Out With the Old in Mexico and Brazil : Reform: Latin America’s largest nations seem serious about cutting ties with the past.

The most important news in the Americas this month is not from the Miami summit but in Latin America itself. Historic changes are occurring, especially in Brazil and Mexico, the region’s largest nations.

From both countries there is evidence that steps will finally be taken to address key problems that have worsened in recent years: social and equity issues and problems of governance, justice and accountability. For while Latin American economies have moved from authoritarian rule toward democratic politics, they have also been plagued by rampant corruption, violence, manipulation and disenchantment with democratic institutions. And although Latin America’s major economies have stabilized and begun to grow, most have also become even more unjust, with poverty deepening while the wealthy get richer on the basis of free-market reforms.

Perhaps the most exciting breakthrough is occurring in Brazil, a country with a population and an economy as large as Russia’s. After 10 years of disastrous political false starts and hyper-inflation, Brazil has in the past six months reduced inflation to less than 3% a month and held exemplary national elections in which some 98 million Brazilians participated. The successful architect of the anti-inflation plan, Fernando Henrique Cardoso, won a decisive mandate by capturing 54% of the vote in an eight-candidate race.

Cardoso, a sociologist whose writings are known by every student of Latin American affairs, was exiled by Brazil’s military regime in the 1960s and entered political life in the first legislative elections allowed by the military in 1978. Since then, he has served with distinction in both houses of the legislature and as foreign and finance minister.

With demonstrated talent at coalition building, Cardoso promises to focus first on consolidating the victory over inflation by assuring fiscal balance, reforming the social security system, and privatizing public enterprises; to promote political reforms to make government more accountable and effective; and to increase strategic investments in education, infrastructure and social services. For the first time since the military coup of 1964, Brazil seems poised to realize its enormous potential.

A similar sense of historic opportunity can be felt in Mexico, where President Ernesto Zedillo stunned the country with the content and tone of his strong inaugural address. Abandoning the usual technocratic recitation of economic indicators, Zedillo spoke forcefully on the issues that thoughtful Mexicans are most concerned about: achieving the rule of law and equal justice, fighting corruption and curbing political violence.

While signaling continuity of the Salinas regime’s economic policies by naming members of the outgoing government to new posts, Zedillo broke with the governing party’s political approach by naming an opposition party leader to the sensitive post of attorney general. Zedillo promised sweeping electoral reforms to separate the ruling party from government authority and also made tough statements on corruption, abuse of authority and accountability. Whether he can deliver on his bold promises remains to be seen, but he has staked his administration’s reputation on political reform.