Lula’s Party Unveils Plan to Reverse Central Bank Independence and Reform the Military

The Rio Times, the Latin American financial news outlet, reports that the PT congress program to be debated this week represents the most ambitious institutional reform agenda the party has presented since Lula’s first term in 2003. The document — leaked by Poder360 on Saturday — is not a campaign manifesto aimed at voters but an internal ideological framework that will shape the government plan Lula takes to the October 2026 ballot.

The program was coordinated by José Dirceu, Lula‘s former chief of staff who was convicted in the mensalão corruption scandal, served prison time, and has since returned as PT’s most influential strategic thinker. Dirceu published a contribution letter emphasizing structural reforms of the state, the judiciary, and the armed forces — proposals that the party document now incorporates.

The Economic Pillar: Single-Digit Selic and Central Bank Control

The economic agenda revolves around a single demand: interest rates below 10%. With the Selic currently at 15% and market consensus projecting 12.50% by year-end, the gap between PT’s target and monetary reality is enormous. The party has already introduced PLP 65/2026 in Congress, which would reverse the Central Bank autonomy law signed by Bolsonaro in 2021 by reattaching the BCB to the Finance Ministry and aligning the BCB president’s term with the presidential mandate.

The PT resolution approved in February 2026 was more blunt, accusing the BCB of acting “against the project elected at the ballot box” and describing mandatory congressional earmarks as a “permanent system of political blackmail against the Executive.” The platform proposes eliminating impositivas (mandatory earmarks) entirely — a direct challenge to the congressional power structure that controls R$37.8 billion in the current budget.

The Institutional Pillar: Military and Judicial Reform

Dirceu was explicit at a Brasília forum on April 9: “The first problem is the Armed Forces. We did not manage to reform them in our previous governments.” He proposed two specific changes — reforming military academy curricula, which he argued reproduce a conservative, interventionist mentality, and amending Article 142 of the Constitution, whose current wording allows ambiguous interpretations about the military’s right to intervene in political crises.

On the judiciary, the platform proposes a code of conduct for the Supreme Court — a response to public anger over judicial perks like the childcare and birth allowances the CNJ approved in recent months, which Dirceu called a “deep reform” that is now “more than public” in its necessity. The party also proposes proportional-list voting with gender parity and racial quotas, a national participatory budget, and expanded mechanisms of direct democracy.

What the PT Congress Program Means for Markets and Elections

For investors tracking Brazil’s October 2026 election, the PT program sends a clear signal: a fourth Lula term would be structurally more interventionist than the third. The combination of Central Bank recapture, mandatory earmark elimination, military reform, and judicial restructuring represents a governance overhaul that would reshape the relationship between executive power and every other institution in the Brazilian state.

The proposals may be moderated during the congress or diluted in the actual campaign plan — PT’s internal programs have historically been more radical than their governing reality. But the Dirceu imprimatur and the party’s simultaneous legislative moves on Central Bank autonomy suggest this is not aspirational rhetoric — it is an operational agenda with legislation already in the pipeline.