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(en) Brazil, Lut FOB: Communiqué: DOWN WITH THE FISCAL ADJUSTMENT OF THE LULA-ALCKMIN GOVERNMENT (ca, de, it, pt, tr)[machine translation]

Date Mon, 29 May 2023 08:57:17 +0300

The Lula-Alckmin government (PT-PSB) through its Minister of Finance, Fernando Haddad (PT), took to Congress the so-called "New Fiscal Framework" - NAF proposal. In practice, this project is a new spending ceiling, and in reality its very existence already marks a permanent fiscal adjustment that penalizes male and female workers, especially the black working population, especially women. ---- The fact is that there is no economic need to build this new spending ceiling other than political pressure from capitalists of national and international origin, especially those who hold public debt securities and the financial groups that command the economy global. The proposal reached Congress and the urgency of the project has already been approved, at the request of the Lula Government. The rapporteur for the proposal in congress is federal deputy Cláudio Cajado (PP-BA), who was an ally of the Bolsonaro government and sponsored by Artur Lira (PP-Alagoas). The rapporteur has already made changes to the original proposal and managed to make it worse.

The main point of Lula-Alckmin's election was to save the Republic of 1988, and to save that Republic is to favor the ruling class that has controlled economic policy since then. In this sense, the NAF is just a fiscal development of the "Golden Rule", the "Fiscal Responsibility Law" (2000) and Constitutional Amendment 95 ("spending caps"), which froze for twenty years, in 2016, social spending.

In this sense, the NAF is fully associated with the neoliberal economic consensus that is the basis of economic stabilization plans, such as the Real Plan. This consensus understands that: 1) stabilization policies are designed to gain market confidence in maintaining such a regime; 2) fiscal policy should be conducted with the objective of generating a primary surplus necessary for balancing public accounts; 3) gain the market's confidence about this purpose; 4) monetary policy must have the sole objective of maintaining price stability, through inflation targets predetermined by an independent central bank and 5) it would be up to the State to guarantee a business environment to favor capitalists. In this sense, state spending must be directed towards maintaining order, public security and borders; compliance with laws and contracts; the protection of private property and property rights.

Social democracy and its degenerate reformism is incapable of even doing the least, which is to present Brazilian workers with an economic proposal that reduces social inequality and improves the living conditions of the people. Quite the contrary, the social-democratic political forces that support the Lula government are tied to the class conciliation pact and are terrified of any possibility of any mobilization or popular uprising. They are today unsatisfied defenders of the bourgeois order, of the bosses.

NAF: new anti-people spending cap

First, it is necessary to make it clear that the debt and GDP ratio is not a problem in itself. This debt can even finance better schools, the SUS, housing, agrarian reform, environmental protection and construction of rail transport. However, the political-economic creed of the NAF does not treat it that way. The government's economic team starts from the idea that it is necessary to stabilize the public debt as a ratio of GDP to produce a drop in the reference interest rate and, with that, stimulate private investment. For this reason, the NAF proposes as central to the sustainability of the public debt, directing the budget to pay its creditors. What Minister Haddad calls creating a business environment for investors. In this way, the proposal's main objective is to withdraw the expenses that the State makes in social investment and infrastructure and to guarantee that the budget resources are in the hands of debt creditors, who are those who receive from the government and at the same time earn from financial investments. The expectation of the minister of finance, his team and the financial market is that with this signal the Central Bank will reduce interest rates to, in theory, facilitate investment. In short: it's all based on creating expectations for the capitalists, through the State, to drain the resources from the budget directed to the working class.

The new spending cap project goes against public services, worsening the Unified Health System (SUS) and resources for public education. It makes any serious rail transport policy unfeasible to improve the quality of life of male and female workers. It has a direct impact on the resources of the National Education Development Fund (Fundeb), in addition to other areas such as Science and Technology, Social Assistance and the Environment. Only the increase in the Minimum Wage and the Family Allowance are currently protected from the capitalists' rage.

The FOB and its federated organizations have always signaled that the only path, from now on, is through direct action to build Socialism through the Social Revolution. There is no possibility of negotiation and conciliation with the bosses, capitalists, and state bureaucrats. In the elections, we analyzed that the main intention of the broad front led by Lula and the PT had only to do with the defense of the bourgeois order of 1988. That its economic program would be a continuation of neoliberalism without solving structural problems, such as the concentration of land in the country. It is no coincidence that the Brazilian parliament, while urgently voting on the regime that reduces the budget for the people, seeks to criminalize the MST. The people are tired of crumbs. We have a world to destroy and another to build!

Build the General Strike!

For Land and Freedom!

Free Health and Education!

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