Rio de Janeiro, Brazil – President Luiz Inacio Lula da Silva of the center-left Workers’ Party has opened a wide lead in the polls over his challenger, Geraldo Alckmin, by accusing him and his centrist Brazilian Social Democracy Party of planning to privatize state-run industries it didn’t get around to during the 1990s, when it led the government.
Under President Fernando Henrique Cardoso, the government privatized dozens of enterprises ranging from the country’s railroads to aircraft manufacturer Embraer.
Many Brazilians feel that companies were sold at fire-sale prices and that privatization has raised service costs and reduced government revenues without helping to pay off the country’s debt, and the issue is playing a major role in the runoff race for the presidency Sunday.
Alckmin, the former governor of the country’s biggest state, has pledged repeatedly to keep his hands off state-run companies such as energy firm Petrobras and bank Banco do Brasil. He appeared at a news conference last week wearing a jacket and baseball cap covered with the logos of state-owned companies.
The strategy hasn’t worked, and public opinion polls show that Lula has all but secured victory Sunday, enjoying about 60 percent of voters’ support.
“Politically, the (Workers’ Party) played the privatization card very well,” political analyst Luiz Pedone said. “It’s an issue that has cost (Alckmin’s party) in the past, and he lost time this time around saying he was not going to do this or that.
“The average voter doesn’t know much about privatization. He only knows public property was sold.”
Studies have found that Brazilian privatization has produced more efficient, profitable companies and better services. Privatization defenders often cite the improved telephone network as an example of what went right.
