Radical Promise, Neoliberal Policy

Published : Apr 21, 2006 00:00 IST

LUIZ INACIO LULA DA SILVA at the Presidential Palace in Brasilia during his inauguration as President, on January 1, 2003. - ERALDO PERES/AP

LUIZ INACIO LULA DA SILVA at the Presidential Palace in Brasilia during his inauguration as President, on January 1, 2003. - ERALDO PERES/AP

Fire in the plains, Fire in the mountains: A balance-sheet of Lula's promises and policies.

Latin America is a continent of contradictions. Like that of the United States and Canada, its own state system was born in colonial occupation, settlement of vast European populations on stolen land who then went on to reserve for themselves all the power and property, extermination and dispossession of indigenous populations, as well as insertion of slave labour in large parts of the continent, notably in Brazil. Yet, in the global division of labour, Latin America itself came to be the object of imperialist exploitation, very much like Asia and Africa, and very much unlike its northern neighbours, so that its recent history has given rise to countless mass movements of socialism, anti-imperialism, populist nationalism and, in the current phase, militant struggles for the rights of the indigenous peoples. Overwhelmingly Catholic and conservative, Latin America is also home to the most radically dissident currents of liberation theology from one end of the continent to the other, in great many forms, from one generation to the next. This permanently insurrectionary political culture has been met with waves of the most brutal coups d'etat, military dictatorship and armed right-wing terror, sponsored by the U.S. Yet, out of the rubble and ashes, the Left keeps rising again and again, in the most surprising ways.

The great revolutionary traditions of Venezuela's Simon Bolivar, Cuba's Jose Marti, Mexico's Emiliano Zapata and Nicaragua's Augusto Sandino have lived on in more recent leaders such as Fidel Castro, Che Guevara, Salvador Allende and, most recently, Hugo Chavez. Millions have fought and struggled for the revolutionary aspirations symbolised by these names. Yet, Latin America also has a long and fateful history of populist leaders who make and break promises with the greatest ease; men who preach socialism when out of power and pragmatism when in power; Left-wing parties who formed governments only to implement pro-imperialist policies. In Bolivia, Evo Morales has inherited an economy where Left parties had colluded in implementing programmes of the International Monetary Fund, and the most sweeping neoliberal policies were implemented in Brazil, in service of U.S. finance capital, by none other than the man who was President between 1994 and 2002, namely Fernando Henrique Cardoso, a former Marxist and a seminal intellectual of Dependency Theory, which held that no Third World country, and least of all Brazil, could develop a modern, prosperous and equitable economy without breaking with metropolitan capital. The balance-sheet of promises and policies by the present `leftist' President, who will face re-election in October, has to be drawn in this perspective.

What is currently called "Latin America's turn to the Left" (or, more accurately, "the pink tide" of the "responsible Left") began in Brazil, with the election of Luiz Inacio "Lula" da Silva - a high school dropout and a former shoeshine, metal worker, trade unionist and leader of the Workers Party/Partido dos Trabalhadores (PT) - to the presidency of the country in 2002, with 61 per cent of the vote. Referring to those class origins, he had exulted shortly before taking office: "I cannot fail. The poor in Brazil have waited 500 years for someone like me." A messianic self-image, if there ever was one. He had himself waited for 13 years, since 1989, when he first fought and almost won the presidential election, with a party and a programme very much more to the Left than it was to be in 2002.

The euphoria, releasing pent-up emotions of all those years, was immense. "Hope has won over Fear," said Lula, echoing Emir Sader, the eminent Brazilian intellectual. There was night-long dancing in the streets of Sao Paulo and Rio de Janeiro, the latter said to have drawn 200,000 to that spontaneous all-night party. Hugo Chavez himself welcomed Lula to what he called "the axis of good" in Latin America, and the level of expectation in Brazil, Latin America's largest and most industrialised country, was in 2002 very similar to what it was to be this year in Bolivia, a much smaller, land-locked country and, next to Haiti, the continent's poorest.

Reasons for celebration were in some respects very well-founded. Most of Latin America had gone through a terrible phase of brutal military dictatorships between the mid-1960s and the late-1980s. Brazil itself had suffered the first of these continent-wide coups when the military overthrew the Left-leaning and anti-imperialist government of Joao Goulart in 1964 and proceeded to rule the country with an iron fist until 1985. The military regime in Brazil was relatively less repressive for most of the social strata than the similar regimes were to be in Chile or Argentina subsequently, but it was brutal in suppressing working class militancy, decimating the predominantly communist Left and closing down the unions. It was in this prolonged military crucible that the hegemony of the Brazilian Communist party, and of the armed guerilla groups which had arisen alongside it, was broken. The Left that arose in the 1980s and eventually came to power in 2002 had no roots in those earlier traditions, was generally antagonistic towards them, and was responding much more to the conditions created during the military dictatorship and the subsequent `democratic' but dependent and neoliberal regimes. Nevertheless, the PT that had been founded in 1980, was the first party of the Left to form government in any of the larger countries of Latin America that had passed through that terrible phase of military rule and neoliberal democracy. Sandinistas had ruled briefly in a small, besieged country. Brazil was, in population and territory, half of South America. Hopes of the oppressed of a continent were pinned on it.

It needs to be remembered that neoliberalism came to Latin America before anywhere else, and that General Augusto Pinochet had applied the economic wisdom of the economists of the Chicago School in Chile, after his 1973 coup, before Margaret Thatcher and Ronald Reagan made those ideas dominant within Western governments. And, as Emir Sader has pointed out, "Jeffrey Sach's shock therapy was tested out by the former nationalist Paz Estensoro in Bolivia well before its implementation in the former Soviet bloc" - not to speak of the formerly nationalist Peronists in Argentina as well as the Centre-Left elsewhere, for instance the Socialists in Chile and Cardoso in Brazil, who acted similarly. With the experience of Manmohanomics of the re-fashioned Congress party in India, this enthusiasm for neoliberalism on the part of the formerly nationalist and formerly socialist should be familiar enough for us. However, the fact that neoliberalism came to Latin America before anywhere else, and that it was implemented in the most naked forms in a continent broken by dictatorships but with vibrant traditions of insurrectionary politics, also meant that the first mass uprisings against neoliberalism also came in that continent. The PT, with Lula as its titular representative, arose in this milieu.

The military dictatorship had not only eliminated long-standing traditions and organisations of the Left, it had also transformed the nature of Brazilian capitalism through a new kind of partnership between the centralised, authoritarian state and the mostly U.S.-based finance capital, which came to Brazil not so much as investment as credit on initially low but fluctuating interest rates, thanks to great excess of eurodollars and then, especially, petrodollars. Eventually, this accumulating foreign credit was to spell ruin of the Brazilian economy when interest rates rose dramatically from the 1980s onward, contributing even to the collapse of the dictatorship itself as well as its model of development, paving the way for the most brutish kinds of neoliberalism under Cardoso. For the first 15 years, however, the economic expansion was brisk, at 10 per cent for almost a decade and at 7 per cent thereafter, as influx of foreign credit was combined with freezing of wage rates and ban on union struggles, pushing up profit rates in sectors of industrial production, such as the automobile industry, which catered to the richer sections of the population and exports to other Latin American countries. This gave rise to the growth of a new working class much of which was concentrated in zones around Sao Paulo which now emerged as the country's financial centre and economic hub, whose prosperity in turn attracted vast migration from the countryside, especially the impoverished northeastern regions. New and very militant struggles for unionisation arose among this newly emergent working class, alongside a variety of organisations among the newly urbanised rural poor of the shantytowns. Those struggles eventually broke the military's wage freeze and ban on unionisation, and, together with movements of the urban poor, became the most substantial and militant base of the PT when it was formed in 1980.

Brazil has a very peculiar mix of the rural and the urban. By now 75 per cent of its population of 177 million lives in cities of various sizes, and this largely urban economy is the ninth largest in the world. However, this still leaves 40 million or more in the countryside, of whom roughly a third can be defined as the rural proletariat and another one-third as small farmers, of whom about four million are landless. Moreover, much of the urban population consists of first or at most second generation landless peasants who have moved to the cities under duress and are unwanted in an economy which has the world's worst income distribution and a real unemployment rate which is said to be close to 40 per cent; even the government concedes an unemployment rate of 20 per cent in Sao Paulo, one of the two most prosperous cities in the country. Meanwhile, land use is extraordinarily lopsided. Joao Pedro Stedile, the leader of the legendary Landless Workers Movement (MST) says: "According to the Gini index, Brazil has the highest concentration of land ownership in the world. One per cent of the proprietors - around 40,000 of the biggest ranchers, or latifundiarios - own 46 per cent of the land, some 360 million hectares, in fazendas of over 2,000 hectares. In general, these are either occupied by livestock or entirely unproductive. Below them, the agrarian bourgeoisie own another 30 million hectares on properties of between 500 and 2,000 hectares; this is the most modernised sector, producing soya, oranges, coffee. The holdings of the small farmers - under 100 hectares - produce mainly for subsistence, selling a small surplus at markets." That is the agrarian upper class. At the extreme other end of the class divide, work conditions in the rural interior are so abysmal that in a recent offensive, the government freed 4,000 slaves from the clutches of landlords; the government estimates that there are 25,000 such hidden slaves in the countryside; other sources estimate that the number may be as high as quarter of a million.

It is under these conditions that several militant organisations of the landless have arisen, of which the MST is possibly the most significant autonomous movement of the landless anywhere in the world. The MST arose in the mid-1980s and now has a presence in 23 of the country's 27 states. Taking advantage of a constitutional provision which provides that land which has been lying fallow and unused may be taken over for redistribution, the MST has organised countless extra-legal land-occupations and has successfully settled 350,000 people on occupied lands, through prolonged confrontations with landowners and the state which has used every conceivable counter-measure of great ferocity, from murder of individual militants to the use of army and even the air force against unarmed peasants.

The new wave of unionisation, beginning under conditions of military dictatorship, gave rise to two major labour federations of which CUT (Central Unica dos Trabalhadores) was the more dynamic, and, together with MST, it became the principal means through which the PT spread its influence in the country at large and especially among the urban workers, landless rural workers and the allied strata; both organisations remained autonomous of the party but were closely aligned with it, the workers' federation very much more so than the MST (which was reflected in the party's name itself). However, the PT was not, despite the name it had given to itself, a workers' party of the type familiar to the communist and socialist traditions. In fact, in its very composition, PT was much more of a conglomeration of movements - women's groups, organisations of indigenous peoples, Afro-Brazilian groups, environmentalists, Catholic communities subscribing to liberation theology - who retained their group identity while working within the party, which prided itself for its diffuse, decentralised, associationist character. By the same token, the MST zealously guarded its autonomous character precisely because it regarded itself as a strictly class organisation in national politics.

For all its great inner diversity, encompassing a whole range from militant trade unionists to former guerillas to lower civil servants chafing at military dictatorship, there surely were certain ideological positions that were fairly common among its key personnel. It denounced the communist tradition for the famous evils of Stalinism, bureaucratism and centralised command structure, to the extent that it went on to align itself with Lech Walesa's Solidarity Movement when that arose in Poland. It criticised European Social Democracy for being "statist" and much too compromising, flirted briefly with Eurocommunism, but finally settled into describing itself as "the first post-social democratic party'. The Eurocommunist criticism of Allende as one who had brought about a coup against himself by being sectarian and not responsive enough to the liberal democrats, was in any case broadly accepted and the party gladly opened itself up to a broad range of social forces, including impressive sections of the business elite.

The generation that founded the PT had come of political age under conditions of military dictatorship and thought of democracy - any kind of `democracy' - as an absolute value, and of `authoritarianism' - not only of military dictatorships but even of political parties based on clear command structures - as absolute evil. The state itself - all kinds of state - was considered intrinsically authoritarian, and far too many of the PT intellectuals adopted much too easily the concept of `civil society organisations' that the anti-communist intellectuals of Eastern Europe - the likes of Havel - had made popular, to be posited against `the state'. `Civil society' was good; `the state' was bad. What was posited against this dichotomy was `participatory democracy', quite forgetting that capitalist `civil society' was based on private property, wage labour and market transaction, none of which could be abolished through dialogue as such. Moreover, this rampant anti-statism also meant that far too many of the PT ideologues were responsive to the idea that the power of the state to shape national economy needed to be curtailed and redistributed into `civil society', which essentially meant the market and the non-governmental organisations (NGOs). Without perhaps knowing it, much of this party of the Left was sliding toward greater privatisation and NGOisation.

The very diffused organisational structure and ideological makeup of the PT made it possible for it to reach out to very diverse strata which were opposed to military dictatorship, its repressive character, its exclusion of large segments of the well-heeled population from political power, and its collusion with foreign capital. The active support it received from the CUT and the MST, not to speak of virtually every well-regarded intellectual on the Left, contributed to PT's status as a party of the Left, in a situation where the socialist Left in other larger countries of the continent has been either eliminated (Argentina, Chile) or contained in the confines of universities and publishing-houses (Mexico). Well before taking the national government, the PT had formed governments at state and mayoral levels, including in some of the larger cities. Its performance at that level had not been worse than, say, that of the Italian communist party (PCI) during the 1970s; in the state of Rio Grand Do Sul and the city of Porto Alegre, where the Left-wing of the PT was in command, much of what it did resembled, in its own very different circumstances, what the Communist Party of India (Marxist) had accomplished in Kerala before neoliberalism took hold of New Delhi. The oppressed in Brazil waited to see, with great enthusiasm, what PT government would be like at the national level. In that odd interval between the collapse of the military dictatorship in 1985 and the onset of full-scale neoliberalism some seven years later, and barely nine years after the founding of the party, PT made its bid for presidential power in 1989, with its radicalism still intact and with Lula as its candidate, but lost by 2 percentage points: a magical moment, not to be recaptured.

The military dictatorship's ambitious plans for debt-driven development, centered especially on heavy industry and production of consumer durables, entered terminal crisis when interest rates began rising dramatically after 1980 and debt payments, contracted on fluctuating rates, started climbing steeply which, in turn, led to enhanced role of the IMF's lending operations for Brazil to meet its debt obligations and subject itself to neoliberal conditionalities. The dictatorship itself fell in 1985 and in the subsequent years Brazil staggered from one financial crisis to another until Cardoso, the former Marxist, was appointed Finance Minister in May 1993 and proceeded to draw up a plan, with the help of U.S.-trained technocrats, an ambitious plan that accorded primacy to the control of inflation and whose fundamental premise was that Brazilian economy could only be stabilised and returned to the path of earlier growth rates if the country could attract large amounts of foreign direct investment. This, Cardosa said, would be easy because abundant finance was floating around the world looking for investment opportunities; but, to attract it, Brazil would need to carry out currency reform for monetary stabilisation, offer exceptionally high interest rates, undertake a vast programme of privatisation of state assets in which foreign capital would be offered preferential treatment, liberalise trade and profit repatriation, and open up all sectors of its economy, from heavy industry to agriculture, for foreign corporate investment and ownership. There was a dramatic increase in wage incomes and reduction of poverty as a result of monetary reform and resulting control of inflation thanks to the introduction of a greatly overvalued currency, and, on the strength of that immediate effect, Cardoso shot his way to the presidency in 1994. The hollowing out of what remained of the Brazilian economy as a result of this currency overvaluation and the remorselessly neoliberal package that accompanied it began only after the elections were over.

Imports shot up by over 52 per cent during the first six months of the new plan (the famous `Plan Real') and the Brazilian trade surplus, which was still running at $10-15 billion annually during the early 1990s, was converted to a trade deficit of $8.3 billion by 1997, partly because the overvalued currency which had been used to curb inflation and stabilise wages had catastrophic impact on Brazilian exports which became far less competitive. Nor did the initial influx of FDI contribute much to expansion of productive capacity. Foreign investors came in, typically, not to build new plants, which would expand production and employment, but to take over the existing ones, even in such key sectors as electricity and telecommunications. During the first four years of the Cardoso presidency, 1994 to 1999, Brazil witnessed 1,233 mergers and acquisitions involving transnational corporations (TNCs), and 70 per cent of all acquisitions were made exclusively by the TNCs with the inflow of $50 billion in FDI in such diverse fields as banking, steel, auto parts, food and drinks, electronics, chemicals and dairy products. The import-intensive service sector was a favourite of foreign capital whose share in it went up from an already high 43.5 per cent in 1995 to 76.6 per cent in 2002 when the Cardoso presidency ended. Between continuing debt payments, spiralling trade deficits, profit repatriation of the TNCs, and flight of domestic capital, the crisis of liquidity remained and grew worse year by year. By the time of the end of the Cardoso presidency and the election of Lula to the office in 2002, Brazil's foreign obligations stood at $400 billion.

Local research and development was largely abandoned, and the cost of capital goods imported from abroad doubled between 1995 and 2001. By the later date, 97 per cent of the components needed for upgrading the Brazilian telephone system were getting imported, and major national enterprises known for technological innovations - Metal Leve, Freios Verga and others - suffered absolute degradation after foreign acquisition, just as research came to a standstill in telecommunication and computer sectors. There was of course a sizable fraction of the internationalised bourgeoisie that profited greatly, in money terms, from junior-partner assimilation into an economy dominated by the TNCs, just as the rural bourgeoisie profited from the great expansion of export crops in collaboration with foreign monopolies in transnational trade in agricultural commodities. However, between trade liberalisation, falling domestic demand due to fall in wages and employment, and high domestic interest rates (which reached an incredible 64.8 per cent in the latter part of 1995), countless small and medium-scale indigenous industrial enterprises simply collapsed. As Geisa Maria Rocha puts it, "Denationalisation, in other words, has been accompanied by a real measure of deindustrialisation."

The first point to be made here is that, thanks to the policies adopted for attracting massive amounts of FDI, the growth and development performance of the IMF-backed neoliberal regime of Cardoso was throughout the eight years of existence strikingly worse than what had been previously achieved through the ambitious state-led programme of national industrialisation undertaken by the military regime during the first 15 years of its existence, before the spiralling interest rates in the core imperialist zone produced a crisis in Brazil, as also in diverse other countries from Mexico to Russia. The second point is that when Lula came to power in 2002, he inherited this crisis, which had indeed sharpened deeply over the few months immediately preceding his election to the presidency. How ready and willing was Lula to cope with it, and through what mechanisms? An argument is often made that despite his radical plans and ambitions, Lula was simply trapped in a financial crisis and a set of massive international obligations of the Brazilian state, which he had no power to resolve. The contrary argument is that continual rightward drift after the electoral defeat of 1989 and the eventual acceptance of the terms and conditions imposed on Brazil by international finance and its institutions in 2002 was the price Lula paid for acquiring the presidency in the first place.

The personal prestige, charisma and popularity of Lula has always been very much greater than that of his party, and to that extent he has always been somewhat above the party. Even in the elections of 2002, which eventually brought him to the presidency, the PT won only 20 per cent of the seats in Congress (the Brazilian Parliament) while Lula gained 61 per cent of the vote in the second round, which brought him to the presidency. (A second round of voting, in a run-off between the two leading contenders is mandated by the Brazilian Constitution in case none of the candidates wins over 50 per cent of votes in the first round.)

The elections of 1989, and especially of 1998, when Lula gained 44 per cent of the vote in the first instance and merely 32 per cent in the second instance, seem to have been decisive in transforming the thinking of Lula himself and the organisational character of his party. Founded in 1980, the PT went through a phase of expansion great and rapid enough to enter the elections nine years later with the realistic expectation of perhaps winning them. The presidency was lost by mere 6 percentage points, a remarkable achievement for a political party so very new, and a great tribute not just to the party but specially to the mass movements, notably the labour federation of the CUT and the militant movements of the landless. Alongside this impressive showing in the presidential election, the PT also improved its position in Congress from 16 in 1986 to 35 in 1990 while also winning several city governments.

This performance of 1989-90 had two consequences. On the one hand, as Lula began to look increasingly presidential, the ambience and political outlook of the top leadership of the PT began shifting away from mass movements such as the CUT and the MST and more toward European social democracy, notably the French socialists who had by and large accepted the main premises of neoliberalism under Mitterrand. And, within the organisational structure, which now got more streamlined - from being a conglomeration of movements, to being more of an electoral machine - power and prestige began shifting away from the unruly militants of the mass movements toward the more sedate PT members of Congress, the state governments and the mayoral offices. In short, the PT became more respectable. As Stedile, the MST leader, was to say later: the Brazilian Left forgot that real political power and social change comes through self-organisation and militant struggle of the masses, not through accumulation of votes. This inner transformation of the PT continued even as mass struggles actually intensified in other arenas, leading to fissures opening up within the labour federation of the CUT and between the leftist and rightist tendencies within the PT. During the latter 1990s, moreover, the crisis of the PT was further aggravated by the profoundly negative effects of Cardoso's neoliberal policies, which decimated the working class in the strongholds of the party in the industrial zone around Sao Paulo while it retained its middle class base in Sao Paulo as well as Rio. The leadership itself became more responsive to intellectuals, Brazilian or not, who advocated monetary stability above all else.

Lula was again a candidate in 1998, chose not to oppose Cardoso's economic policies, seemed to advocate no policies of his own, and received 32 per cent of the vote (a drop of 12 percentage points in his share of the vote) against Cardoso's 53 per cent in the very first round. It is at this point that Lula seems to have decided to remake himself and largely cut loose from PT structures, considering that his own popularity was still more than that of the party. He created an Institute of Citizenship, a think-tank which did not even claim to be socialist, and which gathered economists and experts in other fields for seminars and discussions that were to lead to the formulation of the programme for his electoral campaign of 2002. With Cardoso legally not allowed to run for a third term of the presidential office, Lula fast emerged as the leading candidate in that electoral campaign. The more he appeared as the likely winner the sharper became the campaign of Western governments and media against him, as an "irresponsible" leftist who might try to repudiate the debt and thus bring isolation of Brazil in the international community and chaos in the Brazilian economy, thus creating great panic among the Brazilian middle classes and bourgeoisie. With the presidency possibly slipping out of his hands, Lula opened negotiations with the IMF and the U.S. officials. At length, he chose a textile magnate as his running mate and issued the famous "Letter to the Brazilian People" in which he pledged that, if elected, he would honour all of the previous regime's commitments, would neither repudiate nor try to renegotiate the debt and would not set any new restrictions on movements of international capital. The international campaign against him ceased and he won handsomely.

As President, Lula appointed a neoliberal economist as the Governor of the Central Bank, who had previously been the CEO of the Fleet Boston Global Bank, a U.S. bank that had played havoc with Argentine finance. Banco Central do Brasil, the state-owned banking giant, was put under the charge of Cassio Caseb Lime, aformer official of the U.S.-based CitiGroup. The Ministry of Finance was given to Antonio Palocci, former Trotskyist (like the British Foreign Secretary Jack Straw) who had moved to the neoliberal right. The Ministry of Agriculture was handed over to Roberto Rodriguez, a former President of the Brazilian Agro-Industrial Association, an enthusiast of genetically modified crops and a cohort of Monsanto, the U.S.-based TNC. The Foreign Ministry was given to Celso Amorin, a former Marxist who worked closely with U.S. authorities for preparing the groundwork for Free Trade Area of the Americas (FTAA). Not a single economist associated with the PT or with any other part of the Brazilian left was invited to join the Cabinet. Instead, the PT deputies and one of its Senators were expelled when they opposed Lula's bill putting a new cap on public-sector worker's pensions.

The Brazilian economy was certainly not in too good a shape when Lula took over. There is no truth, however, to the myth, that he was facing an imminent crisis. Reserves were stable at about $40 billion and trade gap had narrowed considerably. He had been elected with an impressive majority and enjoyed great public support, not to speak of militant mass movements who could have mobilised millions into the streets if he had tried to re-negotiate with the IMF for better conditions; after the financial crisis in Argentina, which precipitated mass agitations, Kirchner was able to declare moratorium on debt payments, reopened negotiations and obtained partial debt cancellation. Lula could have easily achieved that much. Instead, he not only continued with Cardoso's policies but went further in raising interest rates even further, raising the level of primary fiscal surplus, attacking workers' pension funds, imposing new taxes on retirees, and so on - with predictable consequences for majority of the population.

In foreign relations, Lula is often presented as working with India and South Africa to build a bloc of the three large economies in the Tri-Continent, as if cooperation with the neoliberal regimes of Thabo Mbeki and Manmohan Singh is some kind of evidence of anti-imperialist radicalism. Lula maintains a cordial though not entirely comradely relationship with Chavez, mainly because a rush of petrodollars makes Chavez attractive to him. By contrast, Lula assembled a Latin America force under Brazilian leadership to constitute the United Nations force, which took over from the Franco-U.S.-Canadian military force that had occupied Haiti after the U.S.-sponsored coup there, thus helping the U.S. in legitimising the coup. The Brazilian giant, Petrobras, is deeply involved in exploiting the gas resources of Bolivia, and it is very doubtful that Lula would offer some dramatic act of solidarity with the Bolivian people by foregoing that corporate interest. Soon after getting elected, he went to Porto Alegre to address the World Social Forum of anti-globalisation protesters as well as to Davos to address the magnates of global capitalism, in a balancing act that displeased even the most ardent of his supporters. The PT made morality in politics a major plank of its electoral campaigns. More recently, some of Lula's closest aides have had to leave office owing to financial scandals surrounding them. Lula himself has survived this crisis, and one still hopes that he will win re-election in October because the alternative is a candidate of the Far Right.

As the "pink tide" rolls across the continent while actual membership in the "axis of good" remains indeterminate, the contrast between the Bolivian and Brazilian situations is stark. The Bolivian mass movements overthrew two governments in two years through direct action in the streets and then helped get Morales elected as someone beholden to their power. In turn, the major immediate objective of the Morales government is to put together a constituent assembly and re-write the Constitution so as to make fundamental radical changes possible. In Brazil, mass movements were never powerful enough to determine the fate of governments, the PT never came close to majority in Parliament and Lula rose to power as a figure larger than his own party. The PT did once have the chance to become a great party of the Left, a serious contender for political hegemony in the country, a point of intersection and union between electoral politics and militant mass struggle. The rise of the CUT and the MST were events of immense historical significance but they never could dominate the PT, and the PT settled much too soon into becoming what is essentially an electoral machine dominated by a charismatic personality. In Brazil, more than elsewhere, there once was a chance that the Left would find that particular mix of mass militant struggle and electoral politics without which no revolutionary politics is possible within the republic of the bourgeoisie. That chance seems to have been missed. What remains now is defence of the "pink tide" and the "responsible Left".

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