IBERO-AMERICAN NEWS DIGEST
Military Nationalists Urge Lula: Follow FDR Model
Under the headline "The Crossroads of Lula's Government," the December issue of Ombro a Ombro, the respected monthly magazine of the retired Brazilian military, starkly describes Brazil's current crisis, for which it blames President Fernando Henrique Cardoso, and his obedience to foreign-policy dictates. Cardoso has done everything the Inter-American Dialogue demanded, and now he will return as their co-president, they wrote. His government's trademark has been "disdain for Brazil's sovereign nation-state, [and an approach] oriented fundamentally for the interests of financial, and especially foreign, investors."
President-elect Lula da Silva, as he assumes the Presidency, is faced with a ticking time bomb: The majority of those who voted for him are expecting immediate changes; on top of that, the threat of hyperinflation looms large. So far, Lula's transition team has suggested that immediate short-term change is impossiblea worrisome tendency, given the gravity of the "scorched earth" situation over which it will have to govern as of Jan. 1, Ombro a Ombro warns.
Lula and members of his team have, more than once, positively referred to the "great American President Franklin Roosevelt and his policies of economic reconstruction," as a model that could bring about a similar economic recovery in Brazil. "There could not be a better inspiration," Ombro a Ombro writes. Just as Roosevelt did in his March 1933 first inaugural speech, the new Brazilian government must "tell the truth" to the country about the real situation the nation faces, and take responsibility for it.
More than rhetoric will be needed, Ombro writes: "Like Roosevelt, it is necessary to have the courage to confront the established powers, and rule for the nation's great majority, for which [approach], certainly, there will be no lack of support." Should Lula fail to immediately repudiate the economic-financial model that has destroyed Brazil, "he will be responsible for the potentially tragic consequences of refusing to change direction, for fear of offending the so-called agents of the market. Were this to occur, the positive expectations awakened by Lula's election could disappear rapidly, transforming him into a huge national deception, whose outcome would be unforeseeable."
Brazil's President-elect Visits Washington
President George Bush has suggested that Brazil and the United States hold a governmental summit some time in the first half of 2003 to discuss bilateral matters, and debate ideas about the preservation of democracy in Ibero-America, security, and economic development, Brazilian President-elect Luiz Inacio "Lula" da Silva announced following his meeting with President Bush on Dec. 10. Lula, for his part, invited Bush to visit Brazil.
The two held a "frank and direct dialogue," the Brazilian President-elect said.
Lula's visit to Washington was for one day only, and it included a well-attended presentation at the National Press Club. The crowd greeted him with a standing ovation and applauded at various points during a speech which was optimistic in tone, although measured, intended to reassure foreign investors and creditors that, as President, he would do nothing to offend them. He vowed that his government will emphasize fiscal responsibility and respect all contractual agreementsi.e., debt payments. However, he cautioned, "We also need a constructive attitude" from the international financial community.
He opened the door to Brazil's participation in the Free Trade Area of the Americas (FTAA), while pressing for "real" free-trade, under which the U.S. would also lift all its tariff barriers to Brazilian goods, and promising that he would be very "tough" in defending Brazil's interests and sovereignty. He reiterated, however, that Brazil will also "seek new trade partners among countries with a size and potential similar to oursas is the case with China, India, and Russia." And, he emphasized that his government must end hunger, poverty, and unemployment in Brazil, and forge Ibero-American integration. "I have no doubt whatsoever that this government can change the path of history," he said, "and this is what I intend to do."
Lula got a laugh from the crowd at the National Press Club when he answered a hostile question which echoed the line of the Hudson Institute's Moonie lunatic, Constantine Menges, that Lula's and the Workers' Party's "alliances" with "communist parties in the region, and in other parts of the world," form a new threat. Asked "why has your political party established a partnership with the Communist Party of China?" Lula responded, to laughter and applause: "I didn't know China that well until the United States made China a preferential trade partner. And I thought to myself, if it's good for the Americans, it's going to be good for the Brazilians." Brazil and China will work closely together, he added, "because China is an important partner for our trade objectives."
In response to a question about Venezuela, Lula said he wanted that crisis to be resolved peacefully, adding that he had discussed this with President Bush. As President, Lula said, "I will do all in my power to contribute in such a way that Venezuela will find a way that is not violent."
Lula Hands Central Bank Over to Bank of Boston Interests
Brazil's President-elect Lula da Silva announced his nomination for Central Bank president on Dec. 11: Henrique Meirelles, a Harvard-trained banker, the bulk of whose career has been with the old "Dope, Inc." bank, Bank of Boston. Meirelles led BankBoston's operations in Brazil for 12 years, before moving to Boston to take up the post of president and chief operating officer of the parent company in 1996. BankBoston was later bought out by Fleet Financial (i.e., Meirelles's bank was bankrupt), at which point Meirelles became head of global and wholesale banking for the new firm, FleetBoston, which is now distinguished as the eighth-largest derivatives bank in the United States, with about a half-trillion dollars in worthless derivatives holdings. Meirelles resigned from FleetBoston last August, so he could run for Congress on President Fernando Henrique Cardoso's ticket, the PSDB party.
The Central Bank nomination followed Lula's announcement of his first two Cabinet posts during his Dec. 10 visit to Washington, D.C. Named as Treasury Minister was Antonio Palocci, who went to meet with Wall Street and Federal Reserve bigwigs the next day, with Meirelles in tow. Palocci, a medical doctor who claims to have taught himself economics by studying university texts at night, could be described as a representative of "monetarist Trotskyism." He joined the Workers Party's (PT) Trotskyite "Freedom and Struggle" wing as a student leader, but became the strategist of Lula's "move to the center" during the campaign, handling contacts with "the markets." The latter liked the fact that, as PT Mayor of Ribeiro Preto, he privatized the public services.
The new Environment Minister is Workers Party Sen. Marina Silva, a hard-core "Green Mafia" agent, who adamantly contested EIR correspondent Lorenzo Carrasco's testimony when the latter spoke before a Federal Senate committee in May 2001.
CFR Man Warns Brazil Could Spin Out of Control This Month
Interviewed by Bloomberg news service on Dec. 6, the chief of the Latin American program at the Council on Foreign Relations, Kenneth Maxwell, warned that everyone must be very careful what they say right now, because the situation in Brazil before the scheduled Jan. 1 inauguration is so "delicate," that the wrong words could have "great impact." Maxwell made clear he is concerned about getting through the month of December.
The outgoing government is virtually gone already, he worried, and the makeup of the new government isn't known. There's a sense that there's no guiding hand running things in Brasilia, in the midst of a situation of "great fragility." If there were to be a major speculative attack on the Brazil's currency, driving the real to above 4 or 4.5 to the dollar, then Brazil would be unable to service its debts. Maxwell singled out the private-sector debt as especially vulnerable, under those circumstances.
Brazil Official News Agency Carries LaRouche Release on Eneas
Brazil's official news agency, Agencia Brasileira de Noticias (ABN) carried a wire story Dec. 10 with Lyndon LaRouche's Dec. 5 statement on why Brazilian Congressman-elect Dr. Eneas Carneiro was under attack. In the statement, LaRouche, noting that Dr. Eneas is a personal friend, dismissed the spurious attacks on him as not credible. The attacks are an attempt by "corrupt, foreign forces to control the administration of incoming Brazilian President Lula," LaRouche charged. "The reality is that the present world financial system is hopelessly disintegrating. This is not a Brazilian economic crisis; it is a crisis of the entire global system. So, those desperadoes who are trying to preserve the existing system are losers: Their system can not be saved, no matter how desperate and hysterical their efforts to do so. We have here the case of the desperately hungry trying to feast on the inedible."
Contacts in the interior of Brazil reported that some local papers published the ABN wire. (See LATEST FROM LAROUCHE in EIW 40, for the complete text of release.)
FARC Car Bombs Proliferate; Uribe Hits Back Hard
Since the car bombing of the main police headquarters in Bogota, Colombia Dec. 9 by the narcoterrorist FARC, which wounded 69 (among them, seven children and a pregnant woman), the Uribe government has ordered at least 50 raids in that city. The result: five more car-bombs in preparation were discovered and dismantled, one of which was already packed with one and one-half tons of explosive. A plot to assassinate President Uribe was simultaneously thwarted with good intelligence work, and a planned hotel conference in the city of Medellin was moved at the last minute to the army barracks in that city.
|