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In defense of the program that elected Lula, PSOL voted against the fiscal framework

Limitation of public investments will make it difficult to fulfill Lula’s promises. The eventual failure of the government to improve the lives of the people interests the extreme right

Lula Marques/Agência Brasil

Brasília (DF) 23/05/2023 Sessão da Câmara dos Deputados que aprovou o Arcabouço fiscal

The Chamber of Deputies approved the fiscal framework proposed by Haddad (Lula’s Finance minister), which is now going to the Senate. There were 372 votes in favor and 108 against the basic text presented by Claudio Cajado (PP). Bolsonaro’s party, the PL, gave 30 votes in favor of the new rule, while PSOL deputies voted against.

PSOL considers that the limitation of public investments, imposed by the new spending ceiling, will make it difficult to fulfill Lula’s campaign promises. The eventual failure of the government to improve the lives of the people is of interest only to the far right. For this reason, PSOL took a stand against the fiscal adjustment that will restrict resources to social areas and economic development.

Fernando Haddad’s original project, which preserved neoliberal austerity, was greatly worsened by Artur Lira’s Centrão. Fundeb, which finances basic education, was put under the new ceiling. Just like the nursing basic salary.

In addition, draconian punishment triggers were placed. If the government fails to meet the daring targets for the primary surplus, there will be automatic contingency of funds, including the ones for health and education. Also foreseen, in this scenario, is the freezing of public servants’ salaries and the prohibition of civil service examinations.

Centrão and financial market put rope to hang the government

The right led by Artur Lira voted overwhelmingly in favor of the framework. The financial market and bankers celebrated the approval of the new fiscal rule tightened by the centrão’s rapporteur. Campos Neto, president of the Central Bank appointed by Bolsonaro, also applauded the new law, while indicating that he will keep interest rates high.

It was not the project that elected Lula that won last night, May 24th. But the reactionary political forces linked to the interests of the dominant elites. They put a straitjacket on the government, which will have strict limits on the expansion of public investments. In case of revenue frustration or economic recession, the situation will be even worse, because spending cuts in all areas will be mandatory. Not even public health and education were left out of the ceiling.

Centrão’s goal is to wall Lula up more and more. They will not settle with the deteriorated framework. There will be no truce, as some sectors of the left had hoped. The majority right in Congress and the far right now want, for instance, to empty the ministries of Indigenous Peoples and the Environment, removing their primary functions, such as the demarcation of indigenous lands. The CPI against the MST (Landless Workers Movement) has already been instituted. The governance pact with Artur Lira, as sectors of the government and PT seem to want, could cost the survival of the program of changes that elected Lula.

Loyal to the program that elected Lula, PSOL was correct to vote against the fiscal framework

Lula was elected to end Temer’s ceiling and expand investments. The winning program at the polls is committed to generating jobs and income, reclaiming rights, improving quality and access to health, education and housing, and preserving the environment. The majority of working people did not vote for the application of a fiscal austerity policy.

Who will benefit from the eventual failure of the government is the far right. So much so that dozens of Bolsonarist deputies voted in favor of the framework. Bolsonaro, by the way, in a recent statement, said that he did not want to jeopardize the progress of the new fiscal rule in Congress.

Despite these facts, there are sectors of the left that criticize PSOL for opposing the new spending ceiling. They claim that the party played “the game of the right”, harming the government. Nothing more misleading.

Firstly, the vast majority on the right voted in favor of the framework and celebrated its passage. Secondly, what can sabotage the Lula government is not PSOL’s vote against a neoliberal rule, but rather the inability to deliver what was promised to the people, as a result of concessions to the ruling elites.

Thirdly, PSOL has a history of political coherence that invalidates any attempt to connect it ith the right and the Bolsonarist opposition. The party was against the coup against Dilma, has been with Lula since the 1st round, is in the active fight against the coupist far right, supports all the government’s progressive measures and defends a program to revert the legacy of Temer and Bolsonaro. PSOL works to make the Lula government succeed.

It is worth noting that the left’s criticism of the new ceiling is not restricted to PSOL. 22 deputies from PT and one from PCdoB, including Rui Falcão, Lindbergh Farias, Natália Benevides and Orlando Silva, published an important statement critical of the fiscal framework. In it, they regret that it was not possible “to free the government from the strangulation caused by the interests of rentier capital, which seeks to subjugate the Treasury to the payment of excruciating interest on the public debt, at the expense of the impoverishment of the Brazilian people and the bleeding of our economy”.

PSOL’s position is also shared by many trade unions, social movements and left-wing economists who believe that the new rule goes against the needs of economic development with social justice and environmental preservation.

The struggle to defeat the far right and bring about the necessary economic and social changes involves turning the page on neoliberal austerity. And also by building another governance logic, which is based on social mobilization and popular pressure on the left. The approval of the fiscal framework in alliance with Artur Lira was a “shot in the foot” by the Lula government.