Brazil’s ‘Big Center’ is more ideological than it looks

. Feb 21, 2021
Brazil's 'Big Center' is more ideological than it looks Jair Bolsonaro (center) sided by House Speaker Arthur Lira (left) and Senate President Rodrigo Pacheco (right). Photo: Marcos Correa/PR

The first movements of Congressman Arthur Lira as the new House Speaker were by no means coincidental. Among the first bills he put to a vote was a proposal granting the Central Bank formal independence from the government — something Brazilian economists have debated over for the last 30 years or more. Besides being a strictly pro-market move, it was also a way for Mr. Lira to prove he is powerful enough to build consensus and overcome the leftist opposition in the House. When approving the bill, he was able to whip many more votes than the minimum required to pass a constitutional amendment.

The new Senate President Rodrigo Pacheco sent similar signals — pushing forward a bill creating credit lines for agricultural producers.

Messrs. Lira and Pacheco sent a clear message to the government — and the market — that they have the political muscle to pass structural reforms. That is, if they want to.

</p> <p>So what will they want in return? While this may seem a simple question, the answer is anything but.</p> <iframe src="" width="100%" height="232" frameborder="0" allowtransparency="true" allow="encrypted-media"></iframe> <hr class="wp-block-separator"/> <p>The new congressional leadership hails from the group known as the &#8220;Big Center,&#8221; a federation of rent-seeking parties that traditionally lends its support to the government <em>du jour</em> in exchange for cabinet positions. Therefore, wielding the Big Center&#8217;s congressional clout will require a healthy dose of horse-trading from the federal government. </p> <p>But that&#8217;s not all.</p> <p>The Big Center has morphed from an unsavory ally of governments seeking a majority into something more: a political force ideologically structured around a <a href="">pro-market right-wing</a>. Which is something that President Jair Bolsonaro promised during the 2018 campaign — but never delivered.</p> <h2>Big Center could mean renaissance for Paulo Guedes</h2> <figure class="wp-block-image size-large"><img loading="lazy" width="1024" height="683" src="" alt="center guedes pro-market" class="wp-image-57020" srcset=" 1024w, 300w, 768w, 1536w, 2048w, 600w" sizes="(max-width: 1024px) 100vw, 1024px" /><figcaption>Paulo Guedes (without a mask) talks next to the congressional heads (wearing white masks). Photo: Luis Macedo/CD/CN/CC-BY</figcaption></figure> <p>While lawmakers have promised to reinstate some form of cash-transfer policy to compensate for the end of the government&#8217;s coronavirus emergency salary, they have done so by conditioning it to counterbalance measures that would avoid the <a href="">public debt spiraling out of control</a>.&nbsp;</p> <p>This was negotiated directly with Economy Minister Paulo Guedes, which symbolizes something of a return to power for the cabinet minister. Mr. Guedes had been progressively sidelined by the Bolsonaro administration, to the point that he threatened to resign unless he was given more of a voice in government business, as <strong>The Brazilian Report</strong> <a href="">revealed in November</a>.</p> <p>The next big task ahead of Congress is <a href="">approving the federal budget</a>. In normal years, the financial plan for 2021 would have been confirmed in the previous year, but political squabbles and coronavirus restraints caused severe delays in this process, meaning that the government is currently only allowed to spend one-twelfth of last year&#8217;s budget each month. </p> <p>If the economic team and congressional leaders can meet halfway between austerity and necessary stimulus to the economy, Mr. Guedes should grow even stronger within the cabinet.</p> <p>One must resist the temptation to disregard the Big Center as simply a gold-digging group of ideology-free parties. Congressional bargaining is natural in presidential systems&nbsp;—&nbsp;and President Bolsonaro&#8217;s omission from the political agenda is making us realize that Congress is a much more complex body than they appear to the untrained eye.

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Leonardo Barreto

Leonardo Barreto holds a Ph.D. in Political Science from the University of Brasília and is a director at consulting cabinet Vector Análise.

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