BRAZILIAN CONGRESS CHOOSES DARK HORSE AS NEW

UNCLAS SECTION 01 OF 03 BRASILIA 000387

SIPDIS

SENSITIVE

E.O. 12958: N/A
TAGS: PGOV BR
SUBJECT: BRAZILIAN CONGRESS CHOOSES DARK HORSE AS NEW
HOUSE SPEAKER


1. (SBU) SUMMARY. In a surprising and potentially serious
setback for the Lula administration, the Brazilian Chamber
of Deputies (lower house) on February 14 chose dark horse
Federal Deputy Severino Cavalcanti (Progressive Party -'PP')
to be its next Speaker. Cavalcanti took over immediately
and will preside over the Chamber for the next two years --
the second half of President Lula's term. The choice came
after a hotly-contested campaign in which Lula's Workers'
Party (PT) failed to settle on a single candidate.
Cavalcanti's PP party is the right-most member of President
Lula's governing coalition, so the Speakership has not
slipped completely out of the administration's grasp, but
his victory over two PT candidates could complicate the
administration's legislative agenda and is clearly a
punishment for the PT's inability to resolve its internal
schisms. Cavalcanti is a back-bencher who has not
established a record during his ten years in Congress. In
his home state of Pernambuco he is seen as an old-style
politico without core beliefs. Thus, Cavalcanti is
unlikely to be as influential as outgoing Chamber Speaker
Joao Paulo Cunha (PT). Separately, the Brazilian Senate
easily chose Renan Calheiros from the PMDB party's pro-Lula
wing as the new Senate President. The 2005 Congressional
session is now underway. END SUMMARY.

SEVERINO CAVALCANTI IS THE NEW SPEAKER
--------------

2. (SBU) Late on February 14, after two rounds of voting,
the Brazilian Chamber of Deputies selected an
undistinguished back-bencher to be its next Speaker.
Severino Cavalcanti of Pernambuco, aged 74, is a high
school graduate who has spent his entire career with what
is now the right-wing Progressive Party (PP) --which at the
time he joined was the party of Brazil's military regime.
Cavalcanti is now in his third four-year term in Congress
and has an undistinguished record, never chairing a
committee or sponsoring significant legislation. He is not
highly regarded even in his home state of Pernambuco, where
pundits and politicians we spoke with painted a portrait of
a career politico with no real beliefs or projects and who
is seen as not completely trustworthy. He is seen as a
passionless politician from the mold of traditional
northeastern "colonels" whose survival is rooted in
backroom deal-making. Cavalcanti's home base is the semi-
rural "Mata Norte" region of Pernambuco's interior, and he
also wins votes from the state's conservative evangelicals.

PT SCHISM LEAVES ROOM FOR A DARK HORSE
--------------

3. (SBU) The failure of the PT to elect its own Speaker is
easily explained: it never settled on one candidate.
Under a long-standing unwritten rule (the "Rule of
Proportionality"),Brazilian legislatures at all levels
allow the party with the largest caucus to nominate the
Speaker, who is generally approved in a floor vote without
serious objection even from the opposition parties. In a
domino effect, this same rule then foresees selection of
the Chamber's other leadership posts --and the committee
chairs-- according to caucus size, so that opposition
parties are guaranteed of getting a few choice posts if
they play by the rule. The Workers' Party, with 90 Federal
Deputies in the 513-seat Chamber, is the largest caucus and
easily elected Joao Paulo Cunha to serve as Speaker in
2003-2005.


4. (SBU) But Speakers can serve only one two-year term, so
in a bitter internal struggle last month, the PT selected
Federal Deputy Luis Eduardo Greenhalgh to succeed Cunha as
Speaker. Despite the Rule of Proportionality, Greenhalgh
faced resistance to his candidacy: he is from Sao Paulo at
a time when many fear the government has become too Sao
Paulo-centric; he is seen as aloof and arrogant; and he is
a human rights lawyer who represented the Landless Movement,
alienating landowners and conservatives. As soon as the PT
named Greenhalgh its official candidate, another PT Deputy,
Virgilio Guimaraes, announced himself as the party's
"alternate candidate". In contrast to Greenhalgh,
Guimaraes is gregarious, from Minas Gerais, and is an old-
style union boss popular with the Chamber's rank-and-file.
Despite concerted arm-twisting by President Lula and nearly
every other Workers' Party heavyweight in the past few
weeks, Guimaraes refused to give up his candidacy. Three
other Deputies, including Severino Cavalcanti, then saw the
confusion in the PT and threw their names into the ring as
well.


5. (SBU) The PT's failure to settle on one candidate
annulled the "Rule of Proportionality". With two PT
candidates in the running, other parties could not be
induced to vote for Greenhalgh. In the first round of the
floor vote, Greenhalgh received 217 votes, 50 short of
victory. Cavalcanti qualified for the second round with
124 votes, while challenger Guimaraes was knocked out with
117 votes. In the second round which lasted late into the
night, Cavalcanti handily beat Greenhalgh 300-195, and the
PT's nightmare was realized. This is the first time that
the largest party has not held the Speakership. Worse, the
domino effect of the selection system left the PT
completely shut out of the Chamber's seven leadership posts.
After Cavalcanti, the Chamber's First Vice President will
be Inocencio Oliveira (PMDB-Pernambuco). Thus, the PT will
have to find ways to exercise influence at the committee
chair level, where it will be well represented.

THE AUTOPSY -- THE PT POINTS FINGERS
--------------

6. (SBU) The PT has only itself to blame. Guimaraes'
insistence on challenging the official PT candidate broke
the discipline of the Rule of Proportionality and allowed
even parties within the PT's coalition to vote at will.
Guimaraes is likely to be punished for inflicting this mess
on his party and President Lula, and there is clearly
sentiment for a severe sanction among PT members with whom
we spoke. Some also note that the PT's defeat is based in
a long-running debate that clogged Congress for much of
2004 --an attempt to allow reelection of the Chamber
Speaker and Senate President-- that short-circuited the
PT's internal debate over who would be its nominee for
Speaker.

NEW SENATE PRESIDENT IS RENAN CALHEIROS
--------------

7. (SBU) In the Senate, the voting was much smoother. The
PMDB is the Senate's largest party, and Renan Calheiros of
the PMDB's pro-Lula wing was unopposed in his bid for the
Senate Presidency. Calheiros, from Alagoas state, is
generally well-regarded but lacks the well-honed political
skills of his predecessor, Senator Jose Sarney.

CABINET SHUFFLE HANGING FIRE
--------------

8. (SBU) President Lula planned to shuffle his cabinet
ministers last month in a way that would reward loyal
coalition parties with a greater cabinet presence. He held
off to see how the parties supported the PT's candidate for
Speaker. With the confusion surrounding Cavalcanti's
selection, the calculus of the cabinet shuffle has changed,
meaning Lula is likely to wait a bit longer before making
any moves.

COMMENT - WHAT THIS MEANS FOR LULA'S AGENDA
--------------

9. (SBU) The Speaker controls the Chamber's agenda,
decides which bills come to a vote, resolves procedural
disputes, and --after the Vice President-- is the second in
line to replace the President. Joao Paulo, PT Mayor of
Recife, the capital of Cavalcanti's home state of
Pernambuco, did not mince words. Hours after the Chamber
vote, he slumped in his chair and told us that Cavalcanti's
selection was "the worst defeat yet for this government".
Joao Paulo said he has never trusted Cavalcanti going back
to when they served together in the state assembly. He
observed that "now every bill that Lula sends to Congress
will require negotiations and compromises". Luciana Santos,
Mayor of the nearby city of Olinda, commented that
Cavalcanti "has no ideology and no projects" --a
"physiologist" in the Brazilian lexicon. She noted that
Cavalcanti is derisively called the "leader of the
Congressional union" because his biggest issue is to raise
pay for congressmen.


10. (SBU) Cavalcanti may rise to the occasion and prove
himself a skilled leader and statesman. Deputy Roberto
Jefferson, President of the coalition's PTB party noted,
"Severino isn't in the opposition. He belongs to the
coalition. There's no crisis at all. He'll work with
coalition party leaders and administration officials." In
his acceptance speech, Cavalcanti himself said, "There is
no way that I'm looking to create obstacles" for Lula. Yet
not many in Lula's coalition are optimistic today. The
administration has struggled mightily over the past two
years to pass its extensive legislative agenda, suffering
some black eyes and often making unwelcome compromises on
the substance of bills. The early assessment is that
Cavalcanti's election as Speaker of the Chamber will only
complicate Lula's efforts over the next two years.


11. (U) AMCONSUL Recife assisted in this report.

DANILOVICH