International Worker's Day may change Dilma's tone in pre-campaign

Dilma will address the nation in the
International Worker's Day

It seems the recent bad numbers in the electoral surveys have finally hit the pre-campaign of president Dilma Rousseff.  Yesterday the president already changed the strategy and started attacking her opponents. She said during a speech that she does not believe the country will make a step back (meaning she believes she will be reelected). The tone is expected to be even more direct on her TV speech tomorrow on account of the International Worker's Day. She may address her main opponents Aécio Neves from the social democrat PSDB party and Eduardo Campos from the socialist party PSB stating clearly what her government has conquered to the working class in Brazil.

Today O Estado de S. Paulo published pieces of Dilma's government program draft. The text basically makes a direct reference on the benefits that the Workers' Party (PT) made for the country and tries to frame adversaries proposals as threats for the average Brazilian worker. One example is the adversaries defense of the Central Bank's independency. The text asks: "Independence from whom?", implying that without control the Central Bank would damage the workers income gains. It also refers to the past government of PSDB as a privatist government.

Both strategies proved to work well on the last two campaigns of PT (for Lula's reelection and Dilma's election). The question is if this is going to work again, specially when the government proved to be such a bad manager in the energy sector, and when the gains from the policy of increasing salaries and maintaining jobs are being eroded by an inflationary bubble that threats to damage the purchasing power of the country's lower classes for the years to come.

The attempt to frame adversaries as members of "evil market forces" is also a fallacy easy to deconstruct, because her government poured buckets of money to huge transnational companies using subsidized loans from the national development bank, BNDES.

The change of tone reflects the loss of 6,7 percentual points in Dilma's vote intention, from 43,7% to 37%. The president would be still reelected if the elections were held today, but if the trend keeps going, Dilma may loose.

Brazil approves new internet legislation

Brazilian senators vote on Internet Law

The Brazilian Senate has just approved the Civil Landmark of the Internet (Marco Civil da Internet), a subject that will for sure be on the cover of this wednesday Brazilian newspapers. The text of the law ensures net neutrality, even though it also opens the door for content discrimination in specific cases to be determined by presidential decree. The net neutrality -- the legal prohibition of discriminate data flow according to the type of content, such as slowing down Skype connections on mobile internet -- was the most sensitive subject of the law, a subject that now will be probably on the hands of the next Brazilian president to resolve.

The law also ensures the privacy of users and limits the liability of Internet Services Providers in cases of judicial process regarding third party's prejudicial content published online. There is an interesting mention that internet application providers (such as Facebook or Google) should not abuse in the use of private information of users (even if authorized by them). I would not be surprised to see in the future a civil lawsuit against one of the big internet companies in the country.

I'm curious to see how will be the coverage of the main newspapers tomorrow. The first time the text was approved on the Chamber of Deputies I noticed few of the criticism about the limited net neutrality (this I saw later on specialized publications). In fact, both O Globo and Folha were rather optimistic about it. In fact just now (as the subject is only on the online versions of the media, the attentions are focused to the victory of the government in surpassing the opposition maneuvers against the project.

-- update --

I just had a brief discussion with a friend  which was on the government during the public consultations of the internet law project. Basically the reason why they let the details of net neutrality to be determined by presidential decree was in order not to pass a rigid law that would have to be changed in the future due to technological developments. So net neutrality is still there as a principle and a set of rules which will have specific subsets of parameters and exceptions (Many thanks to Guilherme Almeida de Almeida).

As for the media coverage it was pretty modest, compared to the first approval. Since the text was not passed with many changes, newspapers sticked to describing the law and its concepts. Folha published an article from PSDB (opposition) senator Aloysio Nunes Ferreira arguing the law could be improved had the Senate more time to work on it. He said the privacy issue could be better defined, granting more protection to users.

-- end of update --

Catching-up

The Easter week I skipped publishing here was dominated by the Petrobras scandal (the refinery purchase that brought a billionaire loss to the company) and the presidential election forecasts, that again are dimming for Dilma. They both seem to be related, but in fact I hardly believe the average voter will put much weight on what is being done with the biggest company in the country.

On the Petrobras' front the most interesting development is a sort of discrepancy between the declarations of José Sérgio Gabrielli, Petrobras' former CEO and president Dilma Rousseff. Dilma said the Pasadena purchase was a bad business. This Sunday, in an interview to O Estado de S. Paulo, Gabrielli replied saying that Dilma was one of the board members and shared the same responsibility in the purchase. This was at least what O Estado de S. Paulo put in the headlines. I read the whole interview and could see Gabrielli saying the purchase was totally in acceptance with the 2006's context. But the contradiction surely was enough to be replicated by Folha de S. Paulo and O Globo on their monday editions.

Dilma vote intentions keep falling as rumors of Lula's return arise

Ricardo Noblat, columnist for O Globo wrote this monday that Lula and Dilma are waging a secret battle for the right to be the Workers' Party (PT) next candidate to the elections this year. According to Noblat, Lula has always envisioned coming back to the presidential seat (no matter how many times he declared he was done with it)  and that was why he chose Dilma to be his successor, a political nobody until 2011 when she started appearing next to Lula in big cerimonies.

But now that Dilma has become used with power, Lula would have a hard time dissuading her from her rightful reelection, unless she keeps going down the vote intention polls, which is precisely what we are seeing in this year. Last saturday Datafolha (the research institute from Folha de S. Paulo) showed the vote intentions for Dilma went down to 38% from 44% on the previous poll, in a scenario where Aecio Neves (PSDB senator) and Eduardo Campos (PSB, and currently governor of the state of Pernambuco) would be the president's main challengers.

André Vargas asked for a removal from the vice-presidency
of the Chamber of Deputies after complaints

Truth or not, it seems the situation is getting worse to Dilma every week. Last week Globo Television showed PT deputy André Vargas (that until this monday occupied the vice-presidency of the Camber of Deputies) in what it seemed to be a  lobbying negotiation with a convicted money dealer, Alberto Youssef. The investigation started after Vargas was getting a ride on Youssef private jet. This monday, Vargas asked for a 60 removal from his position as vice-president.

In the World Cup front, the news are not positive also. In Rio, an union from the workers of the constructing business started a strike and stopped the already delayed work for the World Cup and the Olympic Games this monday. In São Paulo the work in the World Cup stadium were stopped last month after the third death of a construction worker on the site. The stadium may be inaugurated in the end of this month.

Bad news for Dilma were again good news for the market. This monday, following the wave of popularity decrease the dolar hit a five month low against the real. Economists heard by O Estado de S. Paulo interpreted this as a sign that investors see a chance of change for better in the Brazilian government -- in a similar reaction to what happened when the president suffer a popularity decrease. Of course the market may be also responding to the 25 basis points increase on the country's interest rates decided by the Brazilian Central Bank on april 3rd.

Dilma's popularity falls, stock market goes up

Last week Dilma's popularity fell considerably. The percentage of people that evaluate positively her government dropped from 43% to 36% during the first quarter of the year. The survey news were picked up by the major newspapers in the country, namely O Globo and Folha de S. Paulo. Latter both newspapers said the slip in the president's approval (that means Dilma's reelection is under threat) was welcomed by the market, given the valuation of the national currency and the positive closure of the São Paulo stock exchange.

Stories about the 50 years of the military coup d'etat continued to be featured in the media. This monday, Dilma Rousseff, herself a victim of torture during the militar dictatorship period, defended the amnesty law (that basically prevented the conviction of military personnel involved in the dictatorship crimes, and was being questioned by the Bar in Brazil). Her past as a leftist militant is a trump she is likely to use again during the campaign. In her speech she addressed the two former presidents both also opponents from the dictatorship: Fernando Henrique Cardoso, whom she called an exiled, and Lula, whom she called a union leader. 

"I don't deserve to be raped", photos like
this were on social media to fight sexism

Dilma also used the internet on monday to address a victim of today's Brazil reminiscent conservatives, the journalist Nana Queiroz, that started last week a social media movement to raise awareness to a survey that showed 65% of Brazilian people believe a woman that has been raped deserved to be so either because she behaved or dressed inappropriately. Nana took a picture naked from the waste up, covering her breasts with a poster saying: I don't deserve to be raped. The campaign went viral, with several women adhering, and taking similar pictures. The problem was that Nana received several threats both from men and women, and decided to remove her page from Facebook. Using her Twitter, Dilma said Nana deserve respect and solidarity.

If in the dictatorship's speech and in the latter social media manifestations Dilma did good, the president's performance on the economic front continues to disappoint. The latest forecasts for inflation, featured in Folha de S. Paulo this Tuesday shows a 40% chance of the price index finishing the year above its 6,5% ceiling. It would be the first time this would happen since 2003, and a very bad sign for a government looking to win back the market. O Globo also featured another Achilles' heel of Dilma, the investigation over corruption in Petrobras, the big oil state company. The preliminary investigations from the company showed no sign of corruption in one of the two cases, the dutch platform supplier SBM bribe to Petrobras employees. 

Brazil ensures net neutrality

After years of discussion and six months being discussed as an urgent subject in the Brazilian Chamber of Deputies, the set of laws regulating the internet (known as the civil landmark of internet) was approved this Tuesday. The law still has to be approved by the senate, where the government has a more comfortable position. Its approval means the president was able to control the allies rebellion and also puts Brazil on the map of an international discussion over the issue of network neutrality (that has been opposing Internet Service Providers, as the Telecom companies, and Internet Companies, such as Google).

Activists celebrate the approval of the internet law
that ensures net neutrality in Brazil

Folha de S. Paulo front page today was about the law passing. The newspaper said it puts Brazil in the vanguard of the internet, calling the law a "constitution" of the internet. It mentions, though, that the text changed after the lobby of Google to remove the determination to nationalize data centers for all the business conducted in Brazil  -- which would impose that all virtual services had a local server in Brazil. This demand was not on the original project and was put in the text after the NSA scandal broke the news. It was supposed a political statement from Brazil, against the American surveillance.

O Globo said the law puts Brazil in the vanguard of the internet. The newspaper front page, though gave more space to the scandal on Petrobras, which just had one of its former directors, Paulo Roberto Costa, arrested because of a overpriced purchase of a refinery in Pasadena. The president of Petrobras, Maria das Graças Foster gave an exclusive interview for O Globo and stated it will investigate thoroughly the issue.

On the economic ground both newspapers also mentioned the reaction after Brazil had its national rating cut by Standard & Poor's. Contrarily to what might be expected the stock market and the currency reacted positively, because the market have already taken into account such measure from the rating agency.

Finally to complete the subjects covered in the media last week, the proximity of the 50 years of the military coup in Brazil motivated a series os special reports on the main media. Folha de S. Paulo again made a multimedia rich, Snowfall-like, special report on the military dictatorship, which is very interesting. The newspaper covers the whole process that led to the coup, trying also to put in context the role of the Brazilian left at that time, which was also fighting for its own revolution. The story also pointed out to the unsettled case of the amnesty to military torturers and brings the transcriptions of the US ambassador and presidents John Kennedy and Lyndon Johnson, both supporting the military coup. O Globo is publishing during this week a series of stories about the coup.

Dilma faces turmoils as election agenda gains the media

President Dilma inducted six ministers this Monday,
two of them were nominated to make amends with PMDB

From now on no news on the politics section is unrelated with the election for presidents, governors, deputies and senators on october. Every announcement, every quote from a political personality has now a direct reference to the dispute between Dilma and so far the two other possible candidates (Eduardo Campos from PSB and Aécio Neves from PSDB).

The electoral tone was all over two stories that represented a downturn to Dilma on the last couple of weeks: the mess in the energy sector and the dispute with PMDB, the major allied party of Dilma. In the first case, Rui Falcão, president of PT (Worker's Party, the PT of Dilma) declared that PMDB was only interested in positions in the government and not as much in reaching the greater good for the country. Eduardo Cunha, the leading deputy of PMDB in the Congress started a rebellion and threatened to go against some of the most important projects of the government such as the Marco Civil da Internet (the Civil Landmark of the Internet -- a set of rules for the internet business in the country), due to be voted this week.

Initially Dilma tried to ignore the opposition inside her own allied base. But after realizing the power of the unpleased allies she decided to nominate two of PMDB approved names for the ministrers of Agriculture and Tourism. Ironically the crisis that started with a critic of the PMDB greediness for positions inside the government is being solved by providing PMDB with positions in the government.

Another setback for Dilma was in the energy area. Briefly put, the government decided to anticipate the end of some of the energy contracts last year (this way provoking a cut in the energy prices for the end consumer, that would represent a discount of 28% for residential users). The project backfired as it stimulated energy consumption in a time of the year where the hydroelectric dams were not getting as much rain as in the previous years. This forced the electric system to turn on the thermoelectric plants that are more expensive. In order to keep its promise of a cheaper energy, the government decided to subsidize the energy bill by putting billions to pay the extra cost of thermoelectric energy. After denying for several weeks that that was a crisis in the sector, the government decided to acknowledge the problem and promised to not interfere in future contracts at the same time it waved with a tax increase to cover the future costs of the more expensive energy. It was one perfect example of how not to manage a country, given by a president that sold an image of a great manager in the energy department.

Both situations show how bad the current government, and I would dare to say the current president, deal with this sort of conflicts. When faced with a situation where there is a need for negotiation the government usually try to impose itself first and end up being obliged to step back and offer a much more costly and inefficient solution in the end.

Street-sweepers' strike and racism in Brazil

One of the most relevant news in this year's Carnival was the street-sweepers strike in Rio de Janeiro. Even after the union of street-sweepers reached a deal with the city hall in the middle of the celebration, part of the workers disagreed and refused to clean the streets, as millions danced samba and produced tons of garbage.

The dissident workers said the union leaders were not looking for their peers best interest and decided to continue with the strike. After eight days, they conquered a 37% increase in their salary on a meeting with the city government on saturday (March 8th), a much better result than the 9% the
union agreed on monday (March 3rd).

The episode shows two sides of the Brazil's social inequality. First, the vulnerable representation such workers have. The difference between the salary raise the union leaders agreed upon (9%) and the final result after the dissidents protests (37%) shows how union leaders and politicians worked in collusion against the street-sweepers best interest.

On top, doctors (mostly white) protest
against the government last yer.
Below: street-sweepers (mostly black)
on strike in Rio

The second aspect relates to the racial inequalities in the country. The street-sweepers strike showed clearly a vast majority of  black workers. This contrasts with the predominance of white doctors that protested last year against the government, against the program that import physicians from Cuba and other foreign countries. The striking difference of the images was shared this past week in social media, reminding one of the hidden faces of the Brazilian racism, that is usually hidden under social inequalities.

Next week I'll come back to the business, financial and political commentaries. For the time being, it worths saying in this matter that Dilma Rousseff is dealing with a rebellion from her allies. The biggest party that composes the situation coalition, PMDB, is threatening to retreat its support after the Rui Falcão, president of the Workers' Party (PT, Dilma's party), said during the Carnival that all that PMDB's members want are more ministries and government positions. The real reasons for PMDB moves are abundant and for sure are not related solely to Falcão's declaration -- hopefully I'll be able to address some of them here next week. For now, both parties are now trying to mend the alliance that will be crucial in this election year.