In Venezuela, Chavez pits poor against wealthy. Over the last four years financial markets celebrated the fact that Lula maintained the so called neo-liberal economic policy of Fernando Henrique Cardoso's government. Banks have achieved record gains and large corporations accrued significant profits.

For twenty years before achieving the presidency, as the strongest and most charismatic opposition leader, Lula repeated the same cliche: "I'm against everything over there." By this he meant everything both in the government and in its handling of the economy. Once in power, he changed his mind and kept the same fundamental economic policy.

That was a fortunate decision indeed. Brazil fought persistent hyperinflation for over two decades and finally succeeded in 1994 with the Real Plan, which Lula's party in Congress opposed. During the exchange rate crisis of the late 1990's, Brazil risked losing the stability it had recently achieved. In 2002, a confidence crisis triggered by Lula's electoral success increased the exchange rate, country risk figures and inflation rates.

Lula maintained the inflation target adopted in 1999. That returned low inflation rates after the 2002 crisis. However, real interest rates have been at record high levels ever since. Even among financial market analysts, Lula's monetary policy has been considered too tight. Consequently, the exchange rate has fallen precipitously. Since the beginning of his government, the value of the Real has increased by 62%.

The overvalued currency has significantly reduced food and tradable goods prices, improving purchasing power for the working poor. Additionally Lula has revamped all income-transfer public programs into a huge one called Bolsa Familia, similar to the Mexican "Oportunidades". Bolsa Familia has enjoyed strong support from the World Bank's specialists in poverty reduction.

Low food prices and greater income transfers through the Bolsa Familia motivated the Brazilian poor to vote for Lula mainly in the Northeast where 70% of the program beneficiaries live. However, the overvalued currency has hit small and medium farmers badly in the South, leading to less profits for tractor manufacturers and similar industries also located in the South.

This has caused an increase in layoffs all over the region. In addition, shoe manufacturers have suffered. The aggregate loss of profits and incomes has caused a recession. Indignant voters have collectively protested at the polls. The numbers say it all: Lula received a mere one third of the vote in the region, as opposed to the 70% he received in the North and Northeast.

Lula has also been behind his main opponent, former governor of the state of Sao Paulo, Geraldo Alckmin in the Midwest, which is the center of the Brazilian export agribusiness industry. This region has also suffered from currency overvaluation.

Brazil is indeed a divided country, but the Brazilian elections have not expressed a division between two antagonistic parts of the same country. Instead, it has exposed two faces of a same currency.