FACTBOX-Key political risks to watch in Brazil

[Meshuga]

FACTBOX-Key political risks to watch in Brazil

By Raymond Colitt

BRASILIA, April 2 (Reuters) - Brazil's presidential election in October looks less risky to investors than any other in the last quarter of a century and the economy has bounced back after a brief recession, but there are still investment risks to watch in Brazil this year.

PRESIDENTIAL ELECTION

President Luiz Inacio Lula da Silva's leftist chief of staff, Dilma Rousseff, is the ruling Workers' Party candidate to succeed him. She trails her main rival, Sao Paulo state Governor Jose Serra of the centrist opposition PSDB party. But most analysts make Rousseff the favorite because she can count on support from the hugely popular Lula and will be helped by the rebounding economy.

Unlike previous elections, there is no clear market favorite because neither of the main contenders is expected to break with the mostly market-friendly policies in place for the past decade: a free-floating currency, inflation control, and fiscal discipline. Some investors prefer Serra for his party's centrist stance and his managerial experience.

But Rousseff and Serra both believe in a strong government role in the economy and could tighten regulation in financial markets. Though both candidates will try not to unsettle investors, such proposals could weigh on debt and equity markets in a country that has a history of election-year volatility.
There is also some doubt about how firmly the candidates would push for a second generation of structural reforms to ensure Brazil's international competitiveness if elected. These include proposed reforms to tax, pension and labor laws.

(...)

Neither is proposing nationalizations, but Rousseff has said she favors a strong role for state firms in the economy, a position that gained support after low-cost loans by state banks helped Brazil's economy recover from the global crisis. Larger state companies could weaken private sector participation in sectors such as banking, oil, and utilities.

(...)

What to watch:

-- Serra and Rousseff will name their economic advisors in coming weeks. A left-wing choice could unnerve investors and send jitters through financial markets.

-- Candidates will start making proposals after they step down from their current positions by April 3.


http://uk.reuters.com/article/idUKRISKBR20100402

[Peace Patriot]

1. The first thing to notice about this article is that it is by Rotters, which has an unbroken record

of lying about the leftist democracy revolution that has swept South America (and swept elections in Central America as well--winning the presidencies in Nicaragua, El Salvador, Guatemala and Honduras, and an almost in Mexico--widely believed to have been a stolen election; the U.S. State Department, the Pentagon and Jim DeMint, of course, undid the leftist presidency of Mel Zelaya in Honduras*).

So, as with my "rule of thumb" on Bushwhacks, now extended to pretty much anything the U.S. government and the corpo-fascist press asserts, start by assuming that whatever Rotters tells you, the opposite is probably true, and you will be on the path to--or right on--the truth. Take their premise in this article that the "left" and "regulation" are threats to investors. The opposite is true. The most stable countries in Latin America are the ones with leftist governments which have kept tight controls on the banksters and have defied the "advice" of the World Bank/IMF loan sharks and other "neo-liberal" (U.S./EU) instruments of oppression and looting. (Lula da Silva called them the "blue eyed wonders of Wall Street." ) Brazil, Venezuela, Bolivia and Ecuador were the best prepared countries in the hemisphere to withstand the Bushwhacks' Financial 9/11 of September 2008, precisely because they put up the strongest resistance to Wall Street bullshit about deregulation and privatization.

And the most unstable countries in Latin America are the ones with RIGHTWING (pro-"neo-liberal," pro-Wall Street, pro-U.S./EU multinationals and war profiteers): Colombia, Honduras, Peru and Mexico.

Colombia, the most rightwing of all, is a bloody mess of catastrophic proportions. And the others are all heading in that direction.

This Rotters article is also a prime example of the corpo-fascist press as the "river of forgetfulness." Did they FORGET what "deregulation" did to the U.S. and world economy? Not really. Their corporate/bankster puppetmasters want to do it to us some more! They want us to forget it. It is deliberate, willful blindness: regulation = bad; deregulation = good.

This analysis is "of, by and for" the super-rich. The rest of us are the slave labor. Plantation economics. That's what this is. And it has as much regard for the lives of the poor majority as the slave traders of the 19th century, and as much desire for a truly healthy economy, in which everyone prospers, as the British East India Company--or Exxon Mobil.


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*(It remains amazing to me what the Associated Pukes (Rotters included) did NOT report or did not question about the rightwing coup in Honduras, for instance, that the plane carrying the kidnapped president out of the country at gunpoint stopped at the U.S. military base in Hondurans for refueling.)

[Meshuga]

2. First,

Whether you like or trust Reuters or not, the article (which is very general) does not say anything that goes against what is common knowledge in Brazilian politics which is freely discussed by Brazilians in general and the Brazilian media. So if Reuters has a world view to sell with some issues, it appears to be irrelevant here.

Second, I don't think the article was for or against deregulation and/or privatization. It just stated facts about José Serra and Dilma Rousseff as a candidates in the 2010 elections. This is an analysis that anyone can come up with by looking at the policies of the past two administrations (one by PSDB and the current by PT).

And finally, I think Brazilian politics is more complex than your usual bipolar and simplistic "left-wing democracy revolution that has swept South America" versus "the bad guys" spiel. And you have to understand that Brazil is a different animal. The whole belief (or wish) that Latin America is this one cohesive entity that will fall under one ideological utopia is ignorant and (at the same time) offensive.

The fact that the candidates in Brazil are so similar is due to the sad nature of neoliberalism where the organizational infrastructure of democracy is weakened. Countries are democratic and candidates can say what they want when it comes to their rhetoric but when it comes to governing they have their hands tied to a certain prescription or they lose. It was the case with Lula besides some very nice social programs he is responsible for improving and that were initiated by the previous PSDB administration.

Differences between candidates only show up in certain details that are minor but sometimes make a big difference. For example, I remember back in the election of 2006 when Alckmin took a hardline approach when talking about the issues with PETROBRÁS in Bolivia. Lula seemed to be more reasonable, in my opinion, and not being so forceful. The way I see things is that if a Brazilian enterprise wants to invest in a country it has to take risks and accept the outcome. If you lose to expropriation then deal with it and fight your own fight and don't expect your government to interfere in your favor. That swayed my vote to Lula but the difference between the two in terms of governing the country would be few.

Whoever wins in October (or November, if there isn't a majority win in October) is going to keep the ship going pretty much in the same direction. The reality in Brazilian politics is very different than Venezuela so I think your left-wing revolution (in the nationalist and populist flavor) is more like a fantasy of yours than a reality.

[protocol rv]

3. Leftist democratic revolution sweeping South America

Huh, in Brazil the opposition is ahead in the polls. The socialists lost the elections in Chile. The Kirchner duo lost the Congress in Argentina, and looks set to lose the Presidency. Honduras' coup stuck, and now Nicaragua is trying to make a deal. Cuba's government is looking very wobbly, and the opposition won the elections in seven of the ten largest cities in Bolivia. Meanwhile, in Venezuela the economy is swooning, and Chavez has managed to go below 50 % in approval rating.

So please tell us about this revolution sweeping where?