The Brazilian Workers Party and the participatory budget in Rio Grande do Sul

By Ben Reid


August-April 2003 -- Links International Journal of Socialist Renewal, no. 23 -- Many of the most important mass struggles today are occurring within Latin America—in Bolivia, Argentina, Venezuela, Ecuador, Colombia and Brazil. These countries vary considerably in their political and economic crises. The decades of political and economic restructuring that followed the debt crisis of the early 1980s have sometimes been accompanied by formal democratisation. The forces of the working class and the oppressed have been obligated to contest the electoral sphere in the midst of crises generated by the implementation of neo-liberal policies of financial liberalisation and export production. A challenge is posed, however, as to how this space will be utilised.

One outcome of participation in electoral processes by the Brazilian left has been the operation of the Orcamento Participativo [participatory budget—OP) in the southern "gaucho" state of Rio Grande do Sul. The OP has attracted considerable attention following two tremendously successful World Social Forums in the state capital, Porto Alegre. Considerable effort was made to explain the operation of the OP to the thousands of participants at each of these gatherings. The main political party responsible for implementing the OP—the Partido dos Trabhalhadores (Workers Party, PT)—won Brazil's presidential elections in SePTember 2002. The PT-led administrations of Rio Grande Governor Olivio Dutra (1999-2002) and Porto Alegre Mayor Tarso Genro played important roles in sponsoring and hosting the two World Social Forums.

The existence of these forums and "red" state and municipal governments in Brazil's south pose important questions for movements concerned with challenging the hegemony of neo-liberal globalisation, and perhaps even more so for revolutionary politics and practice. The OP has operated at the municipal level since 1989 in Porto Alegre and at the state level between 1999 and 2002. Regrettably, the PT, while winning the presidency of Brazil, lost control of the governor's office in Rio Grande do Sul. Nevertheless, the OP emerged as an important way for PT-led administrations to channel funds to social programs and develop a base of support amongst diverse social layers at a time when the federal Brazilian administration of Ferdinand Henrique Cardoso placed considerable limits on the spending and other capacities of local and state administrations.

This article assesses the character of the OP and what its experience may provide to socialist political practice. It asks three questions. First, what were the context and rationale of the OP's operation and its historical location within Brazil's overall political development? Second, to what extent is the OP experience a new and important contribution to political strategies aimed at reducing the negative social effects of and providing an alternative to neo-liberalism? Third, what is the relationship between the OP and revolutionary socialist political strategy?

Historical Context

The emergence of the OP is very much a product of both the many advances made by and the limitations of the PT and the attempts to create a mass-based and independent working-class political party in Brazil in the context of anti- and post-dictatorship struggle.

No independent and mass-based working-class political party emerged in Brazil until the formation of the PT in 1980s. After the victory of conservative republicanism in Brazil in the early twentieth century, political participation by the country's working class and impoverished social layers occurred mainly through the patronage of competing elites. Historically the working class was politically subordinated to populist political elites—especially during the "Vargas era" of 1940-1964. The south of Brazil played a contradictory role in this era. It remained one of the main bastions of republican progressivism, with its large European migrant population and history of civil conflict. In the 1950s Rio Grande do Sul, along with Rio de Janeiro, became the largest base for the pro-Vargas Brazilian Labour Party. The party was the main expression of the more progressive wing of populism, while remaining subordinated to the overall project of import-substitution national economic development and class collaborationism.

The US-supported military coup of 1964 ended the Vargas era, and a phase of authoritarian political and economic development lasted until the 1980s. Openness to foreign capital and export production resulted in the further expansion of industry and the proportion of the population employed in non-agricultural sectors. The economic structure that emerged was based on the super-exploitation of labour. Workers' industrial and civil rights remained significantly curtailed. By the late 1970s, resentment of the dictatorship culminated in a large-scale strike wave in and around the abc industrial region of São Paolo. Mass strike activity also occurred in the less industrialised southern state of Rio Grande, in which clerical and bank workers played a particularly important role.

The emergence of a significant politically independent core of industrial workers changed the character and composition of democratic opposition to the dictatorship. Most political opposition had previously been subordinated to the official (and bourgeois-dominated) Brazilian Democratic Movement. Debate began in the late 1970s about what role the working class and radical social movements should play, given the historical role that political cooption and patronage had played in marginalising their demands in the pre-dictatorship movement. A similar concern was expressed about the need to avoid the "vanguardist" errors of many radical groups that had largely failed to build any mass base. Debate centred on the inter-linked questions of political principles and program and the need for organisational independence. The outcome was a convergence of political forces—coming largely from the traditional far left (Trotskyist, Castroist and Maoist), radical churches and the new mass leaders of the labour movement—around a position of emphasising the need for the democratic struggle to go beyond simple issues of restoration of formal mechanisms of representation, civil liberties and the like. A need was also identified to oppose attempts to use the new worker militancy as a basis for a revived version of Vargas-era populism. This was being attempted by the rival Partido Democratico Trabalhista (Democratic Workers Party, PDT) and the revived Partido Trabhalhista Brasileiro (Brazilian Labour Party).1

These forces crystallised organisationally through the formation of the PT in 1980. The diverse tendencies within the PT interpreted the party's general positions in various ways. The more moderate sections of the PT understood radical democratisation as the installation of various consultative programs in keeping with the traditions of European social democracy and tripartitism. To the more revolutionary currents, it meant the building of institutions of popular power as alternatives to the state. What united these diverse currents was the desire to promote a mass-based working-class party within the array of forces calling for democratisation. While the party's initial electoral impact was modest (national votes in various national, state and municipal polls averaged just three per cent in the 1980s), it became a substantial reference point for the radical social movements. The PT played a significant role in the mid-1980s in pushing the bourgeois opposition not to retreat from calls for a directly elected president. Internationally, the PT became an important force, establishing the São Paolo Forum of the Latin American left. Within Brazil it helped to establish the CUT national federation of trade unions. The culmination of the PT's gradual growth in influence through the 1980s was the spectacular result achieved by its presidential candidate, Inacio "Lula" da Silva, in 1989. Lula has been and is in many ways synonymous with the PT. After developing as the main leader of the metalworkers in the 1978 strike wave, he went on to become the central leader and spokesperson for the PT. As a result of the widespread disillusionment with the bourgeois parties by the late 1980s, Lula made it into the second round of voting and was only narrowly defeated by the right's candidate, Fernando Collor de Mello.

1989 marked the electoral advance of the PT at other levels. PT mayors were elected in thirty-seven municipalities. In Rio Grande do Sul, Olivio Dutra was elected mayor of the state capital, Porto Alegre. The opportunity to govern Porto Alegre, with its population of more than one million and its European appearance and traditions, posed many possibilities for the PT. The PT won the election after engaging with and exposing the failures of the previous mayor and administration. However, the PT faced considerable challenges in governing the municipality. It was elected on a program of far-reaching reforms and the introduction of substantial new social programs in education, housing and infrastructure. Yet the municipality's public budget had deteriorated considerably as a result of mismanagement and a CUT in allocations from the Federal government. The PT retained and extended its power in three subsequent elections. In 1999 Dutra was elected as governor of the state, in part because of the reputation that the PT had gained from governing Porto Alegre.

What allowed the PT in Rio Grande do Sul to achieve these electoral victories? One important factor was the OP and a range of other participatory programs that became central to the PT . These allowed the PT—a unique party that is a front of revolutionary and reformist forces—to use the administrations it controlled to further politicise the population while delivering to some extent on its policies of countering the effects of neo-liberal restructuring.

The OP and the PT

Understanding the success of the OP and the PT requires two levels of analysis. First, there are the particular challenges that confronted the PT's local governments. Second, there is the complex array of mechanisms that constitute the OP process.

The first experiences of the PT in local administrations were far from resoundingly successful. The first mayoral administration of the PT in Diadema in São Paolo experienced several crises. This was in part due to the diverse range of forces that make up the PT and the differing interpretations of what the priorities of the administration should be. The most significant crises and reversal of fortunes for the PT, however, were in the São Paolo administration of Marta Suplici, which lasted for only one term of office (1988-1992). While the PT in São Paolo undoubtedly faced many obstacles and made unavoidable errors, its failure to win re-election revealed notable shortcomings. The focus of the São Paolo administration, while sharing the PT's commitment to greater public services and improving the lives of working people, became centred on "clean government", implying fairly modest measures of corruption reduction. At the same time, a trend of political conciliation developed towards the political centre and even sections of the right. The PT in São Paolo began to form alliances with these formations and tone down the PT's language and use of important symbols, such as the party's distinctive red star flag. What was clearly emerging was a differentiation within the PT between a rightward moving section of the predominant leadership faction (the "articulation") and more left-wing sections of the party.

One place where the left had some predominance within the PT—in contrast to São Paolo—was in Rio Grande do Sul. When Olivio Dutra won the mayoral position in Porto Alegre in 1988, the new PT administration confronted many difficulties. The PDT was in many ways the "Trabahlista" or populist heir to the pre-dictatorship Brazilian Labour Party, the largest pre-dictatorship party in the south. The Rio Grande PT therefore won a substantial victory in displacing the PDT from its position of majority influence within the state capital's working class. Once in power, however, the PT confronted considerable obstacles to implementing its far-reaching program of social reforms. On the one hand, the previous administration left a considerably deteriorated public budget, with both a large deficit and high levels of debt. Compounding this was the increasing centralisation of revenue towards the federal government and the ongoing loss of resources due to corruption and patron-client relations between legislators and favoured groups. On the other hand, there were the raised expectations of the PT's own constituency and especially large numbers of members of unions and urban resident associations who were expecting increased services and salary rises. The municipal administration had no power to begin disabling the institutions of capital to redirect resources to these ends. Yet it had been elected with a base of mass working-class support.

The municipal-level OP emerged as a partial solution to the difficult situation the PT found itself in. The purpose of the OP was to involve at least a large proportion of the party's constituency in a process of deliberation and decision-making over how the limited funds could most effectively be utilised. The rationale was to explain the limits on the PT's capacity to deliver improvements, encourage the greatest participation in the process of deciding what projects and programs should be approved and encourage representation from the more marginal and poorest communities in the city and increase their share of funding. At the same time, the PT could at least allow some experience of more participatory forms of government, despite the OP applying to the relatively limited sphere of municipal expenditure.

The PT succeeded in establishing the OP, despite initial resistance from the right-controlled municipal legislature. While still not constitutionally guaranteed, the OP has continued to function through three subsequent PT-led administrations. In contrast to the experiences of the PT elsewhere, Porto Alegre became a solid base for the left due to the strong role of participation and successive administrations' strong support for mass opposition to the neo-liberal policies of federal governments. These factors played a major role in Dutra being elected as the candidate of a PT-led alliance of parties in 1999. The OP was subsequently expanded to the state-wide level in 2000.

The municipal-scale OP in Porto Alegre and the state-level process in Rio Grande do Sul operated along similar lines. The following description is of the state-level OP, because it is the one with which the author is most familiar.

The state was divided into 22 administrative regions that grouped together a larger number of local assemblies. The overall process is divided into four stages, which operate throughout the duration of the calendar year. In the first stage, Municipal Public Assemblies, Regional Thematic Development Assemblies and Regional Directive Plenaries discuss and vote on specific projects and thematic priorities. The Directive Plenaries are in some ways very informal, yet are extremely important, because their role is to formulate the general framework and guide for each region's meetings. Held in each of the 22 regions, these are open meetings between the community and government representatives. They resemble more widespread practices of "consultation" employed by various agencies and governments.2

With these guides established, the Regional Thematic Assemblies occur during March. The notion of thematic priorities was a relatively recent innovation that was added to the Porto Alegre process between 1994 and 1997. The thematic options allow each region to prioritise areas of spending on projects in general spheres. Potential selections include, for instance, agriculture, education, science and technology, tourism, health, environment and transport. These enable each region to identify particular overarching priorities and to grade them accordingly, as each participant votes in the Thematic Meetings on their three preferred options. Ballot papers are distributed and outcomes calculated at the conclusion of each meeting using a computer.

The Municipal Public Assemblies (670 in 2001) meet on a number of occasions between the second week in March and early June. It is here that the most pronounced stage of direct democracy occurs, as diverse members of local communities discuss and debate more specific demands for specific programs and public works. The main outcomes are again voted on to decide priorities, and delegates are elected (one for each group of twenty participants) for the next stage in the OP process. The period in which the largest numbers of participants are involved in the OP therefore lasts for just under three months.

In the second phase of the OP, beginning in June, the Regional Plenary of Delegates meets and makes two main decisions. One process involves the task of synthesising and evaluating all of the different demands from the Municipal Assemblies according to the overall thematic priorities and technical and financial feasibility. Each delegate is given a copy of the state's projected revenue and income as means of discerning the feasibility of various projects. The other main task they complete is election of delegates to the next phase of the OP process. This involves election of delegates to the state-level Thematic Council and Delegate Representative Commissions. The regional level meeting therefore acts as another stage of discussion and debate on programs and themes in between the municipal assembles and the main decision-making process at the state-wide level.

The main decision-making process is the third stage: the Council of the Orcamento Participativo. The composition of the Council is determined through the election (and appointment) of three sets of delegates during the previous stage of the OP process. Sixty-nine delegates are elected, in proportion to each region's population. Another sixty-nine councillors are elected in proportion to the number of voters in each region. Each region has the right to elect an additional councillor to represent it according to the thematic proposal of the region. These account for an additional twenty-two councillors. The final group of forty-four councillors comprises two representatives of the Conselhos Regionais de Desenvolvimento (Regional Development Councils). The latter groups were established in 1994, before the PT was elected at the state level, and did little before the OP was established. In 1999, with the start of the PT state government, the conservative group in the state legislature wanted these institutions to administer the budget. The PT government called all these groups in order to counter the arguments of the conservative members of the parliament. Their inclusion was a concession to the conservative opposition.

The fourth and final phase of the OP is execution. Here the decisions of the Council are subjected to a process of appraisal, according to the Rio Grande do Sul state's norms of operation. A Plan of Investments and Services is formulated within the financial year starting in July. The Council and Municipal Assemblies play a monitoring role as successive programs are implemented.

The OP is not the only set of participatory institutions that the PT government has implemented. The Rio Grande do Sul government, in its literature, emphasises the ways the OP combines with a set of programs aimed at promoting what can be broadly defined as a strong social development-centred strategy. Other comparable programs include coletivos de trabala (workers' cooperatives), familia cidada (poverty program relief for families) and the movimento de alfabetizacao (literacy program). The interaction between these programs and government programs is characterised by large-scale participative processes. The School Constitutional Assembly claimed to bring together more than 3000 different representatives to discuss the need for curriculum reform. The participative process therefore exists in different spheres rather apart from the budget process. It is deeply rooted within the administration's commitment to reform of public services (as opposed to privatisation) and transparency.

The OP was therefore the product of the specificities of Brazilian social and political development. These were, in particular, the strong role of the labour and other social movements in the process of democratisation. One effect has been that in at least one state Brazil has a functioning system, although still relatively weak, of open and voluntary participation and deliberation over budget decisions.

The OP and socialist strategy

Questions remain about the OP's relationship to socialist strategy. Is it an experience that can and should be replicated elsewhere? Are experiments like the OP—developed by broad left parties maintaining control of sections of the bourgeois state—compatible with revolutionary struggle?

In Brazil the return of formal bourgeois democracy in the 1980s has been accompanied by a deepening commitment of the local ruling class to the neo-liberal path. In this model of "elite democracy", formal democracy coexists with a centralisation of power within the state and a loss of accountability through privatisation and the diffusion of "managerialist" ideology. The pro-bourgeois regimes of Collor and Cardoso both won office through a combination of populist bravado and savage policies of economic restructuring.

It is within this context that a vital space emerges for the left, as the promise of the return of formal democracy comes up against limits imposed by national and international ruling-class forces. A contradiction exists between the formal boundaries of democratisation and the reality of immense concentrations of wealth amongst the ruling class. In Brazil, this contradiction in part led to the emergence of the radical politics of the PT. These were focused on redefining the process of democratisation to engender genuine and radical forms of popular power. It also united revolutionary and non-revolutionary forces. Clearly the existence of such spaces is not limited to Brazil. Similar mass processes of democratic transformation have occurred throughout much of the Third World.

Revolutionaries have long been obliged to use electoral spheres provided by bourgeois democratic regimes as tools in their strategy. At a time when such opportunities exist in many national contexts, it is logical that revolutionary forces or alliances of revolutionary forces with centrist class-struggle elements may win office within sub-national state and municipal administrations. Will the left succumb to pressure and attemPT simply to implement minimal reforms while coexisting with national and international ruling-class forces dedicated to neo-liberalism? Or will they use these institutions to organise and popularise mass resistance?

The OP remains a central mechanism to help avoid pitfalls by acting as a mechanism of mass politicisation and involvement. Rather like a trade union or any mass organisation in which the left achieves leadership, the OP is a way of facilitating mass involvement within non-national levels of the state. However, it is not co-optive. On the contrary, mass participation acts as a barrier to the growth of bureaucratic and substitutionist tendencies that lead to reformist errors. At the same time, it does mean some level of coexistence with capital. Yet the OP facilitates the promotion of decisions that run counter to the overall dynamic of neo-liberalism in particular and capital in general. Mass participation allows for the immediate redistribution of resources in favour of the impoverished masses. In that sense, it creates a dynamic of conflict that can accelerate as the level of mass resistance rises.

That being said, it would be wrong to see the OP and its constituent bodies as "soviets" or workers' councils. They are not even organs of spontaneous mass power, like the picketers' assemblies in Argentina. What they are, however, is organs of participation and decision-making concerning one aspect of politics and society: the public budget. They are one arena in which mass politicisation occurs. For example, within the OP council one battle that classically occurs is between the "middle-class" sectors and the poorer neighbourhoods. The former argue for their allocation on the basis of their contribution to tax revenue. The latter argue on the basis of their past experiences of neglect and their current needs. Struggles ensue over the distribution of the social surplus. Just as in a trade union, participation facilitates the first stages of politicisation, so in the OP its participants engage in a similar experience of struggle. Just as a social forum or organising meeting facilitates radicalisation, so the OP turns local and state government into a similar terrain of struggle.

This does not imply that the OP process does not contain dangers or difficulties. The PT government is, no doubt, subject to many contradictory pressures. On the one hand, there is a tendency to accommodate to capital in Rio Grande do Sul. Government literature emphasises its strategic location in the (now suspended) MERCOSUL trade area, as an incentive for the private sector to invest in the area. One scenario is that the OP comes to act as a form of "humanising" supplement in an overall strategy emphasising economic competitiveness and modernisation; this is made more likely by the fact that the state government is reliant on capital for job creation and tax revenue. Yet another danger is ideological confusion over the OP's role. Sometimes Gramsci's scenario of "war of position" has been utilised in dubious ways. The implication (which is more reminiscent of Kautsky's attrition strategy) is that mechanisms like the OP can be gradually expanded and capital's decision-making power reduced centimetre by centimetre. Some sections of the PT clearly have such a "left" reformist view.3

The OP's mass character, however, contradicts the direction of these trends towards reformism. The best means of avoiding such errors is to maintain dialogue and participation of the largest mass of the population in decisions regarding the government's direction. It would therefore be absurd to equate the OP with a reformist and gradualist program of social reform. On the contrary, it is one of the central factors ensuring the continued militancy and radicalism in the PT in Rio Grande do Sul. What appears to be lacking (and worrying) is the existence of more formal organisational coherence amongst the left of the PT, which appears to adopt a semi-spontaneist view of the development of socialist organisation.


The OP, therefore, is an important experience that the international socialist movement can learn from. As the former mayor of Porto Alegre, Raul Ponte, explained to the second World Social Forum, the OP experience gives some indication of how the left can adopt a stance of "modern constitutionalism" based on more direct forms of democratic rule. The left must emphasise the ways in which these forms of direct rule can be realised, in contrast to the dour world view of neo-liberalism and the unbridled rule of corporations and the market.

The OP is therefore the product of both general processes within Latin America and the specificities of Brazilian politics and society. On the one hand, there has been the emergence of formal democratisation in many nation-states. This has been accompanied by an intensification of social crisis and the implementation of severe programs of neo-liberal restructuring. The promise of democracy has not lived up to expectations. On the other hand, the PT was formed in Brazil as a result of mass democratic and industrial struggle. The experience of this struggle meant that an important section of the working class recognised the need for an independent political party. The framework of the emerging struggle focused on the form of democracy that could be realised in Brazil. Would it be a return of purely formal "elite" democracy or a more radical project?

The OP, first in Porto Alegre in 1989 and then in Rio Grande do Sul between 1999 and 2002, emerged as a concrete expression of the Brazilian mass struggle. The PT has had to reconcile governing while delivering on immediate demands in three ways. First, the OP is a mechanism to ensure the immediate redistribution of funds and a reduction in the effects of corruption. The public budget is opened up to considerable scrutiny through an array of participatory bodies. Second, the effects of national level neo-liberal restructuring are offset both directly and indirectly through the operation of the OP. The participatory nature of the OP means that political struggles are engaged in over the distribution of public resources. At the same time, the deliberative and democratic process poses an alternative to the advocates of user pays and market-oriented approaches to spending decisions. Third and finally, while not facilitating the creation of "organs of popular power", the OP does give some indication of how a future socialist economy and society might approach some issues of democratic decision-making. Its immediate effect is to school a considerable proportion of the population in processes of participation, discussion and deliberation. It is perhaps this last point that is the most crucial component of the OP. It is a mechanism—along with other mass mobilisations and processes of participation—through which the left can utilise its control of local and state administrations as a means of mass politicisation.

This does not imply that there are no threats or dangers in the OP process and the nature of the PT's electoral advances. The PT in Rio Grande do Sul is relatively exceptional in its political composition and cohesiveness. Nationally, the overall direction of the PT has been marked by an ideological shift to the right. This is particularly the case with the national leadership and, in particular, president-elect Lula da Silva. Lula's victory came partly as a result of the inclusion of sections of the political right, in particular his vice-presidential candidate, Jose Alencar. Lula also pledged support for ongoing cooperation with the imf and its programs of neo-liberal restructuring. The implications of this for the PT in Rio Grande do Sul, where, despite losing the governor's position, it retains control of Porto Alegre and a number of other municipal councils, are not clear. Will there be conflict with the national PT-led government? If so, how will the more radical sections of the PT respond? Hopefully, processes like the OP, which facilitate mass participation, will act as a brake on any tendencies within the PT to capitulate to or compromise with capital. What is required is the extension of such processes on a national scale.

For the international left, the OP process presents many important experiences. The rise in resistance to neo-liberal globalisation has entailed electoral advances for the far left, both standing alone and in alliance with other class-struggle forces. For the left to take advantage of these advances, it is necessary to use such posts in the capitalist state as tools for the further politicisation and mobilisation of resistance against the agenda of capital. The OP is one example of how such a process can occur.


1. For more on the history and context of the PT, see M.E. Keck, The Workers' Party and Democratisation in Brazil, Yale University Press, 1992. Alternatively, while it contains certain emphases common in "official" histories, there is the Partido dos Trabalhadores, Paths, Editora Fundacao Perseu Abramo, 2002.

2. This description is based on interviews with key informants undertaken in early 2002 in Porto Alegre and official documents. For the latter, in particular, see Governo do Rio Grande do Sul, Caminhos da Participacao, Porto Alegre, Governo do Rio Grande do Sul, 2001.

3. See Tarso Genro's sections in T. Genro and U. de Souza, Orcamento Participativo: A experiencia de Porto Alegre, São Paulo, Editora Fundacao Perseu Abramo, 1997.

[Ben Reid is a member of the Democratic Socialist Party in Australia and a lecturer in development studies at the University of Newcastle]