President Luiz Inácio Lula da Silva of Brazil has scored important victories recently, with government candidates winning elections for the presidency of his Workers party and the presidency of the lower house of Congress. Both victories should help the government restore control as it strives to put behind it a scandal that has dogged it for more than four months, concerning alleged vote-buying and illegal campaign finance. But three recent separate incidents suggest that, to complete the job, it must also develop more skill at management. In the most glaring example, the government was forced to abandon acclaimed legislation that would have offered R$3.6bn ($1.6bn) in tax breaks designed to boost exports and investment. Some regarded the humiliating climbdown as proof that the government was failing to bury the scandal. "A day after Moody's applauded Brazil for 'a newly acquired resilience to shocks...' in the aftermath of the recent political crisis, the shocks from that crisis -- and the lack of resilience -- were on clear display in the defeat of Lula's most important legislative initiative of the year," wrote Christian Stracke of CreditSights, a New York-based consultancy. It was certainly bad timing, so soon after Moody's, the ratings agency, upgraded Brazil -- partly on the basis of its improved export performance. The new law would have bolstered that performance by providing incentives for exporters and for purchasers of capital goods, as well as for house-buyers. But rather than being a result of the scandal, some observers say the defeat is symptomatic of a more general failure of government that predates the corruption allegations. "The problem is one of management," says Luciano Dias, a political consultant in Brasilia. The government quashed the tax bill because legislators' amendments to it would have almost doubled its cost. A competent government, says Mr Dias, would have foreseen that probability and used regulation rather than legislation to introduce the incentives. Also recently, an estimated half of Brazil's more than $2.0bn in annual meat exports were put at risk when an outbreak of foot-and-mouth disease was discovered on a farm in Mato Grosso do Sul state, near the Paraguayan border. Brazil has the world's biggest herd of beef cattle, and recently became the world's biggest beef exporter. But following the outbreak, the European Union, Russia and other important buyers banned imports of Brazilian beef from areas at risk. Mr Lula da Silva put the responsibility for the outbreak squarely on the farmer concerned. But the affected farm -- where all 582 cattle in the herd were destroyed after 153 developed the disease -- is reportedly a model of good practice. A more likely culprit, critics say, is the government which, to meet fiscal targets, cut spending on animal sanitation this year from R$167m to R$91m. Of that spending, just R$30m has been released, and none has been spent in Mato Grosso do Sul, home to more cattle than any other state. "Spending on animal safety has been reduced in an extreme manner and made it much harder for the ministry of agriculture to have qualified people inspecting difficult regions such as the Paraguayan border," says Ronaldo Caiado, congressman and president of the House Agriculture Commission. Press photographs showed recently untended cattle wandering the dirt road that marks the border with Paraguay. The government also had to contend with a severe drought in the Amazon region that has made rivers unnavigable and left 30,000 families without transport or food. A state of calamity was declared on October 10, and troops began airlifting supplies later, but many communities were expected to be reached only lately. Critics say more should have been done to prepare emergency services. "We have known this would happen since the beginning of last year," Nadia Marinho of Somar Meteorologia, a weather service in São Paulo, said. "It was not only predictable, it was predicted." Under syndication arrangement with FE
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