Brazils Workers Party has further to fall

Following President Dilma Rousseff’s dramatic impeachment on 31 August, leaders of her Workers’ Party (PT) promised to quickly rebuild the party by bringing it “back to its roots” as a leading opposition force. Yet mayoral and city council election campaigns ahead of voting next month are telling a very different story. Having been ousted from the presidency, the PT is also swiftly retreating at the local level.

The PT is getting smaller, more isolated and radicalized – and the consequences will go well beyond the party. First, a weaker PT is pushing Brazilian politics rightward  . And at the national level, the Workers’ Party capacity to directly influence policymaking in the next years will likely be very limited. President Michel Temer’s real challenges to reform the economy will not come from the opposition, but from inside his coalition.

Since 1998, the PT consistently expanded its presence in local executive and legislative offices. But now its reputation for corruption and mismanagement is taking a toll. The number of PT candidates for mayor and council posts decreased by almost 50% from the last local election in 2012. In that election, the PT was competitive in four of Brazil’s five biggest cities (excluding Brasília, a federal district). This year, the PT is competitive in only one (Fortaleza) and will very likely lose control of its crown jewel – São Paulo, where incumbent PT Mayor Fernando Haddad is polling in fourth or fifth place.

Haddad has refused to do what many PT mayors elected in 2012 did: abandon the party. For instance, in the state of São Paulo, where 20% of Brazil’s population is concentrated, 24 of 72 formerly PT mayors have switched to other parties. In the state of Paraná – where the task force investigating the Petrobras scandal is headquartered – the PT has lost 19 of 40 mayors. In the state of Mato Grosso do Sul, the count fell from 12 to 3. And the mayors who have remained PT are conspicuously avoiding association with the party’s iconic red or five-pointed star.

The ongoing local campaign is also showing a more isolated PT. Mayoral PT candidates are now much more likely to be in smaller coalitions or on their own than in 2012. Even in alliances including the PT, the party is less likely to head the coalition (the case in Rio de Janeiro, for instance).

And after three and a half presidential mandates, the PT is now decisively moving to the left. Ideologically, the party had been in a tough position since late 2014, when Rousseff reneged on campaign promises to expand social spending and embraced an orthodox austerity agenda. With Rousseff gone and Temer about to impose unpopular measures to rein in a budget deficit that has blown out to 10% of GDP, the PT is lurching to the left, hoping to reclaim its traditional electoral appeal. The party will oppose practically all of Temer’s agenda, from pension reform to more market-friendly energy regulations, including policies it defended just a few months ago.

But this leftist turn is very unlikely to reverse the party’s shrinkage or growing isolation. First, it doesn’t address the cause of PT’s tarnished image after the Petrobras scandal and a recession that in two years reduced GDP per capita by almost 10%. Second, the share of the electorate that actively identifies with the left is small and has largely migrated to smaller parties that did not have to make ideological concessions to govern Brazil for 13 years.

However, as politicians on both the left and right recognize, there is one possible game changer for the PT: Lula winning the 2018 presidential elections. He has repeatedly stated his intention to run again and, according to all polls, is the frontrunner. But Lula has been indicted for allegedly obstructing justice in the Petrobras investigation and hiding his ownership of a beach apartment and a house in the countryside paid for by government contractors. If convicted, he can’t run for office for eight years. As prosecutors and the federal police deepen investigations in both cases, his conviction seems increasingly likely.

The PT is not facing an existential crisis, but its decline is affecting Brazil’s party system as a whole. For example, the waning of the PT is pulling apart the PMDB and the PSDB. Those two parties acted in tandem to oust Rousseff and now form Temer’s support base, but cracks in their alliance are growing – and will become more apparent as the 2018 elections approach.

At the same time, the PT’s capacity to directly influence policymaking in the Temer years will be very limited. The new government is promising to pass two constitutional amendments to fix Brazil’s budget imbalance, freezing government spending in real terms and reforming the pension system. Temer also wants to pass a labor reform before leaving office. The real threat to these changes will not come from an embattled PT, but from rebellious allies inside his coalition.