Brazil Needs Imf Funds And Cardoso's Reelection

Ian Katz's comments on Brazil's President Fernando Enrique Cardoso and his decisions vis-a-vis the international financial crisis are off the mark ("Brazil doesn't need a bailout. It needs leadership," Latin America, Sept. 28). His suggestion that Cardoso should have imposed a strong recessionary program and convinced the people that it is the best way to go just weeks from the presidential election is naive. Cardoso was facing an opponent of the unreconstructed Latin American left, and his reelection was the priority of Brazilians and businesspeople across the continent. For much less, President Bush lost in a country where the average voter schooling is 12 years, vs. four in Brazil.

Brazil doesn't need to be bailed out, but a line of credit from the International Monetary Fund and the Group of Seven will assure a more prompt return to growth. Look at the costs of the do-nothing alternatives.

Also, we need to set traffic rules for international flows of flight money. Red lights, no parking at all. Brazil wasn't brought into the storm epicenter because it has a huge fiscal deficit but because it is large and its assets are liquid. After all, Mexico and Argentina have been more fiscally conservative and are suffering all the same. Right now, international markets are irrational. In view of that, which is the best course of action?

Paulo Possas

Sao Paulo

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