Editorial: Four more years to come

brasilobserver - Nov 10 2014
The PT’s fourth victory confirms the possibility of building new growth not only in Brazil but throughout Latin America (Photo: Paulo Pinto/Fotos Publicas

(Leia em Português)

Let’s be clear about the victory of Dilma Rousseff in Brazil’s presidential election. The result of the ballot is emblematic because, despite the feeling of change absorbed by a significant portion of the electorate who are hungry for change, the majority of Brazilians preferred to once again trust in the advances proposed by the Brazilian progressive forces represented by the Workers Party (PT).

Proposals that, if analysed from the perspective of a Neo-Developmentalism model, programmatically committed to economic growth and income redistribution, indicate the overcoming of the neoliberal scheme guided almost exclusively by antidotes touted by the financial market and the interests of more developed economies.

It is not a small thing. Facing an external environment of low growth that embraces the theme of austerity and cuts to welfare, this reflects among other things, the strengthening of an isolationist extreme right view, as seen in the UK with the rise of UKIP. Instead the PT’s fourth victory confirms the possibility of building new growth not only in Brazil but throughout Latin America.

With Rousseff, the country will be far better placed to build true social democracy and face the greatest and most urgent national challenge: reducing the inequality that keeps the privileges and sustain the same unfair structures like those between the plantation houses and slave quarters.

There is, however, no room for illusions. Over the next four years, in order not to suffer the disastrous consequences that a politically divided country can provide, Dilma Rousseff will have to fulfil the promises backed by those who voted for her and balance this with advancing the demands of those who did not give her the vote. This will require a focus on two key issues: the reform of the political system and the direction towards the crossing way to a new cycle of economic development.

This will not be an easy task. Political reform depends primarily on the dialogue that the government can engage in with the National Congress. If the federal deputies do not support a major role of the population in national decisions, how can we believe that they will change the rules of the game and listen to those who gave them the condition to be the people’s representatives? This is the first equation to be solved.

During the campaign, Rousseff advocated for a plebiscite to create a constituent assembly to reform the political system. She had already expressed this during the demonstrations last year, when Brazilians took to the streets to demand, among other things, greater participation in the direction of the country. That’s what we see not only in Brazil but worldwide. There is a growing demand for direct participation, but not through traditional ways. It is clear that parties should not be demonised, after all without parties, what remains is the authoritarianism, but the legitimacy of public engagement cannot be rejected as well.

So who’s really afraid of public participation? Surely those who are not interested in the democratic development of the country. And this development will come, for example, with the end of private funding of political campaigns – which is one of the key points of the reform advocated by Rousseff.

Such a point is defended even by those who have a more conservative view. After all, companies do not vote, and from the moment that they directly influence the election by financing candidates and requiring counterparts, misrepresent the system that has its roots in the concept of “one person, one vote”. If Rousseff get it approved, Brazil will be able to have an unprecedented advance.

In the economic area – where international interest is much higher – the challenges are problematic because they represent a risk for the government to adopt the program defeated at the polls and thus lose credibility. Rousseff used the campaign to say that her opponents would increase the interest rates – what would be a risk to the country. But to the surprise of the market itself, the Central Bank decided to raise interest rates in the last week of October. Moreover, before the close of this edition, came the news that the government was preparing a package to reduce public spending – a possibility that Rousseff had criticised during the campaign.

These are just examples. Regardless of these, the federal government needs to find a way to balance the public accounts deficit and reduce inflation without undermining investment and growth itself that is already at low levels. The exemptions for entrepreneurs held by Dilma under the Greater Brazil Plan were not enough to raise private investment that could be more encouraged if public investment increases, improving infrastructure and rising demand.

Even if the government sees this issue as contradictory, it is unwise to see foreign investments as a threat. It is necessary to expand even more the dialogue with those who understand the Brazilian process of development, those who understand that an internal market heated with jobs, higher wages and social achievements is the inseparable counterpart of sales, profits and investment. The defense of development, competence and national competitiveness is at the centre of the winning project in the polls.