Brazil Elects Lula in a Landslide

Nation's First Vote for Leftist Could Set Back Plan for Hemispheric Free-Trade Zone By Scott Wilson   SAO PAULO, Brazil, Oct. 27 -- Luiz Inacio Lula da Silva, a former union leader who never attended college, won a landslide victory today in a Brazilian presidential election that reflected the disenchantment sweeping much of Latin America after a decade of free-market reforms that have failed to deliver promised prosperity.

Lula, as the gray-bearded socialist is known, defeated his centrist opponent, Jose Serra, a former government minister, by a huge margin. With 95 percent of the vote counted, Lula had 61.5 percent, compared with 38.5 percent for Serra, after a day when millions of Brazilians cast ballots before massing along busy boulevards across the country for evening celebrations. Few voting problems were reported. Serra conceded the election to Lula in a congratulatory phone call tonight.

Lula's victory marks the first time a leftist has been elected president of Latin America's most populous country, and is the clearest demonstration to date of the growing backlash against globalization in this part of the world. His election could mean trouble for the economic reforms backed by the United States -- in particular, a hemisphere-wide free-trade zone -- that represent the Bush administration's most important policy initiatives in Latin America.

While voting in this city's middle-class suburb of Sao Bernardo, Lula appeared to speak to the millions of Brazilians who have endorsed his pledge to move the world's eighth-largest economy away from the "Washington consensus" followed by his predecessor and toward what he has called a "new economic model" for this traditionally conservative country.

"I want to dedicate this election to the suffering poor of our beloved Brazil," Lula told hundreds of chanting, cheering supporters who had gathered at the polling place.

"The result of this election shows that from Jan. 1, we will be responsible for 170 million Brazilians, and we will have to govern with all of Brazilian society to build a more fair, more brotherly and more united country," Lula said in a victory speech tonight before hundreds of supporters in a downtown hotel and tens of thousands more gathered along Paulista Avenue, who watched on closed-circuit television screens. "We are showing the international community a lesson in democracy."

Today's election also marked a milestone in Brazil's democracy, which emerged 17 years ago with the collapse of a repressive military dictatorship. Lula made his name as an opponent of that regime, and his apparent broad-based victory could end the political monopoly that a small, economically powerful elite has enjoyed for much of this century.

Lula, who turned 57 today, spent much of the afternoon awaiting election returns with family and friends in his apartment in Sao Bernardo. Groups of supporters gathered throughout the day on the avenue outside, waving flags bearing the red star of his Workers' Party and celebrating what polls have suggested would be a resounding victory after three previous runs for the presidency.

Raised by a single mother, Lula began earning money for his family on the streets of this city at age 7, and started his first regular job in a laundry service five years later. At 17, he was a metal worker at one of the factories that encircle this city of 17.7 million people, eventually rising to head the 100,000-member metal workers union that gave him a perch in Brazil's politics.

At the time, Brazil's military dictatorship was waging a "dirty war" against student leaders and union organizers in a bid to maintain power. In 1964, the military toppled the country's last leftist leader, President Joao Goulart, after he rose to office from the vice presidency following the resignation of his predecessor. He was never elected president.

Brazil's Workers' Party emerged in 1979, largely at Lula's urging, as a vehicle to speed along the dictatorship's collapse. That eventually occurred six years later, and Lula was elected to Congress the next year with more votes than any other candidate in the country. He made his first run for president three years later, narrowly losing to Fernando Collor de Mello, who resigned in 1992 after being impeached on corruption charges.

But it wasn't until this year, as Brazil suffered through a fourth year of economic stagnation, that Lula's populist message finally resonated beyond the labor unions, landless peasants and urban poor who have long been his political base. Promising a sharp change of tack from President Fernando Henrique Cardoso's eight-year experiment with free-trade agreements and free-market reforms, Lula has outlined a populist agenda that calls for new spending on social programs and promises millions of new jobs.

At the same time, Lula, who begins his four-year term on Jan. 1, has been trying to appease jittery international markets that have reacted sharply to his probable election. Brazil's national currency, the real, has lost 40 percent of its value against the dollar this year and Brazilian bonds have plummeted. Lula, who has backed away from previous threats to default on Brazil's $260 billion public debt, has called the market reaction "economic terrorism."

Lula, who opposes both U.S. military aid to Colombia and the embargo on Cuba, has suggested in recent days that he will chart a more moderate course. He intends to name a conservative economist to run Brazil's Central Bank, his aides have suggested in recent days, and he has pledged to abide by the terms of a recent $30 billion International Monetary Fund emergency loan approved in part to keep Brazil from following neighboring Argentina into economic meltdown.

But he has not backed away from his steadfast opposition to the Free Trade Area of the Americas, at least as it is currently conceived. New U.S. steel tariffs and agriculture subsidies have dimmed prospects for the hemisphere-wide free-trade zone, a Bush administration priority, and Lula's opposition to it enjoys large support within Brazil's business community and disillusioned middle class.

"The rich have gotten richer, the poor have gotten poorer," said Sidney Marcos, 41, after casting his vote for Lula at the Mario Martins de Almeida Public School in Sao Bernardo. Marcos runs a business that helps people and companies negotiate Brazil's confusing bureaucracy, a popular service across Latin America.

"I voted for him to change, to see if we can actually do it," he said. "I have more hope than faith that we can."

With its small, comfortable homes and a car in each gated garage, Sao Bernardo owes its middle-class stability to the powerful union movement that Lula helped lead throughout the 1970s and 1980s. Many of its residents work in the auto industry, and the annual raises guaranteed in union contracts made them comfortable, but also helped send Brazil's inflation soaring until Cardoso's arrival.

Now, though, Cardoso's early success seems a distant memory to people like Perpetua Rosa Nogueira Terencio, a 74-year-old housewife.

"I always voted for him," said Nogueira, small and gray-haired with a cross hanging from her neck. "But life is too expensive now, and the salaries here are poor. This is what's most important -- to increase wages. And this is something we can do."