This record is a partial extract of the original cable. The full text of the original cable is not available.

C O N F I D E N T I A L SECTION 01 OF 04 BRASILIA 000181 
 
SIPDIS 
 
DEPT FOR WHA/BSC AND EB:ALEWIS/JCOOPER 
 
E.O. 12958: DECL: 01/23/2014 
TAGS: PGOV PREL ECON ECPS SOCI BR
SUBJECT: LULA FINALLY MAKES HIS BIG CABINET SHUFFLE 
 
REF: A. 02 BRASILIA 3516 
     ¶B. 02 BRASILIA 3447 
 
Classified By: POLOFF RICHARD REITER FOR REASONS 1.5 B AND D. 
 
¶1. (SBU)  SUMMARY.  Thirteen months into his term, Brazilian 
President Lula da Silva on January 23 announced his 
long-awaited first cabinet shuffle.  The changes affect 
twelve of 35 cabinet posts and address all three of Lula's 
goals:  bringing the PMDB party officially into the governing 
coalition, replacing weak performers and streamlining the 
social assistance portfolios, and improving the workflow in 
the Presidency.  Key changes include bringing the coalition's 
floor leader in the Chamber of Deputies, Aldo Rebelo, into 
Lula's office as the newly-created Minister of Political 
Coordination --taking some weight off Chief-of-Staff Jose 
Dirceu; and creating a new unified Social Development 
Ministry headed by Federal Deputy Patrus Ananias (meaning 
Zero Hunger chief Jose Graziano and Social Assistance 
Minister Benedita da Silva will lose their jobs).  The PMDB 
will get two ministries as it has long demanded --settling on 
Social Security and Communications.  This shakeup should 
smooth the administration's ability to pass legislation and 
carry out the social assistance programs expected to be at 
the heart of the coming year's political agenda.  (Full 
cabinet list is at paras 8-9.)  END SUMMARY. 
 
PMDB GETS COMMUNICATIONS AND SOCIAL SECURITY 
-------------------------------------------- 
¶2. (SBU) The wait is over (ref A).  President Lula announced 
his cabinet shuffle on January 23, thirteen months into his 
administration --the longest any modern Brazilian 
administration has gone without cabinet changes.  The first 
goal was to cement the large centrist PMDB party in the 
governing coalition.  The PMDB has been an ally of Lula's 
Workers' Party (PT) since May, and it has clamored for 
cabinet slots to reflect its size (78 Deputies and 23 
Senators).  Weeks of painfully public negotiations yielded up 
two ministries.  PMDB Federal Deputy Eunicio Oliveira from 
Ceara will take over the Communications Ministry, while 
Senator Amir Lando of Rondonia will become Minister of Social 
Security.  Social Security is a big-budget portfolio, but 
with most of the money earmarked there is little room for 
creativity --no doubt what Lula had in mind.  The heavy 
lifting on passing pension reforms has already been done, so 
Lando's role will be to implement the changes.  In addition, 
the PMDB will also get to name the head of the Postal 
Service. 
 
SOCIAL PORTFOLIOS STREAMLINED 
----------------------------- 
¶3. (C) The second goal was to weed out underperformers and 
streamline the social portfolios.  After spending 2003 
focused on fiscal austerity and reforms, Lula is now expected 
to turn his attention to education, employment, and poverty 
alleviation.  To that end, longtime Lula friends Jose 
Graziano (Minister of Food Security and head of the "Zero 
Hunger" program) and Benedita da Silva (Minister of Social 
Assistance) --both of whom have been criticized for weak 
performances and assorted gaffes-- will lose their jobs. 
Federal Deputy Patrus Ananias, a PT stalwart and former mayor 
of Belo Horizonte (Brazil's third largest city) will head the 
new Ministry of Social Development that will merge the 
portfolios of Benedita and Graziano as well as programs 
consolidated under the Presidency in October (ref B).  A PT 
Deputy commented approvingly to us that Ananias is 
well-respected, low key, and has executive experience.  The 
Deputy also noted that Lula feels personally committed to 
both Graziano and Benedita, and that Graziano is mulling an 
offer to remain as an "advisor" while Benedita, a PT icon, 
may go back and run for the Rio city council in October's 
elections. 
 
ALDO REBELO MOVES TO THE EXECUTIVE BRANCH 
----------------------------------------- 
¶4. (C) Federal Deputy Aldo Rebelo (PCdoB-Sao Paulo) will move 
into Lula's office, relieving Chief-of-Staff Jose Dirceu of 
some of his duties.  Rebelo will get cabinet rank as 
"Secretary of Political Coordination and Institutional 
Affairs", with responsibility to coordinate the 
administration's projects with Congress, governors, mayors, 
and the judiciary.  The overworked Dirceu is unlikely to lose 
real authority, though he will be freed to focus on internal 
administration affairs.  Rebelo, a leading moderate in the 
Communist Party of Brazil in his fourth Congressional term, 
is widely-praised for his consensus-building over the past 
year as the coalition's floor leader.  The leading candidate 
to take over that post is Miro Texeira, who was forced out as 
Minister of Communications because his PDT party pulled out 
of Lula's coalition last month.  Texeira will take up the 
Chamber seat (from Rio de Janeiro) to which he was elected in 
¶2002.  Texeira has now left the PDT to sign on with the PT, 
and in his January 23 announcement, Lula endorsed him for 
coalition floor leader. 
 
DOMINOS FALL AT LABOR, CDES, EDUCATION, AND SCIENCE 
--------------------------------------------- ------ 
¶5. (SBU) The fact of PMDB Senator Amir Lando's replacing 
Ricardo Berzoini at Social Security created a domino effect, 
as Lula was intent on keeping Berzoini in the cabinet.  As a 
result, Berzoini will replace Jaques Wagner as Minister of 
Labor, Wagner will replace Tarso Genro as head of the Council 
for Economic and Social Development (a public-private talk 
shop attached to the Presidency), and Tarso Genro moves to 
the Ministry of Education, replacing Cristovam Buarque, one 
of the "academics" who lost Lula's confidence. (Lula was 
quoted saying he wants fewer "academics writing theses" and 
more concrete results in the coming year.) 
 
¶6. (C) Another unhappy minister will be replaced at Science 
and Technology, as Federal Deputy Eduardo Campos replaces 
Roberto Amaral.  In addition to his weak performance and 
verbal gaffes, Amaral was linked to a faction of the PSB 
party that recently lost an internal power struggle.  Campos, 
38, grandson of the party's founder, legendary leftist Miguel 
Arraes, was on the winning side and so gets the party's 
cabinet post.  (One unimpressed PT politician told us Campos 
is a "professional grandson" who has accomplished little in 
his nine years in Congress.)  Finally, Nilceia Freire, Rector 
of the State University of Rio de Janeiro and best-known for 
introducing minority admissions quotas there, takes over from 
Emilia Fernandes as Secretary for Women's Affairs, the 
smallest-budget post in the cabinet. 
 
COMMENT 
------- 
¶7. (C)  There is palpable relief that the shuffle is done. 
The process has been grindingly slow and emotionally taxing 
for Lula, who felt great anguish at having to give longtime 
colleagues the axe.  Over the past five months, the constant 
begging from the PMDB and the unhappy existences of lame-duck 
Ministers had become major distractions.  In the end, Lula 
addressed his obvious needs, and (aside from the odd 
four-ministry domino effect designed to keep Ricardo Berzoini 
in the cabinet) much of the public speculation was borne out. 
 Lula keeps intact his well-regarded economic team as well as 
his closest group of advisers (the so-called "hard core" of 
Dirceu, Gushiken, Dulci, and Palocci).  With three leading 
Deputies and a Senator moving from Congress to the cabinet, 
there will also be repercussions in the congressional and 
party leaderships.  Overall, the cabinet shakeup is 
promising.  Satisfying the PMDB (and bringing Aldo Rebelo 
onto Lula's staff) should ease the government's ability to 
pass legislation, while unifying the social affairs 
portfolios recognizes the need for a single point of contact 
as Lula turns his attention to the country's poor and 
unemployed. 
 
 
LULA'S NEW CABINET 
------------------ 
¶8. (SBU) The twelve Minister-rank officials attached to the 
presidential Planalto Palace, with party affiliation and 
state of origin.  "p" signifies a non-party professional 
appointment. 
 
Planalto Ministers affected by the shuffle: 
- Minister-Chief of the Civilian Household (Chief of Staff), 
Jose Dirceu (PT-Sao Paulo).  Will off-load some duties to 
Aldo Rebelo. 
- Secretary of Political Coordination and Institutional 
Affairs, Aldo Rebelo (PCdoB-Sao Paulo). Newly-created 
portfolio to coordinate administration policies with 
Congress, governors, mayors, and the judiciary. 
 
- Secretary for Economic and Social Development, Jaques 
Wagner (PT-Bahia), the outgoing Labor Minister, replaces 
Tarso Genro, who moves to Education. 
 
- Secretary for Women's Affairs, Nilceia Freire (PT-Rio) 
replaces Emilia Fernandes. 
 
Planalto Ministers unaffected by the shuffle: 
- Secretary General, Luiz Dulci (PT-Minas Gerais) 
- Communications Secretary, Luiz Gushiken (PT-Sao Paulo) 
- Institutional Security, Gen. Jorge Armando Felix (p-Rio) 
- Inspector General, Waldir Pires (PT-Bahia) 
- Secretary for Fishing, Jose Fritsch (PT-Santa Catarina) 
- Secretary for Human Rights, Nilmario Miranda (PT-Minas 
Gerais) 
- Secretary for Racial Equality, Matilde Ribeiro (PT-Sao 
Paulo) 
- Solicitor General, Alvaro Ribeiro Costa (p-Ceara) 
 
Extraordinary Secretary for Food Security, Jose Graziano 
(PT-Sao Paulo) will lose his job.  His office will be folded 
into the new line Ministry of Social Development. 
 
LINE MINISTRIES: 
---------------- 
¶9. (SBU) Of the 23 line ministries, six will get new 
ministers: 
 
- Minister of Communications, Eunicio Oliveira (PMDB-Ceara) 
replaces Miro Teixeira, who goes to the Federal Chamber of 
Deputies. 
 
- Minister of Education, Tarso Genro (PT-Rio Grande do Sul) 
replaces Cristovam Buarque, who goes to the Senate. 
 
- Minister of Labor, Ricardo Berzoini (PT-Rio Grande do Sul), 
replaces Jaques Wagner who becomes Secretary for Economic and 
Social Development in the Planalto. 
 
- Minister of Science and Technology, Eduardo Campos 
(PSB-Pernambuco) replaces Roberto Amaral. 
 
- Minister of Social Development, Patrus Ananias (PT-Minas 
Gerais).  Newly-created portfolio will merge several existing 
social programs, including those run by outgoing Ministers 
Jose Graziano and Benedita da Silva. 
 
- Minister of Social Security, Amir Lando (PMDB-Rondonia) 
replace Ricardo Berzoini, who moves to Labor. 
 
 
Seventeen of 23 line ministers will remain in place: 
- Minister of Agrarian Development, Miguel Rossetto (PT-Rio 
Grande do Sul) 
- Minister of Agriculture, Roberto Rodrigues (PP-Sao Paulo) 
- Minister of Cities, Olivio Dutra (PT-Rio Grande do Sul) 
- Minister of Culture, Gilberto Gil (PV-Bahia) 
- Minister of Defense, Jose Viegas (p-Mato Grosso do Sul) 
- Minister of Development, Industry and Trade, Luis Furlan 
(p-Sao Paulo) 
- Minister of Environment, Marina Silva (PT-Acre) 
- Minister of Finance, Antonio Palocci (PT-Sao Paulo) 
- Minister of Foreign Affairs, Celso Amorim (p-Sao Paulo) 
- Minister of Health, Humberto Costa (PT-Pernambuco) 
- Minister of Justice, Marcio Thomaz Bastos (PT-Sao Paulo). 
- Minister of Mines and Energy, Dilma Rousseff (PT-Rio Grande 
do Sul 
- Minister of National Integration, Ciro Gomes (PPS-Ceara) 
- Minister of Planning, Guido Mantega (PT-Sao Paulo) 
- Minister of Sports, Agnelo Queiroz (PCdoB-Brasilia) 
- Minister of Tourism, Walfrido Mares Guia (PTB-Minas Gerais) 
 
- Minister of Transportation Anderson Adauto (PL-Minas 
Gerais).  Adauto is a poor performer dogged by old 
allegations of corruption.  He may resign in April to run for 
mayor of his hometown in the October elections. 
HRINAK