Brazil: Mushrooming strikes put Dilma to the test

A strike that began in May by university professors has spread to other federal sectors and is causing intermittent chaos on roads, passport offices, and ports, and is providing one of the biggest challenges yet for Brazilian President Dilma Rousseff's 19-month old government.

Teachers started the strike seeking higher pay and better career prospects, and now federal police, customs officers, and truck drivers are also involved. As many as 400,000 people have taken some kind of industrial action in recent weeks.

The strikes are a test for President Rousseff, who – despite never holding political office before assuming power in January last year – has performed well, with popularity ratings above 70 percent.

A political gamble

Rousseff was slow to negotiate with the teachers, who did not take kind to her suggesting that federal workers already have safe, well-paying jobs and that her priority was providing better conditions and more job security for those in the private sector.

Rather than seek a quick end to the strike, she gambled on it running out of steam. However, the strike spread, and it wasn’t until last week that she promised money to appease university professors. They are expected to accept the offer of a 15 percent raise over the next three years.

Even if they do say yes, Rousseff will still have to satisfy the additional 30 or so sectors who joined the professors’ strike and enjoyed significant and regular raises under the previous government. And she has a deadline:  Rousseff must present her final 2013 budget to Congress on Aug. 31.

“President Dilma is in a difficult financial situation and under a lot of pressure from public workers who were used to a Lula government that had more budgetary space to offer raises,” said former President Fernando Henrique Cardoso.

High cost of living

Rousseff’s main problem is not just that she has little patience or political skill as many pundits like to say, but that she has little room to maneuver. Although Brazil’s economy has been largely resistant to the global economic downturn – it grew 7.5 percent in 2010 and 2.7 percent last year – it is slowing, and the government is in no position to hand out big pay raises.

Brazil is now one of the most expensive countries in the world, with taxes and red tape, high profit margins, and an overvalued local currency making everything from tomatoes to jeans to iphones absurdly dear.

The high cost of living has affected everyone, and so have the strikes.

The first sign of unrest came in the Amazon last year when thousands of construction workers angry about poor treatment and low pay destroyed lodgings and building sites at major dam projects.

The university workers followed in May, and students have already missed several weeks of classes.

Since then, striking truck drivers have closed roads, including the country’s busiest highway, and federal police who issue and check passports are on a “go slow,” where they check every bag in the custom lines, for example, making international travel difficult or impossible. Even imports of medicine has been threatened.

Impact on staying power?

If Rousseff can’t bring the strikers under control it could spell trouble for her party in October’s municipal elections and weaken her broad public support. Civil servants have been an important bedrock of support for the Workers’ Party and if they turn on her, she will suffer.

“If she can’t solidify her base, another leader will look to take over that space,” says Paulo Kramer, a political scientist at the University of Brasilia. “I think there is a bumpy road ahead.”