July 4, 2006 
By Sérgio Baierle:
At the end of 2002, one month after Lula became President of Brazil, the Brazilian media was talking about the Zero Hunger Program and discussed proposals of social inclusion. Social issues had, at last, become the focal point of public debate. Renown economists of the Left appeared on TV and advocated an increase of the minimum wage, Senator Eduardo Suplicy’s basic income proposal, the acceleration of the agrarian reform, a redistribution of income favouring the poor, and the reduction of Brazil’s inequality. Sociologists debated the likely outcomes of a more active citizenship. And senior government officials were commonly seen to collect food donations from their employees for distribution among the poor. Tons of food piled up in public offices. And while nobody was expecting a revolution of the popular classes, it was hoped that Lula would lay the foundation for a republic capable of constructing a national agenda of social integration, and that he would be courageous enough to put this agenda ahead of short term economic interests.
As little as two years later, social issues had almost completely vanished from the national agenda, the spontaneous mass mobilisation that surrounded Lula’s ascent to power had dissipated, and the Workers’ Party’s (PT – Partido dos Trabalhadores) reform program was flagging. Promising to settle 430,000 families over the course of three years, Lulas agrarian reform program benefited a mere 14,000 families in 2003 and around 50,000 in 2004, an outcome easily surpassed by his predecessor Fernando Henrique Cardoso. As a result, 200,000 families, camped along Brazil’s highways or on unproductive fields and engaged in a permanent conflict with local landowners, continued to wait for a piece of land.
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Lula’s economic success is based on an orthodox, market-oriented philosophy. He continued Fernando Henrique Cardoso’s monetary policy geared to attract speculative investment flows through high interest rates, took on board his predecessor’s administrative reform program, and introduced or supported neo-liberal legislative amendments that strengthen
the financial sector. This adherence of the Lula government to neo-liberal economic orthodoxy has earned it the praise of the World Bank as well as of the European Community. The implementation of this orthodox reform program has been hampered by Congress and by resistance within the ranks of the Workers’ Party.
To be sure, Lula’s economic “success” came at a price. It not only transferred national resources to the wealthiest segment of society (during the last seven years, 67 per cent of the GNP has been transferred to the owners of national bonds in the form of interest payments), it also undermined the Workers’ Party’s identity. Although Lula might be re-elected in 2006 and his Party might increase its electoral gains in the upcoming state elections (as it did in the 2004 municipal elections, when the Workers Party increased its share of municipalities from 187 to 411) the party has irrevocably dissociated itself from the alternative national project envisaged by the Workers’ Party during the 1980s and 1990s. In particular, social transformation and popular participation, programmatic cornerstones of
the old PT, have fallen by the wayside. To be sure, this departure from the party’s original premises did not begin with Lula’s election. Lula’s election simply sped up a process a decade in the making. Yet Lula’s rise to power clearly demonstrated the extent to which the PT’s alternative national project had been replaced by an orthodox formula of economic stability and growth. Its innovative governance style had been displaced by a will to
govern at any price. This clearly undermined the very promising participatory processes briefly outlined below that emerged during the transition period to democracy during the 1970s and 1980s.
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During the sixties Roberto Schwarz claimed that the country was unrecognisably intelligent. With this he referred to the base reforms, the fight against large landholders, anti-imperialism, urban workers and peasants movements, and engaged cultural activism. Today it is possible to say that the country has become unrecognisably stupid. Social movements have turned into social capital, active citizenship into capitalist inclusion,
income redistribution into social responsibility, social transformation into solidarity governance, and radical democracy into governance. After programs like University for All, Zero Hunger and Redirecting the Sao Francisco, the grassroots have become synonymous with the popular and all that is empty crystallises into power.
Read full article at JILAS Journal of Iberian and Latin American Studies, ~ 11:2, December 2005: Lula’s Swamp
Baierle & Co. 
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