He became president and was able to get enough support in congress. Political support for Fernando Henrique Cardoso is completely tied to the real, so if the real devalues, then political support for him and his government will devalue also, and may even collapse. That is why I think the situation right now in Brazil is critically important not only for Brazil, but for all of Latin America. Unfortunately, he is not helping generate a new leadership in Argentina, so it is very uncertain what kind of leadership we will have in Argentina in the next four years. With no clear prospects of efficient leadership in Argentina, it is critically important to have a leader like Fernando Henrique Cardoso in Brazil to provide leadership for Brazil and the region.
Brazil needs to prevent reintroduction of inflation and indexation into the Brazilian economy.
It is critical that Brazil in the next few months stabilize the real at a price lower than 1.7 reals per dollar. If Brazil stabilizes the real at a higher price, inflation will build within the Brazilian economy. Once inflation is introduced into the Brazilian economy, the popularity of President Fernando Henrique Cardoso will disappear, and he still has four years ahead as leader of Brazil. He needs support in congress to approve many more laws than those that have been approved so far. The last package just increased taxes, some of them very distorted taxes.