Arminio Fraga: Time to take care of the rabbits

The government has been hitting many precious birds with its stone. The most recent was the meeting of the President of the Republic with ambassadors from important countries. With yet another unfounded questioning of the reliability of electronic voting machines, it has immensely affected our external image and created more uncertainty about its acceptance of eventual defeat, with paralyzing effects on the economy. The issue and its dangerous ramifications have been the object of a robust reaction from important sectors, but there is no room for any hesitation in the defense of democratic values.

A stone in adjacent territory was to encourage and facilitate the population to arm themselves, with the refinement of measures that allow the non-identification of weapons and ammunition, under the exotic justification of thus strengthening defenses of democracy. We are in serious danger of the emergence of a culture of gun violence.

Other examples include the populist PECs, such as the Precatórios, and the recent Bondades, also known as Kamikaze. In these cases, they dealt hard blows to the country’s fiscal health, which remains precarious, and demoralized electoral rules, which wisely prohibited extraordinary spending in election years. Attention was also drawn to the massive and surprising adhesion of senators and deputies (with honorable exceptions) to a proposal that contradicts a principle that seemed to be enshrined.

A fourth stone has been taken in the Amazon, our heritage (dilapidated), postcard (torn), lung (sick) and source of biodiversity (threatened). Help! Leniency with deforestation and organized crime puts Brazil once again in a shameful position on the international scene (and here as well). Moreover, through changes in rainfall, it threatens the productivity of agribusiness, the greatest success of the national economy.

Other examples abound, but at this point we know that we are dealing with a clear and predictable pattern of behavior. At the beginning of the current administration, it seemed that we were “only” facing a populist agenda à la Steve Bannon, the main strategist of the initial phase of the Trump administration, now with a foot in jail. I am talking here about the use of fake news and other instruments of pressure to tame the press, culture, academia and the third sector, the main bulwarks of resistance to authoritarian and backward projects.

Worse, it didn’t stop there. It evolved into constant threats to institutions, culminating in the weakening of control instruments, in a permanent state of conflict with the Judiciary, especially the electoral one, and in surrendering to the secret retail of the Legislative, an unacceptable setback. This is the state of the art on the eve of the elections.

It is, therefore, a turbulent environment, which discourages the long-term investments necessary for the full development of the nation. Examples of areas affected by this climate include nothing less than infrastructure, education and technology. Clearly, Brazil is not going anywhere without pacifying its governance spaces and recovering its systems of control, checks and balances.

But to have any success, the next government will have to go beyond rebuilding the credibility of our institutions. It will have to face two enormous challenges that complement each other: building a functional political system and defining a new strategy for economic and social development.

In the economy, the structural and conjunctural challenges are immense. An adequate response will have to include both fronts, starting from a realistic diagnosis. I will not go into detail here. I only notice that the thermometer of long-term interest that the government pays shows a high fever: more than 6% above inflation, which, by the way, is very high.

Last month, I wrote about four urgent and necessary tweaks. Just to remind you: the biggest is not the (necessary) fiscal adjustment — it’s redefining and financing public spending priorities. Adjustments imply recognizing and allocating losses. It is difficult to understand and explain that the costs of a non-adjustment would be much greater than the costs of a successful adjustment. In fact, a courageous and credible response would bring immediate benefits rather than costs.

In politics, the construction of a coalition that can work on much more solid foundations than the current ones would be the minimum. Party fragmentation and the lack of programmatic clarity of the parties do not have a quick cure, you cannot count on it. A call to Congress will be necessary based on a proposal that, by all indications, will not have been submitted to the electorate. A great distance separates us from democracies where the party system works, but that’s what we have now.

The moment is one of uncompromising defense of democracy and its institutions. But the debate on new political and economic paths cannot wait until next year. Whoever wins the elections will have to enter the field playing.