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Archive for October, 2011

Notes from “Brazil: The Disorders of a Progressive Democracy”

Author: Ieda Siquiera Wiarda, from Latin American Politics and Development (6th edition), editors Wiarda and Kline – notes are from this chapter unless otherwise noted

Additional notes from Skidmore and Smith, Modern Latin America (6th edition), ch.5 “Brazil: Development for Whom?” – notes from this chapter marked with SS – and from Santiso’s “Lula Light” ch. 5 in Latin America’s Political Economy of the Possible

Questions of development:

  • “A Country of the Future – Where the Future Never Arrives”
  • “Disorders of Progress”, rather than “Order and Progress” (127)
  • — Santiso (ch.5 Lula Light) suggests a different reading of “Order and Progress,” stating that it “combines the will to project intot he future with imposing present order upon that projection, to frame it rationally” (137)

Geography notes:

  • Brazil covers nearly half of South America; fifth largest country in the world
  • high degree of cultural integration within country
  • most citizens live on 10 percent of land (129)
  • geographic zones: North (legendary wealth and potential, mostly Amazon), Northeast (droughts and hardship, far from center of power), Southeast (43% of population, contributes more than 60% of country’s GNP), South (haven for separatist ideals; many European immigrants), West Central (agribusiness) (130-131)
  • population groups – indigenous Indians, Portuguese, Africans and various European, Middle Easter and Asian immigrants (137)
Historical notes:
  • Brazil owes its independence to the fact that Napoleon’s army invaded Portugal; royal court moves to Brazil and enjoys it greatly, leaves son Pedro I in Brazil, Dom Pedro proclaims independence and becomes first monarch (not divisive war of independence) (133-134)
  • war with Paraguay 1864-1870; Paraguay ruined because of war for decades; doubts about war in Brazil lead to an overthrow of the monarchy (135)
  • Republic of Brazil proclaimed on November 15, 1889 (135)
  • republic emerges as oligarchic rule (139) – landed interests most powerful
  • Great Depression really hurts economy due to dependence on exports
  • presidential candidate usually alternates between Sao Paulo and Minas Gerais – this was not done by incumbent president from Sao Paulo, Vargas (from Minas Gerais) feels deprived of victory and takes capital with a minimum of force
  • Vargas: corporatist model of Estado Novo, later brand of populism – “father of the poor” (140)
  • between 1930 and 1945, powers centralized, censorship imposed and no convening of the legislative assembly, social security system formed, nationalizations of economic institutions and natural resources
  • Brazil joins Allied side in 1942
  • demands for freer system, military officers usher out Vargas, Dutra becomes new president
  • 1946 new constitution – guarantees civil liberties and free elections but keeps centralization
  • charges of corruption – one of Dutra’s aides involved in assassination attempt of opposition journalist but air force major killed instead; Vargas commits suicide (avoiding possible coup) (141)
  • Vargas back in power in 1950 after being popularly elected
  • 1955 Kubitshek; Joao Goulart VP (minister of labor under Vargas) – “fifty years of progress in five”; lots of public works projects, new universities, major highways and airports, moves capital inward to Brasilia – all of these things important for modern state but pushed too quickly, resulting in large debt
  • Quadros – reforms exchange controls, ends consumer subsidies and curtails printing of money but this hurts poor so his basis of support disappears – he resigns abruptly, leaving Joao Goulart to assume presidency (142)
  • Goulart in China when this happens; before he returns, prime minister position created to share power with President (Goulart eventually undoes this); Goulart populist and demagogic (143); allows many strikes, economic policies create more inflation; Goulart sides with mutinous members of military
  • a note on labor from Skidmore/Smith (SS 171): “The populist policies of Getulio Vargas had created institutions for organizing urban workers.  This posed a significant but ultimately acceptable challenge to the upper and middle classes, the latter represented largely by the military.  But in 1964 Goulart presented, or appeared to present, a much more fundamental threat.  By mobilizing peasants as well as workers, ad by using radical rhetoric, he seemed to be creating the conditions for a class-wide worker-peasant alliance against the socioeconomic establishment.  Both the suddenness and and the simultaneity of these movements startled and alarmed elites.  A classwide coalition was simply not acceptable.  The military exercised its longstanding veto power and went on to create a bureaucratic-authoritarian regime.”
  • bloodless takeover by military (poder moderador – ensure “order and progress” as well as discipline)
  • Branco sees himself as transition to civilian president but hard-liners see a long period of apolitical government as necessary
  • political parties abolished and two political organization (National Renovating Alliance and opposition, Brazilian Democratic Movement) created (144)
  • oil shock of 1973 leads to abertura – opening toward the eventual resuming of democracy (144)
  • for details on political parties, see 145
  • Neves consolidates various groups that want to replace military with democracy
  • Sarney – oppositino from the left (added to Neves’ ticket last minute to appeal to those who had supported the military originally but were now “jumping onto the civilian bandwagon) short-term economic successes like Cruzado Plan (146)
  • inflation becoming larger and larger issue: 1,800 percent in 1989 (socialist and populist candidates becoming more popular)
  • Collor – ambitious neoliberal reforms, Earth Summit of 1992, eventually enmeshed in corruption and favoritism and impeached in 1992, replaced by Franco (inflation 2490 percent by 1993 – SS177), Cardoso finance minister for Franco – gets hyperinflation under control in two years
  • for info on the Catholic Church, see 150-151
  • Brazil a member of many treaties and various international bodies, charter member of UN (for more see 157-159)
  • for info on Brazil’s relationship with the US, see 159
  • Cordoso – Brazil joins MERCOSUR, known for following IMF suggestions to the tee (second term: capital flight slows but at the cost of economic growth, float the real, speculative crisis in 1998-99) (SS 178)
  • Lula – 2002 “Um pais de todos, chooses orthodox figures for important economic policy positions
  • challenges for Lula (SS 180): continuing credit crisis, get economy growing again, attack country’s huge deficit in health care education, and housing
  • Skidmore and Smith describe Lula’s policies as, “a mixture of Trotskyists, advocates of liberation theology, government bureaucrats, and middle-class progressives” (SS 179-180)
  • military as poder moderador (moderating power) (139)
  • fragmentary nature of political parties, hard to maintain own support base
  • large number of interest groups in politics – labor particularly strong (1980 metalworkers in Sao Paulo shut down automobile industry there for 3 weeks, Lula (their leader) jailed); Workers’ party (PT) strongest opposition of the government as it pushes for state-led economic development (149)
  • president holds great deal of power – he chooses and heads a cabinet, coordinates actions of all ministries (153)
  • 5% of population owns half of arable land (high inequality)
  • lots of red tape (papelada) – strong presence of a bureaucratic maze, leads to systematic inefficiencies and importance of personal and political linkages (over merit and efficiency) (154)
  • corruption ever present as well (see previous blog entry on resigned ministers under Dilma’s administration)
  • inadequate health and educational institutions
Trends (From Skidmore and Smith- Brazil: Development for Whom?)
  • export economies, boom and bust pattern: sugar (18th century), rubber (early 19th century), coffee
  • coffee production difficult because must plant trees 6 yrs in advance (hard to predict demand 6 years ahead of time)
  • crash of 1929 prompts industrialization – heavy industries such as steel and automobile production (by 1960 industrial production was up to more than 25% of GDP), resulting surge in urbanization
  • era of populism (1930-1964): “economic nationalism, state-guided modernization, import subsititution and trade policies” (Santiso, 118)
  • late 1960s, early 1970s, manufactured goods replace coffee as leading export; deemed “Brazilian Miracle”
  • organized working class up to 6 million in the 1980s; middle class has close relations to military
  • economic stabilization efforts in 1953-54, 1955-56, 1958-59, 1961, the Cruzado Plan of 1986, the Bresser Plan of 1987, the summer plan of 1989, the Collor Plans of 1991 and 1992 (Santiso, 117) and the Plano Real of 1994; stabilization programs always mean falling real wages, reduction of government deficit, painful reductions in credit (SS 169)

Truth Commission Formed in Brazil

In Brazil, a truth and reconciliation commission to investigate human rights abuses under the 1964-1985 dictatorship passed Congress unanimously this week.  The commission will go into effect immediately once President Dilma Rousseff names the seven members.  The government recently tallied 475 people killed or disappeared under the dictatorship, substantially less than in neighboring countries.  This commission seeks to investigate this crimes, although some worry history will be retold in a limited way.

The commission will have subpoena power, can demand any document it wants from the government and put witnesses under oath. But the country’s 1979 amnesty remains intact, so it won’t result in prosecutions. It’s not clear what will happen to people who refuse to talk.

In Argentina the original truth commission was seen as insufficient, or lacking appropriate teeth, as it did not include the threat of persecution, thus failing to bring those who committed crimes to justice.  Since then, the laws of impunity have been overturned, and 262 people have been convicted of crimes against humanity.  It is estimated that 13,000 people were killed or disappeared under the Argentine dictatorship.


Bolsa Família

What it is: The Bolsa Família program is a system of conditional cash transfers, giving money to families if certain conditions are met such as sending kids to school or taking them to a health care facility.  Emergency assistance is also provided temporarily; the conditions seek to ensure “longer-term investments in human capital.”

Bolsa Família consolidates four social programs, reducing administrative costs and bureaucratic complexity, standardizing results and methodology,  and eliminating redundancies.  These four programs were: Bolsa Escola (Ministry of Education), Bolsa Alimentação (Ministry of Health), Cartão Alimentação ( Fome Zero), and Auxílio Gas (Ministry of Mines/Energy), promoting schooling, health care, food consumption and reduced dependence on government subsidies, respectively.

Objectives: The Bolsa Família program seeks to reduce current poverty and inequality in Brazil and to reduce future poverty and inequality through the building up of human capital.  Thus there exists a quantitative aspect – bringing more people into the safety net – and a qualitative aspect – improving the well-being of the beneficiaries.  Bolsa Família also aligns with some of the Millennium Development Goals (see pg. 68 for specifics).

Bolsa Famliia targets the family unit as the receiver of the conditional cash transfer as opposed to the individual unit.  Payments are made to the mother of the household since studies show she more than others will prioritize investments in her kids (i.e. education, health)

How it targets the poor: “By design, Bolsa Família identi- fied two target groups – the “extreme poor” (families with a per capita income of less than US$17 per month) and the “moderately poor” (families with a per capita monthly income between US$17 and $34). De- pending on the household’s composition and income, the program provides cash transfers ranging from US$5 to $33 (the average is US$24). These amounts were set, in part, to minimize the number of people who might lose benefits from previous programs. On a per capita basis, the average transfer per beneficiary represents about 6 percent of the minimum wage and 19 percent of the poverty line used by the World Bank.” (68).

Donor support: This program has support from the World Bank, the UNDP and the Inter-American Development Bank (see page 69 for SWap –sector wide approach – details: ex. intertwinement of effective implementation – widening the social net – and technical activities of monitoring and evaluation; incentives to exceed milestones, ex. loan’s financing percentage increases).  It uses a results-based approach in which technical milestones are linked to disbursements.

Challenges: a monitoring and evaluation that doesn’t just provide data but actually useful feedback on the quality of the service (coverage is one thing, quality of delivery another); reducing fraud (they are actually publishing names of beneficiaries by municipality on the Internet and setting up a hotline in which people can report suspected fraud).

Results achieved and expected:“Since its launch in December 2003, the Bolsa Família Program has grown exponentially, expanding by January 2005 to cover 26.6 million people. By the end of 2006, the program expects to cover about 44 mil- lion people. Translated as intermediate results in the results-based framework, this means:

  • At least two-thirds of extremely poor families will be receiving Bolsa Família income transfers.
  • At least 40 percent of total transfers will be going to families in the bottom quintile of income distribution.
  • At least 80 percent of primary school–age children in extremely poor beneficiary families will be at- tending school.
  • At least 95 percent of beneficiary children will have and be using health cards.” (71)

Lessons learned:

  • It is beneficial for borrowers to own, lead and sustain their commitment to the process
  • Conditional cash transfers are operationally feasible and political acceptable (as they are not seen as just hand-outs due to the fact that they are not unrestricted cash-subsidies)
  • Human capital conditionalities can help the poor “grow out of poverty

– for more see pages 71 and 72

Applicability: Bolsa Família is the largest conditional cash-transfer program in the developing world.  Thus, its challenges and solutions with respect to beneficiary selection, monitoring and evaluation, and quality control, as well as the World Bank’s lending mechanism designed to support the Bolsa Família program should be applicable to other countries.  Of course, this is not a one size fits all model, but clearly need to be adapted, taking into account new and different circumstances (“the (potential) success of the project is in many respects a function of the donor’s capacity to adapt to the specific needs of that program.” (73))

Source: http://www.mfdr.org/sourcebook/6-1brazil-bolsafamilia.pdf

Dilma “holds her own”

The LA times published a recent article praising Dilma Rousseff, the current president of Brazil, for successfully holding her own as former-president Lula left big shoes to fill (finishing his two terms on an economic upswing).  According to a recent poll, Rousseff’s approval rating is 71%.  She has been seen as tough on corruption, something that plagued Lula’s administration, and justifiably critical of the US and Europe’s inability to successfully deal with their financial and debt crises.  Brazil is still growing quickly which the article attributes to a commodity trade with China (benefitting from the high prices of iron ore and soy) and booming domestic consumption.  Nevertheless, Brazil could be negatively affected if a slowdown or crash happens in China (it seems we aren’t quite past the days of the export driven, dependent-on-the-global-market economic strategy after all).  Moreover, Brazil’s growth is expected to slower as the domestic consumption reaches its limit.  The article notes that combined with this economic growth Rousseff’s moderate social spending has lifted many out of poverty, however she has not taken this opportunity to restructure the tax code or fiscal policy which could increase Brazil’s competitiveness in the long run.  Finally, the article notes the one area in which Rousseff has made a break from Lula: she has distanced her administration from Iran, criticizing the practice of stoning women.  “Her comment was characteristically uncompromising: “I do not agree with practices that have medieval characteristics [when it comes] to women,” Rousseff told the Washington Post. “There is no nuance; I will not make any concessions.”  Rousseff was tortured under the military dictatorship in Brazil.

See the full article here:


Olympics threaten Rio red-light district

Rio revamps poor infrastructure surrounding city in anticipation of the 2014 World Cup and 2016 Olympics. Facing destruction is the Vila Mimosa, a shanty town outside Rio De Janeiro. The current project proposed by the Brazilian government is a 510 km high-speed train that is proposed to run through Vila Mimosa. The project would link the financial capital of Sao Paolo with Rio, a $22 billion dollar project was promised in the Olympic bid.

Vila Mimosa is Rios working class red light district, the construction of the train would dislocate current residents and workers from Vila Mimosa. The women working within Vila Mimosa have been organizing together and working with Architect Guilherme Ripardo. The businesses that are within Vila Mimosa also depend upon the prostitutes financially, their business bringing in revenue for the shanty town. The business association have been working to draw up plans for a $1.8 million community center. The undisclosed location would include a health clinic, child care, and professional training in subjects from sewing to computer literacy. The nick names for the plan coined by the women is “Cidade de Meninas” City of the girls.

2,000 women work Vila Mimosa 24 hours a day. The area is one subway stop from downtown and is a five-minute walk from a station serving many major bus lines. Major road ways and offices are located close by and easily accessible. The removal of Vila Mimosa in the name of modernization, urban planning, and creation of the new high-speed train line would also mean the loss of livelihood for the thousands of residents. Construction on the $618 million Transcarioca express high way has gone underway and through its construction 1,ooo families have been evicted and 3,000 homes will be raised before the public work is completed. The forcibly removed population has been offered homes 65 to 80 km away, but this is considered an unreasonable distance away from Rio for those who rely on public transportation to get into Rio.

Amnesty International and the UN have openly called attention to the allegations to the abuse of rights of the displace peoples. With residents being removed and evicted in the middle of the night.

“It’s about raising property values, but the big thing is making the city more acceptable to foreigners’ eyes,” he said. “It’s taking people who shock foreigners and pushing them out of the way: prostitutes, street vendors, homeless people. They’re going to clean up parts and throw a rug over the rest of it.”

-Thaddeus Blanchette
Investigator at the Federal University of Rio de Janeiro


Entrepreneurship in Brazil

Entrepreneurship in Brazil is playing an important role in the countries economic and social future. Small and medium enterprises in Brazil account for 96% of the jobs. Supporting entrepreneurship throughout the country would also support and begin to employ a large unemployed  young demographic.  36% of Brazil’s population unemployed are between the ages of 18-24. The development of small businesses has also keyed in on more sustainable development. The government is also finding ways to support the business development through “project support start-ups”. Brazil’s Financing Agency for Projects and Studies supports the project support start-ups that will disperse $65,000 to startups that are focused on innovation.

The interest in entrepreneurship and growth also encounters difficulties by the Brazilian political structure and lack of education surrounding entrepreneurship. According to the “Doing Business rank” in the World Bank’s Doing Business project, Brazil is 129 out of 183 countries. It takes 120 days to start a business, along with the wait there is a complex tax system for entrepreneurs. [1]

[1] http://www.entrepreneurship.org/en/resource-center/brazils-entrepreneurship-boom.aspx

A Grassroots Woman Leader and Entrepreneur from Rio de Janeiro

For more information on Entrepreneurship in Brazil



Brazil’s New Republic: 1985- present

Tancredo Neves 1985

  • Prime minister of Brazil during the presidency of Joao Goulart.
  • He ran against Paulo Malof who belonged to the PDS party, who still supported and remained loyal to the military regime.
  • Tancredo Neves defeated Malof and his election was known as the new republic.
  • Neves fell ill and was not able to make his inauguration and passed away.



Jose Sarney 1985-1990

  • He belonged to the same party as Tancredo Neves and all of Neves’ promises were fulfilled by Sarney. Especially the passing of a constitutional amendment to the constitution created after the military regime. In October 1988, a new constitution was created and democracy was fully in place. This led presidents to have five year terms staring with Sarney and his successors.
  • His presidency had two priorities in which they wanted to focus on which was constructing democracy and combating the increasing problem of inflation that had been affecting Brazil for many years.
  • He launched a plan that was called “Plano Cruzado”. It was an economic plan which was supposed to help stabilize the problems Brazil was facing. At first this was successful but then inflation became too big of an issue for the plan to fix. Inflation reached 934% in 1988 and this caused violent strikes to occur in the c. country


Fernando Collor 1990-1992

  • He was the first president who was directly elected by the people after the military regime. He was also the youngest president of Brazil in all its history.
  • He created a new plan to combat the economic problems his country was facing.  His Brazil plan had mixed results and the economy was still in recession.
  • A scandal erupted causing the resignation of Collor.  He and his advisors were accused of receiving money from private companies for profitable contracts. An investigation concluded with a suspension for 180 days. After the 180 days he chose to hand in his resignation.  A trial took place and it concluded with finding Collor guilty of corruption charges and he was not allowed to hold public office for eight years.


Itamar Franco 1992-1995

  • He elected Fernando Henrique Cardoso as his finance minister. They together set up a plan called Plano Real.  It stabilized the economy and it ended inflation.
  • His presidency also was able to stabilize government. He initiated the idea of free trade zone in all of South America which was praised by President Bill Clinton at the time.
  • He offered hi resignation at the peak of ongoing political scandals. The congress rejected his resignation but then he decided not to go for another term.


Fernando Henrique Cardoso 1995-2003

  • He was the first to be elected for two consecutive terms.
  • He acquired a lot of support since under Itamar Franco’s presidency he had served as his finance minister and his economic plan had helped fight inflation in Brazil. His economic policies helped him come to office.
  • He put forth major reforms in the government. He passed legislative reforms in which it reduced government involvement in the economy. His presidency attracted many foreign investments and privatized important state enterprises.
  • He was criticized for making the constitution his own in which reelection was created and helped him stay in office for so long. Many people believe that he had more support in his first four years in office and afterwards his support had dwindled.
  • He also was criticized for not truly being leftist like he had said he was at first. Many of his policies were considered to be those of neo-liberals.


Luiz Inacio Lula da Silva 2003-2010

  • It took him four attempts to finally reach his goal to become president of Brazil.
  • He also served two terms as president of Brazil and was the first left wing candidate elected as president.
  • He created many social programs. He wanted to eradicate hunger and Fome Hunger (Zero Hunger) was put in place to end hunger in Brazil. He also wanted to combat teenage pregnancy, strengthen family agriculture and distribution of minimum amount of cash to poor families.  Bolsa Familia (family allowance) is a program created by da Silva and internationally praised. It gives allowances to families for food and kitchen gas. It receives donations from private corporations and international organizations.
  • The economy of Brazil also benefitted greatly from da Silva’s presidency in which saw banks gain profitably. It also helped raise standard of living in which many Brazilians were now classified as middle class.
  • Lula da Silva also becomes a major player in South America by becoming a negotiator. Meaning he was involved in trying to calm tensions between Venezuela and Colombia and he also wants to form relations with South American countries and developing countries.
  • He also wanted to strengthen Mercosur.
  • He is often criticized for wanting tighter control of government in the media and more government intervention.



Dilma Vana Rousseff 2010-present

  • First women president of Brazil.
  • More women have also been in government during her presidency than any other.
  • She has also been the first women to open a session of the U.N. General Assembly.