A Pivotal Week for Brazil

By Eduardo Valle, Director - Brazil

Photo Credit: Leo Correa/AFP via Getty Images

A series of seismic events this week look set to shape the run-up and possibly even the outcome of October’s election, bound to be the most fragmented since 1989. Some of these events have launched pre-candidates, while others represent a severe blow to two presidential hopefuls.

On March 6th, the Superior Court of Justice (STJ) unanimously denied former president Luiz Inácio Lula da Silva’s bid for a preventative habeas corpus. Lula leads the presidential polls[1] at over 30% of voting intentions, despite an upheld conviction for corruption and money laundering by an Appeals Court in January. He now seems even closer to serving a 12-year prison sentence, and further away than ever from being an eligible candidate. 

A day earlier, Justice Luis Roberto Barroso at the Federal Supreme Court (STF) authorized the Federal Police to lift President Michel Temer’s banking secrecy. Barroso is responsible for an investigation launched in September on whether a decree signed by Temer last year illegally favored a foreign trade and logistics company called Rodrimar in the Port of Santos, the largest in the country.

While Lula remains an immensely popular figure, Temer – the most unpopular president in Brazil’s history, currently at 4.3% approval rates – has barely registered on election polls, with less than 1% of voting intentions. Although the President has declared “I am not and will not be a candidate”, which in Brazilian politics is often gibberish, his hopes of becoming a viable candidate, or at least a decisive supporter of a situational candidate, were somewhat reanimated last week with the military intervention he declared in Rio de Janeiro.

Yet another key event shaking the run-up towards the October elections, the intervention has shifted the Government’s agenda and public debates from fiscal reforms to public security. Temer’s moves to focus on public security, including the creation of a powerful Extraordinary Ministry of Public Security, seemed more about political strategy and a way to promote his popularity than a well-structured approach to reducing violence.  In addition to the recent STF bank secrecy episode, his expectations now depend on the outcome of the intervention in Rio. Improvements in social indicators, for instance, will take much longer to be confirmed than the immediate approval the intervention receives in Congress and the Rio population alike.

Public security, therefore, now emerges as a clear issue for the October elections, alongside two well-established topics: corruption and the economy. For instance, according to data released by the Brazilian Institute of Geography and Statistics (IBGE) on March 1st, the Brazilian GDP increased by 1% in 2017, following 3.5% recession rates in both 2016 and 2015. This has promoted some optimism, and increased the ambitions of yet another presidential hopeful, Ministry of Finance Henrique Meirelles. But unemployment rates still loom at above 12% and Brazil’s economy; as the Financial Times accurately summarized on March 5th, has gone “from zombie to walking dead” and the next president will need to “unwind terrible distortions”. These include a pension reform which is already off the parliamentary agenda for this electoral year after Temer failed to push for a vote last year.

All that is solid melts into air

Some parts of the electoral machine run while others walk. The elections are still months away, and so is a final definition of which candidates will run, as candidatures can be registered until August 15th. Potential candidates can change parties without penalty between March 8th and April 7th. In the meantime, most of the likely candidates –  including center-right Minister Meirelles and President Temer – are either too far from achieving a second round or too vulnerable: to jail, as in the case of Lula, or to being ‘deconstructed’ as electoral campaigns gear up.

Such is the case of far-right federal representative Jair Bolsonaro, a former military officer who has been ranking second to Lula in most polls where the ex-president is considered. Bolsonaro’s declaration on March 8th as the Social Liberal Party  (PSL) candidate, was met with a cheering audience as he summed up some of his positions: “Violence is fought with energy and, if necessary, with more violence"; “A father would rather come home and see his son with a broken arm from soccer than playing with a doll… marriage is between a man and a woman, period”. Such declarations are music to the ears of some portions of Brazilian society that cannot be disregarded, and that seem to be firmly embracing their far-right candidate. But his positions, lacklustre mandates as a federal representative, and dismal knowledge of economic principles give other candidates and even larger portions of society plenty of ammunition against this Trump admirer. Like Trump, however, Bolsonaro is not to be downplayed. He leads the presidential race in scenarios where Lula is absent, followed by center-left Marina Silva (13,9%), a former senator and environment minister. Yet polls also indicate Bolsonaro has remained stagnant at around 20% of voting intentions. 

Though polls are not exactly favorable to the state of São Paulo’s governor Geraldo Alckmin (6.4% with Lula and 8.7% without Lula; 50.7% rejection rate), this seasoned politician has been discreetly paving alliances with center and center-right parties and within his PSDB party, one of the three largest in Brazil. This would also secure him far more TV and radio time than most candidates and a good chunk of the “Fundo Partidário”, a public fund to finance parties and political campaigns that thanks to Congress has dramatically increased since the Supreme Electoral Court forbade corporate financing – a traditional source of corruption in Brazilian elections. Center-right Alckmin also enjoys a widespread approval in the state of São Paulo, the country’s largest electoral hub, which he will govern until April 5th, the deadline for governors and other authorities running for office to leave their current positions.

So far, and in spite of many challenges including his lack of charisma and national projection, Geraldo Alckmin is the only solid candidate among all other presidential hopefuls. This week center-left Ciro Gomes and the speaker of the House, center-right Rodrigo Maia, have also been confirmed pre-candidates. Gomes might inherit some votes from Lula in case the former president is left out of the ballot, but those votes could also be transferred to Marina Silva, minor leftist candidates, and whomever Lula appoints as his Workers’ Party B-plan, e.g. former São Paulo mayor Fernando Haddad. Maia’s candidature for the moment seems more like a means to level up his political influence and guarantee his re-elections as a federal representative and speaker of the House, or else a seat in the Senate, rather than a serious ploy for the presidency.

The atmosphere in Brazilian politics will remain tense and the road toward the 2018 Election long and eventful, with further twists and turns sure to pop up along the way.


[1] The most recent poll is by CNT/MTA, released by the National Transportation Confederation on March 6th and used as a reference across this article.

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Melanie Wahl, Country Manager - Brazil