In Brazil's Ceara State, a Reversal of Fortune by Expanding the Role of Local Governments and Ending Patronage, Two Governors Have Turned an Impoverished Brazilian State into a Model. and Their Health-Care Reforms Have Won International Acclaim

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MOST residents of Maracanau - a rural municipality in the northern Brazilian state of Cear are illiterate and earn less than $80 a month, the official minimum wage. Favelas, or shantytowns, mottle reddish plains parched by a seven-year drought. Most of the sewage flows into open drains. Many people have no clean supply of drinking water.

There is little sign of activity, except in the garbage dumps, where those willing to brave the sun, dust, and stench scrounge with the vultures amid the smoldering refuse for saleable scraps.

But despite the impoverished appearance, this state was heralded as "an example to the world" for its successful health-care reforms by the United Nations International Childrens' Fund (UNICEF). The report has focused Brazil's attention on Ceara as a model of how political leadership can bring needed change. Political leadership

Cears current and previous governors, Ciro Gomes and Tasso Jereissati, have carried out sweeping reforms that have improved the quality of life here.

When Mr. Jereissati, a wealthy businessman, took office in 1987, the state was nearly bankrupt. Its institutions were used primarily as a means of handing out jobs for patronage, and the state's money was kept from the most needy.

But the new governor replaced the patronage system with merit exams and began dismissing nonperforming employees. Teachers were induced to improve their credentials with higher salaries. Those who refused to improve were fired. Unlike most of Brazil, nearly every child attends public school. The state's budget was put in order, and it paid its bills on time.

While Brazil's economic growth rate dropped to zero in 1992, Cears economic growth rate increased by more than 3 percent. It is still the country's third poorest state, but it exports four times more products per person than the rest of Brazil.

Jereissati gave up day to day control of state services to local governments. And under Mr. Gomes, who took office in 1991 and at 35 is Brazil's youngest governor, the program was accelerated.

"We are saying: `Give control to the local people and forget the ribbon cuttings,' " Gomes says. "I can't answer the concerns of 9 million people. They're better off knocking on the doors of their mayors. Many local politicians are corrupt, but we can't protect people from democracy. If they elect bad mayors, they need to know that they will pay for it with bad health care."

Gomes's approval rating is 67 percent and he is considered the most popular governor in Brazil, according to recent public opinion surveys.

Both are being touted as serious contenders for Brazil's presidency, but Gomes seems to be keeping his eye on problems at home. …