Why Dilma Rousseff is still a good bet

By Erasto Almeida

At a moment when voter anger has elected leaders in the United States and Europe running for cover, a healthy number of Brazilian voters would like to see more of the same from their government. President Luiz Inácio Lula da Silva has presided over several years of relatively strong growth, major economic improvements for a significant portion of the population, and rising self-confidence across his country. The 2014 World Cup, the 2016 Olympics, a more obvious presence on the international diplomatic stage, and the discovery of an enormous amount of off-shore oil have fueled the perception that this is Brazil’s moment. Dilma Rousseff, Lula’s former chief of staff, has pledged to build on that record.

That’s why this will likely be one of the world’s very few status-quo elections over the next year. Rousseff, who has now advanced to a second-round run-off on Oct. 31 against former Sao Paulo governor Jose Serra, will also benefit from the dynamics of a head-to-head matchup. With just two candidates in the race, the Rousseff campaign will have an easier job making the case that the election offers a stark choice between a more uncertain and less prosperous past, represented by Serra and his record as a minister in the Fernando Henrique Cardoso administration (1994-2002), and a promising present and future represented by President Lula and Rousseff.

Polls suggest the race has tightened since the Oct. 3 first round, but the gap between Serra of the opposition PSDB and Rousseff has narrowed less than it seems, and she remains the clear favorite to become Brazil’s next president.

Most polls since the first round show Rousseff’s current lead at 5-7 percentage points, a significantly smaller lead than that forecast in second-round simulations held before the first round of voting. This has led some observers to argue that the race has tightened. But the apparently narrower margin probably has more to do with the pollsters’ failure weeks ago to accurately forecast that some voters would skip the first round than any real shift in voter preferences over the past three weeks. Though voting is mandatory in Brazil, 18 percent of those eligible didn’t turn up for the first round. Many of the absentees are lower income, less educated voters who are most likely to support Rousseff and the Workers Party. That helps explain why just before the first round, virtually every pollster projected that Rousseff had enough support to win without a run-off. She finished the first round with 46.9 percent of the votes. Correcting for this distortion, her lead probably hasn’t changed much — and a poll published just last night shows Rousseff’s lead widening a bit.

The election is not a done deal. A bolt from the blue, probably in the form of new corruption allegations that touch Rousseff personally, could still flip the outcome. A corruption scandal involving her inner circle has already slowed her momentum in the run-up for the first round. Rousseff could also move off message and opt for a strategy of attacking Serra, making the opposition candidate’s task easier. She seemed headed in that direction during a televised debate last week, but she appears to have gotten the message and returned to her core argument of comparing Lula’s administration’s with his predecessor’s.

To win, Serra will have to draw about 90 percent of the voters who chose third-place finisher Marina Silva in the first round — she and her party have refused to endorse either Rousseff or Serra — or steal a few of Rousseff’s voters for good measure.

That’s very unlikely to happen.

Erasto Almeida is an analyst in Eurasia Group’s Latin America practice.