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Twenty years ago, when Lula was a firebrand unionist, that sentiment might have been dismissed as dreamy rhetoric. Not today. However the crisis ends, there is widespread agreement that developing economies such as Brazil, China and India will be crucial to ensuring that demand remains buoyant. Lula, too, has changed. These days he's a pragmatist who is as popular inside corporate boardrooms as he is in the favelas. On March 17, he will meet new U.S. President Barack Obama - a fellow moderate liberal who shares Lula's passion for green-energy ventures - in the White House. He will...

Author: /time Magazine | Title: The One Country That Might Avoid Recession Is... | 3/5/2009 | See Source »

That too would mark a change. Brazilian officials have long wanted to make a mark outside their neighborhood, but until recently, the world rarely noticed what went on there - unless it involved beaches, soccer or Carnaval. "Brazil always suffered externally because of its internal poverty," says Lula's foreign-policy adviser, Marco Aurelio Garcia. The nation's founding monarchy, which lasted until 1889, insulated the country from the region's 19th century upheavals but also spawned a quasi-feudal class system that led to the inequalities that persist today. In 2000, fewer than 3% of Brazilians still owned more than...

Author: /time Magazine | Title: The One Country That Might Avoid Recession Is... | 3/5/2009 | See Source »

Lula's predecessor, Fernando Henrique Cardoso, was the first President to recognize that change was needed. He restored fiscal sanity by slaying hyperinflation, but his attempts at social reform were timid. Lula's victory in 2002 panicked Wall Street and the Brazilian élite. But instead of defaulting on Brazil's foreign debt or busting the budget, as they feared he would, Lula embraced one of the few positive legacies of Brazil's royalist roots: deliberate, negotiated consensus-building. It's a hallmark of Brazil's widely respected diplomatic corps - and it tempered Lula even when he was a metal...

Author: /time Magazine | Title: The One Country That Might Avoid Recession Is... | 3/5/2009 | See Source »

...then used that as a base on which to weld social programs, such as Bolsa Família, a grant scheme that has paid out more than $20 billion in aid to poor families in return for parents getting their children vaccinated and making sure they attend school. Brazil's business leaders insist record profits during the 2005-2008 boom allowed Lula to aid the poor; Lula argues his antipoverty crusade fueled the economic growth. It's a chicken-and-egg debate, in which both sides are right. What matters is that social stimulus programs like Bolsa...

Author: /time Magazine | Title: The One Country That Might Avoid Recession Is... | 3/5/2009 | See Source »

...Better Life Whatever the explanation, the philosophy has done the President well. Two years into his second and final term, Lula has an 80% approval rating. This suggests that despite the recession, most Brazilians still feel they're winning. "It was very difficult to change social class in Brazil 10 years ago, or even four years ago," says Luis Minori of the market-research firm Ipsos. "Now people have access to microcredit and computers and other means of social mobility." In that sense Brazil has outperformed even China and India, Neri claims, because "poverty is falling [in those places...

Author: /time Magazine | Title: The One Country That Might Avoid Recession Is... | 3/5/2009 | See Source »

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