Brazil’s two-time former president and former convict Luiz Inácio Lula da Silva was declared the winner in a nail-biter last week. President Biden immediately congratulated him. European leaders and the Western press, who despised the incumbent Jair Bolsonaro because he reminded him of Donald Trump, did the same. Established Western powers from The Guardian, the Associated Press and NPR and their wandering ministers wanted to win over Lula. He won Yippie! But Lula won’t do America or Europe any favors.
First, without debating whether the election went off without a hitch, Lula needed this victory. Arguably the most beloved president in modern times, Lula fell from grace in the mid-2000s due to the Petrobras “car wash” scandal. The oil giant was ransacked. Class action lawsuits, of which I was a part, were filed and won. I don’t think Lula was any particular ring leader who went wrong, but a court held that her involvement and neglect of duty was enough to land her in prison.
Then, one of his Supreme Court-appointed men set him free. His prison record was cleared so that he could run for office.
Was Lula’s arrest a political witch hunt? Some believe so. Many Americans would believe the same if the United States Department of Justice and the Attorney General found Trump guilty of such a thing and imprisoned him.
In a strange way, despite Bolsonaro being labeled “Tropical Trump” by the foreign press, Lula – his supporters – was persecuted in the same way, only receiving a prison sentence.
Certainly, Lula sees the car wash scandal as a swipe against its history. He may also believe that American intelligence forces, suspecting Lula, assisted the opposition in discovering the Petrobras cases, which led to him being undone. I don’t know if this happened, or if it was nefarious at all – many American retirement funds were heavily invested in Petrobras and millions were lost. The US official involvement in the case would be understandable. Petrobras stock was around $28 at the time the scam was taking place and ended 2016 at its lowest point around $3.50. Today, it is struggling to reach the top of $15.
But I think it’s safe to say that Lula doesn’t trust American intelligence forces and believes America was interested in seeing her fall because of Petrobras. He does not do these people any favors and will not give them anything.
Like Bolsonaro, Lula is a nationalist, not a neo-globalist as some have tried to oust him. While he has been hailed by the same European mob that funneled black money into political action committees donating to the Biden campaign, and often spoke his language on the campaign trail about racism, and the siege of democracy and— Oh, good god, even ESG – Lula doesn’t really care about any of this. The West is projecting.
European and NPR listeners might think that Lula will save the Amazon, Because Bolsonaro apparently destroyed it. But it was Lula who was going up against Hollywood’s most famous director at the time, Mr. Avatar Himself — James Cameron — and Mr Titanic – Leo DiCaprio – began construction of the world’s second largest hydroelectric dam in the Amazon, known as Belo Monte. Despite all the cries of Paris and D’s students playing Make-Believe in Los Angeles, Lula reassures the Xingu tribe that it is not the end of the world, and that Brazil needs electricity and Brazil is going to build a dam, which he did. Now Brazil is home to two of the largest hydroelectric dams in the world and one of them is generating electricity in the “lungs of the earth”. It was Lula who did this, not Bolsonaro.
Geopolitically Bolsonaro was better suited to the United States. He can be counted on to make things difficult for China, at least in the US.
Lula wouldn’t do anything like that. That would bring Brazil closer to China, especially if the clowns of Europe and America tell the World Bank about greenhouse gases and cow methane. China will happily lend to Brazil and invest in Brazil and buy Brazilian goods. (Though Bolsonaro probably would have done the same if Biden & Co. had questioned his victory.)
Bolsonaro was a neutral voice in the war in Ukraine.
Lula will not. He is not interested in proxy wars of NATO with Russia. He worked with Vladimir Putin for eight years, four years more than Bolsonaro. And those were the good times. Bricks were all the rage then. Economies were booming. Nobody hated the Russians.
Lula blames Volodymyr Zelensky for the war as much as she did in an interview with Putin time journal this summer.
I think it took all the energy that foreign correspondents in So Paulo had for not calling Lula on this. If Bolsonaro had said it, it would be on the cover of every newspaper, not as a matter of fact (Bolsonaro said this) but as a blasphemy to the Western world order (Bolsonaro said it, and he’s a dummy) ).
Lula will not support US rhetoric against Russia unless Russia launches nuclear bombs in Ukraine. Until then, the US has no ally in Lula over Ukraine. none.
Brazil is the last stand in America.
From Mexico to Argentina, Latin America is becoming a forgotten world. If Brazil collapses, Latin America will become a black hole with nothing but poverty, abhorrent inequality and crime. The sector has already been largely overlooked as a supply chain solution for the US.
The area has exploded over the years. Mexico is surrounded by drug cartels. Venezuela is a failed state. Colombia FARC . is run by Again, now a legitimate political party. Argentina is a disaster. Chile is still fine, but too young to have its say in global politics.
Other smaller countries in South America are hanging on, some quietly hoping the world will leave them alone.
lula’s last chance
Lula will face a Congress dominated by Bolsonaro conservatives. His vice president, Geraldo Alcamin, has ambitions to become president someday. He had previously been unsuccessful against Lula. Now Lula chose him to join the army as the Workers’ Party became just another European-style social democratic party.
Lula is actually the last of the old guards of the Workers’ Party, and when he is gone, the party may be swallowed up by Alkmin’s party anyway. Maybe Lula won’t be terrible. Maybe things will get better sooner rather than later. Lula’s legacy and the future of Elkmin’s Social Democratic Party depend on it.
Yet there is danger here. A lot of question marks hover over Brazil.
Rio may again turn into a drug-ridden crime pit. Lula was not known for being tough on crime. The last thing Brazil needs is to copy the streets of San Francisco. When things fall apart in poor countries like Brazil, they go fast and furious.
There is also a risk that some senior officers in the military and rank and file in the police force, a pro-Bolsonaro majority, will not accept the election of a man who had been in prison a few years ago.
However, these are all unknowns, and such things are said by political junkies and investors are worried.
Brazil is the strongest country in America. It’s not hard to imagine surviving the worst case scenario. It’s not hard to imagine that checks and balances work and that Lula — who has to redeem herself — will be fine. Brazil will not become a failed state like Venezuela and Argentina. The Brazilians won’t let it happen, I’m pretty sure.
But I’m sure it is: Lula is geopolitically worse for America than Bolsonaro. Lula’s chances of bringing Brazil closer to China are far greater than Bolsonaro’s doing. Lula will not support NATO proxy wars in Ukraine like the Europeans. And except for a few proposals to save the planet, Lula won’t do what Western climate activists want her to do with the Amazon. For Lula, like Bolsonaro, the bulk of the largely intact Amazon rainforest is sovereign territory. book it. Bet on this.
Meanwhile, Brazilian investors should be concerned about the short-term and pay attention to who Lula chooses as central bank and finance minister. If Petrobras is led by a party hack, it will not be bullish even if oil prices push back to $100 again.
Thoughts and Prayers.
*The author of this op-ed is a Petrobras investor.
Credit: www.forbes.com /