billions from around the globe await the World Cup in advent, the social and
political situation is sure to grow more polemic for the Brazilian people.
Untold amounts of money will change hands; untold numbers of unassuming
foreigners will trickle into and saturate Brazil. But who will benefit from the economic boom wrought by this year’s
one of two realities will emerge. Either people from around the world will
witness the curious amount of civil unrest that couples the looming soccer
celebration, scratching their heads about the mix, or, by peering into the
history that will undoubtedly drive the tumult between the moneyed class and
its ill-begotten in-house alienation, the global community’s response will be
one of support and solidarity for Brazil’s alienated and oppressed.
the case may be, in a time when jingoists, pundits and bloggers are wont to
signal Brazilian unrest and to mock it, or to rebrand it as something other
than what it is, the global response must seek the promotion of social justice.
To support the marginalized and disenfranchised, who are sure to receive the
brunt of labor without just compensation (thanks to centuries of pillage and
warped policy in Brazil), it is all the more important for the global community
to revisit some important elements of Brazilian history, old and new. Armed
with such information, this World Cup need not only focus on futebol; it can help bolster the popular
social justice movements in Brazil that surface.
1950s, many rich-world economic Nazis treated Brazil (and South America) as a
cadaver for its students of developmentalism to dissect. But despite the
already centuries-long list of foreign malpractice and its newer, 20th
Century woes, Brazil attempted to plot its own course for economic progress in
the early 1960s. The idea behind Brazil’s more autonomous plans was that Latin
America, as a bloc, could realize powerful trade. The dream was perhaps to
rival the maturing economies of Europe and North America. Brazil even had the
president for the job: João Belchior Marques Goulart, an economic nationalist largely
dedicated to land redistribution. Brazil seemed poised for change.
those first few years of the 60s, Brazilians dared to dream of greater
purchasing power on a personal level; they dared to imagine higher wages.
Goulart seemed to take all the necessary steps in the direction his nation
wanted to go. He planned on foreign multinational firms reinvesting profits in
Brazil, rather than simply allowing them to rob the country of the wealth it
produced—something foreign interest had done for centuries.
course, the wallets of many foreign firms were about to get noticeably lighter.
Naturally, the United States intervened indirectly. A US-backed junta led by
General Humberto Castello Branco usurped Brazilian sovereignty, essentially leaving
the people sans democratic control of their country. Fascism once again
intruded; the US and the General’s intentions of robbing the Brazilian people
of their democracy was meant to bludgeon their right to co-operate the economy
for Brazil’s benefit, not that of
foreign multinationals and the other usual suspects.
mid 1960s, this undemocratic and illegitimate regime decided to reverse
Goulart’s democratic and socially just programs. The end goal was to once again
subjugate Brazil and prostitute all its resources to foreign interest. Thus, it
set the precedent for future degradation of Brazil’s ecology, echoing empire’s
age old reminder to Brazil that it should kneel before profit.
enjoyed some freedoms under the puppet regime for a time. Democratically, they
employed what rights they had to vocalize their ire at the increasing poverty.
They blamed the pro-profit, pro-business programs designed by America’s
economic henchmen. When the students marched, the regime likely intuited its
pending doom. It then began systematically torturing Brazilians, but first, it
took away their freedoms entirely. The economy was also tortured with
indenturing burdens of debt. Brazil’s debt doubled from $50 billion to $100
billion in roughly half-a-decade. Along with becoming one of the most
economically unequal countries in the world, it had become completely
Latin America experienced a great deal of growth from 1950 to 1970, there was a
large-scale disassembly and abortion of state-sponsored development and
state-run programs. These were the taproot of the region’s economic success.
Latin America had a democratic feel to it that lead collective groups to seek
greater political and social democracy. Indeed, they wanted to buffer
themselves from the usual economic predation of the upper classes and foreign
interests. Furthermore, this specific twenty-year growth period had been more
evenhanded, more evenly distributing of wealth, than anything that was to come.
Drawing the unmistakable distinction between the US-backed junta in Brazil, and
the epoch when Latin America largely controlled its own finances and economic
destiny, underscores what has happened to Brazil since.
1990s, President Fernando Henrique Cardoso promised to rescue Brazil from
inflation. He tied his country closer to the dollar, widened foreign access to
its riches, and favored a good deal of privatization. A decade later, Brazil
reconsidered its direction; its people no longer stood to be victimized by
international banks and their untenable game of lending. Brazil owed 260
billion dollars. Debts never ended and repaying loans was a chimera. Some
speculate that Brazil might have sold its state firms, which it manicured in
the 70s and 80s, in order to pay its debt. For that matter, Brazil might have simply
left its projects in infrastructure to waste away, unfunded. Nevertheless, none
of these options mattered much given the fact that Brazil’s debt was virtually
presidential candidate Luiz Inácio Lula da Silva promised Brazil something
different in the early 2000s: Fixing the top-heavy income distribution and making
sure money borrowed reach the masses. The resulting 4% growth from 2004 to 2010
helped reduce poverty, address income disparity, ameliorate drastic amounts of
unemployment, engender democratic policy, etc., all of which helped see Brazil
through the Great Recession.
the upswings ushered in after Lula took the helm, one major macroeconomic
problem persisted. Namely, Brazil’s attempt to address inflation meant the
value of the reais, Brazil’s national currency, was increased. The philosophy
behind this mechanism is simple. Brazil wanted to temporarily increase interest
rates with the hopes of increasing influxes of capital, while also lowering
prices of imports in order to lower inflation. The concocted value of the reais
also meant that cheap imports stood to harm the overall productivity of
Brazilian commodities and commerce in general. Thus, the higher the reais, the
lower the competitiveness of Brazilian goods in the world market.
the Rio-based Economy and Energy Institute released a study indicating that in
the decade spanning the mid-1990s to the mid-2000s, carbon dioxide output
increased nearly 50%. This trend in Brazil’s pollution ostensibly demonstrated
that it pollutes more than it generates wealth. Part policy, part foreign
meddling, today’s Brazil is one of the world’s largest polluters. As the last
century witnessed the greatest exploitation of one of Brazil’s most important
natural areas in Brazil, its rainforest basin, the toll on Brazil’s ecology
hits economically harder now than perhaps ever before. Yet, if some of the
negative ecological effects felt today have anything to do with policy coming
from Brazil, and not merely foreign vultures, then it is also important to know
the truth behind this reality.
element of Brazil’s economic “turnaround” under Lula involves China. Within
first few years of the 2000s, China usurped the US’ coveted role as Brazil’s
biggest trade partner. Brasilia-American relations changed and Brazil was
emboldened; despite the fact that the US was a key trade partner at the time,
Brazil risked both confronting and denouncing the US, protesting some 3 billion
dollars in direct subsidies that cotton farmers receive from their Yankee
government. These subsidies invariably violated the WTO’s trade rules, and in
2005, the WTO reified the fact that the US flagrantly distorted international
cotton prices. Cotton complaints, however, were not the last item on the new
agenda. To the chagrin of many foreign firms, Brazil allowed its pharmaceutical
companies to ignore US patents as they endeavored to produce their own version
of many indispensible drugs. Brazilian exports jumped some 65% in 2008 alone, jumping
upwards of $6 billion. Sino-Brazilian relations
grew, climaxing with an $800 million credit loan between China’s Development
Bank and Brazil’s National Bank for Social Development. China, in return, was
to receive handsome amounts of oil.
government busied itself, arranging plans to ensure that the benefits of
Brazil’s new economic upswing would reach the general masses as was promised.
Rather than funneling money into the pocket linings of conglomerates and
multinationals, Lula proposed at least four bills, even one creating a “shared
production” when partnering with foreign oil corporations. Bravely, Brazil’s
government established a fund to channel proceeds toward social spending,
poverty relief, infrastructure, education, etc. The Lula government even
infused the national income average with cash handouts.
economic changes in the first decade of the 2000s did not go unaffected by the
governing and terrorism of decades past. Problems involving infrastructure
still plagued Brazil. A single power outage in Brazil might easily affect
millions of people across the South American continent. Hence, government
officials often find themselves in a quandary as they seek to root-out such
problems, which ultimately reach farther than most today might care to think. Such
issues in power have serious economic consequences. A Brazilian hydroelectric
dam such as Itaipu, for example, can easily suffer unforeseen systematic
failures. The Brazilian Balbina dam actually flooded some 1,000 square miles of
the rainforest, polluting more than 20 million tons of carbon dioxide and more
than a thousand tons of methane within the first few years of its construction.
This carbon and methane pollution is troubling; methane, as a greenhouse gas,
is roughly 20 times more powerful than carbon.
with the fact that some 80% of Brazil’s energy consumption can emanate from
hydropower and its ensuing electricity, Lula defended the construction of such
dams and energy sources, saying that Brazil needed them in order to sustain
annual growth in excess of 5%. Thus, the rainforest has been sacrificed in part
for the energy. Experts argue, however, that had Lula switched to alternative
means of energy, Brazil would be on track to meet its energy needs beyond the
year 2020. Brazil might save $15 billion from these clean technology
alternatives. The difficulty is that so much of Brazil’s directives still
depend on international demand.
nothing is simple when it comes to Brazil and energy. The electrical sector has
called pro-clean energy bastions “utopian environmentalists,” effectively
furthering the divide between profit and planning. It looks as though hydro
energy is here to stay, especially as the Ministry of Development, Industry and
Foreign Trade as well as the Brazilian National Development Bank continue to reap
the sweet rewards of this profit-driven energy source.
things considered, the future of Brazil’s public policy and economy remains
uncertain. In the middle of 2013, Brazil’s social unrest surrounding free
transportation seemed t0 echo student movements of decades past. Sao Paulo
played host to street protests against tariff increases, which then spiraled
into protesting the privatization of public service, ungodly amounts of money
for private World Cup groups, and against the extremely poor quality of public
health, schools and urban public transportation.
not forget Brazil’s Movement of Landless Workers that has put Brazil on the map
vis-à-vis social protest and democratic agendas bubbling up from the margins.
Many of these protests result directly from public anger and disgust regarding
the urban structural crises incurred by the financial sector’s capital
speculation. Said crises that result in soaring rent rates, enormous car sales
backed by banks, and anarchic traffic without viable public transportation
options—all of which effect the poor and middle class.
Dilma Rousseff, Brazil’s current president and previous Chief of Staff under
Lula, has certainly made an impression by railing against Brazil’s banking
oligopoly, whose financial/banking institutions have done little to help with
plaguing interest rates. Even though Brazil’s subpar growth in very recent
years has hurt it, Rousseff has claimed to side with the poor, that Brazil’s
will not tolerate and recoil for its progressive path. Only time, as it is
shaped by mounting social pressure, will tell.
also heralded the end of poverty. Along with an increased foreign direct
investment filtering into the country, an unprecedented $67 billion in 2011,
unemployment was lower and wages were rising. The federal program Brasil
Sem Miséria added nearly three million of
Brazil’s abjectly poor to a list of possible welfare recipients. More than
twenty million received extra cash in order to bump them over the absolute
poverty threshold. Speculation as to whether an additional 30 billion reais
might help the remainder of an impoverished 2.5 million to rise from extreme
poverty. Of course, wealthy Brazilians mourn assistencialismo, or welfare-ism. Some also condemn Brasil Sem Miséria as insufficient,
arguing that 70 reais per person is insufficient economic assistance for
workers who have to travel untold distances just to work.
2013 BRICs leadership summit, Rousseff returned to a country swamped with expectations.
While both she and her predecessor, Lula, may not be the most progressive
leaders when it comes to championing environmental sustainability over business
interest, they nonetheless shine afore the dark pedigree of often murderous
luddites that have come before them. Even when compared with the other members
of BRICs, Yale-Columbia’s Environmental Performance Index lauded Brazil as
having made great strides to clean up. This will become increasingly important
as Brazil compares how much wealth it generates with the amount of
contamination it pollutes.
benefits economically from its extremely productive agriculture sector and
sweeping oil fields, and perhaps also from a stronger legal system than its
BRICs—Brazil, Russia, India, China and South Africa—counterparts. China
continues to devour Brazil’s unending commodities. But because of the global
effects suffered by the majority of nations caught-up in the global economy,
Brazil disappointed many with a diminished growth of 2.7% for 2011, and an
abysmal 0.9% in 2012. Nevertheless, many Brazilians, who were once bound to
poverty, have benefitted from Brazilian social safety nets. This has allowed
Brazilians to weather downturns, exploding wealth inequality, and the nominal
growth of the Brazilian middle class.
so many problems that are sure to surface in the public sphere during this
World Cup, Brazil is still an incredible emerging market. Thanks to doubled
minimum wage and grants, inequality has, to some degree, lessened. Thanks to the
universalization of primary education twenty years ago, coupled with increased
welfare payouts and a rise in the minimum wage, Brazil may have a chance to
actually benefit from whatever future growth might occur in coming years.
Still, Brazil’s work force will slowly be overtaken by an unmistakably
increasing pension demand. For now, the minimum wage in Brazil is roughly three
times that of Indonesia or Vietnam. Brazil can hope to grow, but not without
democracy, and not without the support of the global community for its social
Mateo Pimentel lives on the Mexican-US border, writing for many alternative
political newsletters and Web sites. His work can be found on counterpunch.com
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