Lula makes Bolsonaro freeze Guedes' neoliberal policies.

The strengthening of Lula's political movement, with the increasingly strong possibility of the Supreme Federal Court (STF) voting on the suspicion of bias in Moro's judgment against Lula—which prevented him from running in the 2018 election—is changing the ultraneoliberal discourse that Bolsonaro embraced with Paulo Guedes. Surprisingly, the conservative media is also changing its tune. It's playing anti-Moro tunes and positioning itself favorably towards a re-discussion of the facts it orchestrated to favor the former judge from Curitiba, in order to undermine the Workers' Party candidate, the favorite in the polls. Bolsonaro got there with Moro in tow. Without him, he wouldn't have become president. That's why, subsequently, he dismissed him as Minister of Justice, so he wouldn't overshadow him in the succession. With the captain president in the Planalto Palace, the speculative financial market, fearful of popular political advances with Lula, won the day. The voice of the market, from 2018 to the present, has occupied the space, with Guedes and his agenda of surrendering the main agents of national development: state-owned companies and public banks. Above all, Guedes embraced the spending cap imposed by the neoliberals who, with the coup-plotting Temer, overthrew Dilma in 2016. They froze social spending for twenty years, the spending that energizes the economy, increasing disposable income for consumption. The absolute priority of macroeconomic policy became the spending cap to guarantee the payment of interest and amortization of the debt at the cost of fiscal austerity at any cost. The Union's financial resources have been fully released since 2016, while non-financial resources are blocked. R$ 22 billion from Health, now affected by the pandemic, were frozen; this money was destined for speculators, deepening social chaos, further accelerated by labor and pension reforms. They bombarded the workers, left orphaned by the theft and death of their social rights, etc. From 2016 to 2020, GDP did not exceed 1,5%, and unemployment climbed to 13% of the economically active population. Before the arrival of Covid-19, the situation was already extremely critical. With the virus, everything worsened threefold. 

Despair on the Plateau 

The generals in the Planalto Palace, the support base for Bolsonaro's fascist-leaning regime, now want to eliminate the spending cap. Minister Rogério Marinho, of Social Development, is the spokesperson for this Planalto desire, supporting the Pró Brasil program, spearheaded by General Braga. There will be no Pró Brasil program if the priority of economic policy is fiscal austerity, especially with the pandemic, which signals social, economic, and political disaster for at least the next two years. In Congress, the Guedes Plan faces total resistance. The tax reform proposal he initially put forward, in which those who earn more would continue to earn more and those who have less would earn less, in explicit tax regressivity, was rejected. Guedes had already been defeated in the congressional approval of the R$600 Emergency Aid for the unemployed and informal workers, harmed by the pandemic. That's R$50 billion/month, which is supporting global demand affected by the pandemic crisis, but which neoliberal speculators want to put a stop to in the name of fiscal austerity. The problem is that the people approved and celebrated Bolsonaro in the Northeast, which left him in a dead end: if he stops the emergency aid, he will be politically finished in the municipal elections and mortally wounded in his attempt at re-election. He backtracked, and with that, another defeat for Guedes' neoliberalism is recorded. Once again, this week, in Congress, the Finance Minister, under internal government pressure and the new expectations of Lula's release to run in the 2022 elections, with a cutting-edge social program as his main political banner, found himself in a tight spot. The "Lula free in 2022" factor therefore accelerates the shift in the pro-market neoliberal agenda to one in which the developmentalist experiment of the Keynesian generals in the Planalto Palace gains momentum. Rogério Marinho, flanked by them, is winning the dispute with the minister and his pro-market rhetoric.