CHAMBER PRESIDENCY CONTEST REVEALS COALITION

C O N F I D E N T I A L SECTION 01 OF 03 BRASILIA 000107 SIPDIS SIPDIS E.O. 12958: DECL: 01/18/2017 TAGS: PGOV BR SUBJECT: CHAMBER PRESIDENCY CONTEST REVEALS COALITION WEAKNESS AND RIFTS REF: A. 06 BRASILIA 2758 ¶B. 06 BRASILIA 1960 Classified By: Political Counselor Dennis W. Hearne for reasons 1.4 b a nd d. ¶1. (SBU) Summary. The battle for the presidency of the Chamber of Deputies (equivalent to U.S. Speaker of the House) is revealing an inability by the presidential palace to enforce discipline within the governing coalition and may cause a rift with lasting damage. The crisis is worsening and there is some chance that an opposition candidate could win the Chamber presidency and its far-reaching legislative authority. Frontrunner Arlindo Chinaglia, Workers Party (PT) from Sao Paulo and government leader in the Chamber, has lined up support from several parties by implied promises of ministerial appointments and posts in the leadership directorate. Chinaglia's base includes not only the PT and the largest party in the Chamber, the Brazilian Democratic Movement Party (PMDB),but also the mercenary "rent-a-parties" that were mainly responsible for the "mensalao" scandal that rocked the Lula government through 2005 and led to the downfall of several ministers and congressmen. Incumbent Chamber President Aldo Rebelo, Communist Party of Brazil (PCdoB),from Sao Paulo, although considered to be President Lula's favorite, has seen his support ebb away before Chinaglia's charm offensive, which Rebelo says includes blatant offers of spoils. As Chinaglia gained momentum, members from opposition and disaffected parties launched a "third way" candidate from the Brazilian Social Democracy Party (PSDB),introducing the near certainty of a second round of voting. With a seriously fractured pro-government side, the surprise outcome could be a win for the opposition, and a realignment of political forces. End summary. CONGRESSIONAL WARFARE -------------- ¶2. (SBU) The contest for the Presidency of the Chamber of Deputies, a position second in the line of presidential succession after the vice president, has become an increasingly complicated chess game in the past few weeks. In December the incumbent, Aldo Rebelo (PCdoB),looked set for easy reelection, with broad support among members, including many in the opposition. He is President Lula's preferred choice, even though Rebelo's Communist Party is a tiny component in Lula's coalition in Congress. Indeed, the Chamber presidency traditionally goes to the largest party, with other parties receiving less important posts in the directorate according to the proportionality rule. In the next Congress, which opens February 1, this would give the PMDB the Chamber presidency, the PT the first vice presidency and so on. The PMDB -- which is expected again to hold the Senate presidency -- opted not to put forth a candidate, so the PT did: Arlindo Chinaglia, the government leader in the Chamber. This set off a confrontation within Lula's coalition, pointing up the clear rifts. ¶3. (SBU) Chinaglia is an aggressive campaigner. He has won pledges of support from the PMDB, the Brazilian Labor Party (PTB),the Progressive Party (PP),and other smaller parties. The pledges are based on in-house straw polls. (The Chamber vote is secret, defections are inevitable, and there can be surprises, as was seen in the December 6 election of Aroldo Cedraz to the Federal Accounting Court, per ref A.) The PMDB pledged its support in exchange for Chinaglia's promise of PT backing for a PMDB candidate for the Chamber presidency in 2009. The small, mercenary "rent-a-parties" such as the PTB, PP, and the new Party of the Republic (PR),were apparently lured into supporting Chinaglia with promises of spoils. So far Chinaglia has lined up support from all the parties that were mainly responsible for the "mensalao" scandal that rocked the Lula government in 2005. Press reports, possibly resulting from behind the scenes work by Rebelo, have said the federal government has released funds for pet projects dear to key figures that Chinaglia has been wooing. When the PTB announced its support this week, media said Chingalia had promised the agriculture ministry to a PTB figure, who even dropped by the minister's office to inspect his future digs. Media say that Lula scolded his top lieutenants with a tough reminder that ministerial decisions are his alone to make, and nothing will be announced until BRASILIA 00000107 002 OF 003 after the Chamber and Senate select their leadership. The presidential palace has consistently (but perhaps disingenuously) disavowed any promises made by Chinaglia. Tarso Genro, Minister for Institutional Affairs, reiterated the message on January 18. It is widely believed that the loser of the Chamber contest (that is, either Rebelo or Chinaglia) will be appointed a Minister as a consolation prize. Civil Household chief Dilma Rousseff even paid a call on Aldo Rebelo earlier this week to try to persuade him to drop out of the race, presumably offering him an attractive post, but he refused. (Note: Rebelo's name is now surfacing in the press for Defense Minister, a post Rebelo has sought in the past. End note.) ¶4. (SBU) Chinaglia's opponents are quoted as saying that they could not vote for Chinaglia because he will lead the offensive to win political amnesty for disgraced former Civil Household minister Jose Dirceu (PT-SP),who was forced to resign in the "mensalao" scandal. Chinaglia denies the charge. PSDB -- PING-PONG OPPOSITION POSITION -------------- ¶5. (SBU) Last week the PSDB leader in the Chamber, Jutahy Magalhaes Junior, of Bahia, took a straw poll by telephone and announced that the PSDB would also support Chinaglia. That provoked vociferous protests from former president Fernando Henrique Cardoso, Senate PSDB leader Arthur Virgilio, Rio Grande do Sul Governor Yeda Crusius and other leading PSDB figures. Jutahy was forced to reconsider and a party meeting was announced to revisit the matter in Brasilia on January 23. ¶6. (SBU) Dissatisfied with the "Aldo or Arlindo" choice, a number of deputies from the PSDB, the Socialist People's Party (PPS),the Green Party (PV),and the Socialism and Freedom Party (PSOL) formed the "Group of 30" to launch a "Third Way" candidate, with a platform exulting ethics in government. The result was the candidacy of PSDB deputy Gustavo Fruet, of Parana state. Although the PSDB had already decided to reconsider on January 23, when the third candidate turned out to be from the PSDB itself, leader Jutahy Junior had to acknowledge the "new fact" and announced he was withdrawing his party's support from Chinaglia. The intra-party confusion in the PSDB caused doubts, at least temporarily, about the PSDB's position as lead opposition party. TOWARD A SECOND ROUND -------------- ¶7. (SBU) Aldo Rebelo's base of support at present consists of his own PCdoB, the PSB, the Liberal Front Party (PFL),and probably some members from small parties. Undoubtedly, parts of the PMDB and PSDB will also vote for him. It is also likely that some disaffected PT members will also vote for Rebelo, since Chinaglia is associated with the PT's insiders circle of Jose Dirceu, Jose Genoino, and others who froze out many party members in Lula's first term. ¶8. (SBU) The Chinaglia candidacy has also alienated the PSB, a key part of the Lula coalition, and solidly behind Rebelo. On January 17, Rebelo and PSB president Eduardo Campos, the newly elected governor of Pernambuco, announced the PCdoB and PSB were uniting their congressional delegations into a single bloc in order to win the fourth secretariat whether Rebelo wins or not. This may give some SIPDIS satisfaction to Rebelo, since he was just stung by the betrayal of Inocencio Oliveira (PR, from Pernambuco). Oliveira had pledged to support Rebelo, but could not resist Chinaglia's siren song, jumped on the bandwagon, then bragged he would be the next fourth secretary. Ironically, it was with the locally influential Oliveira that Campos formed an alliance last fall for help to win the state governorship (ref B.) ¶9. (SBU) The PSB and PSDB are now poised to agree to support either Rebelo or Fruet against Chinaglia in the second round, which appears a certainty. The numbers favor a Chinaglia-Rebelo match-up in the second round, but there are still many uncommitted and soft votes in the Chamber, and Chinaglia could face Fruet instead. The prospects of an BRASILIA 00000107 003 OF 003 opposition presidency in the Chamber cannot be counted out. ¶10. (C) Comment: This episode, which is far from over, reveals the weakness of Lula's control over his coalition, and the strength of the spoils system in Brazilian politics. During much of the action, Lula was away: he took a ten day vacation shortly after his inauguration, then came back and on January 17 pronounced himself unable to intervene since Chinaglia and Rebelo are both "like his children." And the episode also points up that all the ingredients for future corruption scandals and congressional gridlock are present in Brazil's political scenario, as Lula's second term gets slowly underway. Sobel