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### Viewing cable 07SAOPAULO734, PT PREPARES FOR NATIONAL CONGRESS

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
07SAOPAULO734 | 2007-08-29 19:02 | 2011-07-11 00:00 | UNCLASSIFIED//FOR OFFICIAL USE ONLY | Consulate Sao Paulo

`

    VZCZCXRO3534
    PP RUEHRG
    DE RUEHSO #0734/01 2411902
    ZNR UUUUU ZZH
    P 291902Z AUG 07
    FM AMCONSUL SAO PAULO
    TO RUEHC/SECSTATE WASHDC PRIORITY 7401
    INFO RUEHBR/AMEMBASSY BRASILIA 8515
    RUEHBU/AMEMBASSY BUENOS AIRES 2841
    RUEHAC/AMEMBASSY ASUNCION 3082
    RUEHCV/AMEMBASSY CARACAS 0542
    RUEHMN/AMEMBASSY MONTEVIDEO 2414
    RUEHLP/AMEMBASSY LA PAZ 3459
    RUEHSG/AMEMBASSY SANTIAGO 2116
    RUEHRI/AMCONSUL RIO DE JANEIRO 8286
    RUEHRG/AMCONSUL RECIFE 3744
    RHEHNSC/NSC WASHDC
    RHMFISS/CDR USSOUTHCOM MIAMI FL
    RUEATRS/DEPT OF TREASURY WASHDC
    RUCPDOC/USDOC WASHDC 2880
    RUEHC/DEPT OF LABOR WASHDC

` `

    UNCLAS SECTION 01 OF 04 SAO PAULO 000734

    SIPDIS

    SENSITIVE
    SIPDIS

    STATE FOR WHA/BSC, INR/IAA, INR/R/AA
    STATE PASS USTR FOR KATE DUCKWORTH
    NSC FOR TOMASULO
    TREASURY FOR OASIA, DAS LEE AND JHOEK
    USDOC FOR 4332/ITA/MAC/WH/OLAC
    USDOC ALSO FOR 3134/USFCS/OIO
    DOL FOR ILAB
    SOUTHCOM ALSO FOR POLAD
    USAID FOR LAC/AA

    E.O. 12958: N/A
    TAGS: PGOV PINR PHUM ELAB ECON BR
    SUBJECT: PT PREPARES FOR NATIONAL CONGRESS

    REF: (A) SAO PAULO 496; (B) SAO PAULO 129;

         (C) 06 SAO PAULO 1264; (D) 06 SAO PAULO 1105
         (E) 05 BRASILIA 2951 AND PREVIOUS

    SENSITIVE BUT UNCLASSIFIED - PLEASE PROTECT ACCORDINGLY.

    -------
    SUMMARY
    -------

    ¶1.  (SBU) In recent meetings with Poloff, leaders within the Workers
    Party (PT) outlined the focus of the upcoming PT National Congress.
    According to Renato Simoes and others, the Third National Congress
    of the Workers' Party (PT) will not be a forum for great ideological
    debates, but rather an opportunity for leaders and factions to
    position themselves for upcoming electoral struggles such as the
    municipal elections in 2008 and national elections in 2010.  The
    National Congress will also address the future leadership of the
    party, seek to enhance the party's profile, and build a lasting
    constituency in a post-Lula PT party.  End Summary.

    ¶2.  (U) The PT will hol its National Congress, only the third in
    its 27year history, from August 31 through September 2 i Sao
    Paulo.  Some 1,500 delegates from Brazil's 6 states and the Federal
    District will participae.  The Congress comes at a difficult moment
    in the party's history as the Lula administration has been rocked by
    a number of scandals as well as internal dissension.  After
    weathering the trauma of a major corruption scandal in 2005 to elect
    83 Federal Deputies, five Governors, and to re-elect President Lula,
    the PT is plagued by disgruntlement and disillusion in its leftist
    base.  Serious internal divisions and rivalries, growing public
    weariness over federal government policies, and the lack of a strong
    national candidate to succeed Lula have all contributed to a lack of
    focus within the PT.

    ¶3.  (U) Over the past few weeks, Poloff and Political Assistant have
    met with various party leaders, thinkers, and office-holders to
    discuss the issues that are most likely to emerge during the PT
    National Congress.  These meetings included: Renato Simoes, acting
    Secretary for Social Movements and a member of the PT's National

    SIPDIS
    Executive Committee; Rui Falcao, a Sao Paulo state legislator and
    former party President who managed Lula's unsuccessful 1994
    presidential campaign; and Ricardo Azevedo, president of the Perseu
    Abramo Foundation (FPA), the PT's think tank.  From varied
    perspectives and with differing points of emphasis, each described
    the state of play and the issues to watch for in the Third Congress
    as well as the 2008 municipal elections, and the 2010 national and
    state executive and legislative elections.

    -----------------
    THEMES AND THESES
    -----------------

    ¶4.  (U) Three broad themes have been identified for discussion at
    the Congress: "The Brazil We Want," "PT Socialism," and "PT:
    Conception and Functioning."  Representatives of different schools
    of thought within the party have published 12 "theses," which have
    been debated and refined in local and state party congresses.  The
    first two are relatively uncontroversial - the PT wants a growing,
    developing free Brazil with a strong dose of egalitarianism and
    emphasis on social progress, including more rights and better access
    for Afro-Brazilians, indigenous peoples, workers, and the poor, and
    favors a vigorous democratic socialism - with only some priorities
    and details to be worked out.  However, the question of the party's
    conception and functioning - how it operates in a multi-party system
    - has stimulated a variety of responses and has the potential to be
    an area of contention.  NOTE:  An in-depth look at the various power

    SAO PAULO 00000734  002 OF 004

    centers is forthcoming septel. END NOTE.

    ---------------
    WHO SHALL LEAD?
    ---------------

    ¶5.  (SBU) Due to the multi-faction nature of the PT, the question of
    internal party elections figures to loom large at the National
    Congress.  In September 2005, the party elected its national
    president, executive committee, and national, state, and local
    directorates to three-year terms.  The timeline calls for new
    internal elections in September 2008, but most in the PT resist the
    idea of holding internal elections so close to the October municipal
    elections.  A small portion of the PT's largest faction, the Campo
    Majoritario (CM), favors postponing internal elections until early
    2009, but most other parties prefer to move them forward to either
    late 2007 or early 2008 (before the municipal races are in full
    stride) to get new leadership in place sooner rather than later.

    ¶6.  According to both Simoes and Falcao, the incumbent PT president,
    Ricardo Berzoini (a Social Security Minister and later Labor
    Minister in Lula's first term) of the CM is a strong candidate for
    re-election, though not without opposition.  However, Berzoini has
    said both publicly and privately in the past week that he will not
    run, and Azevedo thinks he should be believed.  Comment:  Elected in
    the aftermath of the "Mensalao" vote-buying scandal (see ref E),
    Berzoini has never been seen as a strong leader.  He was forced to
    step aside in October 2006 after being implicated in another scandal
    involving a fake political "dossier" designed to undermine Sao Paulo
    gubernatorial candidate Jose Serra.  Though he later returned to the
    job, he has never recovered his strength.  End Comment.

    ¶7.  (SBU) If Berzoini does not run, logical choices would include
    two old-timers, Marco Aurelio Garcia (PT first vice president who
    served as acting President in Berzoini's absence and is currently
    President Lula's Foreign Affairs Advisor) and Luiz Dulci, the
    Secretary General of the Presidency.  Garcia, however, has said he

    SIPDIS
    doesn't want the job and is also suffering from an image problem
    ever since he was captured on national television making obscene
    gestures to "celebrate" the news that the July 17 crash of TAM 3054
    at Congonhas airport in Sao Paulo, which killed 199 people, may have
    been caused by mechanical problems and not by factors under the
    government's purview such as the short, slippery runway.  Luiz
    Dulci, a founder of both the PT and the Unified Workers Center (CUT)
    and a past President of the Perseu Abramo Foundation who remains one
    of President Lula's oldest and closest friends, has also said he is
    not interested, but may change his mind.  As one of the few members
    of the old guard to emerge untainted from the scandals and to remain
    in the government, and reportedly one of the only people left in the
    Presidential palace in whom Lula still confides, if forced to choose
    between party and government, Dulci would probably want to stay in
    the government.

    ¶8.  (SBU) Other potential candidates have emerged, such as Olivio
    Dutra, former Governor of Rio Grande do Sul and former Minister of
    Cities and, most recently, Antonio Palocci, a Federal Deputy who
    served as Finance Minister 2003-6 before resigning over a blatant
    abuse of his office to escape incrimination in a sex scandal.  Both
    would likely generate opposition from either the CM, in the case of
    Dutra, or the PT's left wing, in the case of Palocci.  While
    long-shots, both potential candidates are waiting in the wings in
    the event that Berzoini, Garcia, or Dulci decide not to run.

    ---------------------------------------
    WHAT TO DO ABOUT 2010 AND WHEN TO DO IT
    ---------------------------------------

    SAO PAULO 00000734  003 OF 004

    ¶9.  (SBU) The question about when to elect new party leadership, and
    whom to elect, is extremely important because the new PT president
    must lead the party into national elections three years from now.
    Political observers agree that all parties are already focused on
    2010, but none so much as the PT, which for the first time will
    offer a candidate not named Lula.  NOTE: Some observers believe that
    Lula hopes to see a weak President elected so he can mount another
    challenge in 2014 (the Constitution prohibits three consecutive
    terms, but nothing precludes Lula from running in 2014, when he will
    be 68)  End note.

    ¶10.  (SBU) The decision on when or if to field a leading candidate
    either from the PT or any of the other coalition parties is also at
    center stage for this National Congress.  Azevedo predicted that if
    left up to him, Lula would not decide whom to support until sometime
    in 2009, after the municipal elections have clarified the picture.
    Lula aspires to be the Great Elector and kingmaker, to perpetuate
    his legacy, but many in the PT will insist on beginning now to work
    on identifying a PT candidate.  Comment:  Many analysts agree that
    fielding a candidate too soon would result in increasing dissension
    within the PT ranks and would offer a target for the opposition to
    attack.  End Comment.

    ¶11.  (SBU) Regarding the political/economic platform of the PT,
    there is near unanimity that the political system needs to be
    overhauled before any meaningful economic reforms or improvements in
    governance can take place.  The Lula administration put forward a
    bill with four elements: 1) Voting for a closed party list; 2)
    Public financing of election campaigns; 3) Party fidelity; and 4) An
    end to coalitions in campaigns governed by proportional voting,
    e.g., legislative campaigns.  The PT generally supports the bill,
    but numerous PT Federal Deputies oppose the closed party list (in
    which voters are asked to choose a political party, whose slate of
    candidates is selected by party leaders but not disclosed to
    voters).  Even though strong opposition to this reform agenda by the
    opposition appears to have killed three of the four initiatives for
    now, the PT is likely to maintain many of these areas as central
    themes going into 2010.  A party fidelity measure was approved in
    committee in the Chamber of Deputies and is now awaiting a plenary
    vote.

    -------
    COMMENT
    -------

    ¶12.  (SBU) Despite the challenges it faces, the PT remains strong in
    many ways.  Labor leaders such as the Unified Workers' Center
    (CUT's) Joao Felicio, while taking issue with some of Lula's
    policies, freely acknowledge that Brazil may never again see a
    candidate so friendly to labor.  In addition, the PT is closely
    associated with public welfare campaigns such as the "Bolsa Familia"
    from which roughly 25% of Brazilians receive financial support, and
    thus remains strong with the economically disadvantaged of the
    country.  But there is no question that the burdens associated with
    running the federal government, with its accompanying
    coalition-building and compromising, has severely taxed the party's
    political talent and tarnished its image.  It is losing old friends;
    a number of radicals left in 2005 to join Heloisa Helena's Socialism
    and Liberty Party (PSOL); the MST (Landless Movement) is
    increasingly alienated by what they perceive as a lack of commitment
    to agrarian reform; and we hear increasingly that the Communist
    Party of Brazil (PC do B) wants to leave the coalition and may even
    launch a new labor central in competition with the CUT, a PT sister
    organization.  The question remains whether the support enjoyed by
    the PT is support of Lula or of the party itself.  How the PT will
    meet this challenge and burnish its image is perhaps the most
    important issue its Third Congress will have to address.  End

    SAO PAULO 00000734  004 OF 004

    Comment.

    ¶13.  (U) This cable was coordinated with Embassy Brasilia.

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