bthe citizens of Razili must hope that an ugly campaign, threats, political violence and post-election protests will give way to a better day for their troubled country. Luis Inacio Lula da Silva, popularly known as Lula, will do it again served as president of Brazil. (Lula previously held office from 2003-2010.) Despite warnings that only God could remove him from office, incumbent Jair Bolsonaro has vowed to uphold the constitution and allow the political enemy who defeated him to take office. He even called for an end to truck drivers’ strikes to block roads on his behalf. Fears of a military coup to save Bolsonaro have always been exaggerated and Lula will become president in January.
And it’s going to get tough from there.
of Lula margin of victory was less than two percentage points, the closest presidential result in Brazil’s modern history. (In 2002, Lula won by 22.5 percent and by 20.6 percent in 2006.) Half of this increasingly polarized country sees him as a criminal and/or a dangerous left-wing ideologue who will turn Brazil into crisis Venezuela.
In addition, the country’s economy is far weaker than the last time Lula was in power. Brazil’s worst post-war recession (2015-2016), which helped oust former president Dilma Rousseff, Lula’s hand-picked successor, and the delay imposed by COVID-19 will leave Lula with little money to spend about the kinds of poverty-relief projects he invested in during his first term as president, a boom time for Brazil’s commodity exports that helped fill state coffers. Today, China’s sharply slowing economy has hit Brazilian exporters hard. The problems in the United States make matters worse. Inflation in Brazil is now 9 percent, deeply affecting the purchasing power of many who live from hand to mouth. And Lula must also be careful in the coming months to reassure foreign investors that he will accept the reality that his government must watch its spending. This problem is further compounded by the reality that about 90 percent of Brazil’s federal budget is now dedicated to mandatory spending.
Lula will also have to deal with a far more hostile Congress. Bolsonaro’s Liberal Party now holds the most seats in both houses and has plenty of right-wing allies to partner with in opposition. And just as Donald Trump has become a persistent critic of the Biden administration, Bolsonaro himself will use his popularity among Brazilian conservatives to make his leadership of that opposition as destructive as possible to Lula’s agenda. Periodic protests, both large-scale and potentially violent, are a safe bet.
Brazil’s one-time and future president seems to understand these limitations and will govern with moderation, at least initially. But how will Lula change his approach in a few months, when the honeymoon is over, his popularity is waning, the demand for change is growing, and he is unable to achieve without changing the rules? Can it increase spending to cushion the economic shock without raising taxes to levels that weigh on the growth of an already weak economy? How does it avoid fueling investor doubts about Brazil’s debt sustainability? Or, faced with intense political pressure, is he trying to rewrite the economic rules in ways that push Brazil’s economy into danger?
The rest of the world will be watching. Those who hope for Amazon will be better protected against deforestation as a means of protecting the global environment, will be pleased because Lula has promised, credibly, to make rainforest health a top priority. But the crisis for Latin America’s largest economy is bad news for everyone at a time of global economic weakness.
One thing is clear: Lula will lead a different country than the one he ran a generation ago, and he will have to rely on a different set of political skills to keep his presidency afloat.
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