Identifier
Created
Classification
Origin
06SAOPAULO862
2006-08-07 18:39:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Consulate Sao Paulo
Cable title:  

LULA'S BALANCING ACT: PT LEADER OUTLINES PARTY'S ELECTORAL

Tags:  PGOV PREL PINR ECON BR 
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PP RUEHRG
DE RUEHSO #0862/01 2191839
ZNR UUUUU ZZH
P 071839Z AUG 06
FM AMCONSUL SAO PAULO
TO RUEHC/SECSTATE WASHDC PRIORITY 5556
INFO RUEHBR/AMEMBASSY BRASILIA 6631
RUEHAC/AMEMBASSY ASUNCION 2698
RUEHBU/AMEMBASSY BUENOS AIRES 2376
RUEHMN/AMEMBASSY MONTEVIDEO 2089
RUEHSG/AMEMBASSY SANTIAGO 1814
RUEHLP/AMEMBASSY LA PAZ 2942
RUEHRI/AMCONSUL RIO DE JANEIRO 7334
RUEHRG/AMCONSUL RECIFE 3058
RHEHNSC/NSC WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RUCPDOC/USDOC WASHDC 2528
RUEHC/DEPT OF LABOR WASHDC
RHMFISS/CDR USSOUTHCOM MIAMI FL
UNCLAS SECTION 01 OF 03 SAO PAULO 000862 

SIPDIS

SENSITIVE
SIPDIS

STATE PASS USTR FOR MSULLIVAN
STATE PASS EXIMBANK
STATE PASS OPIC FOR MORONESE, RIVERA, MERVENNE
NSC FOR FEARS
USDOC FOR 4332/ITA/MAC/WH/OLAC/JANDERSEN/ADRISCOLL/MWAR D
USDOC FOR 3134/USFCS/OIO/WH/SHUPKA
TREASURY FOR OASIA, DAS LEE AND DDOUGLASS
DOL FOR ILAB MMITTELHAUSER
SOUTHCOM ALSO FOR POLAD
USAID/W FOR LAC/AA

E.O. 12958: N/A
TAGS: PGOV PREL PINR ECON BR
SUBJECT: LULA'S BALANCING ACT: PT LEADER OUTLINES PARTY'S ELECTORAL
STRATEGY

REF: BRASILIA 1136

SENSITIVE BUT UNCLASSIFIED - PLEASE PROTECT ACCORDINGLY

-------
SUMMARY
-------

UNCLAS SECTION 01 OF 03 SAO PAULO 000862

SIPDIS

SENSITIVE
SIPDIS

STATE PASS USTR FOR MSULLIVAN
STATE PASS EXIMBANK
STATE PASS OPIC FOR MORONESE, RIVERA, MERVENNE
NSC FOR FEARS
USDOC FOR 4332/ITA/MAC/WH/OLAC/JANDERSEN/ADRISCOLL/MWAR D
USDOC FOR 3134/USFCS/OIO/WH/SHUPKA
TREASURY FOR OASIA, DAS LEE AND DDOUGLASS
DOL FOR ILAB MMITTELHAUSER
SOUTHCOM ALSO FOR POLAD
USAID/W FOR LAC/AA

E.O. 12958: N/A
TAGS: PGOV PREL PINR ECON BR
SUBJECT: LULA'S BALANCING ACT: PT LEADER OUTLINES PARTY'S ELECTORAL
STRATEGY

REF: BRASILIA 1136

SENSITIVE BUT UNCLASSIFIED - PLEASE PROTECT ACCORDINGLY

--------------
SUMMARY
--------------


1. (SBU) Summary: Sao Paulo State Legislator Renato Simoes outlined
the strategy of Lula's Workers Party (Partido dos Trabalhadores -
PT) for the October elections. Simoes indicated that the party
believes the Sao Paulo state and national campaigns have to be
integrated. PT gubernatorial candidate (and Senator) Aloysio
Mercadante needs President Lula's coattails to have a chance to
defeat former Sao Paulo Mayor Jose Serra, just as Lula needs a
strong showing by Mercadante to improve his own electoral
performance in Brazil's most populous state. The PT's ideal
scenario would have Lula winning in the first round while Mercadante
forces the gubernatorial race into a second round. On the national
level, the PT will focus on the Lula administration's achievements
while remaining vague and general about future programs and plans;
in the state campaign, the PT believes that Serra has weaknesses
that can be exploited despite his strong position in the polls. The
message in both campaigns will be that Lula needs a strong ally in
Sao Paulo's state government to ensure a successful second term.
Simoes also indicated that the PT's campaign for the federal Chamber
of Deputies will focus on the party list rather than individual
candidates; he is optimistic that the "disaster" of lost seats
predicted by many observers will not occur. He also expressed the
view that although the popular and social movements that comprise
the left wing of the PT will support Lula's re-election, they remain
disappointed with Lula and will be more aggressive and demanding in
a second term. END SUMMARY.


2. (SBU) Poloff and Political Assistant met July 31 with Renato
Simoes, a leader of the PT in the Sao Paulo State Legislative

Assembly. Simoes is also a member of the PT's National Directorate
and is serving on its Executive Committee as acting National
Secretary for Popular Movements, replacing Bruno Maranhao, who was

SIPDIS
suspended after leading the Landless Workers Liberation Movement
(MLST) invasion of Congress in June (reftel).

--------------
LOOKING FOR A FIRST ROUND VICTORY
--------------


3. (SBU) Simoes expressed confidence that Lula will win the
election in the first round. The votes for Lula from the northeast -
especially from the poor - are already solid, he said, so the
President can afford to focus his campaign in the south and
southeast, where his performance in recent polls is worrisome. In
these areas, Simoes acknowledged, Lula is trailing his opponent,
Geraldo Alckmin of the Social Democracy Party of Brazil (PSDB). This
part of the country comprises more than 35 percent of all voters, as
well as the largest proportion of middle class families. Lula needs
to retain the votes of the poor while regaining the trust of the
middle class. Thus, in both his government programs and his
campaign speeches, he is trying to appeal to both groups while
alienating neither, a delicate balancing act. His government is
distributing benefits both to the poor (e.g., the "Bolsa Familia
program and the increase in the minimum wage) and to the medium
class (e.g., a tax break for families that hire a maid formally).
Likewise, his government program is intentionally vague. Lula is
being careful to steer clear of controversy and specific
commitments. The PT strategists believe he will be reelected if he
can run on his image and his bond with poor voters and avoid making
any mistakes during the campaign.

SAO PAULO 00000862 002 OF 003




4. (SBU) Simoes thinks Heloisa Helena, presidential candidate of
the Socialism and Liberty Party (PSOL) and a former PT member,
probably has a ceiling of about 8 percent despite recent polls
showing her higher. The PSOL, a new party created largely from PT
defectors, has no organization at the national or state level to
work for its candidates. Heloisa takes some votes from Lula, but
really takes votes from everybody because some voters express
support for her as a protest against the system. Simoes thinks she
may fall to her natural level of about 5-6 percent; with Democratic
Labor Party (PDT) candidate Cristovam Buarque at around 2 percent,
Lula should thus be able, with his still sizeable lead over Alckmin,
to win in a first round.


5. (SBU) Simoes recognizes that a second round would be hard on
Lula. The President would have to campaign in a much more hostile
political environment. The PT won't have gubernatorial candidates
running in the second round in many important battleground states.
(This is one reason the PT considers it critical for Mercadante to
force Serra into a second round in Sao Paulo.) In addition, merely
by making it to the second round, Alckmin will have shifted the
momentum and will begin to look more like a winner. Many Brazilian
political analysts argue that voters like to vote for winners.

--------------
THE IMPORTANCE OF BEING SAO PAULO
--------------


6. (SBU) In discussing electoral strategy, Simoes stressed the
importance of integrating the national campaign with the campaign in
Sao Paulo state. The idea of winning the Sao Paulo government is
more than just an electoral target. The PT believes the state, with
a friendly government, could give support to the Lula administration
as it did for President Fernando Henrique Cardoso's (FHC)
administration. Simoes remembered that some of FHC's programs were
first implemented in Sao Paulo as a test or pilot and then enlarged
to encompass the whole country. In addition, many things that happen
in Sao Paulo tend to resonate quickly throughout the rest of the
country.


7. (SBU) Simoes is convinced that Mercadante can force a second
round with Serra in the gubernatorial race, despite poll numbers
showing Serra with a commanding lead. Former Governor Orestes
Quercia, candidate of the centrist Brazilian Democratic Movement
Party (PMDB) and third on the polls, who has strong support in the
state's interior, has a ceiling of about 12 percent. According to
Simoes' electoral arithmetic, Mercadante should get around 25
percent of the votes and has a chance of reaching 30 as the PT's
Jose Genoino did in 2002. At the same time, if PDT candidate Carlos
Apolinario and PSOL candidate Plinio de Arruda Sampaio, of PSOL each
get 2-3 percent, a second round is guaranteed.


8. (SBU) In the state campaign, the PT needs to focus on social
issues and the disenchantment of some voters after twelve years of
PSDB rule. Public security, health, and education are areas where
the PSDB Covas-Alckmin governments made insufficient investment,
Simoes said. Public security and the issue of the organized criminal
gang First Capital Command (PCC) won't necessarily be a winning
issue for the PT, however, because the public holds everyone
responsible. The PCC attacks in May damaged Alckmin at the time and
may continue to hurt him in some quarters, but many also held the
federal government accountable. Under Brazil's federal system,
municipalities also have a role to play. The Lula administration
didn't provide enough federal security assistance to Sao Paulo state
over its first three years, in part because state government was in
the hands of the opposition. Thus, while the issue is important to
the campaign, it's not a winner for any candidate or party.

SAO PAULO 00000862 003 OF 003




9. (SBU) Simoes also outlined the PT strategy to fight for more
seats in the Congress. Most observers expect that due to the
"mensalao" corruption scandal, the PT will elect at most 60 (some
say 50) members to the Chamber of Deputies after electing 90 in

2002. However, Simoes thinks the PT can repeat its 2002
performance. Its television campaign will focus on the party list
as a whole instead of promoting individual candidates, and will
attempt to remind voters of the party's historic role in Brazilian
politics. Via this "voto de legenda," the party hopes to take
advantage of the positive image it continues to enjoy with some
segments of the electorate, and to avoid the public identification
of certain candidates who became notorious during the scandals. In
short, Simoes believes that "the anticipated disaster will not
happen."

--------------
LULA'S SECOND TERM
--------------


10. (SBU) The leftist popular and social movements will campaign
for Lula, because they are afraid of losing ground under an Alckmin
administration. However, Simoes said, these leftist movements have
been disappointed with Lula's government and will continue to make
their disappointment felt. They are frustrated with Lula's handling
of social security reform, labor reform, and his failure to do more
on land reform. Assuming a second Lula term, the social movements
will be more active, more aggressive, and more confrontational.
They will expect Lula, with more political maneuvering room, to do
more for his leftist political base.


11. (SBU) Nevertheless, Simoes warned against expecting fundamental
changes from a second Lula administration. Macroeconomic policy
will continue on the same course. But there may be ways that Lula
can open up some political space, work more closely with the leftist
and the social/popular movements, and increase social participation.
Simoes conceded that the MLST invasion of Congress (reftel) had
gotten the PT and the movements some bad publicity, but didn't think
it had done long-term damage to the party's electoral prospects.
Everyone knows, he said with a shrug, that such demonstrations
sometimes turn out well and sometimes end badly.

--------------
COMMENT
--------------


12. (SBU) Simoes' predictions combine optimism with apprehension.
He thinks Lula can win in the first round but fears the consequences
if he doesn't. He expects the PT at the national level to avoid the
worst consequences of the corruption scandals but recognizes the
need to improve the party's performance in key states like Sao
Paulo. He seems aware that one or two prominent blunders could cost
Lula dearly and stressed that the campaign is going to play it safe.
He is aware that Lula has ignored the popular and social movements
and probably cannot do so indefinitely. Despite Lula's comfortable
lead in the polls, all is not well in the land of the PT. END
COMMENT.


13. (U) This cable was coordinated with Embassy Brasilia.

MCMULLEN