Brazil rut: Lula v Bolsonaro, again
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What are the main stories in this episode of The Intelligence?
Hello
and welcome to The Intelligence from The Economist. I'm Rosie Bloor. Today on the show, how honor culture holds women back and the rise of phone-free concerts.
But first...
Why is Brazil’s Lula-versus-Bolsonaro election so consequential?
Look at Brazil and it seems to have so much on its side. No threat of invasion, an economy resilient to Donald Trump's tariffs, friendly relations with both superpowers and resources in abundance. But as Brazil gears up for a presidential election on October the 4th, the country seems to be stuck in a repeating rut.
The stakes could not be higher in this election.
Ana Lankes is our Brazil correspondent.
On the domestic front, the next president will be able to choose four of 11 justices on Brazil's Supreme Court, shaping the country for a generation. The government is also living far beyond its means and creditors are becoming restive. Some people fear a recession in the next administration. And there's a big foreign policy dimension in this election. Donald Trump has treated Latin America as his personal playground since coming back to power in January 2025. He has abducted Venezuela's president. He has propped up like-minded right-wing populists in the region. He has blown up boats in the Caribbean. And if Brazil, the region's biggest country and rival center of gravity, comes into close alignment with the U.S., he will feel far more emboldened.
Who's in the running then as president?
So the problem is no one I've spoken to in Brazil is very enthusiastic about this election because the choices are on the one hand, the incumbent, Luiz Inácio Lula da Silva, who's known as Lula. He's about to turn 81. So that's the same age that Biden was when he dropped his reelection bid in 2024. And a lot of Brazilians fear that he may run the economy into the ground. His government is on course to end the term with the largest public debt interest bill in a quarter of a century. But on the other side, you have Flavio Bolsonaro, who's 45 years old. He's the eldest son of Jair Bolsonaro, a former populist right-wing president, serving a 27-year sentence in jail for plotting a coup after losing his bid for re-election in 2022.
Flavio's main policy is to pardon his father. He denies humans are causing climate change. He has been investigated for alleged but very credible ties to violent criminals, which he denies. So for our listeners outside, maybe it's helpful to think about this race as Bernie Saunders versus Donald Trump Jr., except if the younger Trump had links to Sicario's.
Ana, talk me through the challenges that either of these might face.
Why is Brazil’s rising public debt putting its economy at risk?
Let's start with the economy.
So it's possibly surprising that Brazil's economy isn't in a better state, given that Brazil is home to vast reserves of oil, renewable energy, critical minerals. And it's also about to overtake the U.S. as the world's biggest agricultural exporter. Brazil has a lot going for it, which made it the biggest recipient of foreign direct investment among developing countries last year outside of China. But Brazil faces a predicament similar to many other countries, which is that the debt is rising very, very fast. And there's basically no interest in Congress to reduce that. Brazil is borrowing very heavily and it's spending above its means. But the difference between Brazil and, say, the US or Europe or Japan, which all have very high government debt,
is that the cost of servicing the debt in Brazil is far, far higher. Brazil pays more to service its debt than any big country except Egypt and Pakistan. And that's because it has a long history of hyperinflation and recessions. And so investors basically demand a premium. So what's happening right now is that the debt is on track to reach 100% of GDP in the next few years. And there is no fiscal credibility from the government. So investors are really getting very restive. Over three terms as president, Lula has spent very lavishly on handouts and subsidized credit. His growth model has been focused on spurring consumption, but that has just heated up inflation. Whereas Bolsonaro is also not very credible.
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Chapters
8 chapters
1
What are the main stories in this episode of The Intelligence?
0:03–0:43
2
Why is Brazil’s Lula-versus-Bolsonaro election so consequential?
0:43–3:16
3
Why is Brazil’s rising public debt putting its economy at risk?
3:16–5:07
4
How are corruption scandals shaping Brazil’s presidential race?
5:07–6:42
5
Why are Lula and Bolsonaro’s son dominating Brazil’s election?
6:42–8:58
6
How does honour culture keep women from working outside the home?
8:58–13:55
7
Can women’s employment challenge honour culture and boost the economy?
13:55–17:03
8
Why are artists banning phones from concerts?
17:03–20:56