Class Struggle in Brazil: The Neoliberal Coup, an Attack on Workers and the Poor

What has become clear by now…it was not a coup against Dilma or the Workers’ Party [PT]. It was a coup against public education and healthcare; a coup against the rights of workers and pensioners; a coup to privatize public enterprises and the Pre-Salt [oil reserves]; a coup to denationalize the Amazon; a coup against the country.

—Interview with Lula, Brasil de Fato, August 21, 2017.

Over a year has passed since the neoliberal coup seized power in Brazil, removing the democratically elected president Dilma Rousseff (PT—Workers Party). The impeachment fractured basic democratic interactions of power and ended (if it ever existed) any illusion that neoliberal rightwing political forces were committed to democracy and its institutions. The underlying factors that led to the kangaroo impeachment process reflect a long-stewing conflict between neoliberal political forces repeatedly defeated in national elections and the anti-poverty and socioeconomic development policies in place since 2003 with the victory of Lula and the Workers Party. These policies were the basis for major advances that reduced historical large-scale poverty and socioeconomic inequality, expanded the rights of workers and fostered regional integration. The coup designed to undo them was set in motion and sustained by a legislative realignment of political forces, led by the PMDB (Partido do Movimento Democrático Brasileiro), under the leadership of Michel Temer, at the time vice president, and Eduardo Cunha, then president of congress.

The backdrop of this process has been mounting charges and evidence of corruption, suggesting that many of the PMDB leaders, including Temer, are key participants in the largescale federal corruption scandal, “Operação Lava Jato” (Operation Car Wash). Over the course of the year many of Temer’s closest advisors, appointed shortly after the coup, have been arrested or indicted for their participation in corruption schemes, attempts to manipulate federal investigations, and abuse of power. Recently federal prosecutors, for a second time, charged Temer and seven ministers and close associates, all of the PMDB, with practices of corruption and the abuse of power, arguing that Temer is the head of a criminal enterprise. Currently Cunha remains imprisoned under similar charges.

The coup leaders, despite these charges, did not waste time in initiating a comprehensive assault on Brazil’s working class and the poor, proposing a program of neoliberal reforms that amount to the de facto dismantling of many of the country’s social welfare policies, such as social security, labor legislation protections, and the advances made in public education. Added to this are the government’s recurrent attempts to criminalize political activism and weaken Brazil’s vibrant labor movement. The response by labor-left and social movements has focused on mobilizing increasingly larger sectors of Brazilian society against the coup through the Frente Brasil Popular (Popular Brazilian Front) and the Frente Povo Sem Medo (Front of the People Without Fear). Over the past year Brazil has become the stage of massive demonstrations, including two impressive national strikes, against the coup government, giving form to mounting popular discontent with the Temer regime. From an institutional perspective, the immediate objective is to pressure legislators to reject or at least to delay the approval of the draconian neoliberal reforms.

As a direct result of the coup led by Temer and his cronies, Brazil has plummeted into a deep political, social and economic crisis that threatens the very basic constitutional safeguards and protections enjoyed by workers and the poor. As Larissa Ramina and Carol Proner analyze it,

The fundamental origin of the Brazilian crisis, in its current phase, is political, nurtured by an elite that demonstrates, on a daily basis, its lack of commitment to the future of the country and never accepted its defeat at the polls. The unconfessed objective of this elite, among the many setbacks, is their return to the neoliberal project, surrendering the national patrimony, if necessary, natural reserves, state-owned enterprises, political stability, and democracy; a project that returns us [Brazil] to the subservience of hegemonic international interests.1

The neoliberal regime has had a deep and far-reaching influence on most (if not all) of Brazilian society, too extensive to examine in a single essay. Here I focus on two key aspects of the coup. The first part analyzes the socioeconomic transformations imposed on the Brazilian people since Temer seized power, the political alliances that sustain the illegitimate government, and the contradictions of the latter. The second part explores the mounting left-progressive mobilizations and class responses to the neoliberal political project of “reforms.” This section focuses on the attempts by the left-progressive opposition to halt the government’s attempt to roll back working-class advances achieved between 2003 and 2016 (during successive PT governments), on political alliances and conflicts emerging on the left, and on the institutional constraints in the shadow of the 2018 national election.

Neoliberal Reform: A Bridge to Dante’s Inferno for Workers and the Poor

The austerity program of the center-rightwing alliance is organized around three major components. Their political agenda is based on PMDB’s program outlined in A Bridge to the Future.2 Currently Brazil faces a growing socioeconomic and political crisis, massive unemployment, and a rapid return to high levels of poverty, making clear who is benefiting from the coup. As Lula recently declared:

We can fix this country. [During PT governments] we [Brazil] had been removed from the UN’s Map of Hunger, we are now back on [the map]. For the people governing the country, the poor are not people, the poor are statistics. When they see a statistic of 14 million unemployed, it is only a number. For us they are human beings.3

The long-term objective of the neoliberal coup seeks the drastic reduction of the state in economic activity, such as the recent announcement of plans to privatize fifty-seven state-owned companies and financial activities, including the state owned energy company Electrobras. The plan, entitled Plan for Joint Investments (Programa de Parcerias de Investimentos), proposes the sale, extinction, or concession of major state-owned economic activities to private investors in areas such as energy transmission, petroleum, ports, highways, and airports.4 Their justification draws on the tiresome neoliberal diatribe that privatization of the public good leads to efficiency, lower costs, and the reduction of public spending.

Previous privatization schemes have yet to prove that they lower costs or that they are economically and functionally more efficient. More important, it is clear that the current crisis was avoidable. While it is certain that by 2013 the Brazilian economy presented clear signs of deceleration there is no indication that the impact could not have been minimized, if not for the clear attempts to block any movement in this direction by the neoliberal right in congress. In 2008 while the US and much of the European economies were in deep recession Brazil had avoided the impact of the international economic crisis by expanding consumer consumption, manufacturing, and social welfare transfers while drawing on a favorable international commodities market. The deceleration of the economy in 2013, and the government’s response, occurred under entirely different political and economic circumstances. This is not to say that the government did not err, but that solutions to minimize the crises were available. However, from the onset of her second term Dilma confronted a hostile congress, many of which were already committed to the coup. As a recent economic analysis of the coup reported:

during this period the international environment was adverse; however, there were errors in the orientation of the Brazilian economy in both the monetary and fiscal spheres. Important sources of internal economic stimulus were removed without the necessary structural changes … On the international front commodities were presenting an expressive decline.5

But by 2013 pro-coup economic and political forces were already in motion, and by 2015 their political agenda included immobilizing the federal government’s attempts to confront the crisis, thus creating a public perception of chaos and economic uncertainty, laying the groundwork in congress for the pro-coup forces to solidify. As Dilma argued:

Far back maneuvering by pro-coup forces had become increasingly successful. During my administration they vetoed any and all measures to reverse the crisis, instituting a political practice of “the worse it gets, the better” and “explosive political agendas” (pautas bombas).6 … Worse. They mobilized sectors of the population against its own interests and constrained any attempt to expand benefits and rights.7

While financial speculators on the Brazilian stock exchange were celebrating the government’s plans to privatize Eletrobras, energy specialists quickly warned that the reasoning behind the measures was incoherent. One objective of the privatization of Eletrobras is to transfer hydroelectric generators to private enterprise. Currently energy costs are regulated by a quota system set in place during the Rousseff (PT) presidency, which regulates consumer energy costs.8 In fact, past privatization schemes during the neoliberal government of Fernando Henrique Cardoso (1995-2003) proved that privatization schemes led to quite the opposite of the promised efficiencies. Ildo Sauer, Professor of Energy and the Environment at the University of São Paulo, declared that similar measures taken during the Cardoso administration were a “disaster,” stating:

The Fernando Henrique government started to privatize, claiming it would lower the national debt, be more efficient, increase quality, and lower costs. However the public debt increased as did the cost of energy, well above inflation rates.9

Another fundamental privatization scheme (among the many) of the neoliberal vultures is the comprehensive transfer of the country’s lucrative natural resources, such as petroleum, to international financial interests. Under previous PT governments, programs such as Pre-Salt (the deep exploration of petroleum) were conceived with provisos that earmarked a percentage of the profits to finance and expand public healthcare and education. In contrast, the current government seeks to hand over important lucrative resources to international petroleum companies.

Similar to what occurred with the Vale do Rio Doce [a state-owned mining corporation] during the government of Fernando Henrique Cardoso, now it’s the turn of Pre-Salt. Senator José Serra [PSDB] presented the project-law (PLS 131/2015) [a law] that would allow for the exploration of Pre-Salt without forming a partnership with Petrobras [the state owned petroleum corporation]. On the night of March 23, the senate in a vote of 33 to 31 decided to maintain the bill as a matter of urgency. The bill is a crime against the nation’s natural resources, they are in a rush to hand over the country’s wealth.10

Besides the privatization of state owned companies, the neoliberal coup government plans to deregulate national reserves and hand them over to private enterprise. A good example was a recent government decree to extinguish the National Reserve of Copper and Aggregates (Reserva Nacional do Cobre e Associados— RENCA). RENCA is a national mineral reserve located on the border between the northern states of Amapá and Pará. The reserve occupies an area of 4 million hectares, just slightly smaller than the size of Denmark.11  Waiting in the wings were fifty-eight mining companies, who almost immediately after the announcement submitted requests to explore the reserve. Under a hail of public outcry from environmentalists, indigenous groups, progressives, and the left, the government was forced to cancel the decree. Even economic analysts from the conservative Rede Globo, such as Miriam Leitão, declared on a morning national news broadcast: “What the government did was absurd. This decision was made by decree, with no discussion regarding its impact. Mining must be very controlled because its impact is irreversible.”12

To approve their program in congress the government relies on the time-tested strategy of attacking social welfare programs and state-owned companies by creating a false perception that excessive public spending is the cause of the country’s financial woes, repeating the commonplace that state-owned enterprises are inefficient and costly. Their political rhetoric is combined with vague arguments about modernization, which has become synonymous with reducing the role of the state in the economy. The rightwing alliance found willing support among congressional representatives that sustained the legislative-political realignment and provided the institutional wherewithal for the coup. The coup government relies on support from politicians and center-right parties, who, in exchange for their favorable congressional votes, receive federal appointments and congressional budgetary amendments—a sector of congress that MST (Rural Landless Workers Movement) leader João Pedro Stédile defined as “lumpen-bourgeois” politicians.13

The neoliberal program includes: a) the drastic reduction of the federal budget, with a direct impact on social welfare, education, public health, and research spending, a.k.a. “the death budget”; b) labor legislation reform, removing or weakening many of the longstanding protections enjoyed by Brazilian workers and, under the guise of creating “flexible” labor relations, undermining the country’s trade-union movement; and c) social security reform, imposing stricter and longer work requirements, which, given the current and past employment structure would make full retirement unattainable for large sectors of Brazil’s working class.

The “End of the World” Budget—Constitutional Amendment 55 (PEC 55)

The first measure of the Temer government was approval of Constitutional Amendment 55 that constricted the federal budget for twenty years. In November 2016, the Brazilian senate approved (in record time) the measure, effectively reducing federal investments in all aspects of state activity. The measure has a direct impact on federal social welfare, public health, technology, research, and public education. To approve the measure, it was necessary to close the senate to the public while outside of “the people’s house” protesters were violently attacked by military police.

The long-term freeze on federal spending (notwithstanding the obvious absurdity of the measure) seeks to roll back measures of previous PT governments to eradicate historically high levels of poverty. A recent study by the Secretary of the Treasury Department illustrates the importance of federal investment to reduce poverty. During the Lula and Dilma governments (2002-2014), federal transfers to social benefits tripled and were an essential factor for removing millions from the national poverty statistics.14 Senator Humberto Costa pointed out: “Expenses made through the direct transfer of federal funds to social benefits were responsible for a 47 percent reduction in income inequality…resulting in removing 6.8 million from poverty.”15 At the same time, the approved budget constraints impede future growth and socioeconomic development and stand in direct conflict with basic rights guaranteed in the country’s constitution. The current constitution (approved by a constitutional congress in 1988) is acknowledged by all to be the most democratic in Brazilian history. For example, the Magna Carta guarantees access to public healthcare and acknowledges the right to healthcare as a universal right for all and an obligation of the state. The constitution defines percentages of minimal federal investment for healthcare and education. According to Carlos Drummond, “The current constitution determines at least eighteen percent of federal taxes must be spent on education and twenty percent for healthcare.”16 The long-term objectives of the freeze are all too apparent: reducing public spending and access to education and healthcare will reinforce the expansion of privatized services and exclude millions of workers and the poor. As Esther Dweck and Pedro Rossi pointed out, “PEC 55 renders any improvement in public health and education in Brazil impossible, on the contrary, it creates an opportunity for the dismantling of these areas and the elimination of their universal character.”17 In this sense, the measure will eliminate and/or nullify successful anti-poverty measures and return millions of Brazilians to abject misery.

The enduring effects of the measure, if not reversed, project a grim picture for the future. Shortly before the legislation was approved a United Nations representative for Extreme Poverty and Human Rights, Phillip Alston, publically declared the amendment “a historical error” and went on to argue that “in the next twenty years the government will spend far less on social policies than they are currently spending. This means that an entire generation is condemned.”18 That the target of the political project whose centerpiece is reducing public spending is evident; as Alston pointed out, “This is a measure that is in the interests of a small sector of elites and in no way in the interests of a majority of the people.”19 In this way, the measure will force Brazilian workers and the poor into extreme abject need, becoming easy prey to corporate demands and a source of cheap labor. As a result, socioeconomic development, social services, research and technology would be redirected and constrained to attend to corporate rather than national interests, reinforcing privatization schemes in the principal aspects of economic activity. As André Singer pointed out:

This measure [PEC 55] constitutionalizes restrictions to social investments, going against what was decided in 1988 when the current constitution was approved…it is a measure that freezes, for a long period of time, the possibility to reduce poverty through public social policy.20

Labor Legislation Reform: The Attack on Organized Labor, Workers and the Poor

If the objectives of PEC 55 were not sufficiently obvious, the goal of the second feature of the Temer-coup government’s political project, labor legislation reform—PLC 38|2017 (Projeto de Lei da Câmera-Congressional Law Project)—is all too apparent. The measure, (approved by congress in July 2017), provides the legal framework for weakening organized labor, constraining the rights and protection of workers while expanding the rights of employers. The neoliberal apologists argued that labor law reform was indispensable to “modernize” current regulations. The recently approved measures transform the way in which work is performed, making workers “flexible” to corporate interests and weakening protections in place since 1943 when the Consolidação das Leis do Trabalho – CLT (Consolidated Labor Law) was approved by congress. In this sense, as Singer argued, with the recently approved legislation, “The vast majority of workers will lose protections, and this represents a return to the 1940s.”21

Just one day after the country watched in outraged disbelief as former president Lula (PT, 2003-2010) was condemned in Operação Lava Jato (in spite of a clear lack of proof of any wrongdoing), the Senate moved swiftly to approve the pro-corporate labor law reform legislation. According to DIEESE (Departamento Intersindical de Estatística e Estudos Socioeconômicos), the newly approved measures impose over two hundred modifications to the previous law, many of which are directed toward weakening or eliminating the rights of workers while reinforcing and expanding the rights of employers. Just a few examples help illustrate the nefarious impact for organized labor and for the legal protection that workers currently possess. In effect since November 2017, the recently approved legislation limits the power of industry-wide collective bargaining, allowing local collective bargaining agreements (CBA) to prevail over industry-wide agreements. This will allow employers of companies where labor organizations are weak (Brazil’s labor organizations function under open-shop arrangements) to impose agreements with lower wages, benefits, and protections. It weakens the overall power of unions and the solidarity of workers to act collectively. The legislation eliminates the annual trade union fee,22 an important resource for labor organizing, educational projects, and services that unions provide to their members. At the same time, the legislation provides for “flexible” work contracts, creating regulations that sanction “intermittent” work.

In spite of massive protests by some of the country’s largest labor federations, professional associations, progressive organizations and their affiliates, such as the CUT (Central Única dos Trabalhadores) with approximately 25 million members, the legislation moved quickly through congress. The final congressional vote that approved the labor reform measures was 296 in favor, 177 against, and 29 congressional representatives who failed to appear.23 While there were a few dissident votes among the congressional governing block, the vote is a clear indication that Brazil’s party system, besides being highly fragmented, is also conditioned by weak party identification and dominated by pro-corporate interests. Moreover, there is a general perception that voter retaliation is minimal if unpopular measures are approved well in advance of the upcoming national election.

The Attorney-General for Labor (Procurador-Geral do Trabalho) noted, “The speed with which the legislation was approved did not allow for a meaningful analysis of the measures… and violated international labor regulations to which Brazil is signatory.”24 The measure was met with strong resistance and massive protests, including two enormous national strikes that paralyzed the most of the country. In spite of national condemnation, the congressional rightwing alliance ignored massive public pressure and swiftly approved the reform.

Social Security Reform: The End of Retirement—“Work Until Death Do We Part.”

The third major aspect of the illegitimate government’s reform project proposes far-reaching changes to the structure of retirement benefits that would drastically increase current age and employment requirements. The measure would make it nearly impossible for workers to achieve full retirement. Drawing on an age-old rightwing strategy of using massive media campaigns, the neoliberal clique hopes to convince the population that the current structure is financially unstable and represents a drain on the federal budget. Many pension specialists and labor unions, however, contest the government’s allegations, arguing that the regime’s claims are fictitious and project a fabricated picture of the current situation of the country’s social security program. As they point out, the system draws on myriad financial activities and not solely contributions made by workers and employers.25 CUT Executive Director Júlio Turra argued, “If you include all of what should go to social security the system is financially sound.”26

Likewise, Miguel Horvath Jr., Professor of Social Security Law at PUC-São Paulo (Catholic University of São Paulo) pointed out that the actions of the government in fact lead to defunding social security. He argued that:

the state increased the percentage of non-committed financial resources (desvinculação de receitas da união – DRU) from 20 percent to 30 percent, allowing the federal government to divert resources that should be applied to social security…you don’t divert resources from where they are needed, much less increase that amount from 20 to 30 percent. This is hard to explain.27

The draconian reform includes, among other measures, the increase from 35 to 49 years of contributions required for full retirement. While the coup government attempts to convince the Brazilian people that their proposal will create jobs, Horvath argues that the proposal could have the reverse effect, and in fact lead to greater levels of informal employment. “I can’t understand how this proposal will stimulate the economy. Stricter rules [making retirement more difficult] could lead to greater informal employment and a decline in contributions.”28 Moreover, the legislation would undermine any future benefit increase. Currently the value of benefits is regulated by the national minimum wage rate, but as Singer points out, “They propose to detach social security benefits from the minimum wage rate … removing the nexus would make any decision of minimum social benefits an administrative decision of the Ministry of Finance.”29

The neoliberal reform agenda proposes expanding the minimum full retirement age to 65 for women and men alike. The measure, however, fails to consider years of persistent economic crisis of the 1980s and 1990s, years of high levels of unemployment, the existence of large-scale informal employment, and variable regional life expectancy rates, such as in the north-northeast, were poverty levels are much greater and historically access to public health services is inadequate.

The Politics of Crisis, Conflict, Corruption and the Labor-Left Response

The rightwing clique led by Michel Temer assaulted the legitimately elected government of Dilma Rousseff (PT), rapidly plunging the country into a far-reaching social, economic and political crisis, marked by massive unemployment and the breakdown of political institutions. According to the Brazilian Institute of Geography and Statistics (IBGE), by mid 2017 there were 13.1 million workers unemployed, an increase of 9.1 percent in relation to the same period in 2016,30 with a noticeable rise in informal employment.31 In spite of Temer’s declarations at a recent meeting of the G20 in Berlin that there is no economic crisis,32 the immediate effects of the corporate neoliberal takeover are evident in almost every aspect of everyday life. The cuts enacted by the “End of the World” budget forced a drastic reduction of federal investment in social welfare programs and public education, paralyzing national development projects and scientific research. There has been a drastic cut in federal research funds; in April 2017 the Temer government reduced the projected budget of the CNPq (National Council for Scientific Research) by 44 percent.33 Even what are seemingly simple functions of government were affected by the massive budget cuts. For example, in July 2017 issuance of passports was suspended for almost a month after the federal administration failed to pay the government printing house (also scheduled for privatization) responsible for their production.

While the Temer government and conservative news media consistently remind the Brazilian people of a growing federal deficit, there seems to be no problem in changing laws to benefit corporate allies and large landowners. For example, the recently approved Law 13.465/17, popularly called the “Lei da Grilagem” (The Land Speculation Law), facilitates the illegal occupation of land, used in most cases for financial speculation. As Márcia Lia argued, “We are moving backwards, law 13.465/17 legalizes land speculation making agrarian reform much more difficult. Combined with labor legislation reform and the privatization of civil service we are returning to a situation similar to when Brazil was a colony [of Portugal].”34

This law provides the legal wherewithal for land speculation by large international investment firms, such as TIAA-CREF. In a report published in Carta Maior, the company’s questionable practices are evident in spite of their rhetorical declarations to adhere to “socially responsible business practices.” As the report stated:

The investment giant administers the savings of millions of university and public school administrators and professors. TIAA-CREF prides itself on defending socially responsible values, including their contribution defining UN principles for the purchase of agricultural land, promoting transparency, environmental sustainability and respect for the rights of landowners.

The documents indicate, however, that TIAA-CREF’s incursions into the Brazilian agricultural frontier could be going in the opposite direction.

Exerting an enormous effort, the American financial group and their allies accumulated vast agricultural areas in spite of the Brazilian government’s [during the PT governments] attempt in 2010 to prohibit such large-scale activity by foreign exploiters.

While the government’s efforts had some effect, TIAA-CREF remained unfazed and continued their initiatives in a region marred by land conflicts and relying on a spurious land speculator known to use hired gunman to steal land from poor farmers.35

From an institutional perspective, since seizing power, the Temer coup-government has been marred by multiple accusations of corruption and the abuse of power. Their anti-popular policies have led to an all-time low in public support. A recent poll by Datafolha reported that Temer has the support of only seven percent of Brazilians, the lowest of any Brazilian president in the last twenty-eight years.36

This rapidly dwindling public support is sustained by the government’s herculean efforts to sidestep accusations of corruption levied by federal prosecutors. While Temer continues to impose a slash-and-burn budget on the Brazilian people, there seems to be no lack of discretionary federal funds to appease his political cronies in exchange for votes that would delay any investigation into his wrongdoing until the end of his term in 2018. A recent vote in the congressional Committee of Constitution and Justice (CCJ) declined to approve a proposal that would have allowed the Supreme Court to review the accusations of corruption. To assure a victory in the CCJ the government removed political allies that were in favor of the investigation while offering massive funds for congressional amendments of allied committee members.

The decision to refuse the investigation into Temer’s involvement in the major federal corruption scandal was subsequently confirmed by congress, demonstrating that the current legislature has lost its political credibility and capacity to act independently. Shortly before the legislative vote that examined the corruption charges Temer approved US$1.3 billion in congressional budget amendments (discretionary funds) to his cronies in congress in exchange for their support, giving new meaning to the words of scripture “give and you shall receive” (Luke 6:38). Meanwhile many essential activities and services of government continue to go underfunded or unfunded.37

The congressional vote, however, also illustrated that support for the Temer presidency is not unanimous among some sectors of the rightwing alliance that had congealed to support the coup. As the crisis deepens, some sectors do not want to tie their political future to the very unpopular president. After the final vote that examined the Temer corruption charges in congress, it was clear that some sectors of the right who supported the coup against Dilma and support the neoliberal reforms were also in favor of the Supreme Court investigation. If the measure had been approved he would have been removed from office, initially for 180 days.

The divergences, at least in part, reflect a conflict of competing corporate-conservative political representatives. While they are committed to the neoliberal socioeconomic agenda, they also need to survive an increasingly complex political landscape shaped by the upcoming general election. Recent polls indicate Lula (as a possible candidate) would win the presidency in every possible situation.38 For example, almost 50 percent of the congressional representatives of the PSDB (Party of Brazilian Social Democracy, a strong supporter of the coup) voted to approve the indictment against Temer, and their recent national television program was packed with critiques of the Temer government. The party, however, until recently continued participating in the government apparatus and supports the neoliberal reforms proposed by Temer.

João Pedro Stédile, MST leader, offered an interesting understanding of the distinct groups that seized power with the coup. According to Stédile:

The ruling class does not have a political project for the country. The Temer-Cunha Government is an attempt to rapidly apply measures that interest a section of the capitalist class, which is divided into three groups. The first is the nucleus of economic power, whose composition includes finance capital and transnational companies seeking to apply the neoliberal recipe. This project is anti-popular and anti-national. The second nucleus, the “lumpen-bourgeoisie,” is comprised of conservative members of congress, led by the Cunha, Temer, Juca group. They act on self-interest. Finally, a third nucleus moved by ideological interests. This group comprises [media news giant] Rede Globo, Federal Judge Sérgio Moro, the federal prosecutor’s office and the Federal Police. [These groups] have contradictions and divergent views because they are based on group interests and not a unified political project for the country…they seized control of the government with the support of the judiciary to impose a neoliberal emergency program.39

Stédile’s argument is helpful to understand and identify current and future underlying conflicts within the rightwing alliance, even if it remains unclear to what extent these groups will congeal as the national election approaches. For example, recently Paulo Skaf, president of the Federation of Industries of São Paulo (FIESP), clearly opposed the government’s excessive fuel tax increase. Skaf argued that an increase in taxes was “unwarranted…[and] the speech by the Finance Minister [Henrique Meirelles] a cause for complete indignation … going in the opposite direction of the current situation in Brazil.”40 In spite of large-scale sentiment against the measure, the government’s tax increase on fuel products (petroleum, gasoline, ethanol, diesel) will certainly have a domino effect on other sectors of the economy, such as food production, manufactured goods, etc. and will further weaken the country’s rapidly faltering economy. While neoliberal apologists normally do not defend higher taxes, the increase in fuel products was, they argued, a short-term correction to bolster failing government revenues, driven by high levels of unemployment and subsequently weakening consumer demand. More importantly, however, the increase in taxes illustrates a much deeper problem of an economy increasingly driven by market speculation and the prevalence of financial and economic group interests within the regime; as Dilma pointed out, “Reduced economic growth and accelerated retraction of the consumer market can only be understood if you take into account the elevated profitability achieved through financial speculation”41 —i.e., it’s a bankers paradise.

A second underlying aspect fueling the current crisis is the complete lack of political-institutional legitimacy of the executive and legislative branches of power and a judiciary that seems dedicated to propping up the coup regime. The authoritarian coup ruptured the democratic process in existence since the end of the military dictatorship. Dilma was elected with a legitimate majority (approximately 52 percent of the electorate), and her subsequent removal from office was not based on any wrongdoing. The seizure of power by Temer and his neoliberal cohorts signal the midterm congealing of political and economic forces united under a political agenda that has been continuously rejected by a majority of the Brazilian people and repeatedly defeated in general elections since 2003. Paulo Sérgio Pinheiro argued that the seizure of power by the neoliberal clique and the ensuing crisis represents a process of “deconsolidation of democracy.” The coup and its anti-popular program “signals the slow and gradual deconsolidation of democracy… [in this sense] the crisis is the direct responsibility of a president who was not elected and a government comprising persons that are under indictment.”42

Although the Temer government and its representatives in congress, at every available moment, declare that their actions are nothing more than the normal political workings of the democratic state, it has become evident, if it were not already clear with Dilma’s impeachment, that a large sector of the elected congressional representatives have little to do with expressing popular sentiment and are committed to propping up an illegitimate government while enhancing individual political gain. In this sense there appears to be little (if any) allegiance of the corporate-rightwing alliance to the basic workings of democracy and its institutions.

The neoliberal coup also magnified the ongoing debate regarding the future of progressive politics, labor, social movements, and the left, both in immediate terms of building unity among progressive forces to roll back the neoliberal reforms, as well as long-term strategic objectives to expand working-class power. While the role of progressives and the left has been galvanized by the massive anti-Temer demonstrations and strikes energizing the groundswell of public opinion against the coup government, popular demonstrations alone have had limited effect at reversing or impeding the nefarious reforms. On one hand because the government and a significant part of congress has turned a deaf ear to public sentiment, and, on the other hand, because media coverage has continuously sought to minimize or draw attention from working class mobilizations against the reforms.

Mobilizations against the reforms have, more times than not, been been ignored or played down by the major media sources, such as Globo, whose daily news broadcasts are dominated by scandals of corruption schemes perpetrated by CEOs of major corporations and political leaders. Notwithstanding the moral-ethical aspects of political corruption, neoliberal reformers attempt to distance the ongoing investigations into federal corruption schemes from the broader political conflict where corruption is presented as an individual behavioral problem. This view sidesteps the authoritarian nature of the Temer regime and obfuscates the class character of the crisis and the struggle for effective and democratic political reform that reinforces the mechanisms of popular participation in society.

The rightwing apologists attempt to dissociate the ongoing investigations of corruption from the process of neoliberal reforms, a not so veiled justification for their defense of a “minimal state.” The almost daily orchestrated outrage of “uncovering” acts of political corruption has generated likewise vague calls for moral and ethical political behavior that are negotiated by legal measures imposed by some of the very institutions committed to the coup and its authoritarian neoliberal project. By portraying political corruption as a purely legal, ethical, and moral issue perpetrated by individuals, they minimize the underlying mounting class inequalities of neoliberal reforms sponsored by the very forces being charged with corruption. Corruption, however, is not simply a problem of individual behavior but the consequence of a political structure, long in place, which fosters a perverse relation between private enterprise and the state. Their strategy fits neatly with the overall objectives and rhetoric of the minimal state, representing an autocratic attempt to roll back the power of labor, social movements, and the left by shifting the location of political decisions from the spheres of democratic politics to the courtroom. As a result political conflict is decided by conservative federal judges who have assumed the role of arbitrators and whose decisions will have long-lasting socioeconomic and political effects that reinforce the neoliberal agenda. It is the de facto hijacking of democracy based on the “reduction of politics to economics and the economy to finance…there is a communion between the state and the market, where the latter determines the actions of the former.”43 This has created a broad sense of frustration among unorganized sectors of the population, perpetuating simplistic analogies that lead to the public perception that “all politics” is corrupt, which in turn reinforces the rightwing judicial-authoritarian alternative. As University of São Paulo Professor Vladimir Safatle explained:

I understand the melancholic reading of the current situation as a consequence of the catastrophe we are living, the fact that the Brazilian state has broken with all ties to formal democracy and we are dominated by a kleptocracy. This could encourage the perception of being on a dead end street, but this perception should not be understood as an absolute truth.44

The rightwing reductionist view perpetuates historical distortions of the Brazilian political structure where there is no clear distinction between state and market interests, a problem that has long pervaded Brazilian politics and gained systemic characteristics that have permeated the electoral and legislative process. As a recent analysis of the political coup argued:

In our historical trajectory a spurious articulation emerged between the state and the market, currently visible in the connection between the contracting of public works and the finance of political campaigns. Private enterprise pays for favors, bribes, etc. with public resources; electoral powers negotiate their personal interests offering in exchange state owned enterprises…Under capitalism the relations between the state and market are intertwined and sometimes ambiguous, in this sense corruption becomes systemic…and until a process of political reform occurs we will continue to navigate the underworld of delações premiadas and leniency agreements with the judiciary dominating the political process and economic activity regulated by the police…It is in this climate that an opportunistic association has developed between fighting corruption and dismantling public investments and state owned enterprises. …As has occurred innumerable times in the political history of the country [Brazil], the supposed fight against corruption and patrimonialismo ends in predatory actions against the Brazilian state.45

The process has been also been underscored by the increasing criminalization and repression of political activism, a recurrent factor since Temer seized power. The escalation of political repression is a clear attempt to curtail mobilization of Brazil’s social and labor movements and a not so veiled attempt to disqualify the left in the upcoming 2018 elections. On November 4, 2016 police in the states of São Paulo, Paraná and Mato Grosso do Sul carried out raids on MST encampments as well as the organization’s Florestan Fernandes national training school, detaining and shooting at activists. According to MST reports, the police invaded the school without warning “and started firing toward the people in the school.”46 As MST leader Débora Nunes argued:

After the coup, the Brazilian agrarian bourgeoisie and agribusiness gained even more power in the current and illegitimate administration of Michel Temer, as well as in other government sectors. They are pushing for an even more conservative and violent agenda for the National Congress of Brazil, especially through the agribusiness caucus in Brazil’s National Congress, by removing rights, denying peasants access to land, fueling violence that often results in deaths of landless peasants. Recently we have faced two brutal massacres against peasants in different regions of Brazil. One took place in Colniza, Mato Grosso, where 9 rural workers were killed….This is the same state where on May 24, 9 men and one women—the president of the local union—occupied some land and were brutality murdered by police in the distant locality of Pau d’Arco. This case shocked the society for its cruelty. Before being shot point-blank, all of them were psychologically and physically tortured.47

The criminalization of political activism, however, has a much broader objective and is intrinsically tied to the issue of political corruption, as the neoliberal right seeks to disqualify left politicians and activists, taking particular aim at the PT in the upcoming elections. This is an attempt to offset the popularity of Lula, who has announced his candidacy for president in 2018 and who is leading in the early polls.48 Both Lula’s conviction in Operação Lava Jato investigations (in spite of the lack of proof of wrongdoing) and recent attempts to implicate him and Dilma Rousseff in another case under investigation are clear efforts by the neoliberal right to criminalize viable left candidacies.49 Lula’s conviction and the subsequent confirmation of the sentence by the 4^th Regional Federal Court (TRF-4) on January 24, 2018 is further illustration of the Brazilian judiciary’s role in the comprehensive neoliberal right wing’s agenda to weaken and constrain a labor-left alternative, not only in the upcoming general election set for October 2018, but as a long-term political strategy. The appeals court’s decision, reminiscent of Judge Roy Bean, is one of the most Machiavellian of the legal travesties that harken back to the dark days of the military dictatorship when convicting democratic activists to long-term sentences was commonplace. The ruling has nothing to do with justice and effectively further weakens the country’s political institutions, a central feature of Brazilian politics since the coup government seized power in 2016. The appeals court’s decision restated the original ruling, by Federal Judge Sérgio Moro, a pre-determined declaration of guilt without proof that a crime was ever committed, and increased the original sentence from nine years of reclusion to twelve years and one month. It was a ruling directed against Brazilian workers and the poor. After hearing the decision Lula stated “The judges may have won in the media, but they have lost in the consciousness of the Brazilian people… ideas can’t be jailed, you can’t condemn what the people know, that we governed better than the elites who have governed this country.”50 Barring Lula from the upcoming election futher confirms the overall illegitimacy of the current government and the institutions that sustain it. The long- and short-term implications for labor, progressives, and the left in Brazil are clear: any election without Lula will clearly condemn any future government to the same illegitimacy experienced by the current mandatories. Political scientist Maria Victoria Benevides summed it up best when she declared: “The trial of ex-President Lula is the eloquent proof that the Brazilian judiciary is bankrupt and is dominated by the concept that justice has nothing to do with the democratic state and works against the people…, the central concern of the struggle against this trial is the future of democracy, the renewal of the democratic state.”51

This has been increasingly apparent over the past months as the movement to oust Temer has grown exponentially, both in popular support and its political base. The evident unpopularity of the neoliberal rightwing reforms, discredited institutions, and fragmented-weak party system add to the fact that the upcoming elections, if they are held at all, will most likely be realized under the current electoral legislation and political structure, deepening the caldron of conflict and uncertainty. As Safatle pointed out,

It is true that Lula leads in all the polls. What impresses me, however, is that many are worried solely with the election and do not redirect their energies toward reconstructing a new hegemony based on the strength of their ideas. I insist, 2018 doesn’t exist, I do not see a minimum possibility of those who led the coup in giving up [power] easily. They are not going away and will not accept losing. The only way is to consolidate the mobilization process.52

Safatle’s concerns of a possible autocratic exit to the current crisis may not be as farfetched or alarmist as they might appear, in a country whose history is dominated by long periods of authoritarianism. Recent declarations made by General Antonio Hamilton Mourão alluding to a possible military intervention are certainly cause for alarm and harken to the dark and not so distant past, when a military dictatorship ruled the country between 1964 and 1987. He stated, “Either the institutions resolve the political problem through the judiciary, removing from public life the individuals responsible for illicit activities, or we will have to impose a solution. If they are not able, we will impose a solution. This imposition will not be easy. It will bring problems, you can be certain.”53 Unsurprisingly, as Tereza Cruvinel so poignantly noted, Temer (as Chief of the Armed Forces), the Minister of Defense, and the military hierarchy all remained chillingly silent, but what can you expect, “He [Temer] also holds his current position through a coup…what moral authority does he have to chastise pro coup proclamations?”54 As could be expected, the general’s declarations have emboldened the demands of extreme rightwing political forces for a military intervention. More importantly, however, the general only foresees authoritarian alternatives to the current crisis, i.e, either the judiciary or the military.

            The complexity of the situation poses important questions for the short- and long-term left and working class politics in Brazil and Latin America and lays bare conflicts and weaknesses within left politics. In this sense successful mobilizations and massive strikes do not necessarily translate automatically into political or electoral victories or greater organization of the working class. Likewise the immediate effect of the coup made clear the fragility and limits of the ability of political institutions in popular governments to withstand corporate power and the potential of political forces that can in a given moment coalesce to overthrow them. As Steve Striffler correctly argued, “Not surprisingly, elections did not sweep away old regimes with the speed and decisiveness of armed revolution. Once elected, center-left governments found themselves in charge of countries where the opposition still controlled most of the media, the economy, the church and significant sectors of the state.”55

In Brazil’s case, the coup also illustrates the limited ability of the left, shaped by a weak and fragmented party system, to impede the rightwing legislative-political realignment.56 The speed with which pro-corporate-rightwing forces congealed and were able to successfully impeach Dilma shapes, in important ways, the current and future battles facing the left. Even though the coup was certainly a defeat for progressive political forces, it should not be construed as an invitation for the left to adhere to sectarian politics or, even worse, withdraw from the spheres of institutional politics.

In spite of the current constraints and weaknesses, any movement in this direction would reinforce the neoliberal right’s strategy to politically isolate the left. As Singer argued, “To roll back the reforms … sectarianism needs to be considered a deadly sin.”57 In this way acknowledging the constraints and limits of institutional politics should not be a deterrent to fostering movements that can lead to effective political reform, building broad support among “extra-institutional” political organizations and providing the basis for a progressive-left movement encompassing increasingly larger numbers of workers, the poor, and their organizations. Singer’s analysis is very useful: The parliamentary coup in course placed the working class on the defensive.”58 And: “… the working class entered this defensive period divided. First because sectors of the working class were divided during the impeachment process and important sectors of organized labor support the temporary government that resulted from the coup…”59 And finally: “the road, as always, is to combine the social struggle with institutional struggle. You can’t give up either of these spheres. It is unproductive, even if one acknowleges the legitimate impulse to negate institutions that are strongly discredited.”60

Forging political alliances in Brazil is a messy business on the best of days, much more so when the country and its institutions are in apparent disarray. The problem is further galvanized by the fact that the political alliances against the Temer government do not and probably will not translate easily into electoral alliances. In many ways the current situation, shaped in large part by the struggle against the neoliberal reforms, will, as Singer acknowledged, “defy the political capacity of the left.”61 As debates of strategy, electoral and beyond, emerge on the left, some are increasingly consumed by discussions that limit the scale and scope of left-progressive political alliances. For many with long involvement in militancy on the left, particularly during the struggle against the military regime in Brazil, the debate of left unity versus broad political unity is déjà-vu of a discussion that leads nowhere fast. It immobilizes the political capacity of the left to act institutionally and limits its effectiveness in building broad class movements. Fundamentally it is a self-absorbed discussion that fails to acknowledge the plurality of political forces that influence workers and the larger society. It is the equivalent of a continuous rerun of a bad movie that every so often plays out within the left, and an exercise in self-righteous gatekeeping. This debate is, in many ways, comparable to discussions occurring on the left in other countries, such as the United States, and Adolph Reed’s response is extremely insightful: “It should be clear as well that the elevation of questions like whether we should align with Democrats to a level of core political principle is dilettantish bullshit. The only answer to such questions can be, ‘It depends on particular circumstances, local political histories and patterns of alliance, and what the actual alternatives are.’”62

In Brazil, the left, particularly the PT (with over 1.5 million affiliated members),63 given its scale, scope, and level of organization, is central to building a left-progressive response to the advances of the neoliberal right; and, as Singer argued, “the struggle [against the reforms] will demand a high level of openness, to build a broad front.”64 Since the coup, however, even if the left has demonstrated formidable capacity and unity toward building massive popular actions, the same cannot be said for electoral unity, which seems increasingly elusive. At least in part, the difficulties for left-progressive unity in the upcoming election and its aftermath are compounded by recent shifts in legislative political alliances, the looming 2018 national election, and divisions among some political parties, including on the left.65  The highly charged political landscape could lead many, again including some on the left, to opt for political expediency, if for no other reason than as a means of surviving an increasingly complex and volatile political terrain. It is important to remember that the PT and the left in general were always far from commanding a majority in congress and that the successive PT “governments had to work within a diffuse political party structure defined by weak party identification, conflicting interests and party leaderships representing distinct political fractions, with additional layers of conflicting interests at the regional and national level.”66

Finally, but no less important, the neoliberal coup in Brazil has served to boost neoliberal rightwing and reactionary forces throughout Latin America, strengthening US foreign policy in the region and the Trump administration’s attacks on Venezuela and Cuba. The illegitimate coup government has become a forceful opponent of the democratically elected government of Nicolás Maduro and a willing partner of US foreign policy as well as a soundstage for the Venezuelan rightwing opposition.

During the PT governments of Lula and Dilma, Brazil’s regional and foreign policies stood as a roadblock to neoliberal economic schemes for the region, such as the defeat of ALCA (Área de Livre Comércio das Américas—Free Trade Area of the Americas, FTAA). At the same time Brazilian foreign policy was noted for promoting mutually advantageous socioeconomic initiatives in the region and fostering Latin American solidarity, such as the organization of the Universidade Federal da Integração Latino-Americana – UNILA (Federal University for the Integration of Latin America) currently scheduled to be closed by the Temer government.67 In stark contrast, the Temer government has ignored a basic principle of sovereignty among Latin American nations. Supporting US plans for the region, Brazil has provided the wherewithal for regional bodies such as Mercosur and OAS to exert political and economic pressure, seeking to isolate popularly elected governments like Venezuela’s. Dilma Rousseff’s observations on Trump’s recent declarations to the United Nations General Assembly make clear the glaring difference between Brazilian foreign policy under previous PT administrations and the current illegitimate Brazilian government led by Temer. “Trump’s attitude is a regression to the era of the cold war and a threat to free nations, placing humanity at risk. It is lamentable that Brazil’s illegitimate government has bowed to Trump and has remained silent in relation to his threats against Venezuela.”68

If there were any doubt as to the insidious character of neoliberalism, its impact on workers and the poor, and the political setback it engenders for working-class organization, the coup in Brazil provides a compelling paradigm. It is also a beneficial lesson for the left, if for no other reason than that the current crisis in Brazil underscores a few of the many misconceptions that have endured, as in the past when some have likened previous PT administrations of Lula and Dilma to neoliberal regimes. The ongoing battle against the illegitimate Temer government and the neoliberal political agenda will challenge the left’s capacity to build strong movements, expand working-class solidarity and consolidate a broad left-progressive movement capable of isolating the corporate rightwing alliance. These challenges, however (which are many), cannot be a call to retreat to sectarian seclusion or an invitation to become the gatekeepers of the political/moral high ground. One essential feature of class politics demands a clear notion of who is the enemy and a continuous reevaluation of who are your allies at every moment.