, the growth of the Gross National Product (GNP) was mediocre, and did not even manage to affect the GNP per capita. There was an improvement in 2004, but without a bigger impact – in terms of jobs (there was a small increase in comparison to the size of the work force), in terms of salaries ( in fact the average salary decreased in the two year period).

The government made an effort to demand the formalization of job relations – which would be reflected in better salaries. In spite of that though, the number of registered workers, is still lower than those working under informal contracts. That might help to explain the shocking fact that the income of almost a fourth (23.8% according to Ipea [Institute of Applied Economic Research]) of Brazilian workers is bellow the minimum wage. Having inherited a centennial situation of inequality, the government could claim the impossibility to reverse this scenario in only two years. This argument would be acceptable if, in those two years, efficient measures were taken to alter the corrupt structures that create inequality. That is not what we have seen. The agrarian reform did not come out of the paper. The goal of settling one million families, in four years, which in itself would be enough to generate the virtuous dynamic of wealth redistribution in the countryside, was cut to half, and that half is not being executed.

There was no mention of urban reform – another structural measure for the reduction of social inequality. Even a traditional housing programme for the construction of popular houses did not get off the ground.

The use of taxation for wealth redistribution -an instrument used by developed countries in Europe and North America- was not even contemplated. What we have seen was a tax collection fury, completely indifferent to the fact that the current tributary system places a disproportional burden on the poorest layers of the population.


In the absence of structural reforms, the battle against social inequalities was limited to the assitencialist expenditure of the State. What we have seen there is that after two years of the Hunger Zero programme, Bolsa Escola (school Incentive), Minimum Income and so many other programmes under good sounding titles, the government did not entirely manage to get rid of the neo-liberal concept of “focused social expenditure”. The announced “structuring” vector of those income transferences to the poorest sectors did not go beyond the level of good intention. The disproportion between the amount of resources allocated (even if they were superior in relation to the previous government) and the scale of the demands of the immense mass of poor has frustrated the objectives. Miniscule transferences of wealth do not generate a favorable social dynamic for the political and social protagonism of marginalized people. In other words: in spite of their good intentions, it is not possible to come out of the traditional assistentialist line practiced by the dominant elite which is merely destined to lessen the explosive poverty situation.

The big argument from the conservatives with regards to wealth redistribution is that we first need to have wealth. The government boasts that the economy is growing, only in 2004 at a rate nearing 5% – the best result in nine years. The growth rate is exhibited as evidence that the economic policy is correct. However to put it into perspective, it is appropriate to compare it with economies such as Venezuela (18%); Uruguay (12%); Argentina (8.2%); Ecuador (6%); Panama (6%); Chile (5.8%), in the same period. In this broader context we should question if the announced 5% in Brazil would actually be the result of a keen management of the economy or the expansionist situation of the international market, considered the performances of the US and China. Where is the guarantee that this rate will remain? However, that is not the central point of the redistributive controversy. Even if the 2004 rate remains for five, ten years or even longer (which no economist dares to predict), if the structural scheme of sharing wealth is not altered, the situation of social inequality will be substantially the same, even if the total income level might be a bit higher.

The conclusion of this analysis is that, in the first two years of Lula’s government there was not any significant result in terms of the reduction of social inequalities. THE NEOLIBERAL ADJUSTMENT CONTINUES

To measure the performance of Lula’s government in reducing dependency – a second dimension in this evaluation – the analysis must include two aspects: political and economic. In the economic aspect, the basic and shocking fact is to verify the continuity of the structural adjustment process of the Brazilian economy to the canon of the neoliberal model: the Pension Reform; the removal of any constitutional hindrance to the autonomy of the Central Bank; the Judiciary Reform; and the Bankruptcy Bill: this structuring legislation, sponsored by all means in hand by the PT government fits rigorously with the prescription of the Washington Consensus – weak state and free market. The economic policy followed the same footsteps. Everything was subordinated to the same motto: “Confidence Building” (as we read in the manuals that instructed the economic team) from the centers of financial capitalism in the government of Brazil. To reach this confidence, unjustifiable concessions to the energy and communication multinationals were made, speculators and investors received undue exemptions, we turned a blind eye to the transgressions of the norms of forest protection by foreign logging companies; a retrocession to the environmental legislation was sanctioned, in order to favor GMO transnational companies. Not to mention the maintenance of a primary superávit that is incompatible with meeting the minimum social demands and the urgent needs to recover the economic infrastructure of the country.

This inventory of structural and circumstantial measures only brings us to the conclusion that, after two years of Lula’s government, the Brazilian state has become feeble and less equipped to execute economic policies, since a large number of relevant decisions have been transferred to external centers of decision.

In the political dimension and the issue of dependency, the government and Itamaraty tried to push forward FTAA without bending too much to US pressure; they managed to torpedo the assignment of the Alcântara base; to create the G-22; to defeat, for the first time in the history of trade negotiations, proposals supported by both the US and Europe. This “achievements”, though questionable, completely fade in light of the inexplicable deployment of Brazilian troops in Haiti, serving the obscure needs of US and French diplomacy.


We can now start examining the third axle of analysis: the political organization of the people – an essential aspect, since we all know that the reduction of inequalities and autonomy are not generous gifts from the rich and the foreign powers. Quite the opposite, they are conquests that must be plucked from the powerful through a lot of struggle and sacrifice. Therefore, they require people aware, organized and mobilized.

There is no doubt here that these have been the worst results of Lula’s government in these two years. For a start, the government conducted its politics fully submitted to the traditional patterns of the corrupt Brazilian elite; collusion, give and take; bogus alliances; obscure financing of the electoral campaign – nothing different from the reprehensible practices of Fernando Henrique Cardoso’s government in its relationship with the parliamentary and supporting base. This behavior only helped to confirm the skepticism of large part of the population with anything that has to do with politics (“they all come from the same place”) and to demoralize the popular vanguard which, for decades, struggled to convince the people that PT was different. The disappointment with their ethical behavior was followed by total astonishment at the lack of measures that were always part of the party programme and of Lula’s speech during his political life. The indigenous people, for example, could not understand why the government does not demarcate the reserve Raposa Serra do Sol; the two hundred thousand families that ran to the countryside when they heard about Lula’s election cannot accept that they must remain on road sides or in occupied areas, under the target of gunmen; environmentalists saw their hopes for a decisive repressive action against deforestation and the penetration of GMOs being frustrated; those affected by dams have not being able to receive the compensations that they are entitled to; the true trade unionists complain about the value of the minimum wage and against a proposal for a trade union structure; not to mention the elderly, who were hit by a new pension legislation. A rosary of disappointments.

Having in sight that all those demands were the banners of the struggle of the popular vanguards, we can conclude that, today, popular movements are weaker, more confused, more divided than two years ago. To give a clear picture of that, we should only observe the fact that all the internal tendencies of PT “cracked” and that the various important trade unions are in the process of or have already cut links with CUT [Central Única dos Trabalhadores]. The other left wing parties and popular movements from the countryside and the city also did not escape the process. They find themselves everyday with the dilemma: “break up” with “their government” or retreat, in order not to directly confront it. Lula’s government does not repress the left or popular movements, however, it provokes its dilution and fragmentation.

This evaluation apparently does not fit with the feeling of the people; opinion pols show a 70% approval for the performance of President Lula and 45% for the government. Why such harsh criticism if the “masses” are happy? It is too early to draw definite conclusions from those pols. Would they indicate that Lula is replacing his supporting base – PT and combative popular movements – bending towards a new kind of “populism”, founded in his personal charisma and in the transformation of PT into an amazing electoral machine? Or would the pols only show a situation which could quickly fall apart, if 2005 does not bring the benefits that the masses are still waiting for?

Whatever the answers are, one thing is certain: Lula’s failures are forcing everyone who struggles to push forward the transition from “the Brazil-Colony of yesterday into the Brazil – Nation of tomorrow” to make a profound effort to revise the strategies of their discourse and their practices.

Plinio Arruda Sampaio is the director Correio da Cidadania. Founder of PT and líder of the party in the Constituinte (1987/1988)

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