Haddad and Lira win, PT is defeated and Câmara sends a warning to Lula – 05/17/2023 – Vinicius Torres Freire

The Chamber approved the urgent processing of the movable ceiling on Lula-Haddad spending, the so-called “fiscal framework”. It was a victory by 367 votes to 102, with one abstention – the presence of 91.6% of the deputies.

It was a victory for Fernando Haddad, finance minister, and Arthur Lira (PP-AL), mayor. Defeat of the PT command, which does not swallow the “fiscal framework” and even less the slight tightening that the Chamber gave to the spending rule. This procedure also has a message for the President of the Republic.

Nothing has been approved. The project will be voted on next week, the 24th. The voting numbers, however, were expressive. Proceeding with urgency reduced the possibility of major amendments to the project. What matters here is less economic policy and more political politics.

In a sense, the government won, after weeks of being slammed, shoved and tripped by the House. In another respect, it is a somewhat illusory or sub judice force.

Lira acted somewhat in her tractor manner. She wanted to show the government that she can be a good partner in the administration of Luiz Inácio Lula da Silva, as long as she has power, as long as she is a bit like the semi-premier that she was in the second half of the government of darkness. Lira still doesn’t have that power, say people from around her and even from Planalto, who now seem to be starting to understand the game.

It was not the release of parliamentary amendments and other treats that significantly facilitated Wednesday’s victory. The money and positions have not yet arrived in relevant volume. In addition, they arrived because of pressure from Lula on his ministers at home.

Lira wanted to demonstrate goodwill and strength in order to obtain an agreement from Lula: she wants more than amendments for her people. He wants to be the director of transit for these funds, saying who receives it, how and when, in agreement with his friendly leaders. This is the first message for Lula.

The victory depended on an agreement between the top of the Farm and the top of Lira. It was not a negotiation mediated by the Civil House or the Planalto. When the matter came up there, as on the Monday before last, it got stuck for a few days, as the Civil House then realized that the negotiation was direct, Fazenda-Lira. Due to a power dispute and because it was a more PT center of government, the Civil House did not like it. Neither the handling of the matter nor the content of the new fiscal rule, slightly more rigid.

Furthermore, PT deputies and friendly economists outside the government came to formulate an alternative plan. There was pressure from deputies close to the top of the party. Lula intervened and the movement stopped.

There is a second message for the government, which should have been aware of this since the election of this right-wing Congress.

Lira wants to show itself to be the guarantor of economic responsibility, so to speak. In interviews in New York last week, she reiterated, now to the world, that she will stop “retreats” from the 2016-2022 liberal reforms. She says the new tax rule is a “country issue”. Thus, it satisfies allies outside Congress, such as in finance, part of the parliamentarians who are more convinced of these ideas and others who are just anti-PT and anti-Lulist.

Lira’s and her surroundings’ attitude towards the fiscal rule is facilitated by the fact that Lula’s spending limit 3 is very flexible. Given the increase in spending to be allowed for 2024, Lula should have a bigger problem with his government’s accounts only in 2025.

This Wednesday’s vote could be the beginning of a beautiful friendship between Lula and aspiring semi-premier Lira. Lula still has difficulties in Congress. The Chamber presented its proposed rules of the game and what it has to offer. It remains to be seen Lula’s reaction and his.

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