The elections were a blow close to home for Bolsonaro
Alessio Perrone

Brazilian local elections can be fun to watch. Candidates come from every walk of life, and are notably allowed to use nicknames on the campaign trail — and there have been some true gems over the years: a loud man with thick sideburns and bushy hair campaigned as "Geraldo Wolverine"; an elderly man in army uniform and full beard was "Bin Laden for Governor"; and we've also seen a tropical, chubby Spiderman, an old Robin and Jesuses in various shapes and sizes.


Earlier this month, as Brazilians headed to the polls to elect local leaders in the country's major states and cities — including Sao Paulo and Rio de Janeiro — there were exactly 78 candidates who chose to run as some form of "Bolsonaro," and even one as "Donald Trump Bolsonaro."


Results are in and 77 of them failed to get elected, including the president's ex-wife, who campaigned as Rogéria Bolsonaro. The Brazilian leader personally chimed in on his social media accounts to endorse the 59 candidates (with and without familiar nicknames) he favored — only nine of whom got elected, according to Estadão de S. Paulo daily.


The elections were a blow close to home for Bolsonaro while he was still smarting from the blow he took from the north, when his kindred populist spirit Donald Trump lost in the U.S. election. The two have formed a bond over the past four years, with similar reactionary policies and shoot-from-the-hip tactics.

Joao Santana or "Donald Trump Bolsonaro" —​ Photo: Portal da Cidade

The Brazilian president's divisive brand of politics has been honed for years, eventually winding up at the center of the nation's political and cultural life. Like Trump, he exists beyond any party structure, choosing instead to reward loyalty and, above all, family ties: Three of his five sons, Flavio, Carlos and Eduardo, are prominent elected politicians in Brazil and spearhead an influential network of social media accounts that rallies around the president.


Some commentators see the poor performance of Bolsonaro's local allies, coming shortly after Trump's, as possibly marking the end of an exhausting type of politics that has come to dominate the news. Others are more cautious: After all, local elections are often about local issues.

But perhaps the overlooked connection between the Brazilian and U.S. elections is that there is actually no clear winner in either case. The Democratic party was stunned to lose ground in the races for the U.S. House of Representatives, adding doubts about the viability of its more leftist wing led by the likes of Bernie Sanders and Alexandria Ocasio-Cortez.


In Brazil, centrist and moderate parties made gains in the local contests, which also came at the expense of the other massive political force in the country, the leftist Workers' Party. After having led Latin America's "pink tide" a generation ago by introducing measures that lifted millions of Brazilians out of poverty, the party of former presidents Lulu and Dilma is continuing a downward trend that started in 2016 when its defeat paved the way for Bolsonaro.


Yes, elections can be fun to watch — sometimes. Having failed to win a second term, the U.S. president appears to have his eye on running again in 2024. When his Brazilian counterpart gets his shot at reelection in two years, he will need a better performance not only than Trump but also than those 77 other Bolsonaros.

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Economy

European Debt? The First Question For Merkel's Successor

Across southern Europe, all eyes are on the German elections, as they hope a change of government might bring about reforms to the EU Stability Pact.

Angela Merkel at a campaign event of CDU party, Stralsund, Sep 2021

Tobias Kaiser, Virginia Kirst, Martina Meister


-Analysis-

BERLIN — Finance Minister Olaf Scholz (SPD) is the front-runner, according to recent polls, to become Germany's next chancellor. Little wonder then that he's attracting attention not just within the country, but from neighbors across Europe who are watching and listening to his every word.

That was certainly the case this past weekend in Brdo, Slovenia, where the minister met with his European counterparts. And of particular interest for those in attendance is where Scholz stands on the issue of debt-rule reform for the eurozone, a subject that is expected to be hotly debated among EU members in the coming months.

France, which holds its own elections early next year, has already made its position clear. "When it comes to the Stability and Growth Pact, we need new rules," said Bruno Le Maire, France's minister of the economy and finance, at the meeting in Slovenia. "We need simpler rules that take the economic reality into account. That is what France will be arguing for in the coming weeks."

The economic reality for eurozone countries is an average national debt of 100% of GDP. Only Luxemburg is currently meeting the two central requirements of the Maastricht Treaty: That national debt must be less than 60% of GDP and the deficit should be no more than 3%. For the moment, these rules have been set aside due to the coronavirus crisis, but next year national leaders must decide how to go forward and whether the rules should be reinstated in 2023.

Europe's north-south divide lives on

The debate looks set to be intense. Fiscally conservative countries, above all Austria and the Netherlands, are against relaxing the rules as they recently made very clear in a joint position paper on the subject. In contrast, southern European countries that are dealing with high levels of national debt believe that now is the moment to relax the rules.

Those governments are calling for countries to be given more freedom over their levels of national debt so that the economy, which is recovering remarkably quickly thanks to coronavirus spending and the European Central Bank's relaxation of its fiscal policy, can continue to grow.

Despite its clear stance on the issue, Paris hasn't yet gone on the offensive.

The rules must be "adapted to fit the new reality," said Spanish Finance Minister Nadia Calviño in Brdo. She says the eurozone needs "new rules that work." Her Belgian counterpart agreed. The national debts in both countries currently stand at over 100% of GDP. The same is true of France, Italy, Portugal, Greece and Cyprus.

Officials there will be keeping a close eye on the German elections — and the subsequent coalition negotiations. Along with France, Germany still sets the tone in the EU, and Berlin's stance on the brewing conflict will depend largely on what the coalition government looks like.

A key question is which party Germany's next finance minister comes from. In their election campaign, the Greens have called for the debt rules to be revised so that in the future they support rather than hinder public investment. The FDP, however, wants to reinstate the Maastricht Treaty rules exactly as they were and ensure they are more strictly enforced than before.

This demand is unlikely to gain traction at the EU level because too many countries would still be breaking the rules for years to come. There is already a consensus that they should be reformed; what is still at stake is how far these reforms should go.

Mario Draghi on stage in Bologna

Prime Minister Mario Draghi at an event in Bologna, Italy — Photo: Brancolini/ROPI/ZUMA

Time for Draghi to step up?

Despite its clear stance on the issue, Paris hasn't yet gone on the offensive. That having been said, starting in January, France will take over the presidency of the EU Council for a period that will coincide with its presidential election campaign. And it's likely that Macron's main rival, right-wing populist Marine Le Pen, will put the reforms front and center, especially since she has long argued against Germany and in favor of more freedom.

Rome is putting its faith in the negotiating skills of Prime Minister Mario Draghi, a former head of the European Central Bank. Draghi is a respected EU finance expert at the debating table and can be of great service to Italy precisely at a moment when Merkel's departure may see Germany represented by a politician with less experience at these kinds of drawn-out summits, where discussions go on long into the night.

The Stability and Growth pact may survive unscathed.

Regardless of how heated the debates turn out to be, the Stability and Growth Pact may well survive the conflict unscathed, as its symbolic value may make revising the agreement itself practically impossible. Instead, the aim will be to rewrite the rules that govern how the Pact should be interpreted: regulations, in other words, about how the deficit and national debt should be calculated.

One possible change would be to allow future borrowing for environmental investments to be discounted. France is not alone in calling for that. European Commissioner for Economy Paolo Gentiloni has also added his voice.

The European Commission is assuming that the debate may drag on for some time. The rules — set aside during the pandemic — are supposed to come into force again at the start of 2023.

The Commission is already preparing for the possibility that they could be reactivated without any reforms. They are investigating how the flexibility that has already been built into the debt laws could be used to ensure that a large swathe of eurozone countries don't automatically find themselves contravening them, representatives explained.

The Commission will present its recommendations for reforms, which will serve as a basis for the countries' negotiations, in December. By that point, the results of the German elections will be known, as well as possibly the coalition negotiations. And we might have a clearer idea of how intense the fight over Europe's debt rules could become — and whether the hopes of the southern countries could become reality.

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