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Edition: U.S. Article Comments (0) Email Print Reprints Read Japan intervenes to weaken yen for 1st time in 6 years 2:48am EDT Tea Party win hurts Republicans' Senate chances 3:07am EDT Popularity can come at a price: getting flu first 14 Sep 2010 FOREX-Dollar soars, yen drops as Japan intervenes 1:04am EDT Oprah trip "Down Under" surprises Australians - with a bill | Video 14 Sep 2010 Shared Walking helps keep body and brain young 13 Sep 2010 Lady Gaga's meat dress 13 Sep 2010 B vitamins found to slow progression of dementia 09 Sep 2010 More sellers cut U.S. home prices for 3rd month 12:13am EDT Twitter remakes website, adds new features 14 Sep 2010 Watched Gaga crowned; Oprah's big trip Mon, Sep 13 2010 JLo on "Idol" Tue, Sep 14 2010 Melting glaciers expose artifacts Tue, Sep 14 2010 NYSE and AMEX quotes delayed by at least 20 minutes. NASDAQ delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here. Scandals dominate Brazil campaign as vote nears Tweet This Share on LinkedIn Share on Facebook Related News Brazil's Rousseff takes heat in televised debate Sun, Sep 12 2010 UPDATE 2-Brazil's Rousseff takes heat in televised debate Sun, Sep 12 2010 UPDATE 1-Brazil graft scandal heats up election campaign Sun, Sep 12 2010 Brazil graft scandal heating election campaign Sun, Sep 12 2010 UPDATE 1-Brazilian candidate Rousseff keeps wide lead-poll Fri, Sep 10 2010 Analysis & Opinion ANALYSIS-Brazil may be outgunned in fight to weaken currency Related Topics World » Brazil » By Stuart Grudgings RIO DE JANEIRO | Tue Sep 14, 2010 6:06pm EDT RIO DE JANEIRO (Reuters) - The tone of Brazil's presidential race has lurched lower and is likely to stay there as scandal accusations and increasingly bitter exchanges between the two main candidates drown out policy debate. Trailing badly in the polls, opposition contender Jose Serra has honed in on ethics charges against front-runner Dilma Rousseff and her political party as his best bet of avoiding a humiliating knockout in the first round of voting on October 3. Those allegations are dominating media coverage and took up most of a televised debate on Sunday night as Rousseff denied wrongdoing and accused Serra, who appears to be on the last legs of a long political career, of desperate tactics. "He wants to win this campaign dirtily because he is unable to convince the Brazilian people," a confident Rousseff said in the debate. Apparently coasting to victory on the coattails of massively popular President Luiz Inacio Lula da Silva, Rousseff is unlikely to be derailed by the scandals unless a "smoking gun" emerges linking her directly to any wrongdoing. Former Sao Paulo state governor Serra accuses Rousseff and her leftist Workers' Party of having illegally accessed tax records of his daughter and opposition members in search of potentially damaging information. A new scandal erupted last weekend when news magazine Veja published accusations a former Rousseff aide who is now Lula's chief of staff, Erenice Guerra, was involved in a kickback scheme for public works contracts run by her son's consulting firm. The so-called tax scandal has been rumbling on for weeks as evidence of new violations emerge in the media but has yet to resonate with voters. A new poll released on Tuesday showed Rousseff widening her lead, putting her on course to win with a crushing 58 percent of votes in the first round on October 3. MEDIA DELUGE "We're going to get a deluge of media coverage on this ... it does increase the odds that it goes to a second round but I still think she'll get a first-round victory," said Christopher Garman, a political analyst at Eurasia Group in Washington. A key reason why the mudslinging over tax records is not having an impact on polls may be that only about 15 percent of Brazilians pay income tax and therefore have little understanding of the scandal, he said. Residents in the interior of northeastern Pernambuco state were mostly clueless about the issue when questioned by a reporter from O Globo newspaper, as quoted in a story on Sunday. "I don't know what a tax privacy code is, but I'm following it on TV," said Edmilson Felix da Silva, a 50-year-old plowman. "For me, this is just being done to hurt Dilma." Still, the government moved to address the issue on Tuesday, saying it was tightening controls over tax office employees' access to private financial data. Every access to personal tax data would have to be justified and people would have the option in their tax statements of protecting their information, Finance Minister Guido Mantega told a news conference in Brasilia. Mudslinging is likely to dominate the rest of the campaign as the media digs up new details on the allegations and Serra struggles to make headway with policy arguments in the face of Lula's popularity and a briskly growing economy. Last week Serra made a new pledge to raise the national minimum wage to 600 reais ($350) a month, compared to the 538 reais planned by the current government, in what some analysts saw as a sign of desperation. Even a slight increase in the minimum wage could strain Brazil's public finances, as pension payments are readjusted every time there is an increase. Serra's hope is that the whiff of scandal will give him enough of a bounce in the polls to take the election to a runoff on October 31. A similar scandal involving Workers' Party officials trying to buy information about the opposition was seen as one factor preventing Lula from winning in the first round in the 2006 election. "This is a subject that is important for democracy, because if they do this in the campaign, imagine them tomorrow," Serra said during the debate. (Editing by Todd Benson and Jerry Norton) World Brazil Add a Comment *We welcome comments that advance the story directly or with relevant tangential information. We try to block comments that use offensive language or appear to be spam and review comments frequently to ensure they meet our standards. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. © Copyright 2010 Thomson Reuters Editorial Editions: Africa Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom United States Reuters Contact Us Advertise With Us Help Journalism Handbook Archive Site Index Video Index Reader Feedback Mobile Newsletters RSS Podcasts Widgets Your View Analyst Research Thomson Reuters Copyright Disclaimer Privacy Professional Products Professional Products Support Financial Products About Thomson Reuters Careers Online Products Acquisitions Monthly Buyouts Venture Capital Journal International Financing Review Project Finance International PEhub.com PE Week FindLaw Reuters on Facebook Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests. NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.

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