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Brazil votes in tight presidential runoff split along class lines


By Paulo Prada

RIO DE JANEIRO (Reuters) – Brazilians vote on Sunday in a bitterly-contested election that pits a leftist president with strong support among the poor against a centrist senator who is promising pro-business policies to jumpstart a stagnant economy.

Polls give a slight edge to incumbent Dilma Rousseff, 66, who is seeking a second four-year term. Her Workers’ Party has held power for 12 years and leveraged an economic boom to expand social welfare programs and lift over 40 million people from poverty.

But many voters believe Aecio Neves, a 54-year-old former state governor with strong support among upper-middle class and wealthy Brazilians, offers a much-needed change of the guard for Latin America’s biggest economy. A decade of growth peaked at 7.5 percent in 2010 and has flagged since Rousseff took office.

Despite acrimonious finger pointing and corruption scandals that have characterized the campaign since a first-round vote on Oct. 5, voters are likely to be divided between those who feel better off than they did before the Workers’ Party took office and those who believe its reign, no matter how successful, is no longer producing results.

“Forget the noise on both sides,” said Alexandre Barros, a political consultant in Brasilia, the capital. “This is about an individual choice by each voter – what’s in it for me?”

Rousseff has promised to deepen flagship welfare programs and seek to restore growth with a new economic team.

Neves also vows to keep the social benefits while adopting more market-friendly fiscal measures to rein in public spending, take a tougher stance against inflation and give the central bank more autonomy to set monetary policy.

The choice takes Brazil back to a clash between classes in a country still riven by inequality.

It also reverts to a longstanding rivalry between the Workers’ Party, with roots in Brazil’s labor movement, and the Brazilian Social Democracy Party, which held power for two terms before Luiz Inacio Lula da Silva, Rousseff’s mentor and predecessor, was elected in 2002.

Two closely-watched polls on the eve of the runoff showed Rousseff with a lead of as much as 6 percentage points.

Earlier in the day, however, a smaller poll swung in favor of Neves, who surprised in the first round of voting earlier this month by surging from a distant third place in polls to clinch second.

Pollsters faced widespread criticism for failing to pinpoint Neves’ strong showing then, and he himself has dismissed them as unreliable.

If the vote were about the economy alone, Rousseff would have a hard time winning.

As demand for Brazil’s vast natural resources cooled in recent years, her administration has been unable to revive growth. That has strained a government model that relied on soaring tax revenues to fuel social programs and pump subsidized credit through state lenders, juicing a consumer boom.


The economy, which fell into recession in the first half of the year, has grown by less than 2 percent annually on Rousseff’s watch. Investment has sagged and inflation is running just over the government’s official tolerance limit of 6.5 percent.

Although unemployment remains at historic lows, economists see few bright spots on the horizon.

“Regardless who wins, the economic model in Brazil is exhausted and needs real change to grow again,” said Luis Otavio Leal, an economist at Banco ABC Brasil in Sao Paulo.

Meanwhile, persistent corruption scandals have led to criticism from many that the ruling party has turned a blind eye to the pillaging of public coffers.

An ongoing probe over kickbacks by contractors at the state-run oil giant known as Petrobras (PETR4.SA) has hurt Rousseff’s reputation as a competent manager because she once chaired the company’s board and as president appoints senior executives.

In a televised debate against Rousseff on Friday, Neves said Brazilians could end corruption with one measure: “Pull the Workers’ Party from government.”

Still, his plea is likely to fall on deaf ears among many of the roughly 40 percent of the electorate who credit the Workers’ Party with helping them lead more prosperous lives. The party’s aggressive campaign team has cast most criticism as the deceitful propaganda of a power-hungry elite.

“No other party is going to work on behalf of people like us,” said Sergio Calazans, a 42-year-old fruit vendor in the Rio de Janeiro slum of Pavão-Pavãozinho. “Sure there are mistakes, but who doesn’t make a mistake?”

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