A Historic Election In Brazil

Facing an uncertain economic future, Brazilians stuck with the incumbent for the first time in their history Sunday and re-elected Fernando Henrique Cardoso as president, exit polls showed.

Cardoso won with 56 percent of the vote compared to 29 percent for his closest rival, former labor leader Luiz Inacio Lula da Silva of the Workers Party, surveys conducted by the respected Ibope polling institute said. Ibope questioned 54,000 voters nationwide.

The outcome was no surprise. Cardoso, a 67-year-old sociologist, was the overwhelming favorite in Sunday's national elections, getting a boost from voters' fear of a deepening economic crisis.

"The important thing is not to switch drivers in the middle of the race," said Marcio Karte, a Rio newsstand dealer who voted for Cardoso.

About 106 million voters went to the polls Sunday to choose a president, 27 governors, all 513 federal deputies, a third of the 81-seat Senate and 1,405 state legislators. Voting is mandatory for Brazilians between the ages of 18 and 70.

For weeks, the presidential race has been mostly a one-man show. Cardoso held steady even as Brazil lost the confidence of international investors, and despite his promises to cut spending and maybe raise taxes if elected.

"I voted for him even though he led the country into the crisis, because he's the only one who can get us out," said Rodrigo Jelmayer, a third-year law student in Sao Paulo.

Voting was mostly peaceful, although army troops were stationed in northern states with high Indian populations or a history of land conflicts. A ban on liquor sales was in effect in most of the country.

As usual, a ban on last-minute campaigning was widely ignored. In Rio, 23 people were arrested for handing out pamphlets.

Cardoso voted just before noon in Sao Paulo. He flashed a "v" for victory sign to photographers but declined to talk to reporters. Lula voted earlier in Sao Bernardo do Campo, an industrial suburb of Sao Paulo where he worked for years in an auto plant.

For the first time, more than half of Brazil's voters used electronic voting machines instead of paper ballots. The electronic votes were to be tallied within 24 hours, but the rest weren't to be counted until Friday, electoral officials said.

The big concern for Brazilians is what will happen after the election.

Cardoso has pledged strong measures to control a ballooning budget deficit of more than $60 billion. Many economists predict a recession in 1999 and even worse unemployment, which unions now estimate at 18 percent of the work force.

Finance Minister Pedro Malan is heading negotiations for an emergency loan package reportedly worth $30 billion with the International Monetary Fund and other public and private lenders.

Cardoso's success may hinge on the strength and cooperation of his inconstant five-party coalition in Congress. Legislators are to vote on long-delayed rforms to cut spending and raise revenue.

Meanwhile, voters hope he can revive the magic of the economic program that propelled him to the presidency in 1994 and eliminated 2,400 percent inflation.

Written by Peter Muello