Next Regime Change: US Election Meddling Targets Brazil, Latin America | Dr. Mark Weisbrot

## Brazil: Lula, Bolsonaro and household debt The Brazilian election cycle has become a focal point for broader debates about democracy, economic sovereignty, and external pressure in the Western Hemisphere. At the center stands Luiz Inácio Lula da Silva—an incumbent whose popularity in earlier terms reached historic heights—and the Bolsonaro political legacy, now personified by Flávio Bolsonaro. The exchange examined in the conversation highlights how domestic economic policy, not merely personality politics, has reshaped voter attitudes and produced openings for resurgent right-wing forces. A crucial factor described by Dr. Mark Weisbrot is household debt under high policy interest rates. Brazil’s central bank has kept its short-term policy rate unusually high—13.75 percent at the time of the discussion—while inflation has come down to levels that would normally permit much lower rates. The result is a very high real cost of borrowing for ordinary families. Lower-income households, Weisbrot observed, effectively face double-digit or even near-quadruple-digit annual interest on consumer debt because of fees and market practices. Even when real wages have improved and poverty has fallen under Lula’s administration, debt-service burdens can erase perceived gains and push voters toward candidates promising relief or a different economic model. This dynamic explains, in part, why Lula’s once-immense lead has narrowed. Central bank independence—established during the Bolsonaro administration and widely celebrated in orthodox economic circles—has removed levers of accountability that might otherwise favor employment and wage stability over a tight-money anti-inflation orthodoxy. The political consequence is predictable: when people feel credit is punishing their households, nostalgia for more radical or populist alternatives intensifies, opening a path for Bolsonaro-style appeals. ## Trump’s pressure on Brazil and the courts The conversation also traced how external actors have attempted to influence Brazil’s political trajectory, turning domestic contests into arenas of geopolitical competition. Dr. Weisbrot flagged interventions by U.S. actors—statements, tariff moves, and public pressure—that amounted to more than diplomatic commentary. These were described as part of a broader effort to tilt the playing field against left-leaning incumbents and to fortify right-wing allies across the region. A parallel theme concerned the rule of law and whether judicial instruments were being weaponized. The discussants rejected a simplistic equivalency that paints all prosecutions as “lawfare.” In Bolsonaro’s case, the conversation noted, the charges involved apparent attempts to subvert democratic institutions, including efforts to involve the military in overturning election results—actions that, according to the exchange, cannot be readily dismissed as politically motivated prosecutions. Still, the broader problem of judicial overreach—used selectively to sideline political opponents—remains a worrisome pattern across multiple countries, with consequences for democratic legitimacy and public trust. Much of the danger derives from the coupling of legal interventions and foreign meddling. External actors that publicly back one side, or apply economic pressure during election cycles, make courts a secondary battleground. The result is an erosion of institutional neutrality: judges become figures who preside not only over law but also over politically consequential disputes amplified by foreign influence. ## Argentina, dollar debt and sanctions The exchange moved from Brazil to a regional pattern in which the U.S. dollar and international finance carve deep grooves into national policymaking. Argentina’s recent trajectory—electing an unapologetically free-market president who proposed radical measures such as dollarization—was presented as an object lesson in how external financial lifelines can sustain governments whose legitimacy might otherwise be tenuous. Dr. Weisbrot emphasized how critical foreign-currency-denominated debt is to this equation. When a large share of sovereign and private obligations is denominated in U.S. dollars, a country becomes vulnerable to exchange-rate shocks, capital flight, and sudden stops. That vulnerability invites international institutions and creditor states to intervene, whether through emergency lending packages or conditional programs that reshape domestic economic policy. In Argentina’s case, a rapid package—$42 billion in credits mobilized by foreign and multilateral actors—was described as decisive in stabilizing the government. From this vantage, U.S. leverage over financial flows is a tool of geopolitical influence: it can shore up friendly regimes and strangle adversaries. Sanctions, in particular, are a form of economic coercion with political intent. The conversation drew a stark contrast between countries that receive prompt international backstops and those that face punitive exclusion. Venezuela’s collapse—losing an estimated three-quarters of GDP during the period of tightened sanctions—was invoked as a dramatic demonstration of the power of financial strangulation. The implication is clear: U.S.-centric control of the dollar system gives Washington a capacity to reshape political outcomes across Latin America by affording or denying access to liquidity and markets. ## NGOs, USAID and humanitarian aid No discussion of external influence is complete without considering non-state actors and development agencies. The interview parsed the line between humanitarian assistance and political intervention, noting how organizations and aid flows can be co-opted or perceived as instruments of soft power. The conversation suggested that while humanitarian aid is essential and often life-saving, funding streams and programmatic priorities controlled by donor states—especially when they come with conditional or political strings—can undermine sovereignty. USAID and related actors occupy an ambiguous place: on the one hand, they provide infrastructure, health, and social services; on the other, they can support civil-society networks that align with donor-state foreign policy preferences. In fragile political climates, that duality means aid can become a vector of influence rather than a neutral public-good provider. Weisbrot’s remarks pushed listeners to distinguish genuine relief from strategic intervention. Where donors tie resources to political objectives, the consequence is not only compromised independence, but the potential delegitimization of NGOs and civic organizations in the eyes of local populations. That delegitimization is precisely what foreign policy actors who seek regime change would count on to justify larger interventions. ## IMF policies and Bolivia’s election crisis International financial institutions were a recurring focus—especially the IMF. The conversation critiqued conditionality and the way global lenders have sometimes amplified crises rather than resolving them. Bolivia’s recent turmoil over election disputes and political transitions was analyzed through this lens, with attention to how IMF-styled prescriptions can be mismatched to regional needs. Weisbrot and the interlocutor argued that austerity-conditioned lending creates social and political strain, frequently triggering instability that can then be exploited by domestic elites or foreign actors seeking regime change. The case of Bolivia was used to illustrate how narratives about corruption, governance failure, or electoral legitimacy are sometimes woven together with economic pressures to justify external interference. Rather than functioning as neutral crisis managers, multilateral institutions can become part of a chain of events that undermines democratic sovereignty when their interventions are accompanied by sharp fiscal adjustments or market-opening requirements. This critique extends to the broader architecture o

Next Regime Change: US Election Meddling Targets Brazil | Mark Weisbrot The US Regime-Change Industrial Complex is currently working in over-drive when it comes to consolidating Washington's power over the Western Hemisphere: The next country on the chopping block is Brazil and its only the latest in many regime change operations the USA has been conducting over the past 70 years in Latin America. Economist Mark Weisbrot joins me to discuss Brazil’s election and Washington’s influence across Latin America. He examines household debt, central bank policy, Argentina’s dependence on international lending, and the political power of dollar sanctions. Their conversation explores Venezuela, Bolivia, Haiti and Ecuador, contrasting economic sovereignty with external intervention. Weisbrot also distinguishes humanitarian aid from political interference, challenges prevailing accounts of Bolivia’s election crisis, and considers whether the region’s current rightward shift can deliver lasting improvements in ordinary people’s lives. Mark's Links: Center for Economic and Policy Research: https://cepr.net Mark Weisbrot’s research and articles: https://cepr. net/people/mark-weisbrot/ Article on Brazil’s election: https://cepr.net/publications/los-angeles-times- trump-and-rubio-fight-to-sway-brazils-election-and-control-the-hemisphere/ Neutrality Studies Links: Neutrality Studies Substack: https://pascallottaz.substack.com Support Neutrality Studies: https://neutralitystudies.com/donate Neutrality Studies shop: https://neutralitystudies.com/shop Time Stamps 00:00 Introducing Dr. Mark Weisbrot 03:11 Brazil: Lula, Bolsonaro and household debt 07:58 Trump’s pressure on Brazil and the courts 14:41 Argentina, dollar debt and sanctions 27:38 NGOs, USAID and humanitarian aid 33:44 IMF policies and Bolivia’s election crisis 47:00 Haiti, Ecuador and economic sovereignty 57:52 Brazil’s prospects and Latin America’s future #Pascal Welcome back, everybody, to Neutrality Studies. Today, for the first time, with Dr. Mark Weisbrot, a senior economist, co-founder and co-director of the Center for Economic and Policy Research in Washington, D.C., and a good friend of Jeffrey Sachs, who was so kind to introduce us to each other. Mark, welcome. #Mark Weisbrot Thanks, and thanks for inviting me. #Pascal It's great having you because you, as an economist, have been looking very closely also at the things that were happening at the moment in South America and Central America. And, you know, the whole idea for this talk was that Jeffrey said, look, there are very important things happening in -- 1 of 18 -- Brazil that are flying under the radar. And you've been researching those. Can you maybe fill us in on what you're seeing there at the moment? #Mark Weisbrot Yes. Well, the big thing right now in the present is the election in Brazil, which is just a week from today. Actually, the second round of an election between Lula da Silva of the Workers' Party, who was first elected from 2003 to 2010, and then came back for his third term, and he's the incumbent. And then you have Flávio Bolsonaro, and he's a senator right now in Brazil, but he's mostly gotten where he is as the son of the president that Lula defeated in the 2022 election. And in that election, he did kind of what Trump did. He refused to accept the result, and there were people that actually rioted a lot more than even here. And he was convicted. His father, Jair Bolsonaro, he was convicted of attempting a military coup because he tried to get the military involved as well. He couldn't get enough of the generals. And he was also convicted of attempting to destroy the rule of law in Brazil. And his son, who's running for president, is very close to him. He calls himself Bolsonaro 2.0. He kind of branded himself as a continuation, mostly, of that prior regime. And Lula, on the other hand, you know, he's got a whole story himself. I mean, he was, you know, in his first term, he left office as one of the most popular presidents in the whole world, with 83% approval. And he only didn't run because he was put in jail for 580 days for an alleged crime that was later annulled by the courts. And that's why he's in this situation facing the Bolsonaro family. #Pascal But according to the opinion polls that I've seen, or at least some of the reporting I have seen, actually it seems as if Bolsonaro has the better chance at winning next week, Sunday in a week, that is. What's the reason for that? It seems that Lula da Silva's approval ratings are not as high anymore as they used to be during his first term. #Mark Weisbrot Yeah, well, it's been a long haul, and I think... You know, it's true. In his first term, while he was in jail, he was still—the polls showed him with a 20-percentage-point lead if he were allowed to run for president from jail, and they wouldn't let him. So he was very popular. I think, you know, he did pretty well in his third term, too, in terms of reducing poverty by 27% and extreme poverty by 40%, and a large increase in the real wage. And so by all those measures, he did all right. I think the thing that hurt him was actually not his fault. It was—the Central Bank of Brazil has the short-term interest rate at 13.75%. And the inflation is about 4.2. That's, you know, that's one of the highest real interest rates—policy rates, we call them—in the world. And Brazil has had that for most of the last few decades. We did a -- 2 of 18 -- paper on that years ago. And so it's really terrible because the lower-income groups, well, especially, they're averaging about 100% interest on their household debt. So you can see how, even though their real wage has increased, their family household income has increased substantially, and Lula also, you know, has social programs that the Bolsonaros wouldn't have, they can still feel those debt payments, especially in the lower-income groups, are taking away from that. But that is actually, that's really Flávio Bolsonaro's fault, because he was the one who made, in his term right before Lula, he gave the central bank its complete independence from the executive branch, which a lot of the neoliberal economists especially—and it's almost standard for economists to see that as a good thing—but not all. I mean, a lot of us see that when you take away any accountability of a central bank, you're asking for trouble, because they're not going to look out for the employment or wages of the population. Although Lula did succeed still in bringing unemployment down to record levels from, I think it was, 9-point-something to 5.4%. But still, it hurts them. It's hurting them very badly, I said, the lower-income groups, through these huge interest rates and therefore debt payments. #Pascal So the answer to my question before is actually, it's the economy, stupid. So the economy is not running well. You still have too high inflation in Brazil. You have the—in that case, with that kind of rate from the central bank, you would also not have a lot of investment, I suppose, private investment into a lot of infrastructure projects and so on, because it's more profitable to keep money in the banks and have it there. #Mark Weisbrot No, the economy has done fairly well in terms of growth, in terms of real wage growth. They've done okay. It's really the debt service that is the big complaint, because it's just these huge interest rates and debt payments, and they're paying a fairly high—again, lower-income groups especially are paying a fairly high percentage of their income for debt service. #Pascal Hey, just a very quick note: the best way to support this channel is by signing up for my free Substack. You can also help with a paid subscription there, or you can get some of our new merch on neutralitystudies.com. Links below. See you there. Now, Donald Trump has, of course, also weighed into this election, and he wants very much Bolsonaro to win and Lula to lose. And, you know, there's a lot of talk in my part of the internet that if that happens, maybe the B of BRICS might actually be leaving the BRICS kind of, you know, framework. What are your assessments there? #Mark Weisbrot -- 3 of 18 -- Well, I don't think it... Oh, yeah, I mean, I can't see them in BRICS. Yeah, I mean, this guy's really right-wing. And, you know, that's something I think... It's a little bit scary, you know, the kind of horrible, mean things these people have said. Both Jair and... #Mark Weisbrot And Flávio. And, you know, he told a fellow congresswoman, Jair did, that he wouldn't rape her because she was too ugly. And he praised—they both have praised—the military dictatorship that was prior, you know, that ended in the late '80s. And Jair has said things like, you know, you won't get anywhere. Oh, he said the dictatorship, the mistake they made was they didn't kill enough people. And there's a whole, you know, pile of these kinds of comments. I think that's kind of important. I'm not doing it just, you know, to wage war against them or something. I think because you look at the, you know, they're a lot like Trump and his team in some of the things. I mean, Trump has made these—you've seen the statements from him about annihilating the population of Iran. He said that twice already and threatened that. And, you know, I think—and then you have Hegseth, who—and this is relevant to Latin America because he was just in Ecuador a few weeks ago—and he said to the president of Ecuador, "I'm really looking forward to coming there and helping you kill a lot of bad people." And helping in the killing, I should say, he said, of a lot of bad people. And he can barely talk about—you know, he calls himself the Secretary of War very deliberately—and he's always talking about lethal and lethality. And then, of course, they've blown up all those boats on the coast of South America. And by the way, Flávio supports that too. And he supports the war in Iran. And so that, you know, if you want to get into it, that's really why the election has been kind of turned into a kind of regime change operation, with all the things that Trump has done. You know, he weighed in to try and stop the trial of Jair Bolsonaro. Flávio lobbied him to put more restrictions on Brazil, and he did it. And so you have, you know, he had tariffs starting at 25, and then during the campaign season here, he's weighed in a few times with things that were pretty obviously deliberately designed to intervene in the justice system and also to harm the economy with the tariffs. And people actually reacted badly to that part. #Pascal Right. What is your assessment of the justice system in Brazil? Because one thing we see time and time again, actually even in the United States, is that when some political means fail, then what you retreat to is lawfare. And you do try to get the main opponents, strip them of their rights, put them in prison, and so on. I mean, it's what happened to Lula, right? And then it's what's happening to Bolsonaro. It's like, you know, the top heads of these parties and these movements then get indicted and whatnot. And we see that in other places. -- 4 of 18 -- We are seeing it in Romania, how lawfare is used in order to get rid of the most popular opposition candidate. Actually, it is something that happened to Donald Trump. And I still judge—I'm not a fan of Donald Trump at all—but the kind of lawfare that was used in order to try to convict him of a very, very weird felony of, like, accounting fraud, that still strikes me as something that, you know, is paramount to lawfare. And how independent are these Brazilian courts, in your opinion? Well, uh... #Mark Weisbrot I don't think there's really lawfare on both sides here. I mean, I agree with you. There were some cases. That case you mentioned, I think, was weak in the United States. And I do think that the law, you know, the courts have been abused, you know, in numerous cases before Trump even was elected. And so that happen