INTRODUCTION

In January 1999, Fernando Henrique Cardoso became the first Brazilian president in history to pass the presidential sash to himself. He won a smashing first-round reelection victory in October 1998, defeating his nearest rival by over 20 percent, and the parties in his alliance also won sizeable majorities in both houses of Congress. By all rights, Cardoso's reelection ought to have rejuvenated his efforts to maintain Brazil's economic stabilization program (the Plano Real) and to pass extensive political reforms. On top of the prestige due from his relatively easy victory, soon after the election the IMF agreed to provide Brazil with U.S.$42 billion to give Cardoso extra political and economic breathing room to maneuver for reform. Superficially, President Cardoso appeared to possess significant political capital upon the start of his second term.

However, Cardoso experienced no “second honeymoon.” Quite the contrary; his second term began as a nightmare.