After attacks in Brasilia, next steps on the economic agenda divide analysts’ opinions

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While part of the specialists believe that coup acts divert the government’s focus and tend to delay the adjustment measures, others defend that the government’s response showed speed and proposals gain strength to walk in parallel. Terrorist Bolsonarists are arrested and removed from the Planalto Palace Ueslei Marcelino/Reuters The terrorist attacks, seen in the country on the second Sunday in January, still bring disagreements among experts heard by the g1 about possible impacts on the advancement of the new government’s economic agenda. Right at the beginning of the mandate, the government of Luiz Inácio Lula da Silva (PT) is charged with a solution to the crisis of the country’s public accounts, while trying to move forward with a revenue expansion program and tax reform. Some of the specialists say that the dissolution of anti-democratic acts requires so much attention from the government that it can delay discussions on fiscal policy and the negotiation of reforms in the National Congress. At the other end, it is necessary to argue that President Lula’s quick response and the unification of the Executive, Legislative and Judiciary branches to deal with the issue gave greater security to the market and brought a political gain to the new government — which may increase the chances of a faster evolution in the procedures of the economic agenda. Exclusive: the investigation of one of the main suspects of financing the terrorist acts Keeping an eye on the economy With the fiscal scenario in the center of attention, the perception of some economists is that the quick response to anti-democratic acts facilitates the unfolding of the government’s plans. Along with this, the recent economic package announced by the Minister of Finance, Fernando Haddad (PT), last week, was well received by the market. For this part of the analysts, the reading is that the institutions remain focused and keep working. According to the president of the Regional Economic Council of São Paulo (Corecon-SP), Pedro Afonso Gomes, the attacks have little importance for the progress of the fiscal debate and discussions on budget adjustments and tax reform. He comments that not even the market felt any impact from these acts, citing as an example the positive reaction of the Brazilian stock exchange shortly after Sunday’s events, and opines that the prospects already seem to be more positive for the economy. “On the market side, if the government’s response [para os atos antidemocráticos] had it been delayed or delayed, I think the effects could have been worse. But the issue was resolved quickly and most economic agents work in the medium and long term. The same happens from the inspector’s point of view, where we can already see the picture starting to evolve, ”he says. Haddad brought, in the week following the attacks, the first measures to try to reduce the gap in public accounts and contain the rise in public sector debt. Among the measures is a new extraordinary debt installment program, the intention to reduce R$ 50 billion in expenses, among others. “We have already noticed a firmer position from Lula, who has been asking his ministers to present results. There was a brake on account of anti-democratic acts and it is natural, since the government needs to respond accordingly, not only in politics, but in the criminal part as well. But now, we already see people showing their work”, says economist, lawyer and deliberative counselor of the Commercial Association of São Paulo (ACSP) Alessandro Azzoni. Economists also say they believe that the measures announced by the government to address the attacks have brought greater political strength to Lula and may even end up reducing any divergences in Congress, in order to mitigate the most radical positions and facilitate articulation with parliamentarians. , helping to guide the guidelines of the economic agenda. “I believe that the debate [fiscal] will prevail. I think that the big points that need to happen will pass and my opinion is that they should still pass with a majority. I don’t see so much ideological divergence”, completes Gomes, from Corecon, highlighting that even if the more conservative principles are maintained, there will be more space for conversation. Haddad announces measures to reduce deficits in public accounts; economist Zeina Latif comments One step at a time On the other hand, some experts still see obstacles ahead for the new government. According to Carlos Melo, a political scientist at Insper, the terrorist attacks seen on the second Sunday in January —and all the repercussions that the cases still have— divert part of attention from the necessary economic measures. “First, there is no way to make a more sustained and lasting adjustment [na economia] with everything that is happening in the Federal District. It is not possible to think that we will see a group invading Praça dos Três Poderes, federal intervention and everything that has happened in recent days, and believe that the country will breathe normally, ”he says. In addition, the reading is that the more liberal profile of Congress in Lula’s term still brings a different opposition than the president faced in his first term, in 2003. In this scenario, specialists reinforce that even if there is a certain political gain for Lula given the quick responses to the attacks, this will not necessarily translate into greater room for approving the economic agenda. According to Rafael Cortez, political scientist at Tendências Consultoria, even with force majeure, the new government is already born with limited political capital due to a still high rejection of the president, in addition to having already had to deal with institutional problems and with the signs of a scenario of economic slowdown ahead. “Thus, a good part of the effort of this political capital will be used in more thorny issues that are already knocking on the door at the beginning of this government. So, I believe that the alternative will be a more gradual fiscal adjustment, in the medium and long term”, he says, reinforcing that he also expects significant divergences in the debates on tax reform. “The tax reform is another important item, which affects the federal pact and the large economic sectors. In this case, there is still an important variation in the paths to be followed for this reform”, adds Cortez.

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