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Brazil 2010: A profile of Dilma Rousseff

By Cristiano Noronha, Thiago de Aragao.

In this new article, the FPC's Senior Research Associate based in Brazil, Thiago de Aragao, provides a profile of the key ideas of Dilma Rousseff, one of the main candidates in this year's Presidential election.

1. PUBLIC ADMINISTRATION

State. For Dilma, the state has to act where there is market failure. Especially where there are large concentrations of power or networking. For example, in the case of electricity, we must ensure that the magawatts reach the consumer's home, regardless of who controls the transmission networks. The same applies to the highways.

Public Officials. The former minister defends the hiring of new workers in essential activities of the state. "More engineers, more technicians, more teachers. Less general services assistant," said the former cabinet minister in an interview with CBN radio (17/05).

Public official's remuneration. Advocates the creation of differentiated pay for public officials as an incentive. The civil servant needs to be valued so that there are quality services.

Regulatory agencies. For Dilma, the criteria for filling positions in regulatory agencies must be technical. But when a party indicates members to agencies, this does not necessarily mean that the person is unable or does not meet technical requirements. Agencies need to act to prevent the formation of cartels, monopolies and market imperfections.

Privatization. At an event in New York, the PT's candidate for president, Dilma Rousseff said that we should not privatize Petrobras, Eletrobras and all companies in the electricity sector and public banks. She said she supports the granting of new dams and highways to the private sector where it is cheaper to make by way of grants rather than by public works.

2. AGRICULTURE

Family farming. At the 2nd National Meeting of Family Farming Housing in Santa Catarina, pre-PT candidate for president, Rousseff, criticized the governments that did not give importance to family farms and pledged to continue and advance in the actions of the Lula government in this area.

Rural housing. Dilma promised to make some changes to the program My House, My Life, among them the inclusion of retirement homes and the cutting of red tape. But she also promised to create within the national housing management of the Caixa Economica Federal, a specific sector devoted to rural areas.

3. EDUCATION

Education. For Dilma Rousseff quality education means more than just building, laboratories and installing broadband in schools. It is about well-paid and trained teachers. The former minister has promised the creation of six thousand daycare centers. To be a developed country, according to her, you must have quality education and daycare.

Teachers. Advocates appreciation of teachers through "decent wages" and continued education. It is favorable that school teachers have university degrees.

4. ECONOMIC STIMULUS

Role of the State. During a seminar on infrastructure in Rio de Janeiro (May 10) organized by Valor Economico and the Financial Times, Dilma said: "In certain areas it is absolutely imperative that the state has active planning, regulation. I believe that the Brazilian state needs to be agile. Today it is not agile. The state is inductive, but the private sector is important. Without it, you cant build an avenue or a dam."

Growth. Dilma, during an event in Sao Paulo (31/05) said that Brazil can grow around 5.5% per annum on average until 2014. Among the sectors which would boost this growth are oil and gas, electricity, logistics, housing construction and agribusiness.

Ministry of Micro and Small Businesses. The PT's candidate defended during the "Industry Meeting with the Presidential Hopefuls" held by the National Confederation of Industry (CNI), the creation of a ministry oriented towards micro, small and medium sized businesses. Dilma reported that this hypothesis has been raised by the current government, but that with the arrival of the international financial crisis, the project was suspended. According to Dilma the micro and small businesses need local production support.

Industrial park. In the same CNI event, Dilma said everything that can be produced in Brazil, should be produced here. For her, we have a diversified industrial sector.

Payroll tax reduction. The pre-candidate was favorable to a topic that is being requested by employers for some time, which is the relief of the payroll. "This is fundamental. At one point, the Treasury will have to bear the difference, because it does not break the system, but capital goods and investment, export, and payroll are essential," she said. Moreover, she said that would also discuss the Brazil cost. "We have an encumbrance in the energy sector and energy is critical throughout the production chain," she said at an event organized by CNI (25/05).

Tax credits. During a debate sponsored by CNI, Dilma said that tax reform is now the major step towards competitiveness with other items such as tax relief and encouraging investment, increasing exports and employment. "This means so much that we complete exoneration of capital goods allowing immediate use of PIS, Confins IPI … today they leak and are not considered." She also defended the automatic return of the tax credits based on the estimated payment in the last 12 months by entrepreneurs. "The return of 100% of these loans is essential and is done on all exporting countries," she compared.

5. ECONOMIC POLICY

Economic fundamentals. On several occasions, Dilma has reinforced her commitment to the primary surplus, a regime of inflation targeting and floating exchange rate.

Inflation target. Dilma said at an event in New York, that she has as a goal the reduction of the inflation target from 2011 to 2014. But said this must be done gradually and carefully, because we live in turbulent world.

Central Bank autonomy. The pre-presidential candidate for the PT Dilma Rousseff said (10/05), in an interview after attending the seminar Brazil Infrastructure Summit in Rio de Janeiro, that she considers "extremely important" the autonomy of the Central Bank. Dilma made the statement while answering questions from journalists about the interview given by the pre-PSDB presidential candidate Jose Serra to CBN radio in which he stated that "the CB is not holy." Asked if she intends to maintain the autonomy of CB, the PT's candidate said: "I think the important operational autonomy to the Central Bank had in the government of President Lula. We always had a very tranquil relationship with the CB."

Sovereign Fund. According Rousseff, the growth of the Brazilian economy opens the doors so there is extra in the national sovereign wealth fund, which currently accumulates close to R$ 17 billion, according to the pre-candidate. "Clearly, economic growth enables us to increase the sovereign fund, why not?" she asked during the "Industry Meeting with Presidential Hopefuls" held at the headquarters of the National Confederation of Industry (CNI), in Brasília.

6. FISCAL POLICY

Spending cuts. During a debate sponsored by CNI (25/05), Dilma says you have to cut government spending, but in a rational way. "It is not cutting spending costs, but spending costs that are not rational for the country and its investment," she said. The pre-candidate cited the example of the gap in wages between executive officials and those who oversee the Executive.

Real interest. According to Dilma, it is possible to achieve in the coming years a real interest rate "just below 5%" and for that we need to move forward on the issue of taxation, reducing the government debt.

7. INDUSTRIAL POLICY

Funding of public banks. Dilma said the big challenge for the next government will be to find "different sources of funding" for the economy. "The crisis showed that it was very important that Brazil has owned banks for financing. But we can only rely on the public benches. We achieved, I believe, the limit of public banks, "said the minister in an event in the United States.

Pension funds. One source of funding for infrastructure, according to the PT candidate, are the pension funds. "Without that, we will not redeem the problem of private and public savings," said the former minister at an event organized by CNI (25/05). For the pre-candidate, you must have technical features that enable the management, induction and correct regulation of the increase in public savings without harming the private sector.

Ports. Rousseff argued during debate in the National Industry Confederation, the creation of a centralized port management to expedite the clearance at the ports that today is extremely fragmented and decentralized.

8. SOCIAL POLICY

Social inclusion. Dilma, during a conference on infrastructure in Rio de Janeiro (May 10), said her government has committed to a policy that continues the process of development with social inclusion.

Health. Rousseff advocates the allocation of more resources for health. In an interview with CBN radio (17/05), the former minister criticized the CPMF who, she says, took R$ 40 billion a year from the health sector. In her opinion, there are two ways to ensure more resources for health: 1. Reassign money, and 2. Create a new tax. Defends the provision of Amendment 29, which seeks more resources for health.

Medicine. Dilma argued (26/05) for the reduction of taxes on medicines. For the PT, in addition to forwarding the tax reform proposal, the government must make decisions "immediate" to lessen the tax burden. "In medicine, it is absurd to tax. The next action is immediate remedy because it is a matter of survival of the population."

CPMF. According to the PT candidate, the end of the CPMF has not brought lower prices to consumers, as was stated by entrepreneurs at the time of the extinction. Furthermore, with the end of CPMF, we lost the ability to monitor suspicious financial transactions.

Extreme poverty. In an interview with IstoÉ (8 / 05), Dilma said her great mission is to eradicate poverty and that it is possible to do so in coming years. In the interview, she cites IPEA study showing that by 2016 it is possible to eradicate extreme poverty.

9. REFORMS

Pension reform. She is against a broad pension reform. In countries that have, according to the minister, there was one problem: a race to retirement. Maintains systematic adjustments.

Tax Reform. The former minister is in favor of a tax reform that will end tax cascading. It would be a way to increase our productivity and therefore our competitiveness. She says that to reform, however, is impossible without compensation. So, to counteract the negative effect of loss of revenue, she plans to propose the creation of a compensation fund for states and municipalities.

Workday. The minister believes the government should not go on defending the reduction of working hours from 44 to 40 hours weekly. In her view, this is an understanding that needs to be built between the trade union movement and business associations.

10. OTHER TOPICS

Reelection. Dilma is in favor of reelection. However, when asked if she could give up on reelection in 2014 if elected in October, she said: "He [Lula] already told me not to answer that question."

Energy. Thinks that Brazil needs to invest in plants of Belo Monte, in the plants of San Antonio and in the mills of the Tapajos. At the same time, investing in biofuels, wind, biomass and small hydroelectric dams.

Settlement of accounts with municipalities. During the March XIII of Mayors to Brasilia, Dilma advocated the settling of accounts with the Municipalities of the INSS. According to the National Confederation of Municipalities, the municipalities should pay to Social Security R$ 22 billion. The account is being charged by federal agency withholding portions of the Municipal Participation Fund. Moreover, the INSS owes these local executives about R$ 26 billion.

Oil royalties. Argues that the producing states receive most of the royalties as bill sponsored by President Lula to Congress.

UPA. The former minister said she intended to create, if elected, more Emergency Care Units (UPA). UPAs structures are intermediate in complexity between the Basic Health Units and the doors of emergency hospital, where together they make up with an organized network of Attention to Emergencies. Also defends the Polyclinics for specialized treatment.

Security. On public safety, she speaks of a combination of "authority" and inserting in social programs of marginalized populations in regions dominated by organized crime. "Our issue is to defeat crime and we need to strengthen the National Security Force, which we created," said the candidate of the PT in Bahia (16/05). Dilma advocated expanding the intelligence activities of the police and social programs in places where the police authority has taken control of the territory of organized crime, as occurs today with Peacemaker police units (upps) in Rio de Janeiro.

MST. During an interview on Agrishow (Ribeirao Preto, April 29), Dilma said it is very important to maintain dialogue with social movements. However, she said she did not agree with any activity of any social movement that results in lawlessness. Asked about the estimate of the National Confederation of Agriculture of loss of R $ 9 billion to the agribusiness sector caused by the "Red April," the MST, Dilma was firm: "I'm not condoning any illegal activity. Lawlessness cannot be rewarded," she said. Also argued against illegal land invasions.

Flooding. If elected, Dilma promises to invest R$ 10 billion in drainages. "There was no investment during the Lula government because it could not. The federal government had no obligation to invest in drainage. So it did not, but now it seems important to stop this where rain floods homes and people lose everything, "said pre-candidate in an interview with Radio Record (26/05).