In a previous post, I wrote (in Portuguese) that Brazilians vote according to their pockets - a simpleminded and suboptimal feedback control strategy, which has the merit of being robust against long-term, constant disturbances - and that the PT government will not be strong politically starting January 1st. The possible sources of trouble are as follows:
1 - Political (self generated). As pointed out in A Mão Visível, the Worker's Party has completed the transition of its voter base: from a party of rentiers ensconced in protected industries, government offices, and nonperforming academic departments, to a party representing the poor and uneducated Brazilians who have benefited from social programs started in the last 15 years. Trying to reconcile the interests of the 2 sectors, which are diametrically opposed, PT often becomes embroiled in scandals. Lula's political skill kept the government running. Dilma seems less adept at controlling the party hacks, and the option for an agressive electoral campaign seems to have sidelined PTs more professionally qualified side. Probability of trouble: 100%. Danger: from minor to medium (been there, seen that).
2 - Economic (domestic). Brazil's private and government consumption is balanced by imports, the lack of domestic savings by a massive inflow of investments. At the moment foreign goods and capital have nowhere else to go, but this cannot go on forever. PTs two wings can only be kept in peace by generous social programs combined with inefficient and unproductive federal spending. Probability of trouble in the next 4 years: 50%. Danger: serious to very serious (been there, seen that, didn't like it).
3 - Foreign relations (exogenous, mostly). Although Brazil's neighbors have not been a serious concern since Pedro II won the Paraguay war seven score years ago, at present the solanolopistas can count on a sizable domestic fifth column. The Foreign Office has proved itself completely inept in the Honduras episode. Dilma, who showed herself to be curiously uninterested in international affairs, even more so than the Brazilian voter, would have to be the one making decisions if there are discontinuities in Argentina, Cuba, Paraguay, or Venezuela? Probability of trouble: ask the Moirae. Danger: uncertain.
4 - Environment (including public health and access to energy sources). Brazil's environment is healthy in the short term. Probability of trouble: very small. Danger: extreme.
Still to be answered: how would the Dilma administration react if there is trouble?
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