Franco's Presidency, 1992-94
Franco's Presidency, 1992-94
Senator Itamar Franco (Liberal Party-Minas Gerais) had been chosen
running mate for three reasons: Minas
Gerais had the second largest electorate; Franco had led the
impeachment CPI against Sarney's
alleged corruption; and Franco was the ideal anti-impeachment "insurance"
because of his idiosyncratic nature. During the 1989 campaign, Franco
had threatened to resign several times and later voiced outspoken
opposition to some Collor policies, especially concerning privatization.
As president, Franco immediately installed a politically balanced
cabinet and sought broad support in Congress.
Franco's presidential style was the opposite to that of Collor.
A man of more simple habits and tastes, Franco refused the imperial,
ceremonious presidential role. However, he proved to be quite temperamental,
and many of his appointments were ill-conceived and short-lived.
His most serious difficulty was defining an optimum economic strategy
and selecting a minister of finance. He slowed Collor's privatization
program to a near standstill and reverted to a developmentalist,
nationalist model that was based on a national plan to guide the
country through a series of stages of development, eventually culminating
in modernization. After successively appointing two politicians
and an academic economist to head the Ministry of Finance, Franco
moved Senator Fernando
Henrique Cardoso (PSDB-São
Paulo) from the Ministry of Foreign Affairs to Finance in May
In October 1993, Congress installed a CPI to investigate its own
members involved in a far-reaching scandal within the joint budget
committee. The scandal had begun during the Sarney period and extended
into Franco's government. In addition to investigating possible
involvement of some fifty members of Congress and identifying the
"corruptors" in the private sector, the investigations
unmasked a conspiracy ring within the executive branch that involved
several middle-level bureaucrats. Distraught by the scandal reaching
the executive branch, President Franco contemplated resigning. However,
cooler heads persuaded him not to, and instead the president appointed
several distinguished citizens to a Special Investigating Commission
(Comissão Especial de Investigação--CEI) headed
by the SAF (Federal Administration Secretariat) chief. Some of those
involved in corruption were fired. Franco also appointed several
military officers to civilian positions in the Ministry of Transport,
Federal Police, and Office of the Federal Budget Director, which
had difficult problems.
With Cardoso's PSDB (Brazilian Social Democracy Party) team installed
at Finance, the Franco government became less erratic, and the kitchen
cabinet's influence somewhat diminished. However, inflation had
increased from 25 percent to 45 percent by April 1994, when Cardoso
resigned to run for president, a month after his new stabilization
plan went into effect.
The economic stabilization plan took into account all the errors
of the Cruzado Plan of 1986, and both Cardoso and his team were
aware of its potential effect on the 1994 elections. Because of
the great success of the Real Plan, President Franco's approval
rating soared to nearly 80 percent at the end of his term. The Franco-Cardoso
transition was the most tranquil in Brazilian political history.
Data as of April 1997