Good morning! Today, we talk about the near-future priorities for the government and Congress — which includes passing a new fiscal framework.
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Fiscal framework: is today the day?
The government promised to deliver its fiscal framework proposal to Congress today, having unveiled the broad strokes of the plan on March 30. The government postponed the framework’s delivery date a few times, and the latest deadline was set for after the return of Lula and Finance Minister Fernando Haddad from a trip to China and the United Arab Emirates.
Context. Lula was elected under the promise of boosting social spending while also containing the public deficit. It was what he called a combination of social responsibility and fiscal responsibility.
Why it matters. The government’s plan is not lacking in ambition. But lawmakers and analysts are eager to scrutinize its fine print to see whether it is feasible.
The rule. The plan limits expenditure growth from one year to the next to 70 percent of the growth in revenue, provided the government meets its...