Neves's biggest advantage: he's not Rousseff.  

Brazil's Voters Got Hope, Want Change

Mac Margolis writes about Latin America for Bloomberg View. He was a reporter for Newsweek and is the author of “The Last New World: The Conquest of the Amazon Frontier.”
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It's tempting to read the results of Sunday's election in Brazil as a win for the status quo. President Dilma Rousseff took nearly 42 percent of the tally, 9 million votes more than the runner-up, Social Democrat Party leader Aecio Neves, and now looks poised for the Oct. 26 runoff.

But not so fast. Start with the arithmetic: 42 percent is no mandate. Flip the graphic and look again. Better than half -- 58 percent -- of those who cast ballots voted for someone other than Rousseff. That means almost 18 million more people voted against her ruling Workers Party (PT) incumbent than for it. Tellingly, Rousseff got clobbered, 26 percent to Neves's 44 percent, in Sao Paulo, the PT's birthplace.

If Brazilians were fat and contented, they wouldn't be so eager to trudge to the polls again, which thanks to their split decision is now inevitable. Scratch a little deeper and a murkier picture emerges.

Brazil's biggest cities rejected Rousseff, as did states representing 70 percent of Brazil's gross domestic product. That might explain why the stock market rallies every time Rousseff's opponents beat expectations.

The big Brazilian board was up 5 percent the day after the vote, and the Brazilian real surged against the dollar, even as the greenback gained ground around the world.

Or maybe that's just "exuberancia irracional," as they say in the vernacular. After all, Rousseff came out on the top of a very large and aggressive heap. That means a lot in a land that just a year ago saw hundreds of thousands of demonstrators in the streets seething about World Cup overspending, underfunded public services and failing schools and hospitals.

Just because the Brazilians are fickle doesn't mean they're inconsistent, as Jose Casado, a political columnist for O Globo put it succinctly on Monday.

The same pollsters who have touted Rousseff all along to win the first round also have consistently indicated that seven in 10 Brazilians want changes in the way the country has run. When asked which candidate they wouldn't vote for under any circumstances, the voters picked Rousseff two to one over Neves.

There are some concrete reasons why Rousseff is still on top. Unemployment, though increasing, is still low. Prices are rising, but not yet ruinous. One in four Brazilians still draw monthly benefits from Bolsa Familia, the popular cash transfer program, which has helped the poorest make ends meet. The program has pulled 35 million from poverty, reduced inequality and helped turn Brazil into a majority middle-class nation for the first time.

It's up to the Social Democrat to change the narrative and transform the dismal data points that fire up economists and eggheads -- the tanking economy, plunging worker productivity, protectionism -- into a rallying cry for the majority worried about keeping their jobs and social benefits and making their paychecks last the month.

Marina Silva, the former Amazon rubber tapper, impressed Brazilians with her compelling back story and straight talk and rode a swell of sympathy after stepping in for Eduardo Campos, who died in a plane crash. She stumbled in the less glamorous game of marshalling her squabbling coalition and parrying brutal attacks by Rousseff campaign wizard Joao Santana, who was Karl Rove with a tan.

Now Rousseff faces a grittier opponent with equal time on the all-important televised campaign spots. Neves has plenty to say. Two decades ago, the Social Democrats changed Brazil with sweeping reforms, not just privatization, economic stabilization and a fiscal responsibility law that curbs executive spending, but also laying the groundwork for cash transfers to the poor.

Staggered by the populist tide, his party buried the message, whispering over reforms they should have been touting. That's something that only political leadership -- not spin -- can fix.

This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.

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Mac Margolis at

To contact the editor on this story:
James Gibney at