Created: 6/15/1962

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oci S2

Current Intelligence Weekly Summary






conftdonee in the Goulart roe line, which rose steadily during the early months of this year, ham again fallen off. One Important factor Is the expectationew cabinet. Congressional and gubernatorial elections are scheduledctober, and ministers who run must remlgn their cabinet postsuly. Prime Minister Tancredo Mevea. abo la among those doing so, has tended to support President Goulart rather than compete with blm, but Neves' successor may seek to utilize more fully tbe powers his office was given by tbe constitutional amendment ofhrough which Brazilar1lanentarv form of government.

Uncertainty Is heightened by Goulart's precarious health. Bis illness when he visited

Mexico Citypril wasaslight hearteportedly hla fifth. Political leaders have shown Increasing apprehension recently, baving apparently learned that Goulart la refualng to follow Insistent medical advice that heday leave of absence.

In the Sao Pauloraee, former President Janlo Quadroe has Improved his standing and sow may be running abreast of ex-Governor Adhemar de Barrosess widely known protege of the Incumbent governor. In the keystate of Pernaabuco, pro-Cbmmunlst Miguel Arraes appears to be tbe earlyas his opposition tries to agreettractive Goulart's brother-in-law

Leonel Brizola, govornor of Rio Grande do Sul, has lost popularity in hla borne state, but onay he opened afor deputy from the state ofthe city of Rio dea speech violently attacking the United States, Sorth Americans, and the Alliance for Progress.

Both Arraes and Brizola may face legal Impediments to the ir candidacies,onstitutionalbarring from tbeand congressional races persona closely related to an incumbent state or federal chief executive. Arraes Is the brotber-ln-law of Governor Sampalo of Pernambuco, although Arraes1 wlfo now In dead, and Brlzola's wife Is President Goulart's sister.

Tbcro also are Indications of instability In the economy. Therehortage of prime staples--beans andmost major cities except in the three southernmost states, and this shortage lm accentuated by hoarding. In the north and nortbeaat, there have been floods In some areas, while drought prevails elsewhere. The foreign exchange rate has fallen aboutercent since early May.

Spreading rural unrest was indicated by the killing of eight peoplelash between rural workers and police In late May tnreviously peaco-ful northeastern state. |

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