U.S. Brazil watchers doubt leftist candidate will win

Despite the latest polls showing that Brazil's leftist candidate Luiz Inacio ''Lula'' da Silva is widening his lead for the October presidential elections, the majority view in U.S. business and diplomatic circles is that he will not win and that predictions of a dramatic shift to the left in Latin America's biggest country are premature.

Is it wishful thinking on the part of Wall Street economists who fear a massive economic downturn for Brazil if da Silva's Workers Party wins the election? Or is da Silva, who has already failed in three previous runs for the presidency, incapable of surpassing the threshold of the estimated 35 percent of Brazilians who traditionally vote for the left?

A poll released this week by Brazil's GPP Institute shows da Silva is leading with 38.7 percent of the vote, followed by centrist government-backed former Health Minister José Serra with 14.5 percent of the vote, leftist-populist former Rio de Janeiro Gov. Anthony Garotinho with 13.9 percent of the vote, and left-of-center former Finance Minister Ciro Gomes with 13.8 percent.

The latest surveys show that da Silva has widened his lead by about four percentage points from last month's polls. Unless he wins by more than 50 percent of the votes in the Oct. 6 first-round election, he will have to go to a runoff vote three weeks later.

With the latest polls in hand, I asked some of the leading U.S. Brazil watchers this week whether they foresee a da Silva victory. To avoid wishy-washy answers, I asked them to rate the candidate's chances in percentage points.

o Paulo Leme, managing director of emerging markets of Goldman Sachs in New York, gives da Silva a 30 percent chance of becoming president. ''Lula's chances have risen in the last six weeks from 15 percent to 30 percent,'' Leme said. ``There is no question that he has strengthened in the polls, but opinion polls in Brazil this early in the game have in the past been very poor predictors. Fifty percent of the people have not yet made up their mind. And the Serra campaign has not yet taken off.''

o Michael Gavin, head of economic research with UBS Warburg in New York, gives da Silva a 30 percent chance. ''Brazilians are too cautions to make a leap in the dark,'' Gavin says. ``And there is no period of severe economic and social stress in Brazil that would generate an anti-government vote strong enough to elect Lula.''

o Paulo Vieira Dacunha, chief Latin American economist with Lehman Brothers in New York, gives da Silva a 30 percent chance. ''The distribution of political resources heavily favors government candidates,'' he says. ``And the second round election in Brazil is inherently conservative.''

o Robert Berges, senior Latin American stocks strategist with Merrill Lynch in New York, gives da Silva a 30 percent chance, despite his own firm's downgrading of Brazilian bonds earlier this week because of concerns over his climb in the polls. ''You will see the polls changing in July and August, when the campaign really starts,'' Berges says. ``Serra has not been visible at all yet. But he will have the government behind him, and he will have the media establishment behind him. Brazil is still our favorite market in Latin America.''

o Albert Fishlow, head of Columbia University's Brazilian Studies Institute in New York and until recently a Wall Street business consultant, gives da Silva a 25 percent chance. ''Historically, Lula has always started out with a considerable margin in the polls,'' he says. ``But Garotinho is likely to drop out of the race to run for reelection in Rio, and his votes will not go to Lula. They are protestant, lower middle class and middle class votes, that will ultimately go to Serra.''

In U.S. diplomatic circles, da Silva is not given much better chances. While U.S. officials say they do not rule out any outcome in the Brazilian elections, most are privately skeptical of a da Silva victory.

Melvyn Levitsky, the former U.S. ambassador to Brazil during the Clinton administration who now teaches at Syracuse University, told me that he gives da Silva a ''35 to 40 percent chance'' of winning.

''I would give Lula a somewhat better chance this time around, because the other candidates are somewhat lackluster,'' Levitsky said. ``They have not shown the kind of national appeal that [President] Fernando Henrique Cardoso had.''

My own hunch: I would give da Silva a 40 to 45 percent chance of winning. Serra, the government-backed candidate, does not seem to be a great campaigner, and the opposition will benefit from a growing anti-corruption sentiment, which could lead to a surprise first-round victory by da Silva. If there is a second round, he will most likely be history.

Globaphobic Vote in Brazil could alter political map of region**** If you think that the Bush administration has problems in Latin America with the latest crises in Argentina, Colombia and Venezuela, think about what it may face if Brazil's leftist candidate Luiz Inacio ''Lula'' da Silva wins this year's presidential elections in the region's biggest country. For starters, a Brazilian move to the left could pave the way for a South American nationalist-populist bloc -- that could also include Venezuela and Argentina -- that would strongly oppose the U.S.-backed plan to create a Free Trade Area of the Americas by 2005. Conceivably, the new ''globaphobic'' bloc could strengthen ties with Cuba, and with Colombia's Marxist guerrillas.****

If Brazil falls to De Silva, for all intents and purposes, the United States will be shut up to it's borders. Panama has already been lost to the US. The vacuum there is quickly being filled by the PRC. Cuba appearently will remain Communist for some time, or at least heavily anti-American. Venezuala, the oil richest nation in the Western Hemisphere has fallen to a communist, a long desired goal of the International Socialist Revolutionaries. Due to the innate inconsistencies of globalization, Argentina which rapidly adopted it's precepts, has collapsed, making it likely that the Socialist Revolutionaries will capture that nation. Peru, is now under the control of a cortiere of Socialist Revolutionaries operating behind the front of an Indian revolutionary. Meanwhile, thanks to nearly 35 years of Open Border and Open Immigration policy, the US has effectively lost control of the border with most of the counties bordering Mexico now effectively under Mexican control.

Once Brazil collapses, the innate weaknesses listed above will be further aggravated worsening America's geopolitical situation. Already unable to defend itself from overseas sabotage of the highest level, with an elite hell bent on continuing the policies which got us here in the first place, it's clear the US won't last as a superpower beyond 2015. Brazil will only serve to prove that trend.

The fall of Brazil to the Communists in a Lula da Silva victory would herald our greatest defeat to the Communists since Mao's Red Army proclaimed the People's Republic of China in 1949!! Lula da Silva is no mere leftist. He is a member of the Brazilian Worker's Party. For the past 15 years or more, the Worker's Party has been in a Communist "Popular Front" coalition with Brazil's two overtly Communist parties. While Lula has led in each of the past three presidential elections and lost each won, the first in 1989 by a mere FOUR percentage points, this election is destined to be a squeaker like 1989 which could seriously go either way. I concur with the author in giving Lula a 40-45% chance of victory though I believe his chances of a first round victory remain slim unless the still fairly crowded field gets smaller. For example if leftist Gov. Garotinho bows out of the race, most of his vote should go to Lula, which could almost give Lula the extra 11.5% or so he needs to win in the first round.

If Lula wins, Brazil will become a Sino-Russian and Cuban client state. China would establish a strong presence in Brazil, which would become the new Communist powerhouse of Latin America and would export revolution to its neighbors. Columbia would fall quickly. The Maoist Shining Path rebels in Peru might get a new lease on life as well. Argentina, teetering on the brink of economic collapse, is ripe for takeover by a Marxist strongman. America's remaining allies in Latin America would be isolated. The US would be hard-pressed to retake such a massive lost territory as Brazil from the Reds. We would have to adjust to this new reality by repositioning our forces in SOUTHCOM and retaking the Panama Canal from the ChiComs if we had any hope of restoring a measure of continental, let alone hemispheric security. We will know the outcome of this threat in only five months when Brazil elects its next President.

Regardless of Brazil's fate, Bush with his radical unilateral nuclear disarmament of 75% of our strategic nuclear deterrent and support for the Clinton plan to eliminate our entire tank force, has ensured that America's superpower days are numbered and that the Sino-Russian alliance will soon rise to the challenge to take our place as the world's new global hegemon.

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