Haddad is working – 06/10/2023 – Celso Rocha de Barros

Fernando Haddad had a good week.

On Monday, the Ministry of Finance announced Desenrola, a debt renegotiation program for poor Brazilians. The program will benefit families with incomes of up to two minimum wages and debts of up to R$5,000 contracted by the end of last year.

On Tuesday, the congressional working group on tax reform delivered its report. It came out very similar to the Lula government’s proposal.

As we have already argued here, the reform aims to implement in Brazil a tax system similar to that of developed countries, based on a value added tax.

Projections indicate that the reform would increase the efficiency of Brazilian capitalism, would not increase the total tax burden and would slightly reduce the system’s regressivity.

It was feared that the reform would come out of the working group already disfigured by political pressures, to the point of frustrating these projections. Did not happen. It was a victory for the Lula government.

The mayor himself, Arthur Lira, whose relationship with the government is not always marked by the intoxicated lust of first love, declared that the reform should still be voted on in the first semester.

Considering, moreover, that the new fiscal framework has already been approved by the Chamber, it is necessary to recognize that Haddad’s plan is being implemented.

It is not easy to implement, but there is nothing in Brazil today that is both easy to implement and has a chance of succeeding outside the head of the person who proposes it.

Why, among Lula’s proposals, is the economic agenda easier in Congress?

The hypotheses I have heard reflect the debate on the current functioning of Brazilian presidentialism that I discussed in the May 27 column.

For some, Haddad is a more competent negotiator than Padilha or Rui Costa. Last week, vice president Geraldo Alckmin had to deny on CNN Brasil the rumor that Haddad would replace Rui Costa in the Civil House.

On the other hand, a government source has already told journalist Mônica Bergamo that the government (as a whole, not just the Treasury) is prioritizing the economic agenda in its negotiations with Congress, concerned with the effect of the economy on its chances of success. .

Finally, it is possible that Lira and his supporters are guided by ideological criteria, approving business-friendly agendas to build support for the right in the 2026 presidential election.

Be that as it may, part of the left still does not seem convinced by the agenda that Lula prioritized in negotiations with Congress.

In the vote on the fiscal framework, for example, a large group of PT parliamentarians voted “yes” under protest. It was kind of weird. The framework is good, but suppose it were bad: would the population forgive those who approved it because, you see, before approving it, we made a manifesto?

On the other hand, last week, this Sheet published an editorial saying that the government made mistakes in the economic area, but that the most important thing was its role in democratic normalization.

I completely agree with this ordering of priorities, I agree that several of the measures listed in the editorial were mistakes, but anyway: whatever combination of his personal merits, Lula’s support and Lira’s flexibility, Haddad is working as Minister of Finance .

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