>From today's New York Times.
NYT November 8, 2002  Brazil's Election Victor Maps His Way to More Social
Equality By TONY SMITH

SAO PAULO, Brazil, Nov. 7 -- Meeting with 150 of Brazil's wealthiest and
most powerful businessmen, President-elect Luiz Incio Lula da Silva laid
out plans today for what he termed a "social pact" to narrow the gap
between Brazil's haves and have-nots, a feat that has eluded all his
elected predecessors.

Mr. da Silva, who won a landslide victory in elections on Oct. 27,
acknowledged that negotiations to reach a deal among business, workers and
other sectors of society would have to "start from zero." He said his
transition team was examining how similar social accords worked in other
countries.

"We will see if it's necessary to bring together 200, 60 or 70 people," he
said. "Our society is more complex than those in other countries."

The talks with big business and labor are seen here as a gamble by Mr. da
Silva to put public pressure on Congress to approve reforms that Brazil
needs to improve its sickly economy once he takes office on Jan. 1.

Although Mr. da Silva's Workers' Party is now the largest in Congress, it
still commands fewer than 20 percent of the seats and he will need broad
support to push through any reforms. He needs perceptible change to have
any chance of making good on vote-catching campaign promises like the
creation of 10 million new jobs or the doubling of the $56 minimum monthly
wage over his four-year term.

In the view of many economic experts, Brazil's byzantine, inefficient tax
system and generous public sector pension scheme need urgent overhauls, as
do rigid labor laws that in fact mean more than half the work force has
little job security and wages below the legal minimum.

Although Brazil ranks among the world's top 10 economies, it has the
fourth worst income distribution in the world, according to the United
Nations Development Program.

Oded Grajew, the head of Instituto Ethos, a nonprofit group that promotes
what it terms responsible management, said that Brazilian executives could
support the pact proposed by Mr. da Silva because they "have finally
realized that the social question -- worsening crime, education,
unemployment -- is bad for business."

Since democracy was restored in Brazil in 1985, every president has faced
calls to forge some sort of social pact to narrow the country's gaping
social inequalities, especially in times of economic crisis.

But calls for solidarity habitually faded with the first signs of economic
recovery.

Today, participants sounded generally positive about Mr. da Silva's
chances of at least fashioning some kind of unity to push for reform. In
the past, such attempts have foundered, in part because both labor and
management in Brazil lack strong nationwide institutions to make deals on
behalf of their members.

"We've had several magic moments like this one in the past and we made no
progress," said Eugenio Staub, president of the electronics manufacturer
Gradiente and a vocal supporter of Mr. da Silva.

Ablio Diniz, head of a supermarket chain, Po de Acar, said, "This is the
first time we are receiving clear signs from a government that it wants to
listen to society."

"If these parallel negotiations are used well," said Christopher Garman at
a So Paulo-based consulting concern, Tendncias, "they could increase
Lula's popularity, which could help put pressure on Congress. But they
will need to come up with a concrete proposal and that will be difficult
with so many disparate interests."

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