Brazil’s two time ex-president, and ex-convict, Luiz Inacio Lula da Silva, was declared the winner in a nail-biter final week. President Biden rapidly congratulated him. European leaders and the Western press, who despised incumbent Jair Bolsonaro as a result of he reminded them of Donald Trump, did the identical. The established Western powers and their wandering minstrels from The Guardian, the Related Press and NPR wished Lula to win. He received. Yippee! However Lula will do the U.S., or Europe, no favors.
First, with out arguing whether or not the elections went off with out a hitch, Lula wanted this win for himself. Arguably essentially the most beloved president in fashionable instances, Lula fell from grace within the mid-2000s due to the Petrobras “Automobile Wash” scandal. The oil large was ransacked. Class motion lawsuits, of which I used to be a component, have been filed and received. I don’t assume Lula was any specific ring chief in all that went fallacious, however a court docket mentioned his involvement and dereliction of obligation have been sufficient to place him in jail.
Then, a Supreme Courtroom appointee of his set him free. His jail document was cleared so he may run for workplace.
Was Lula’s arrest a political witch hunt? Some consider so. Many People would consider the identical if the Division of Justice and Lawyer Normal of america discovered Trump responsible of some such factor, and jailed him.
In a bizarre approach, regardless of Bolsonaro being labeled by the international press because the “Tropical Trump”, Lula — to his supporters — was persecuted the identical approach, solely he ended up with a jail sentence.
For positive, Lula views the Automobile Wash scandal as a swipe in opposition to his historical past. He would possibly even consider that U.S. intelligence forces, which have been skeptical of Lula, helped the opposition with discovery within the Petrobras circumstances that led to his undoing. I don’t know if this occurred, or if it was in any respect nefarious — many American retirement funds have been closely invested in Petrobras and misplaced thousands and thousands. U.S. official involvement within the case would make sense. Petrobras inventory was round $28 on the time the scandal was going down and ended up round $3.50 at its lowest level in 2016. In the present day, it struggles to high $15.
However I feel it’s secure to say that Lula doesn’t belief the U.S. intelligence forces and believes that there have been U.S. curiosity in seeing him fall due to Petrobras. He owes these guys no favors and can give them none.
Like Bolsonaro, Lula is a nationalist, not a neo-globalist like some have tried to make him out to be. Whereas he has been courted by the identical European crowd that funneled darkish cash into political motion committees donating to the Biden marketing campaign, and sometimes spoke their language on the marketing campaign path about racism, and democracy below siege and — Oh, good God, even ESG — Lula does probably not care about any of these issues. The West is projecting.
The Europeans and the NPR listeners would possibly assume that Lula will save the Amazon. As a result of Bolsonaro apparently destroyed it. But it surely was Lula who, going in opposition to Hollywood’s most well-known director on the time, Mr. Avatar himself — James Cameron — and Mr. Titanic — Leo DiCaprio — launched the development of the world’s second-largest hydroelectric dam within the Amazon, often known as Belo Monte. Regardless of all of the whining from Paris and D college students who play make-believe in Los Angeles, Lula satisfied the Xingu tribe that it was not the top of the world, and that Brazil wanted electrical energy and Brazil was going to construct a dam, which they did. Now Brazil is house to 2 of the world’s largest hydroelectric dams and one in every of them is producing energy within the “lungs of the Earth.” That was Lula who did that, not Bolsonaro.
Bolsonaro was higher for america, geopolitically. He may not less than be counted on to make issues tougher for China within the Americas.
Lula will do nothing of the kind. He’ll deliver Brazil nearer to China, particularly if the clown world banks of Europe and the U.S. pester him about greenhouse gasses and cow methane. China will gladly lend to Brazil and put money into Brazil and purchase Brazilian commodities. (Although Bolsonaro most likely would have achieved the identical if Biden and Co. questioned his win.)
Bolsonaro was a impartial voice within the battle in Ukraine.
Lula is not going to be. He’s not fascinated with NATO proxy wars with Russia. He labored with Vladimir Putin for eight years, 4 greater than Bolsonaro. And people have been good instances. The BRICS have been all the craze then. Economies have been booming. Nobody hated the Russians.
Lula blamed Volodymyr Zelensky for the battle as a lot as he did Putin in an interview with Time magazine this summer season.
I think about it took all of the power the international correspondents in Sao Paulo may muster to not name Lula out on this. Had Bolsonaro mentioned that, it might have been on the duvet of each newspaper, not as a matter of reality (Bolsonaro mentioned this) however as a blasphemy to the Western world order (Bolsonaro mentioned this, and he’s a dummy).
Lula is not going to assist U.S. rhetoric in opposition to Russia until Russia begins lobbing nuclear bombs into Ukraine. Till then, the U.S. has no ally in Lula on Ukraine. None.
Brazil is the final stand within the Americas.
From Mexico to Argentina, Latin America is changing into a forgotten world. If Brazil collapses, Latin America can be a black gap, with nothing however poverty, disgusting inequality, and crime. The area is already largely ignored as a provide chain resolution for the U.S. It is going to be fully and deeply ignored if Brazil falls aside.
The area has imploded through the years. Mexico is besieged by drug cartels. Venezuela is a failed state. Colombia is run by the FARC once more, now a reputable political get together. Argentina is a catastrophe. Chile continues to be high quality, however too tiny to have a say in world politics.
The opposite smaller international locations in South America are hanging on, some quietly hoping the world will depart them alone.
Lula’s Final Likelihood
Lula will face a Congress dominated by Bolsonaro conservatives. His vice chairman, Geraldo Alckmin, has ambitions to be president sometime. He failed in opposition to Lula earlier than. Now Lula picked him to affix forces because the Staff Occasion turns into simply one other European-style social democratic get together.
Lula is absolutely the final of the previous guard of the Staff Occasion, and when he’s gone, the Occasion would possibly as nicely simply be devoured up by Alckmin’s get together, anyway. Perhaps Lula received’t be horrible. Perhaps issues will calm down sooner relatively than later. Lula’s legacy and the way forward for Alckmin’s Social Democratic Occasion depend upon it.
Nonetheless, there’s a danger right here. Too many query marks hover over Brazil.
Rio may flip right into a drug-infested crime pit once more. Lula was not recognized for being powerful on crime. The very last thing Brazil wants is to repeat the streets of San Francisco. When issues crumble in poor international locations like Brazil, they crumble quick and livid.
There may be additionally a danger that some senior officers within the navy and the rank and file within the police pressure, majority pro-Bolsonaro, is not going to settle for the election of a person who was simply in jail just a few years in the past.
These are all unknowns, although, and issues political junkies hold forth and traders fear about.
Brazil is the strongest nation within the Americas. It isn’t laborious to think about it avoiding a worst-case state of affairs. It isn’t laborious to think about that the checks and balances work and Lula — who should redeem himself — can be okay. Brazil received’t develop into a failed state like Venezuela and Argentina. Brazilians received’t let it, I’m fairly positive.
However what I’m sure of is that this: Lula is worse for the U.S. geopolitically than Bolsonaro. The chances of Lula bringing Brazil nearer to China is and was larger than Bolsonaro doing so. Lula is not going to assist NATO proxy wars in Ukraine just like the Europeans. And barring some overtures to saving the planet, Lula is not going to do what Western local weather activists need him to do with the Amazon. To Lula, like Bolsonaro, the majority of the largely intact Amazon rainforest is sovereign territory. Guide it. Guess on it.
Within the meantime, Brazil traders must be apprehensive brief time period and take note of who Lula picks for Central Financial institution and Finance Minister. If Petrobras is led by a Occasion hack, even oil costs pushing to $100 once more received’t be bullish.
Ideas and prayers.
*The author of this op-ed is a Petrobras investor.