The Real Meaning of the Economic Policy of Lula’s Government

Abstract

The victory of the PT in the 2002 presidential elections gave rise to different expectations: gloomy for some, bright for the great majority. The expectation that the people would start to transform Brazil into a nation became stronger. Forged from the bottom up in the difficult times of struggle against military dictatorship, starting with the movements of the workers in the ABC region in the state of São Paulo (the most important industrial area in the country), and under the leadership of Luiz Inâcio Lula da Silva, the Workers’ Party seemed well-suited to accomplish the task of pulling Brazil out of its centuries-long lethargy and freeing it from the unparalleled inequalities which that lethargy sustains. It was not going to be this time, however. The hope for the refoundation of society was postponed. On the basis of a catastrophist diagnosis, according to which the country would be on the brink of an economic abyss after the 2002 elections, the incoming administration decided to continue the orthodox economic policies that were typical of the previous eight years under President Fernando Henrique Cardoso (FHC).