Ideology tops common sense in Brazil campaign | World| Breaking news and perspectives from around the globe | DW | 02.10.2014
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Ideology tops common sense in Brazil campaign

Brazil's economy is flagging shortly before the election. But despite stagnation and growing inflation, frontrunners Rousseff and Silva debate about social programs and don't focus their campaigns on economic policy.

The political system is not actually in question in Brazil. Unlike in neighboring countries. like Argentina and Venezuela, a planned economy isn't on the table. Even though the two most promising candidates belong to the Workers' Party (Dilma Rousseff) and the Brazilian Socialist Party Marina Silva, capitalism is the way to go in Brazil and nobody is straying from it.

Still, economic issues are sometimes discussed so ideologically that one would think a working class victory was at stake. This became especially clear at the beginning of September when Marina Silva called for an independent central bank. Rousseff jumped on that: "Banks cannot be the fourth estate in our state," the President countered. Rousseff's campaign plan is to portray her main opponent as a representative of neoliberal economic policies.

Conservative and Socialist

Banco Central do Brasil building. (Photo: EPA/JARBAS OLIVEIRA)

Brazil's central bank has been a contentious topic in the campaign

It's one of the many contradictions in the Brazilian presidential campaign that "Socialist" Marina Silva is the more conservative of the two frontrunners. That not only goes for the moral values of the evangelical - she's a member of the popular Pentecostal church Assembleia de Deus(Assemby of God) - but also her political plans.

Marina Silva wants to scale down the government apparatus, which has grown during the 12 years the Workers' Party (PT) has been in power. And she's aiming for tax reforms that would mostly unburden companies und reduce the bureaucratic jungle.

"Marina Silva wants to change things and is bringing in good ideas, and she's also able to accept criticism and willing to learn new things," Ingo Plöger, President of the Business Council of Latin America (CEAL) in Brazil, said.

Other business people are more wary of her. After all, the former environment minister has announced she'd demand that companies be more sustainable.

The fear in economic circles is that this call could include the stricter interpretation of an existing law, which allows the disappropriation of land that's not used productively. These areas would then fall to small-scale farmers.

Stagnating economy

But Dilma Rousseff's economic policy is also facing criticism. According to the Organization for Economic Cooperation and Development (OECD), Brazil's economic growth has decreased from 2.7 percent to 0.3 percent (forecast for 2014) since Rousseff took office in January 2011.

Silva and Rousseff at a presidential TV debate. (Photo: EPA/Sebastião Moreira)

Silva (center) and Rousseff (right) are the frontrunners in Brazil's presidential election

The cooling global economy is only part of the reason for that, seeing that international trade only contributes 20 percent to Brazil's GDP. Brazil's economy has also grown slower than the rest of Latin America's under Rousseff. Among the region's large national economies, only crisis nations Argentina and Venezuela are doing worse.

Experts say four factors are responsible for this downward development: a lack of trade agreements, high taxes and import tariffs, poor infrastructure and excessive bureaucracy. These factors neutralize the advantages that come with the country's wealth of resources and the growing purchasing power, according to experts.

The problems in Brazil even have a name: "Custo Brazil," the cost of Brazil. To ease the investment backlog, the PT government already initiated a 200 billion euro economic stimulus package under Rousseff's predecessor Luiz Inacio Lula da Silva. But that was only modestly successful.

On the whole, economic issues have played only a subordinate role in the Brazilian campaign, despite the flagging economy. The corruption scandal at the semi-state-controlled oil and gas corporation "Petrobas" and the funding of social programs figure more prominently. And nobody's talking about an independent central bank anymore either.

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