Once the pride of the New Left in Latin America, the PT administration is buffeted by the worst economic crisis to hit Brazil since the country’s redemocratization in 1985, charges of abetting corruption at Petrobras, the state petroleum company, falsifying its electoral spending reports, and going back on its electoral campaign pledges by imposing austerity measures.
In 2010, President Inácio “Lula” da Silva left office with an 83 percent approval rating, something unprecedented in Brazilian history for a departing head of state. Today, his approval rating is down to 25 percent. Dilma, his successor, won her second presidential mandate in October 2014 with 52 percent of the vote. Just a year later, her approval rating is down to 7 percent.
“She dare not show herself in public,” said one irate cab driver, who remarked that the “PT government has shown itself to be as rotten as the rest.” Another said loss of income over the last few years had forced him to move his family from “adequate housing to a cramped apartment” owing to cuts in his income. These feelings are widespread.
Demonstrations involving thousands have backed the opposition’s call for her impeachment, with a fringe but vocal element calling for a return to military rule. PT partisans and the broader Left are not so much worried about these rallies mounted by what they consider an angry, but unorganized public. What really concerns them is the relatively much smaller numbers that have attended counter-demonstrations against what they are calling an anti-democratic coup.
Not surprisingly, members and allies of the party are asking themselves: What happened to us? PT programs lifted more than 30 percent of the people out of poverty and 40 percent into the middle class. Don’t people realize this? Why aren’t they grateful? “The PT rose to power as a party known for our militant stance against corruption,” said Gonzalo Berron, a civil society activist and PT supporter: “Now we’re made to look as if we invented corruption.”
The PT’s ‘Heroic Age’
The PT was formally established in 1980, as a discredited military dictatorship withdrew from the political scene and social movement actors sought a vehicle to ensure that democracy would address the concerns and interests of the working class.
In its beginnings, the PT was organically linked to the “New Unionism” that developed in the industrial belt of greater São Paulo. According to Emir Sader’s classic analysis, the party was a dynamic new force produced by the creative confluence of three streams: trade unionists independent of both the union networks of the old left and yellow union bureaucrats that emerged in the newer industries spawned by Brazil’s rapid industrialization in the sixties and seventies whose key figure was the charismatic Lula da Silva; the progressive wing of Catholic clergy and laity inspired by “Liberation Theology;” and the new left with its reinvigorated Marxism and enthusiastic young cadres.
By the mid-1980s, the PT, the New Unionists now organized into the Unified Workers’ Central (CUT), and the Landless Workers Movement (MST) were among the largest and best-known social forces pushing for the expansion of democratic space and a vision of a socialist Brazil.
Unlike the vanguardist and dogmatic old left parties, the PT was ideologically pluralistic and internal democracy and vigorous debate were seen as sources of strength. The establishment of a mass-based, internally democratic party in a system dominated by patronage and weak, personalistic political parties was heralded by academics and leftist observers as a game-changer for Brazil.
The PT’s pluralism was also key to its growth and electoral appeal. In the 1980s and 1990s, the allure of the PT’s open discourse, and the recent sting of dictatorship, reached beyond the working classes to attract middle forces.
Dynamic and ambitious, the PT sought nothing less than the presidency, which it managed to win in 2002 after four attempts. Lula’s 2002 presidential campaign caught international attention for how different it was from his first run. Whereas 1989 Lula was an outspoken t-shirt-wearing unionist, the 2002 Lula featured a trimmed beard, tailored suits, and noticeably more centrist discourse. Nevertheless, the infrastructure for the national effort was laid by the PT’s success winning and administering cities and states. Thus, even before it came to power at the national level, the PT had already made its mark as a party against corruption at the local level and with innovative policies, like the participatory budgeting that was successfully institutionalized in the city of Porto Alegre.
To Latin America, Lula and the PT were an example of “Gramscian politics,” of a way to power that combined gaining electoral dominance with a hegemonic discourse of social transformation that was meant to appeal to all social groups except Big Capital.
Indeed, the PT became the leading force of the Sao Paulo Forum, a continent-wide grouping that proposed the vision of a popular, egalitarian democracy as an alternative to neoliberalism. The Sao Paulo Declaration of 1990 confirmed the intent of the 46 parties that signed on to it to expose “the “nonexistent positive aspects of liberalism and capitalism” and “to renew the concept of the left and socialism, to reassert its emancipatory character, to correct erroneous conceptions, to overcome all manifestations of bureaucracy and to counteract the total absence of real social democracy for the masses.”
Social movements allied to the PT were also prominent in the international anti-globalization movement that took off in the 1990’s and were the central actors in the founding of the World Social Forum, which, among other things, became a vehicle for the popularization internationally of such PT and CUT-connected innovations like social movement unionism and participatory budgeting.
From class crusader to ruling party
The transition from a class crusader to a conventional electoral party was difficult enough, but the internal organizational challenge to the PT was magnified when Lula became president in 2002 and the PT became the ruling party.
The PT quickly learned that campaigning on a platform of anti-corruption and social justice was much easier than running a government with those goals. Brazil’s electoral system encourages the proliferation of multiple, weak parties. Although it was the top performer in both Legislative Houses following the 2002 elections, the PT held only 17 and 18 percent of the upper and lower houses, respectively.
PT operators promptly got the party in trouble in their attempts to bribe non-PT members of the Brazilian Congress to allow the passage of PT legislation benefiting the poor and marginalized. Though Lula was not accused of having a hand in the bribery, this scandal at the beginning of his term might be said to mark the beginning of the erosion of the PT’s image as a clean party. In later years, the PT accepted corruption-tainted candidates in order to try to maintain its numbers in the legislature.
Brazil’s mainstream media has also been a major contributor to the erosion of the party’s clean image. Brazilian media is an effective monopoly, with the Globo network reaching 99.5% market saturation. Globo has been widely criticized for its biased coverage against the PT, including exaggerating coverage of corruption allegations when PT members are involved and editing scandal and corruption coverage to imply the involvement of PT personalities without directly accusing them.
Perhaps most tragic, though, has been the deterioration of grassroots organization, on behalf of both the PT and allied social movements. Starting around 2005, the PT stopped organizing núcleos de base, the basic units of party organization. Iole Iliada, the PT’s Secretary for International Relations, considers this a major setback to party life, owing to the virtual elimination of the ideological and political debate that once took place in the núcleos, as well as the disappearance of the vision of a bottom-up, participatory party.
Social movements also slowed their organizing following Lula’s election. Various activists, from labor unions to urban housing and service movements, admitted that many movements lost their vigor, adopting instead a “wait and see” attitude. As João Stedile, a leader of the Landless Workers’ Movement (MST) said in a 2007 interview, “We thought that a simple electoral victory would give a shock to the masses…We thought this was it, the time had come! And it hadn’t. It was really frustrating…This is the greatest challenge that we face today: we’re waiting around, seeing if the government will do this or that instead of just acting on our own.”
Squaring the circle
The Lula years from 2002 to 2010 exhibited a decrease in inequality (from a GINI coefficient of 0.59 in 2001 to 0.53 in 2012), income growth for low-wage earners (between 2001 and 2012, the income of the 5% poorest grew 550% faster than the 5% richest), as well as increased spending on education and health by the federal government (13% of GDP in 2003 to over 16% in 2011). But, these years were a far cry from breaking the hold of the ruling class over political and economic life.
Rather, the Lula years were marked by the implementation of orthodox foreign investment, trade, fiscal, monetary policies, indeed so orthodox that the neoliberal periodical Economist toasted Lula’s policies as providing a model for other big “emerging markets.”
Those years were also marked by declining poverty, despite the absence of the redistributive measures that both business and labor had expected the PT to put into effect. So how did Lula square the circle? In a long, illuminating article in the London Review of Books, the leading Marxist analyst Perry Anderson says that Lula’s innovation was to combine conservative macroeconomic policy and foreign-investment-friendly policies with an anti-poverty program, the Bolsa de Familia, that cost relatively little in terms of government outlays but produced socially and politically significant impacts. Bolsa, a program of cash transfers conditioned on parents keeping the family children in school and subjecting them to periodic health checkups, by some estimates, contributed to the reduction in the number of poor people from 50 million to 30 million — and made Lula one of the few contemporary political leaders who was more popular at the end of his reign rather than at the beginning.
One other factor was decisive: the expanding global economy. The first decade of the 20th century was marked by a rapid expansion of trade that benefited large emerging markets like Brazil, which grew by an average of five percent per annum between 2000 and 2012. Rapid growth meant that even with minimal redistributive policies, people’s incomes increased. Lula had the good fortune of being president at a time of a global commodities boom which also provided the resources that allowed Brazil to weather and then delay effects of the 2008 financial crisis.
Along with China, India, Russia, and South Africa, Brazil became part of the so-called BRICS, a group of big emerging markets that became key drivers of the world economy. The PT government’s representatives played a key role in advancing the BRICS as well as other developing countries’ agenda in the World Trade Organization, International Monetary Fund, and the United Nations.
Unfortunately, this sense of playing an historic role in the world stage also translated into a bread-and-circuses complex that led the Lula government to bid, successfully, to host the 2014 World Cup and the 2016 Olympics. The consequences of these decisions would come to roost during Dilma’s presidency, when the actual events would take place.
From triumph to crisis
While there were protests throughout the first ten years of the PT’s reign, the first really massive protests exploded in the run-up to the World Cup.
These were triggered by the displacement of urban poor communities by construction activities, the popular perception of corruption surrounding some construction deals, and the sense that the focus on the World Cup was leading to government neglect of transportation and other essential public services. These were not partisan political protests, says Iole Iliada, “but the Right noted that there was dissatisfaction with the government and that they might also be able to mobilize people by riding on the issue of corruption.”
The abandonment of basic organizing by both the PT and leftist social movements left a vacuum that steadily came to be occupied by Rightist forces. The rise of evangelical churches (61% between 2000 and 2010 according to IBGE) and the exercise of their political muscle (Evangelical legislators, who belong to different parties, doubled in the 2010 election and rose by another 30 percent in the 2014 election to comprise about 18 percent of the current lower House) has come with a resurgence of conservative social values that directly contend with the progressive identity politics of the PT and social movement militants. Rightist and opportunistic parties such as the Social Democratic Party of Brazil (PSDB) and the PMDB and the have taken advantage of the social frustration fomented by these churches, as well as their grassroots organization, to rally discontent with PT rule.
While tension has been building since Brazil’s economy began shrinking in 2011, a major opportunity for the Right came in 2014, when the Petrobras scandal broke out. Over 50 members of Congress and the Workers’ Party were implicated in a massive $3.7 billion kickback scandal, one of them being the national treasurer of the Workers’ Party. While Dilma has not been directly implicated in the affair, she was, in fact, head of the Ministry of Energy that oversaw Petrobras at the time of the kickbacks.
If corruption brought the middle class into the streets, Dilma’s shockingly quick turnaround from the pro-social services, pro-employment program she aggressively pushed in the last month of the hotly contested elections of October 2014 dampened support for the PT among the organized working class that has long served as the base of the party.
Expectations that keeping unemployment low, focusing on growth, and maintaining social programs benefiting the poor would be her priorities were punctured by her raising interest rates just three days after the elections and her appointment of Joaquim Levy, an aggressive fiscal conservative popularly known as “Mr. Scissorhands,” as finance minister. Also, the rural lower classes were affronted by the appointment as minister of agriculture of Katia Abreu, a senator known as a fierce defender of landowning interests who had displayed such disregard for the environment that she received Greenpeace’s “Golden Chainsaw” award.
The appointments of “Mr. Scissorhands” and “Mrs. Chainsaw” were seen as a strong indication that Dilma endorsed the neoliberal view that the way out of Brazil’s current recession lay in a strategy of cutting government costs while intensifying Brazil’s export drive, particularly of large agricultural products like soybeans and sugarcane. It is important to note that neither these appointments, nor the government’s fiscal austerity program, were decided in consultation with the PT membership.
One cannot avoid speculating, however, that if international commodity prices had not lurched into crisis, Dilma would not be in the pickle she is in today. Lula, in many ways, surfed on the wave of a growing global economy that benefited Brazilian exports, particularly soya exports to the burgeoning Chinese market. With the financial implosion of 2008, Brazilian exports to the US and Europe fell, but it seemed like the domestic economy would suffer nothing but a hiccup, especially since the Lula government put into motion a strong Keynesian spending program. By 2011, however, the global recession caught up with Brazil, with the economy growing by only 1.3 per cent over the last four years compared to 4-5 per cent during the Lula period. This year Brazil is in recession while inflation has reached a 12-year high.
One of the key beneficiaries of capitalist globalization over the last three decades, Brazil has now become a prime victim as the downside of that process – global contraction and long-term stagnation – has taken hold.
With massive opposition-inspired protests, the Dilma administration’s survival depends greatly on the moves of its supposed allies in the non-ideological PMDB. Wooed by the opposition PSDB to support its initiative to impeach the president, the PMDB, opportunistic as usual, is weighing whether to stick with Dilma in return for more positions or join the impeachment drive, which might have an even bigger payoff. Two things are giving it pause.
The first is that although the PMDB President of the Lower House, Eduardo Cunha, has openly split with the government and portrays himself as Dilma’s “archenemy,” he himself is politically vulnerable. In addition to being implicated in the Petrobras scandal, Cunha is currently facing money laundering charges by both Brazilian and Swiss government prosecutors in relation to several bank accounts discovered by the Swiss government and previously undisclosed to the Brazilian government. The Brazilian Attorney General alleges that the at least US$16 million Cunha had in the Swiss accounts was derived from bribes and partially laundered through an evangelical megachurch before ending up in Switzerland. Pushing for Dilma’s impeachment, Cunha fears, might provoke a fierce PT response that could threaten his own position.
The second is that the pro-impeachment lobby can’t make up its mind on whether to push for impeachment now or postpone it till later in Dilma’s administration. The rationale for the second strategy, which might be called dealing Dilma a “death by a thousand cuts,” is to get the PT government to make more social cuts and take the flak for them, with the strategic aim of discrediting Lula, who is expected to run again for president in 2018 and whose charisma cannot be underestimated.
PT militants fight back
Though much delayed, PT militants and leftist social movements are beginning to fight back.
A study, For a Just and Democratic Brazil, put out by the party’s Perseu Abramo Foundation, based on consultations with over 100 economists and other analysts, lays the blame for the economic crisis principally on the international crisis rather than wrong policies, as alleged by the Right.
Since it was based on the wrong diagnosis, the adjustment program pushed by the government and personified in Levy has merely worsened the situation, “reducing aggregate demand, blocking growth and incurring social costs.” The document claims that half a year into the second Dilma term, the fiscal retrenchment strategy has raised unemployment to 7.5 per cent in July, compared to 4.9 per cent a year earlier, a drop that represents the loss of nearly 500,000 formal sector jobs. In May alone, the PT study claims, average real income fell by five per cent.
In place of the fiscal retrenchment program, the document lays out in great detail a strategy of maintaining or increasing the levels of public investment to trigger increasing income economic growth, reducing interest payments, tax reform, revision of fiscal incentives, and combating tax evasion. The avowed aim of these measures is to preserve the PT legacy of social inclusion that is now under threat from the neoliberals.
What impact the alternative program will have remains to be seen. But the consensus among party members and sympathizers we talked to is that the problems of the PT government go much deeper and will require more fundamental solutions.
Back to the past?
Some of the more thoughtful progressive critics trace the problem to the erosion in internal party discourse and bottom-up participation, combined with the collapse of grassroots recruiting and organizing on behalf of both the PT and leftist social movements.
When the party gained power and, in some places, prioritized winning seats over the quality of candidates over the last 15 years, party cadres got absorbed into government, party life ossified, if not disappeared, and ideological debates on key issues were overshadowed by pragmatic adjustment to capitalism as a reformist force.
For some, regaining the party’s early identity and vigor as an anti-capitalist force linked to an insurgent labor movement and a dynamic civil society is the real answer to the PT’s troubles. In order to do this, the party faces the puzzling predicament of shaping a new generation of anti-establishment militants when it has been the face of the state for over a decade.
The question is, are the forces of renewal within the party strong enough to push the party back to its roots in its heroic era?
Cecilia Lero and Telesur columnist and TNI Associate Walden Bello, both belonging to the Philippine political party Akbayan, recently visited Brazil as guests of several civil society organizations and universities.