Lula da Silva to be inaugurated; vows to help poor
Brazil's first working class president was making the nation's poor the center of his inauguration to a second term Monday, renewing pledges to boost the nation's lackluster economy and ease the deep divide between a rich elite and millions living in misery.
Luiz Inacio Lula da Silva, required by law to ride in a classic Rolls-Royce to Congress for his swearing-in ceremony Monday, was scheduled to give an open-air inaugural speech to left-leaning supporters outside the presidential palace.
Thousands were pouring in from far-flung regions of Latin America's largest country to attend the inauguration in the heart of Brazil's futuristic and architecturally renowned capital.
World leaders weren't invited, and the highest-ranking foreign government official attending is Italian Foreign Minister Massimo D'Alema -- in sharp contrast to Lula's first inauguration, which included the presence of Cuba's Fidel Castro and Venezuelan President Hugo Chavez, an ardent socialist.
Lula has managed to stabilize Brazil's economy and increase social spending for tens of millions living in misery, but growth lagged behind the rest of South America. This, along with a corruption scandal that dogged his leftist Workers Party, put him on the defensive during his re-election campaign.
His main second-term push is expected to be jobs for Brazil's poor.
Lula, a poor farmer's son who gained fame as a union leader resisting Brazil's 1964-1985 military dictatorship, acknowledged over the weekend that his second term could be tougher because Brazilians will expect more from him.
"The second term ... is a much stronger and demanding commitment than the first," Lula told reporters. "And we are committed to doing more, and doing it better."
Lula has vowed to craft economic policies to spur annual economic growth of 5 percent -- a goal most analysts consider lofty.
Lula isn't expected to announce the makeup of his new cabinet, but has promised that he will map out plans for the economy in the days after the inauguration. Investors are betting he will not invoke populist measures that could spook markets.
Four years ago, many financial players were scared he would wreck Brazil's economy by defaulting on debt. Instead, he surprised Wall Street by sticking to orthodox monetary policy, as his administration invoked high interest rates that stymied growth but brought down inflation and ended the nation's traditional boom-and-bust cycles.
The nation's benchmark interest rate has been reduced from a high of 19.75 percent last year, but still stands at 13.25 percent, making it tough for businesses to expand.
Brazil will not experience significant job growth until the rate drops much more, said Mark Weisbrot, an economist at the Washington-based Center for Economic and Policy Research.
"They have the highest real interest rates in the world," Weisbrot said. "Just think about what the U.S. economy would look at with those interest rates, a depression, and the more interesting question is how Brazil is able to have any job creation at all."
After growing just 2.3 percent in 2005, Brazil is expected to post gross domestic product growth of 2.8 percent for 2006, and experts believe South America's largest economy will expand 3.4 percent in 2007 -- far below Lula's goal.
Corruption scandals during Lula's first term forced members of his inner circle to resign and prevented him from pushing through Congress labor and tax reforms aimed at bringing down the cost of doing business in Brazil and helping the economy.
Another election corruption scandal within his Workers Party cost Lula a first-round re-election victory on October 1, but he won by a landslide four weeks later.
Analysts said Lula won much of his support by expanding the "Zero Hunger" program that gives 11 million Brazilian families money for food every month if they keep their children in school.
A poll released earlier this month showed Lula has the highest popularity ever of recent Brazilian presidents, but analysts doubt he has the congressional votes needed to push through extensive business-friendly reforms.
His inauguration follows a wave of gang violence that has led to bus burnings, attacks on police stations and retaliatory killings by authorities.
Last week, attacks by gang members killed 19 in Rio de Janeiro, Brazil. Similar attacks in May in Sao Paulo, Brazil, killed nearly 200 people.
Luiz Inacio Lula da Silva, required by law to ride in a classic Rolls-Royce to Congress for his swearing-in ceremony Monday, was scheduled to give an open-air inaugural speech to left-leaning supporters outside the presidential palace.
Thousands were pouring in from far-flung regions of Latin America's largest country to attend the inauguration in the heart of Brazil's futuristic and architecturally renowned capital.
World leaders weren't invited, and the highest-ranking foreign government official attending is Italian Foreign Minister Massimo D'Alema -- in sharp contrast to Lula's first inauguration, which included the presence of Cuba's Fidel Castro and Venezuelan President Hugo Chavez, an ardent socialist.
Lula has managed to stabilize Brazil's economy and increase social spending for tens of millions living in misery, but growth lagged behind the rest of South America. This, along with a corruption scandal that dogged his leftist Workers Party, put him on the defensive during his re-election campaign.
His main second-term push is expected to be jobs for Brazil's poor.
Lula, a poor farmer's son who gained fame as a union leader resisting Brazil's 1964-1985 military dictatorship, acknowledged over the weekend that his second term could be tougher because Brazilians will expect more from him.
"The second term ... is a much stronger and demanding commitment than the first," Lula told reporters. "And we are committed to doing more, and doing it better."
Lula has vowed to craft economic policies to spur annual economic growth of 5 percent -- a goal most analysts consider lofty.
Lula isn't expected to announce the makeup of his new cabinet, but has promised that he will map out plans for the economy in the days after the inauguration. Investors are betting he will not invoke populist measures that could spook markets.
Four years ago, many financial players were scared he would wreck Brazil's economy by defaulting on debt. Instead, he surprised Wall Street by sticking to orthodox monetary policy, as his administration invoked high interest rates that stymied growth but brought down inflation and ended the nation's traditional boom-and-bust cycles.
The nation's benchmark interest rate has been reduced from a high of 19.75 percent last year, but still stands at 13.25 percent, making it tough for businesses to expand.
Brazil will not experience significant job growth until the rate drops much more, said Mark Weisbrot, an economist at the Washington-based Center for Economic and Policy Research.
"They have the highest real interest rates in the world," Weisbrot said. "Just think about what the U.S. economy would look at with those interest rates, a depression, and the more interesting question is how Brazil is able to have any job creation at all."
After growing just 2.3 percent in 2005, Brazil is expected to post gross domestic product growth of 2.8 percent for 2006, and experts believe South America's largest economy will expand 3.4 percent in 2007 -- far below Lula's goal.
Corruption scandals during Lula's first term forced members of his inner circle to resign and prevented him from pushing through Congress labor and tax reforms aimed at bringing down the cost of doing business in Brazil and helping the economy.
Another election corruption scandal within his Workers Party cost Lula a first-round re-election victory on October 1, but he won by a landslide four weeks later.
Analysts said Lula won much of his support by expanding the "Zero Hunger" program that gives 11 million Brazilian families money for food every month if they keep their children in school.
A poll released earlier this month showed Lula has the highest popularity ever of recent Brazilian presidents, but analysts doubt he has the congressional votes needed to push through extensive business-friendly reforms.
His inauguration follows a wave of gang violence that has led to bus burnings, attacks on police stations and retaliatory killings by authorities.
Last week, attacks by gang members killed 19 in Rio de Janeiro, Brazil. Similar attacks in May in Sao Paulo, Brazil, killed nearly 200 people.
posted by Alice at
Monday, January 01, 2007
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