In the opening of its annual session, the UN's General Assembly 2004 was stage to a great dispute. On one side, the warlord, George W. Bush, isolated and defending a policy condemned all over the world, causing insecurity and instability, threatening the peace and safety of all countries and peoples. On the other side, a broad current of leaders who defend peace, international cooperation, the development of a new international economic and political order. One of the most distinguished chiefs of state on the latter side was Brazilian President Luis Inácio Lula da Silva. His speech and the actions he proposed to fight inequalities instead of the current war policy achieved great repercussion. Every time President Lula makes pronouncements and gestures of that sort the international progressive forces turn their eyes to Brazil and analyze the nature of our country's evolving political process. Foreign friends who are sympathetic to the struggles of the Brazilian people insistently question us if the balance of the first stage of the Lula administration is positive and ask which paths it will take from now on. Not pretending to clear all doubts, I expose below what, in my opinion, synthesizes he experience of the Brazilian left-wing forces in the government. After almost two years since the electoral victory of the Brazilian left-wing forces led by Luis Inácio Lula da Silva in 2002, the fulfillment of political, economic and social changes that motivated the struggles of the Brazilian people over decades, determining the election of Lula and being inscribed in the electoral platform is still in the agenda as a fundamental and urgent need, though with an uncertain destiny, in case we face the international and national correlation of forces, as well as the existence of diametrically opposed views regarding its range inside the government and among parties that constitute the broad governmental coalition. It is still too early to make a conclusive assessment of the Lula administration. "Singing victory" when we have not yet reached half the presidential mandate is a velleity in which the consequent left cannot indulge. Foreseeing failure is a nihilist attitude that is today the touchstone of national right's policy — which is still bewildered with the defeat suffered in 2002 — and of an inconsequent and counter-revolutionary "ultra-left", which bases its political action on frustrating the expectations of the masses and creating and artificial environment prone to adventures. Both postures are far-out and harmful to the struggle of the Brazilian people for national and social emancipation. The Brazilian progressive forces and the popular movement struggle to transform Brazil amid peculiar conditions that define its pace. International context is adverse and still characterized by the heavy effects of the defeat of socialism in the USSR and East Europe; by the retraction of the revolutionary movement in the world; by the predominance of an interventionist and warmongering policy practiced by the United States' imperialism — a voracious and aggressive super-power committed to impose its absolute domain on countries and peoples; by an unprecedented offensive against labor rights and national sovereignties of dependent countries, despite the intensifying resistance struggle that can be observed all over the world, a factor that inspires hope and stimulates the search for alternatives. In a still unfavorable situation, how to implement changes, change courses and advance towards structural transformations — which are revolutionary in their core — in a politically and socially complex country of continental dimensions such as Brazil, living a reality where the government was conquered not by revolutionary means, but by an electoral victory? The progressive forces, among which the communists, have a historical opportunity to outline the answer to so acute issues as those not by means of manuals, but with practical exercises, with the daily search and adoption of solutions to solid problems and adequate political answers to recurrent disputes allowed by the present situation. Lula's election is the result of a set of objective and subjective factors, among which we highlight the collapse of the neoliberal model, the temporary rupture of the political scheme that supported former President "Professor" Cardoso's government, the increasing dissatisfaction of the popular masses and the formation of a broad political-electoral front constituted by left-wing forces, such as Lula's Workers Party (the major force), the Communist Party of Brazil (an ally since Lula's first candidacy in 1989), the Brazilian Socialist Party and center forces, such as Vice President's Liberal Party, among others. The positive result of the elections was not reproduced in the elections for the House of Representatives, the Senate and state governments, which play a relevant political role in the Brazilian federative Republic. That was another unfavorable condition added to preexistent ones, forcing the new administration to form new, broader alliances in order to obtain the necessary political stability what was fulfilled by dividing the opposing camp, attracting to the government's side another center force, the Party of the Brazilian Democratic Movement, which was part of the previous government's supporting base. The importance of such demarche can be measured in contrast to the ill omens uttered by the defeated forces, including a good amount of prejudice regarding Lula's class origin and political trajectory, who was viewed as someone not even able to take the first steps and doomed to succumb to difficulties. Therefore, Brazil is facing the peculiar circumstance of having the left in the heart of Republican power, but yet unable to constitute a strictly left-wing government. Replacing the neoliberal, anti-popular, anti-democratic and anti-national administration led by "Professor" Cardoso, we have a government constituted by a broad national coalition with the Workers Party and Lula's leadership at its core, with the participation of progressive and center forces. It is the first time since the military coup 40 years ago that Brazil sees a government with such constitution of forces. If, on the one hand, President Lula's government gained political stability with its broadness, on the other hand, the pace of changes became slower. If, on the one hand, there is the possibility of resisting with more safety to the present neoliberal, anti-democratic and anti-social international offensive with a government of national coalition, on the other hand, the commitments made with center-right political sectors, branches of dominant classes polarized by traditional party chieftains, conditioned the form, character and pace of the reforms performed by the government, some of which confuse, many others unnecessary and contradictory in contrast to the government's progressive sense and national, popular aspirations. Communists have characterized President Lula's government, since its formation and since they accepted the challenge of taking part of the Ministries under Lula's invitation, as a "disputing" government where forces of change, bearers of a national development project that value labor and social justice and that open the way to building a sovereign and progressive nation, coexist with forces willing to conform to the previous model, bearers of a withered neoliberalism, unable to conceive and put into practice alternatives to a model that proved to be useless to the country and, therefore, condemned not only by history, but also by ballots cast in the urns. But the fact that the Lula administration stands out due to its democratic and patriotic character, as well as to the commitments made to recover social justice, is indisputable. It is with such parameters that one should evaluate the Lula administration in the short period since the President took office. The democratic character In the history of the Brazilian Republic, which completes 115 years in November, there has never been such democracy and dialogue between popular movements and the nation's highest officer. Unionists, students, farmers, landless peasants, women, in fact, all segments of the Brazilian population have President Lula as a patient interlocutor. The government acknowledges the social movement as the force that elected it and, therefore, as a fundamental constitutive part of its supporting base. In almost two years of government, the general feeling is that police repression to social movements belongs to the past. It is not something with little importance in a country where the social issue was always treated as a "police case" — often as a military one — a case of national security. And I am not referring only to the "old Republic's" methods or those of the dictatorships that marked our history, but to the very government of "Professor" Cardoso's Party of Brazilian Social Democracy, which authorized the invasion of an oil refinery that was on strike and persecuted the union movement with unimaginable cruelty for a Sorbonne academic. Lula inaugurated a method of consulting society's organized sectors that allows him to collect and systematize proposals made by popular movements in order to design public policies. Therefore, in one year and a half, many conferences were held, among which the Women, Sports, Human Rights, Cities (addressing issues such as housing and sanitation), Health and Youth (which was organized by the House of Representatives) conferences. Those conferences were preceded by intense debate and mobilization from the lower ranks in municipalities. The presence of the President of the Republic, Ministers and officers specialized in the fields addressed in the conferences does not intimidate delegates who, with typical Brazilian irreverence and the responsibility of representing communities and social movements, do not spare the government of criticism and formulate claims and proposals with clarity. The existence of a democratic government in Brazil is a great achievement that has been ripening since the end of dictatorship in 1985, the Constituent Assembly in 1987-88 and now is consolidated during Lula's mandate. In Brazil, we have had some short periods of democracy in the 115 years of the Republic. In general it has been oligarchic, dictatorial and fascist governments and, more recently, the joint domain of the interests of a neoliberal, financial elite. Democracy is exception. A sovereign foreign policy Since March 2003, when Lula finished a call made by United States' President Bush with a sound NO to his request for Brazilian support in the invasion of Iraq, the sign that clear changes were beginning to be implemented also in the Brazilian foreign policy was given. The foreign policy, conducted with serenity and ability by the Ministry of External Relations, is the distinctive trait of the Lula administration as a patriotic government that exerts national sovereignty with responsibility in a disturbed world, under an unbalanced, unfair and threatening international order. The government's action regarding foreign policy has been the incessant search for granting a new spot for Brazil in the world according to national expectations for peace, sovereignty and development. Brazil will not find that place in case it remains on the side of imperialist powers, submitted to the rule of inequality and warmongering policies, but on the side of its Latin American neighbors, as well as standing by other fraternal, poor or developing countries in Africa, Asia and the Middle East. Lula inaugurated a new presidential diplomacy that deals with great powers in a stately manner, at the same time trying to diversify our relations according to the argument that an international order characterized by unilateralism does not contribute to the progress of humankind or to national development. The balance of achievements in that field is very positive: the efforts to integrate Latin America and strengthen Mercosur; solidarity towards Cuba and Venezuela; weakening and delaying the FTAA; the struggle against rich countries' protectionism, the creation of the G-20 during the WTO meeting in Cancun — a high point; the help to African countries and the initiative of proposing an international debate on fighting poverty. Those are great achievements if we consider that Brazil was traditionally submissive to the United States' imperialism. The exercise of national sovereignty is also an exception in our Republican history. The Achilles heel Although democracy and foreign policy are the most positive traits of the Lula administration up till now and the endorsement the President enjoys results from the reaffirmation made speech after speech of his social commitments, the general orientation of the economic policy is too feeble. It is clear that the Lula administration has made a conservative choice regarding the economic policy and has submitted to the pressure of IMF, international banks and local financial advisers. Now, with small signs of economic growth manifested this year on a compressed basis (a –0.2% recession last year), there is much hubbub with the pretension of canonizing the economic policy, as if the growth signs were its result. The government is still prisoner of the previous logic: generate more and more domestic and foreign surpluses in order to finance the payment of domestic and foreign debts and maintain high interest rates, as well as a floating exchange with the free flow of capitals, what means focusing the dynamics of national economy on high remuneration of creditors. It is a mean and anti-social logic, since it withdraws colossal resources from the productive economy that are transferred to financial market monopolists, what can be done only by means of cutting social rights. In at least two occasions, forced by the conditions of such economic policy and submitting to the rules of IMF — which continues to monitor economic management — counting with the consent of a docile economic staff led by Minister of Finance Antônio Palocci, a former Trotskyist converted to neoliberal dogmas, the Lula administration made efforts to approve in the National Congress (both the House of Representatives and the Senate) anti-popular and anti-social measures, such as the conclusion of the social security reform initiated by the previous government and a minimum wage raise that was below expectations and the government's payment capacity, since in the occasion (second quarter, 2004) an unprecedented increase in governmental revenues and, as a consequence, in fiscal surplus was registered, much more than the amount the necessary according to agreements made with the IMF. Under the same pressures — and with the aid of union summits that are too far from the interests of workers — preparations are being hastened in order to promote "union" and "labor" reforms that ambiguously combine some of the democratizing and sanitizing measures regarding union life with the unacceptable attempt to make labor laws "flexible", an euphemism with which they intend to attack rights that were historically achieved by Brazilian workers. The economic policy put into practice in the first half of President Lula's mandate is incompatible with the needs for national development and for facing the most severe Brazilian social crisis. With such economic policy we will neither be able to overcome the country's structural crisis nor open the way to long-term sustained development. Pointing out a new path, following a different way that leads to a new model of national development that values labor and social justice is the great challenge of Lula's progressive and reforming government. In order to do that, besides reinforcing the unity of the democratic and progressive forces that constitute the government, the main challenge of the consequent left, including the Communist Party, is to promote the political and ideological struggle along with the popular movement's democratic and legitimate pressures, assuring solid convictions that change is possible and necessary, that there are alternatives to neoliberalism also in the economic field, even though by means of a gradual course. The assessment that can be made of the Lula administration in the moment must, therefore, avoid univocal approaches. We are living the initial moment of a transition that may take longer than we expected when we celebrated victory. There are visible difficulties, some of them are objective in their character, others are related to limited horizons and the social-democratic character of the party force leading the process and exerting hegemony in the governmental coalition. To the consequent left, namely to communists, the important thing is not to lose track, having the courage to take the necessary steps and trust that the circumstances we are experiencing now in Brazil will bring valuable positive results in the future of the struggle for the Brazilian people's national and social emancipation. * José Reinaldo Carvalho is Journalist, Vice President of the Communist Party of Brazil, person in charge of International Relations and director of Cebrapaz – Brazilian Center of Solidarity to the Peoples and Struggle for Peace.