One year of "demo-
Brazil
AQUI SAD OUTROS 51L MARCA Jen CHARL municipal administrations (particularly in São Paulo state) had a large element of adaptation to the existing institutional cratic and popular"
structures. And they abandoned attempts to confront the interests of the local dominant classes.
But in Rio Grande do Sul, there government The PT experience in Rio Grande do Sul
The new model of government which the PT is developing in Rio Grande do Sul state is a decisive test for the party as a whole, and for each of the currents inside the PT.
This article by Carlos Henrique Árabe* introduces a special report on the first year of "democratic and popular government", the tensions within the PT, and the particular role of Democracia Socialista, the PT current associated with the Fourth International.
The PT victory in the 1998 state elections was the result of a deep polarisation in Brazil's southernmost state. This class confrontation has continued throughout the first year of PT government. The successful resistance of the PT administration makes the Rio Grande experience all the more important to study. It is the most sustained, and most coherent attempt to develop a programme 20 International Viewpoint #319 February 2000 of structural change anywhere in Brazil.
The Participative Budget is a key element of this process. This successful involvement of citizens in public affairs is not just a strategy to legitimate and strengthen the left government. It is also a way of building a new kind of institutional behaviour, based on elements of direct democracy, and transforming the established relationship between governors and governed.
It is 12 months since Governor Olivio Dutra and Vice-Governor Miguel Rosseto took power. The following articles evaluate their performance, and show the difficulties facing the left government. It is one thing to assemble a wide social base at election time. It is perhaps more difficult to actually govern.
Our "globally positive" judgment on thems •Dutra administration contrasts sharply with the record of PT administrations elsewhere in Brazil.
Other PT state governors (Vitor Buaiz in Espirito Santo and Cristovam Buarque in the Brasilia Federal District)and most PT is not just the participatory budget system. Conflicts like the renegotiation of the previous government's incentives to the Ford motor company, or the prohibition on the cultivation and sale of genetically modified crops have established a constant confrontation with the state's elites.
The PT's programmatic identity suffered a rupture in 1994. Until then, party documents expressed the aspiration to promote the interests of the working class and the majority. There were strong elements of a transition to socialism. But this perspective was much clearer Sin the 1989 documents than in 1994, when it was watered down by economistic arguments. And in the 1998 "minimum programme", these elements of rupture were completely absent.
But the orientation of the Rio Grande do Sul government goes in quite the opposite direction. It has attracted so much criticism precisely because it has established a strategic confrontation between its own project, and the bourgeoisie. Social organisation and party building
The Rio Grande experience has
----- photo credits and running heads -----
*
maintained another continuity which has been lost in other parts of the PT - the link between institutional politics and social organisation. At the national level, and in many other states, the PT has "disconnected" these two areas of activity.
The campaign to elect Olivio Dutra as governor of Rio Grande was not just a political-electoral struggle. It was an mobilisation. The organised forces of the working class and middle classes confronted the bourgeoisie.
Rio Grande is the place where the PT has been most successful in developing an equilibrium between the two arms of its "pincer" strategy - attacking the centres of bourgois power with a combination of of institutional and mass struggle.
The PT in Rio Grande has continued to function in a very democratic manner. It was the first state PT to introduce proportional representation of the different PT tendencies in the party leadership meetings in Rio Grande do Sul still stress the importance of militants coming together to discuss and decide on party policy - despite nationally-imposed reforms that weaken this way of
In other words, the construction of the PT in Rio Grande do Sul is the most advanced experience in all Brazil. Although the above factors are not the only reasons for the spectacular success of the PT there, they are certainly crucial, and a key lesson for the rest of the party.
Those who don't like this often argue that Rio Grande has so many historical and cultural specificities that it is virtually "another country." More often than not, this argument serves to justify the watering down of PT policy, and the anti-democratic practices that occur in the PT elsewhere in Brazil. São Paulo, for example.
In fact, since Rio Grande do Sul is not another country, it is more and more affected by national factors. Not just the economic crisis or the changing nature of the federal state, but also the degeneration of the PT elsewhere in the country.
And so, although Rio Grande certainly has many cultural specificities, it is more and more involved in national political debates.
And it is very positive that the idea of participatory democracy is spreading out across Brazil. This started when the PT won control of the Rio Grande capital, Porto Alegre, over 11 years ago. Now that the PT controls the whole there is much more potential to "spread the word." In fact, it would be good if they made this a priority, rather than just influencing the rest of the country as a consequence of their local activities.
But there are other, more worrying developments. Only a minority of the PT shares our "globally positive" evaluation of the first year of government.' Most of the PT in the state capital, Porto Alegre, recently approved a resolution which accused the Dutra government of "kissing the hand" of the right wing parties in its negotiations with Ford. This resolution was supported by Articulação de Esquerda. This is the current most strongly represented in the state government, but for some reason it doesn't defend the government, and generally avoids serious discussion of the question. They formed a block with the right of the party, the
"Broad PT Amplo", comprising the Articulação Unidade na Luta current of party leader Lula da Silva and Democracia Radical. These currents produced a separate
1S618 document in which they criticised the Dutra government as ultra-left and "conflictive." These currents have failed to understand that the Dutra government is the government of all the party They are obsessed by short-term (including the elections within the party). They exaggerate responsibilities of the leadership. And they fail to explain why their own currents act and speak in one way inside the government, and another in party meetings.
All this shows the growing distinction between the struggle for leadership inside the Rio Grande PT, and the willingness of each current to take responsibility for formulating, arguing and implementing initiatives which respond to the real difficulties of governing the state of Rio Grande do Sul.
It is time to build a new leadership, and a new dynamic inside the party, to reflect the new situation and the new dynamic unleashed by the election of Dutra and Rosetto.
The PT's reaction to what is happening in Rio Grande do Sul will be a decisive factor in coming struggles with the bourgeoisie Dealing with the situation in Rio Grande do Sul will also be decisive for the evolution of each of the currents inside the PT. Particularly those which, at least until now, considered themselves as part of the left. The capacity to respond to the challenges of the most difficult moments, the key social and political struggles, and the capacity to exercise true leadership, is what tests and demonstrates the qualities - and the limits — of the party, and of each of its currents. * *Carlos Henrique Árabe is a member of the PT's national leadership (Diretorio Nacional) and a leading member of Democracia Socialista, the PT current associated with the Fourth International. his comments are taken from "O PT e sua experiência gaúcha," Em Tempo n°310, October 1999. International Viewpoint #319 February 2000 21
Building popular
* Brazil power by Adam Novak [this article should be read in conjunction with the articles on Rio Grande do Sul published in the June and July 1999 issues of International Viewpoint] Introduction
Ubiratán de Souza of the Rio Grande do Sul Budget and Finance Department is one of the 200 PT activists from the Porto Alegre town hall who swept into the Rio Grande do Sul state administration after PT leader Olivio Dutra won the state presidential election in late 1998.
De Souza is proud of the first year of "democratic and popular" government. "Obviously, we live in a capitalist state, and that puts big limits on what we can do.. But you can make many more changes at the state level, compared to our previous municipal governments. We can already dispute the redistribution of public income. At a national level, much much more would be possible."
"Under the previous state government, public funds were distributed to the multinationals. Now, those funds go on health, education, small farmers and small business development. That's a big change. One of our key successes was introducing the participatory budget. We decided to let citizens decide on 100% of resources: not just new investments. Because you have to 22 International Viewpoint #319 February 2000 ruortle oz bitA rom zi ti reitbitibeqa understand the whole picture of income and expenditure in order to make informed decisions."
But the success of the new Rio Grande do Sul government goes far beyond its progressive reforms, or its experiment in direct democracy. The whole strategy of the Dutra government has been to build popular confrontation with Brazil's economic and political elite. Including the conservative parties who still dominate the state assembly. Inherited problems
Any evaluation of the new administration must start with an appreciation of the immense problems they face. The PT state government cannot/immediately create the favourable conditions that exist in the state capital, Porto Alegre, where the party has been in power for twelve years (see previous issues of International Viewpoint).
Under the previous state president Antonio Britto, Rio Grande do Sul regularly ran a 30% budget deficit (R$1.2bn). This disastrous situation was financed by privatisation. Tax income was collapsing, through neglect and corruption.
To make matters worse, Rio Grande do Sul was been particularly affected by the regional recession. The collapse of trade barriers almost destroyed the local shoe industry, and weakened much of the metalworking fishing and agricultural sectors
Despite privatisation, and the collapse of real spending on public services, the Britto administration spent more and more public money every year. This was largely because of the growing weight of interest payments on the public debt. This increased from R$4.4bn in 1994 to R$13.4bn in 1998.
The incoming PT administration faced a situation where salary and pension obligations consume over 80% of income, and interest payments over 15%. The whole spending structure was confined in a straitjacket of benefits to companies, exemptions and tax breaks.
Having ruled out privatisation and redundancies, "in the first months, the Dutra government was forced to implement a "war economy'," according to an official report after six months in office. "Our government represents a clear break with the project that was previously underway: the neoliberal dismantling of the state apparatus leaving nothing but a 'Minimum State' and a bouquet of good business deals for big capital."! Increasing income
The Dutra administration has removed some injustices and absurdities from the tax system. It has removed many of the previous government's regulations which enabled Cable TV and breweries to pay lower taxes than food and other producers. As well as revising the web of fiscal concessions, the government is auditing cases from the previous administration. Reforms are leading to a simpler, more universal tax system. Enforcement is becoming easier. It is also a much higher priority than under the Britto administration. As Ubiratán de Souza notes, *Porto Alegre has achieved a massive increase in its income. We will try to do the same. We can't take direct control of the means of
¡Porto Alegre production, but we can use control of the state machinery to seize a bigger part of surplus value and distribute it to
(SV0g bas the people."
The government has also tried to stop the downward spiral of tax Capital da concessions by other Brazilian states, to attract industry. Procurator General democracia Paulo Torelly and Vice Governor Miguel Rosseto have made repeated trips to Brasilia to challenge these tax cuts, and try to reach consensus on federal regulations for tax concessions.
Each increase in taxation is a potential struggle with the economic elite and central state. In November 1999, the Porto Alegre administration was forced to reintroduce a standard tax rate for residential buildings, after the Federal Supreme Court declared illegal the progressive system introduced by the first PT city government under Olivio Dutra.(0.95% for residential property, 1.18% for commercial property). Guilherme Barbosa, leader of the PT group in the city council, admits that this contradicts the progressive policy introduced in 1989, but expects total income will be the same, because successive administrations have been able to increase the collection rate of this tax to very high levels.
In Porto Alegre, 12 years of PT administrations have increased municipal income by 300%. The Dutra administration might not be able to achieve the same level of income redistribution from rich to poor. But it has successfully resisted immense pressures to continue privatisation and public sector redundancy, without cutting public services or increasing the tax burden on the majority of the population. Debt
The new government has been handicapped by a very unfavourable debt repayment agreement which the Britto government signed in the months before election. Dutra administration found itself bound by an agreement to pay much more in debt repayment than Britto had done. In case non-privatisation, this percentage was to increase. The outgoing state government had also cededsome of its sovereignty, authorising the federal government to directly seize state resources in pursuit of its claim.This legislation designed to impose a straitjacket the incoming PT administration, and to force it to privatize what is left of the state sector.
Vice Governor Miguel Rosetto realised that refusal to repay the debt would isolate the new government, and be used to justify an intervention by the federal authorities. Default would also prevent the Dutra government from borrowing money on the commercial market. The Dutra government could have continued Britto strategy, by selling the remaining state assets: Banrisul (Brazil's 14th largest bank), the remaining shares in the electricity utility CEEE, the water treatment company Corsan, and the information technology company Procergs. It could also use federal and international credits offer for "downsizing" the civil service.
But privatisation and redundancy were out of the question. Rosetto quickly developed a dual strategy. State procurator Paulo Torelly found a series of legal loopholes that enabled Rio Grande do Sul to deduct its debt from other payments owed by the federal government, but frozen because of the financial crisis. Meanwhile, Dutra and Rosseto tried to maximise an anti-debt movement, both in the institutions and in broader society. Dutra managed to bring together five governors (three from the PT and two from the ruling parties) to demand a renegotiation of the federal government's treatment of all states' debt. Meanwhile, the PT and trade unions threw their efforts into public discussion of the debt, and strategies for building a "can't pay, won't pay" movement. They linked this
21200 OVSE puber 5.02Я to the development of a Brazilian wing of the international ATTAC movement for taxation of financial transactions.
Many PT supporters elsewhere in Brazil were disappointed that Rio Grande do Sul did not mount a more aggressive campaign, or simply default on its debt. Other state leaders, notably former federal president Itamar Franco, made much more noise. But according to Luis Felipe Nelsis of the Vice Governor's office, "bourgeois dissidents have more room to make noise than we do. They scream and shout, and then do a deal behind closed doors. After all, they're all part of the federal president's political family We on the other hand can only move forward if we have convinced the population of the need to do so, and educated them about the possible consequences."
Left frustration with Rio Grande's "moderation' on the debt question has died away in recent months, as all the other governments have fallen in line with the federal administration, while Rio Grande do Sul has continued to build popular support for a renegotiation of federal debt, and of the country's debt to foreign banks and governments.
The new administration has also demonstrated its commitment to "governing differently" by cutting over 80% from the budget for publicity, International Viewpoint #319 February 2000 23
* Brazil governor's travel, car hire and congresses. Total nonwage and non-investment costs of the administration have been cut by over 29%. Stability achieved
"The opposition said that, unless we privatised, there would be no money to pay the wages in March [the third mandate]," says Nelsis. fact, we have paid on time throughout the year, even the bonus 13th month. No other state in Brazil can say the same. We have drastically reduced the deficit, from R$1.2bn to R$0.3-0.4bn. receipts, despite economic stagnation.
exceptions prevented us from taxing Cable TV, other products. Unfortunately, there is a continued tax war between the states of Brazil, making competitive cuts in the hope attract companies. We have increased resources on detecting fraud, and reduced the incentives which had such a big cost to society. But we need a federal renegotiation to resolve the question of tax competition between the states. Ambitious policies
Debt reduction austerity measures required an enormous effort. But they made possible the regular function of the state machinery, and — so far— regular payment of salaries, without privatisation or redundancies. To have refused these pressures, and survived, was considerable achievement. It distinguishes Rio Grande do Sul from all the other Brazilian states. But the Dutra administration has gone much furthei, lt has already signalled new priorities, and changed the pattern of spending, so as to direct resources to the majority of the population. Renegotiating with the multinationals
One promise of the electoral campaign was to reevaluate and renegotiate the previous administration's contracts with multinational investors. Tax breaks, infrastructure promises and other state commitments threatened to empty the public purse, while creating very few permanent jobs. The Dutra administration successfully renegotiated its contract with General Motors, saving over R$103m. 24 International Viewpoint #319 February 2000
It also convinced Dell Computers to accept lower incentives over a longer period, and source a greater part of its scientific and technical work from local subcontractors.
Unfortunately, the Ford motor company was less advanced in its installation, and was already worrying about the financial implications of another Brazilian factory. Encouraged by the federal government, Ford walked away from the negotiations, refusing to return the R$134m already paid by Rio Grande do Sul. Ford has now promised to build a factor in Bahia state, where it is already receiving massive state subsidies. The new administration has also renegotiated over 400 contracts with a series of public sector contractors, mostly the road building and operating companies. In exchange for new orders and longer concessions, contractors have reduced their costs. Critics warned that the participatory budget system would force the government to split investment into impossibly small parcels. But in 1999 the Dutra government was able to spend R$299m on road spending more than any incoming state government. In Brazil, road building is a traditional election— year programme. In Rio Grande, election no longer depends on populist stunts. Health
The government is only partially satisfied with its progress in the field of health. Most resources are federal, and the public health system is in crisis. According to Nelsis, "we were able to plan well, and integrate movements concerned with health care. We won greater control over health care, and passed control to the municipalities, at their request. We accompanied this with state financial and logistic support. Despite a generalised fall in health spending, we improved the public health system, compared to the previous government. The perspective is for growth in a well organised system.
The Unitary Health System (SUS) was decentralised and regionalised improving access to health care across the state. An emergency loan of R$3.8m to 12 charity hospitals prevented them from leaving the SUS, and preserved public access to these establishments. At the request of the municipalities, the state administration began devolving responsibility, and resources, for health care, to a series of inter-municipality health consortia. The state has also provided 31bn to create local and intermunical health consortia. Total health spending increased. Education
The number of secondary school places increased by 18.62% (60,485 students). The state now guarantees a place in public school to every every child and adolescent who wishes to study. This required an additional
35,000 teacher hours, which was provided by contracting 2,500 new teachers (with another 2,800 planned) and 1,375 administrative personnel (when the PT took over the state, only one in three schools had administrative personnel to support the pedagogic staff). Rio Grande continues to have Brazil's best literacy campaigns (MOVA-RS), and the eradication of illiteracy is now a realistic target.
The government also launched an ambitious two year education debate (Constituente Escolar), to refound the school system on democratic and quality system. Unfortunately, the teachers' union has so far boycotted the debate, in support of its wage demands. Agriculture
Few in government are happy with their progress in the field of land reform. "This is a very conflictive area," says Nelsis. "But this isn't the only reason why we've fallen behind.
government's land reform secretariat is staffed by comrades from the Landless Movement (MST). But experience."
Nevertheless, Rio Grande do Sul does at least have an agrarian reform programme, after ten years of complete government inactivity. The government has allocated R$43m for land reform, including R$28m to buy land (which is quite cheap now, because of the agricultural crisis). But Nelsis is careful to warn that "the government can't substitute for struggle, around questions of land, salary and so on. The basic force for transformation is the social movement. We can make the public administrative system receptive to this pressure. But we can't do it all on behalf of the movements."
The new PT administration was never going to be able to solve the landless problem. Only the federal state has the authority to confiscate and reallocate land. And the balance of forces in Rio Grande doesn't allow the government to make its own legislation in this field. Nevertheless, the Dutra administration aims to house 10,000 families by the end of its first mandate - 1,000 in 1999, 2,000 in 2000, 3,000 in 2001 and 4,000 in 2002. Only about 800 families were actually rehoused in 1999, but the land reform secretariat consider themselves "more or less on target."
Other agricultural polices have been more successful. The state bank Banrisul has introduced a range of loans for small and medium farmers, and there is a new insurance system to protect farmers against severe climatic fluctuations. administrations, only largest agricultural companies could access
Under some new Banrisul programmes, the maximum loan is fixed at R$30,000 — much too low to interest the bank's traditional customers in the landowning elite.
The government has also banned production and commercialisation of Genetically Modified crops (a concern it shares with the landless movement, ecological and consumer organisations). The Dutra administration has also promoted a couple of challenges in Brazil's higher courts, which may play a major role in stopping or slowing the spread of GM crops across Brazil With 70% of grain in neighbouring Argentina already GM, Rio Grande is proving a key player in environmental politics at a continental level. Employment
The "first job for young people programme"is the first of its kind in Brazil. It has already benefited 8,000 young people aged 16-24. (This group makes up 40% of the unemployed in the state. "We know this programme is inadequate," says Nelsis. "But we can't just build infrastructure and other longterm projects. We need to show that we are doing something directly, and immediately. We have also introduced quotas in public sector employment and contracting, to attackstructural discrimination in the employment market." Street cleaning in the capital Porto Alegre, has been contracted to collectives of workers, many of them women. Other state programmes have provided support to micro, small and medium enterprises, and the clothing and shoe sectors.
Housing
The state collaborated with several municipalities in a house-building and improvement programme. R$20m were allocated for the construction and renovation of public housing, benefiting an estimated 20,000 people. Social security
Under the previous government, programmes were fragmented and clientelist. They have now been unified into two main programmes: Minimum Wage and Nutrition Security. 40,000 children receive milk, 11317 receive regular food parcels There are also income support payments for families with malnourished children, and for the families of street children. Public security and civic rights
The police is increasingly subject to state and public control, and increased transparency. Three top police officers were detained for insubordination after Olivio Dutra named a new police chief who is loyal to the "Democratic and Popular" government. The police is now forbidden to intervene in civil conflicts between workers and employers, peasants and landlords, or in political demonstrations. Police activities are now focused on protection of civic and human rights. Four new prisons will be built, to ensure more humane conditions for those detained. By paying police salaries on time, unlike most other states in Brazil, the Dutra government has so far enjoyed the support of most ordinary police officers, and neutralised reactionary officers.
The new government has also introduced policies for "invisible" sectors of the society. There is a new mental health policy, closing the isolation cells, and creating short-term residential facilities for people with International Viewpoint #319 February 2000 25
* Brazil mental health problems. The treatment of young people in conflict with the law has been humanised. The new philosophy of state intervention resists the paradigm of exclusion, and reinforcing criminality and violence. The state is also supporting over 100 voluntary groups working against the sex industry, and providing information, services and alternative career and training choices for prostitutes.
Rio Grande do Sul has also made a historic advance in its treatment of indigenous people. After his election, Olivio Dutra received delegations from the Kainkang and Guarani nations, according them the same respect as a foreign head of state. The two sides are drawing up a series of measures for the development of indigenous peoples, based on support for their autonomous development and improved access to the facilities of the majority society. The state also supported the Il Citizen's Forum of Indigenous People, and rehoused Brazilian settlers squatting on indigenous land. Participatory budget
These policies are underpinned and reinforced by the expansion of the participatory budget from Porto Alegre and the other municipal PT strongholds to the state administration. The process has been surprisingly successful, and is already transforming the relationship between the state and society.
The participatory budget process is based on open public meetings at the local level. These establish local priorities for government spending, and elect delegates to a regional level, which discusses in greater detail. State officials provide assistance and information, but have no vote in the assembly, which approves and supervises implementation of the final budget.
The budget for the first year of the new administration had to be decided before a participatory budget system could be introduced. But a series of open public assemblies were held, to ensure that legislators were informed about popular expectations. At the same time, a fully participatory process began to fix the details of the 2000 state budget.
Although participatory budgets are now a well-established part of PT administrations in many towns across Rio Grande do Sul, the extension of the process to state level was a very uncertain process. The tissue of popular 26 International Viewpoint #319 February 2000 organisations is much weaker in the interior of the state, and the PT itself is less developed. In addition, the success of the participatory budget was based on its ability to give people decision-making power over matters that affect
F 3:00 them directly. Some PT militants worried that, while it had been relatively easy to establish this direct link over municipal questions like water supply, street lighting and public transport, it would be more difficult to convince ordinary people that the state government was determined to listen to and respect their priorities.
In fact, there was no evidence of a greater distance between citizens and government. While the state level decisions required more intermediaries between citizen and final decision, the issues decided on — health, education, agriculture - were of immediate concern to citizens in all parts of the State.
"The state participatory budget unleashed a process of radicalisation of democracy, which will have consequences on society's relations with all the public spheres of the state," says Ubiratán de Souza. . "As they begın to discuss the state budget, people began to wake up to the possibilities of discussing their municipal affairs Elite opposition
Not surprisingly. the parties focused their attacks participatory budget process. -In the middle of the process of community discussions on the priorities for the 2000 budget, a local member of the federal parliament asked the courts to impede the progress of the participatory budget," reports Ubiratán de Souza. "Without even examining the motivation of this appeal, the courts ruled that the state government could not use its infrastructure for the participatory budget meetings. In immediate response, the delegates of the budget process, mayors, popular organisations and citizens in general began to organise the necessary meetings themselves, in a process of self-organisation of society. As a result of this process, popular organisations and political parties came together in a new Forum in Defence of Popular Participation. In this way, the participatory budget received its baptism of fire. And society made a qualitative CLAC!!
step forward in the process of social organising independently of the state. The judges' rapid response to the opposition was the result of their own political and social affiliations, but also a reaction to their own conflict with the new administration, explains Luis Felipe Nelsis. "This tortuous ruling was provoked by out attempts to attack the high, illegal benefits which many judges and top civil servants received under the previous regime." cles, we demonstrated the vitality of the system. There were no adverts, and no sign posting until half way through the process - so everything was organised by the trade unions and associations. The opposition set up its own "Democratic Development Forum" — but few people participated. We managed to bring 190,000 people to the meetings [from a total population of 10m]. This is a surprising success. In Porto Alegre, it took many years to build that level of participation. This institutional subversion was very positive. Not just did it fail. But it forced the opposition to become the "loyal opposition" within the participatory budget process — the only way they could make any impact on the population was to say that they supported the participatory budget, but
disagreed with the way it was organised or managed. Of course, all this required much energy, which limited our ability to pursue our own priorities."
The process was even strong enough to incorporate the Regional Development Councils (CRDs). These largely cosmetic bodies were introduced by the Britto administration, and initially comprised of local deputies, mayors, trade unions and academics. In 1998 Britto instructed the CRDs to organise am popular consultation, where citizens could indicate priorities from a long list of projects. These only actually represented R$100m of the state budget (R$8bn). But, rather than challenge the ad CRDs* legitimacy, the participatory budget process accepted the same regional divisions as the CRDs, and incorporated a small number of delegates from CRD structures into the participatory budget council.
It was not possible to do the same with the Democratic Development Forum (FDD), a public consultation set up by the state assembly in direct competition with the participatory budget. Heavily manipulated by the opposition parties, this forum produced a huge number of amendments and budget proposals. (461 from deputies, 250 from population, and 619 collected at 22 public meetings). Opposition leaders hoped that this process would give them enough legitimacy to challenge the participatory budget, debate it in the state assembly, and vote the final version of the state budget. This was in direct opposition to the participatory budget process developed in Porto Alegre, where the city council votes to accept the participatory budget without discussion or amendment — since it is a direct expression of the considered will of the population.
Within this general strategy to regain hegemony, the opposition parties particularly hoped to reduce the progressive content of the budget being generated in the participatory budget process. According to the leader of the PT fraction in the state assembly, "51 of the 62 health amendments collected by the opposition deputies reduce funds from the municipal solidarity programme. The opposition parties want to reduce the funds allocated to this area by 60%, even though health was one of the three top priorities chosen by the population." Mobilise people for broader struggles
The current situation is very unfavourable to the lower classes which the new government represents. A government that focused on local reforms would ultimately be crushed by much larger social, economic and political dynamics. But the leadership of the PT in Rio Grande do Sul has always seen its government as a strategic weapon as part of the wider struggle towards winning hegemony, and effecting a radical transformation at the level of Brazil as a whole. globally-dominant neoliberal model is in crisis in the core capitalist countries," says state governor Olivio Dutra. "But, since most global tendencies take some time to arrive in Brazil, the neoliberal flood is still rising here... This situation won't change in the short term. The only solution in such a situation is for PT governors and mayors need to be more coordinated with the party. The parties must build much closer links with the social movements. And the social movements, which have so many repressed demands, must also learn how to carry forward opposition protects like this government. The administration, the opposition parties, and the social movements each have their own role. They need to reinforce their specific struggles, at the same time as building closer links. This is the only way to administer the state, at the current period, and to take forward the struggle against the central and government,
Its substantial foreign support."
(Reportagem #2, 1999)
The whole government process in Rio Grande do Sul is an attempt to promote self- organisation of the population, and increase their awareness of the dynamics that govern life in Latin
America today.
The participatory budget provides a structure for discussion of broader questions. It creates a much denser tissue of links between the more active part of the working class, and draws ever larger numbers of people into political activity.
This, together with the growing political awareness and consciousness of the population, is making Rio
Grande do Sul increasingly an important player in national political struggles. In November 1999, Porto
Alegre saw the second largest demonstration in the national day of action for the resignation of president
Cardoso.
Although the PT does not directly intervene in the participatory budget, it has build enormous prestige and support as a result of its 12 year rule in
Porto Alegre. The PT delegation was also the largest, most sophisticated and most radical component of the recent
2nd national PT congress.
Party, social movements, government
The new administration is a strategic tool in the building of an everlarger, ever-deeper movement for radical change. In building that new revolutionary movement, the traditional roles and interrelationship of government, political parties and social movements are changing.
Changing relationships within the state
The participatory budget has had a major effect in transforming the workings of the state. Corruption has been sharply reduced. Clientelism has become much more difficult.
International institutions like the
International Viewpoint #319 February 2000 27
* Brazil Inter American Development Bank are very interested in these aspects of the Rio Grande experiment. "Only about 48% of all taxes due in Brazil are actually collected, because of corruption, and a chronic lack of confidence in government. But participation ensures that there is a discussion of civic values, and normally leads to a deeper, and more universal acceptance of these values, including the need to pay taxes," comments Luceana, an Intered American Development Bank consultant. Brazil traditionally has a low level of fulfilment of internationally-funded projects, because of inefficiency and corruption.
"Under the participatory budget system, there is also less risk "capture of the political process by powerful lobbies, as so often happens in Latin America. The participatory budget also enables authorities control costs. It also promotes transparency. This is the most important element in increasing the voluntarist element in tax collection."
The Inter American Development bank is now attempting to use elements of the participatory budget process to increase transparency, tax collection and public works completion rates in a wide range of Brazilian cities.
At a time when - the federal government is using neoliberal rules, and direct bullying, to reduce the autonomy of governments at all levels, the growing self-administration of the population of Rio Grande do Sul is creating much stronger and more self-confident administrations, which know they have solid public support.
The old clientelist and party-clique relations between municipal and state governments has also begun to change in Rio Grande do Sul. Government at both levels is transparent, and works to clearly defined popular priorities. In health care in particular, municipal and state governments have been able to negotiate a transfer of responsibilities and finances, in a new atmosphere.
The PT has not copied the patronage relationships that link city mayors and state governors elsewhere in Brazil. They have changed the system, and lett place for arbitrariness and The state of Rio Grande do Sul now respects its regular schedule of transfer payments to cities, and is carrying out a ioint preparation of municipalisation of health. The state also surrendered control of vehicle inspection, because municipalities want to use this service to generate independent resources. (The 28 International Viewpoint #319 February 2000 previous administration wanted to privatize this service, which generates over R$140m/year, of which R$30 in «віно об ро Porto Alegre. In other parts of Brazil, have only benefited municipalities of the ruling party. In Rio Grande do Sul, it is universal.
But, parallel to this improved relationship between the municipal and state administration, there has been an increasing confrontation with those parts of the state that most reflect the old order. Not yet with the police, which is under the governor's formal control, but with the judicial system — would like to increase the autonomy of the state's own judicial system. At the same time, it accepts the federal justice system as a field of struggle, combining legal argument with the widest possible coalition-building 'within the system' and maximum pressure from social movements outside the system.
There has also been a conflict between othe governor and the opposition-dominated state assembly and between the PT mayors of Porto Alegre and the city council). In both cases, the PT victory was the result of a presidential-style election the traditional parties continue to dominate the representative assemblies. Popular organisations
The role of popular organisations has been transformed during the 12 years of PT power in Porto Alegre. The growth in consciousness and militancy is a significant factor. But the most important single factor is the participatory budget process, which requires very different forms of popular organisation, and different strategies and alliances for promoting the interests of each segment of the population.
Most participants agree that the Delegates and Counsellors (community representatives elected at the local and regional level of the participatory budget process) should be autonomous, not dependent on the town hall or the state. But the boundaries of their role are unclear. And, so far, autonomy has meant that they are not paid - not even their expenses are reimbursed. Public servants of any kind are not able to stand for election, though most of them are no richer or closer to power than their neighbours. Luciano Brunet, a PT activist who works in the community liaison office at the Porto Alegre town hall, has observed a growing desire among popular counsellors to hold private meetings, without council representatives. They want to discuss wider questions than the participatory budget. This raises a series of questions. What representitivity do these delegates and counsellors have? Do they have a mandate fro the population outside the narrow confines of the participatory budget. Would it be desirable for them to develop more formal structures? How should their aspiration channelled?
At the same time, many traditional working class organisations are stagnant. They have not found a way to work alongside the participatory budget process. Some left currents blame this decline on the "centralisation" or "bureaucratisation" of the participatory budget.
According to Porto Alegre city counsellor Sonia Sarai "the rules for hierarchisation of demands and organising the (ever longer) waiting list is a dispute for small resources -smaller and smaller, as the town hall divides and subdivides money into smaller and maller parcels. The demand that all demands on the town hall pass through the participatory budget means that individual residents groups, their federation, the Municipal Workers Trade Union and any other working class organisation loose their raison d'etre, because they have to subordinate their demands to the municipal budget. This budget is now legitimated by the participatory budget process, which allows the town hall to reject as 'illegitimate" anything that doesn't emerge from its own discussion process."
These criticisms seem ill-fonded: the process is self-managed by the community, and more decentralised than any traditional system. In one sense the amounts of money being decided are getting maller — because the system is now sophisticated enough to allow greater precision of decision at the local level. But the overall resources which the community can decide about are increasing.
In fact, these criticisms reflect the frustrations of a certain layer of traditional community leaders, who, it is true, no longer have a clear role under the participatory budget. Since the 1930s, residents" associations have developed in a paternalist relationship with the state. Many of their leaders were interested in having a closer relationship with the various levels of the executive arm of government, but not with the administrative structures. Their conception of "a good relationship" with the state was paternalistic handouts, rather than regular consultation and decent service provision. But these organisations, and some of their leaders, are recycling temselves, and finding new roles. According to Waldir Bohn Gass, president of the Porto Alegre PT, "this is one of the revolutionary aspects of the participatory budget - it has changed the relationship between the people and the state."
Gass recognises that the cOordination of the participatory budget should be based on parity of popular organisations and government, rather than being dominated by the government.
Gass himself comes from the urban residents' movement. In 1983 he helped form the city-wide union of residents's associations. "We wanted to introduce some kind of participatory budget. At that time, the budget came from central government. The PT accepted proposal into its own programme." He remembers that the first organisational metings for the participatory budget were coordinated by prefects and residents organisations (led at that time by a member of the PDT). "We hadn't had in depth discussion on popular power. One tendency within the town hall suggested that the town hall should dominate the process. Olivio Dutra, the first PT mayor, tried to mediate. But the PDT saw that they would inevitably lose power as "the" representative of organisations. withdrew from the process, denouncing "manipulation." organisations withdrew, and went with the opposition. And so, the PT town hall development of the initial participatory budget process.
Many modifications have been made since then, but the organised structures of the working class are very much outside the process. It didn't have to be that way. The first two PT mayors, Olivio Dutra and Tarso Genero accepted this rather state-dominated version of the participatory budget process. Genero s vice-mayor Raul Pont began to organise a joint council of popular organisations and the town hall, something he has continued to promote as mayor. Things are changing in the right direction, but ordinary people are still not involved enough. "Even under the new system, the residents organisations are not fully autonomous. They need to atfirm temselves. To become real subjects, they need to become more political. *We should realise that there are many types of leadership. The president residents" association shouldn't seek election as a representative or counsellor within the participatory budget. His role is to ensure, on behalf of the organisation, that the local delegates and counsellors in the participatory budget attend the relevant meetings, and that they come back and discuss questions of interest with the residents' association members. "For local problems which they can solve temselves, people need to create their own organisations. Not everything should pass through the participatory budget! Not everything should be linked to the town hall." A former collaborator of Porto Alegre mayor Raul Pont, Gass rejects any suggestion that the PT town hall team welcomes the subjugation of working class organisations to the participatory budget process. "Residents organisations are vanguard organisations of the working class. About half of the popular mobilisation that happens in this town passes through the network of residents associations. Those of us in the political vanguard should be trying to build these groups"
In the new, evolving situation, there are a range of views about the future forms of popular organisation. Some militants say that traditional community leaders should actually seek election as representatives and counsellors in the participatory budget. Residents organisations and other groups should become more integrated into the formal organisation of the participatory budget and local democracy.
Others worry about giving a formal decision-making role to popular organisations — even in a city with a hıgh level of participation in civıl society, no more than 10% of the population are members of a International Viewpoint #319 February 2000 29
* Brazil community-based organisation. But all have the right to participate in the participatory budget process directly.
This debate about increasing the role of representatives from inside the working class communities obviously has implications for the existing structures of representative democracy. As Waldir Bohn Gass notes, "we also need to rethink the role of the city counsellors. They don't decide on the details of the budget any more. Is their only role now to supervise the mayor's administration of the town? In my opinion, they should find a role much closer to that of the counsellors elected within the participatory budget process.
According to Gass, "the left has analysed the role of left parties in government in minute detail. But the problem is not simply that the left doesn't know what to do government. We should also realise that social movements don't spontaneously know how to relate to and support a radical government. What we are doing here is learning and developing those abilities together. Transformations in the PT
The participatory budget process has also had a very positive educational effect on the PT itself. The participatory process forces PT militants to recognise and work within the inevitable pluralism of the wider movement. According to Gass, "we mustn't lose the perspective of the popular organisations. The material interests of the working class are our interests. What are the best ways of advancing these interests? We need to listen. We can't say, like some 'left' currents do, that those close to us, but with slightly different outlook "create confusion." That's a wrong perspective. We need to work with them, learn from them."
Ignacio Fritzen is organisational secretary in the Rio Grande do Sul PT. He is positive about the first year of the government, though he sees a number of negative trends within the PT as a result of the intense pressures they now face.
"Over the last year we continued and increased the struggle against president Cardoso. We didn't privatize the state sector, we introduced jobcreation schemes, and, most importantly, we introduced the participative budget at the state level. So the Dutra government has already demonstrated that it is governing differently.
"Since we came to power, we have had a different kind of debate inside the PT. There are inviable contradictions 30 International Viewpoint #319 February 2000 when a left party takes power within the capitalist system.
"There is a strong differentiation within the PT over the question of government. Do we see this as a criticism should be tightly focused.
"Unfortunately, there is a growing idea in the PT that there are 'those of us in government' and 'those of us outside government', or some such other false
People don't understand that this is a strategic government. It is enabling the PT to build itself, and transform society.
"Of course, the PT, a party built out of social struggles, is opposed to heavygovernment, the way the traditional parties operate when they are in power. The PT will always be in favour of increasing the salaries of the majority of Brazilians. But we need to is "just another government" we can make demands on, or something we can use to construct our alternative.
"Unfortunately, party life is not big political challenges facing the party, but by the search for petty factional advantage, and tactical agreements between the tendencies bear most responsibility for this sorry state of affairs. The 1999 congress was like a student union conference. I've never seen such a depoliticised meeting. Most questions were solved outside the conference hall, by deals between the supporters of Jullo Ouadra (centre-left) and Tarso Genero delegates understand what the votes were about.
"There is a big contradiction between the fantastic energy of the PI in and this terrible missed opportunity to transform the energy into cresce hide ted tic a moment of change and growth, the majority currents bear most of the responsibility. increased from 70,000 to 90,000 since cities, there has been fantastic growth in the party. But, overall, the growth is significant, but not overwhelming.
"There are some very good local examples of solidarity with the government, which contrast sharply with the irresponsible behaviour of the leaders of the majority currents in the party. For example, over the Ford renegotiation, people mobilised. there was a very strong feeling of solidarity between the base of the party and the government. This feeling has not been lost." Opportunism
According to Ignacio Fritzen, "some *left' currents, like Articulação de Esquerda, actually have a rightist, corporatist vision of institutional politics. :They want to preserve the existing corporatist relations between the social and trade unions and the state, and develop new ones. But a handful of leaders handing out money is not just unsustainable. It isn't really a left policy - how does it take the movement forward? There is a lot of opportunism in their activities. The public sector trade unions are a big source of PT members. By inciting these members against the government, they hope to win greater influence inside the party This might work. But it would do terrible damage to the PT project."
Tension between revolutionary
There is also a worrying divergence between the various revolutionary currents in Rio Grande do Sul. Leading members of Democracia Socialista (DS), the fourth internationalist current in the PT, suspect that the Landless Movement (MST) is supporting the increasing hostility of Articulação de Esquerda towards the Dutra government, but particularly towards DS, the largest revolutionary current in Rio Grande. "The leaders of MST want to be the only revolutionaries," complains one senior member of DS. "They like to be the only 'hard" left, to stay in their countryside bases, but with the support of urban "tailenders" and uncritical supporters in the PT. They don't have the same tradition of democracy as we do. Nor the same idea about education in the movement. For them, the end result is all that counts. A bit of manipulation is OK to this end. Another problem is that their leaders don't understand the urban base of the left in the PT.
"They have no experience of government administration. For them, the government is something we can put pressure on. A source of resources.
To reject anything "accommodation to the system.' That's why the land reform programme is not moving forward.
"They don't realise the implications of their flirting with the right of the party. They are not interested in the long-term future government. This is somewhat understandable for their rural base, which has yet to see many concrete benefits. But it
could terribly miseducate their urban
There is little DS can do to avoid the coming isolation. "We will go through a more difficult period," says Lúcio Costa, who recently resigned as Rio Grande PT communications secretary and became a full time organiser for DS. "There will be difficulties within the left, over the future of the party, and the question of the Dutra government.
"This is why DS presented its own list in the PT congress, rather than continuing the broad left block together with Articulação de Esquerda and other groups who, here in Rio Grande do Sul, have created a dynamic of 'everyone on the left against DS. We expect to become more isolated nationally, and even in R. So we need to strengthen our own apparatus, and increase our public profile. Of course, we must try to do this without falling into a sectarian conflict with the others."
DS attracted about 10% of votes at the national PT congress, reported in last month's International Viewpoint. This suggests that delegates did not penalise them for leaving the left block, and recognised tendency's positive role in Rio Grande Tensions
A number of tensions have emerged during the first year of PT rule. Not just conflicts with opponents of the progressive movement in Rio Grande, but growing tensions and different strategies within the progressive camp.
"Contradictions between the party, the movement and the government are normal, given the conditions we find ourselves in," argues Ubiratán de Souza, a member of the DS current. "We have reduced the massive deficit. But this made it impossible to increase salaries. The government needs the firmness to say clearly to the trade unions 'yes, we will increase salaries, but we must first gain effective control over the state, and that means reducing the deficit to manageable levels.' The government can only be credible with this message if it avoids all elements of transparency. All this has taken a great political courage, and a dialectical vision of the contradictions we face. We must deal openly with these contradictions, treating them as political questions. We can resolve Contradictions serve as a motor, enabling us to synthesise different factors, and move forward."
The PT's organisational secretary Ignacio Fritzen, also from DS, agrees. "There is a contradiction between the interests of the government and the interests of the trade unions. The government is responsible for meeting its programme, to the extent that the circumstances permit this. The trade unions are responsible for protecting and improving the conditions of their members. Both roles are legitimate.
"The idea isn't to control the trade unions more. If they want to protest or even strike, then they must be able to do so. But the PT should strive to make sure that conflicts remain within a agreed framework - the general vision of the government.
"For public servants, the state government is the traditional enemy: they wanted to privatize. To make people redundant. They blamed public servants for the situation. But the Dutra government is an ally. They want to improve conditions. Teachers wages have not increased, but new teachers have been
"The problem is how to link trade union struggles with the other struggles of our overall project. The government clearly needs to make a policy for the civil service, and a plan to improve their working conditions over the remaining three years of the Dutra mandate. The movements of public sector workers. And it is correct that these struggle to ensure that the government fulfils its promise to them.
"We are approaching a limit situation — a moment that would be the first real test of our project, a moment that could bring the government down, or set it onto a path that would discredit its original ambitions. A teachers strike could paralyse the education system. But the government would try to work with the unions to reach an agreement. Without putting unfair pressure on the strikers. Institutionalisation
The growing acceptance of the participatory budget system masks popular consultation, and a return to the hegemony of political parties and representative democracy. parties recognise the popularity of the participatory budget. So they no longer call for its abolition. Instead, they demand that the state impose a legislative framework — in other words, that the tendency towards self-organisation and the predominance of the social movement be reversed, and the organs of representative democracy regain the primary responsibility for legislation and deliberation."
Ubiratán de Souza of the Rio Grande budget office recognises that the participatory budget process needs "regulations, distributive criteria and a mechanism. regulations should be elaborated in an autonomous way by the community, and form the basis of a social contract between the government and The participatory budget is not piece of work, perfect and beyond discussion. It could never be such a thing. Indeed, asserting its perfection would be an authoritarian act, and the negation of the dialectic process, the constant overcoming of the old by the new, which characterises all social processes. Understanding this, the government and society should, every year, make a critical evaluation of the process and regulations of the participatory budget. And then the Participatory Budget Council should, autonomously and supervision of executive or legislative branches of government, decide what necessary to modernise the process. The principle of self-regulation already applied in the Porto Alegre participatory budget, and introduced into the new Rio Grande do Sul state budget, allows for the constant modernisation of the democratic and mechanisms d participatory budget."
Despite the clamour of the ultra-left, the Dutra government has not yet "sold out," reneged on its original promises, crossed the class barrier, or any of the other sins predicted by the guardians of revolutionary purity. But senior members of Socialist Democracy (DS), the strongest left current in the Porto Alegre PT, point to a number of issues that have divided the party, and could develop into "limit events" that would seriously test the government's resolve, principles, and ability to continue leading the coalition for change. Reducing top salaries.
Brazil's civil service comprises a mass of low salaried "public servants" and an elite of "functionaries" with very high salaries, the result of years of arbitrary pay awards, often in secret. In International Viewpoint #319 February 2000 31
* Brazil Rio Grande do Sul, the top 4,200
Learn more than the remaining 167,000 public servants. The highest salary is R$27,000/month (US$14,000), almost four times more than governor Dutra. Meanwhile, almost 50,000 public sector workers would earn less than the minimum wage, if they did not receive transport and meal tickets from their employers.
PT and government leaders believe that attacking these top salaries is not only a legitimate attack on the old regime, but the only way to increase the salaries of the mass of public sector workers. "There is an urgent need for the state government to adopt concrete steps towards correcting the distortions of public sector salaries," says Paulo Pimenta (PT), President of the Finance and Planning Commission in the state parliament. "We should fix a top limit of R$7,800, which is what Governor Dutra earns." Anything above this level should be used to raise the lowest wages in the public sector. According to Pimenta, a sustained attack on these unacceptable super-salaries (mostly for and heads of nationalised companies) could free up to 6-8% of the total wage bill.
Reorganising public sector wages on a clear scale will only become legally possible once Brazil's federal government will bring in its own salary scale later this year. But the real struggle is likely to be inside the PT and union movement. Some left currents say any attack on the wage system is a concession to "the system".
useany period of renegotiation to encourage lower-paid workers to become more intransigent in their wage demands, but proposing where the government could find the money to meet these demands.
This conflict has already spilled into the open over the question of retirement pensions. Rio Grande do Sul has the highest state retirement pension costs of any Brazilian state. government is trying to reduce pension entitlements in the federal civil service, which has provoked widespread resistance from the left and trade unions. Cardoso taunts his opponents by pointing to Rio Grande do Sul "where your own comrades proposing even more savage cuts in the pension system."
The Dutra government's proposal, which is very controversial even among the government's closest supporters, Is to tax existing pensions, and force those in work to make regular contributions to the pension fund. According to Luis
Felipe Nelsis of the Democracia
32 International Viewpoint #319 February 2000
Socialista current "retirement pensions comprise half of the state wage bill. Functionaries receive 100% of their last salary, index linked, without having ever made a contribution to the pension fund. We say that this system is simply unsustainable, and the only solution is to tax these pensions, to fund future pension needs. Those in work will need to contribute regularly to the pension fund too. We understand why many of our comrades — including from DS -are not happy about these proposals.
the pension system is something very delicate. But people sometimes forget that almost halt the pension fund is absorbed by a small number of very high pensions. Those are the ones we want to get at. Taxing the other pensions will have a very limited effect, and we can discuss what minimum thresholds are necessary to protect a minimum standard of living. The other thing to remember is that most Brazilians don't have any pension cover at all. This government also belongs to them."
According to Nelsis, the Rio Grande pension reform has nothing in common with the federal government proposals. This is why Governor Olivio Dutra refused to attend President Cardoso's recent pensions summit.
According to DS organiser Lúcio
"ultra-left tendencies in the PT are making hay with this so called attack on the working class. It's very convenient for them, of course. Because civil servants are the main membership
So bashing the government on this issue might bring direct benefits in the factional struggle within the PT. Inside or outside the government
Pensions were a difficult question at the state PT congress at the end of 1999. The 'Moreno-ite' CST argued that "the left should not be interested in the government - It's the movement that counts." According to Lúcio Costa "they want to focus all struggle on the central government. They'd be willing to bankrupt the state for this."
According to Costa, "some "left' currents are carrying this kind of false debate into the trade unions. the unions represent?' they ask. 'Are the unions for the workers. or are they a corporatist body?' This is a false polarisation. They imply that there is no third alternative. But what is happening in Rio Grande do Sul is not any kind of structural adjustment programme.
"We have to be careful, because reform in this area is very sensitive, very close to workers interests. We should explain what we're doing much better. This isn't neo-liberal reform. The money saved by cutting top pensions is not being removed from the salary pool. Quite the contrary. We are reducing a handful of astronomical salaries so that we can increase the lowest salaries, even at a time of recession and stagnation." Is the left ready for power?
According to Ignacio Fritzen, "learning how to relate to the government, the trade unions and the social movements is essential to the development of the revolutionary current inside the PT. Looking at these problems over wages and pensions, I begin to worry that the left is not ready for power. They don't realise the strategic importance of government. And they don't know how to articulate differences of opinion and even differences of interest within the movement, without weakening us.
To some extent, government can take comfort from the way labour relations are handled in Porto Alegre, where the PT has been in power for 12 years. According to Odir Tonollier, Mayor Raul Pont's Finance
"the last public sector strike in Porto Alegre was in 1991. Since then, we have maintained the level of real wages, with biannual adjustment Unlike most towns in Brazil, we pay on time. Alongside this basic engagement to our public sector workers, we have shifted labour politics from a bipartite model to a tripartite system, where new contracts are approved by a commission of town hall staff, trade union representatives, counsellors from the participatory budget system. Porto Alegre has also made some improvements in its salary scale. Monthly salaries vary from 500 to 4,000 reais. Secondary school graduates carn about 900 reais, and university graduates start at 1,200. Conclusion
In a future issue of International Viewpoint we will examine the growing influence of the Rio Grande experience on the rest of Brazil's progressive movement, and internationally. But, as the above report shows, the first year of "democratic and popular government" is rich in lessons about institutional politics left parties, social movements, and the challenges and rewards of building a coalition for change across these three sectors.