For the final paper incorporating the research previously posted on this blog, please see here.
Archive for the ‘Political and Economic HIstory’ Category
“Brazil as an intermediate state and regional power: action, choice and responsibilities”
This article primarily speaks about Brazil’s foreign policy however the focus on a developmentalist agenda mirrors many of the efforts I will discuss in the Bolsa Familia program.
Brazil has attempted to link an increasingly activist stance in world affairs with political support at home for a more active partisan involvement in foreign policy. In this context, the government’s fight against poverty and unequal income distribution at home and its assertive and activist foreign policy can be viewed as two sides of the same coin.
– foreign policy has always had a strong developmentalist component
– history of commitment to multilateralism
– 1930’s: crisis of agro-exporting model, replaced by ISI (relatively successful: central role for state in regulation, provision of incentives and production; relative discrimination against important; large-scale participation of FDI in wide range of industrial sector), and then again in the 1990s by a model of competitive integration into global economy (23)
– with this transition into the global economy, foreign policy shifts from just autonomous to “autonomy through participation” as Brazil participates fully in a variety of international regimes
– foreign policy includes “active development policy”, “ collaboration with countries of similar interests”, and “the need to articulate a national project focused on overcoming domestic social imbalances”
– Brazil often a mediator in the past between great powers and smaller nations – defending rights of the later while positioning itself to assume the position of the former
– in 1970s, Brazil tries to delay or block trade negotiations unfavorable to developing nations
– UN reform agenda according to Brazil should include: reinforcement of multilateral principles and norms, a reestablishment of conceptual frontier between peacekeeping and peace enforcement, reformulation of decision-making structure of UN security council
– up to mid 1990s, Brazil focused on regional integration and common market (Mercosur); deepening trade and cooperation in infrastructure projects
– now Brazil’s identity as Latin American country shifting to become South American power
– Lula furthered Brazil’s South American leadership, some question this ‘parallel diplomacy’
– hope that Lula’s furthering of Brazil’s democracy would have positive spillover effect in promoting regional political stability; also hope that Brazil’s increased regional presence will help it further its global aspirations
– Brazil’s relations with US primarily aimed at “prudent coexistence, possible collaboration and minimal collision” (33) – Brazil’s foreign policy decisions involve consideration of costs and benefits of convergence or divergence from US
– 2003 IBSA Forum (with India and South Africa) which was formed around three shared interests: commitment to democratic institutions and values, effort to link struggle against poverty to development policies and the need to strengthen multilateral institutions and procedures in order to deal with security issues and political and economic turbulence
– danger of multilateralism is that Brazil must assume consequences of collective action
– almost half of the region’s GNP is of Brazilian origin and its exports account for more that 40% of the total exports of the region; Brazil’s trade pattern is more diversified that other Latin American countries
– however Brazil falls behind Argentina, Chile and Latin American and the Caribbean as a whole in terms of HDI Rank (at the time of publication – see earlier blog post as to current stats)
– if take into account GINI index (which measures level of inequality in income distribution), Brazil drops dramatically ***include graphs of this in paper
– idea that domestic efforts could spur a “virtuous path of democratic consolidation, sustained economic growth and social inclusion”
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)
- 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)
- 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
- 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)
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.
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.
The military dictatorship period represented a break from the populism of the previous 30 years.
1961 – João Goulart takes office
– Left-wing tendencies, nationalist politics and sympathies to Communist Bloc deemed too radical by the military
– His Basic Reforms plan – calling for greater state interventionalist policies – was the main reason for his fall
- “Education reform: aimed to combat adult literacy with the widespread use of the pioneering teachings of Paulo Freire and his method. The government also proposed to hold a university reform and prohibited the operation of private schools. It was imposed that 15% of the income produced in Brazil would be directed to education.
- Tax reform: control of profits transfer by multinational companies with headquarters abroad; the profit should be reinvested in Brazil. The income tax would be proportional to personal profit.
- Electoral reform: extension of voting rights to illiterates and low-ranking military officers.
- Land reform: properties larger than 600 hectares would be expropriated and redistributed to the population by the government. At that time, the agricultural population was larger than the urban.
- Urban reform: it was stipulated that people could own only a single house. Those who had more than one urban property would have to donate them or sell their properties at low prices.”
March 31, 1964 – military regime takes over, Goulart flees to Uruguay
THEMES OF THE DICTATORSHIP:
– economic policy: “The main thrust of the military regimes’ economic policy was to rely less on the exportation of primary goods and to pur- sue economic growth by facilitating the production of more manufactured goods, such as consumer durable goods, for the domestic and foreign markets.10 In order to have export led growth, Brazil had to modernize its industrial base and build a comprehensive infrastructure which could support this industrialization” (325, Galano). This was a renewal of import-substitution industrialization and export promotion growth models. It is important to note that the consequential investments (in energy, steel, telecommunications, transportation, mining and agriculture) entailed a large quantity of borrowed capital, leading to great debt burdens in the 1980s.
– guidelines: economic development, opposition to radical nationalists and populists, and to Communism
– Brazil realigns with US, breaking relations with Soviet Bloc countries
– censorship of media, torture and disappearances of political activists, trade unionists and journalists; restrictive Constitution, stifling freedom of speech and political opposition
– hard-liners pushed for purging of legislators, suppression of direct elections and firing of civil servants as part of a “long recuperation”; moderate military believed in a brief period of reorganization to return Brazil to “the electoral democracy recently endangered by irresponsible politicians” (172, Modern Latin America)
– military dictatorship intended to transform Brazil into a modernized capitalist economy; great economic growth 1968-1973 (manufactured goods replace coffee as country’s leading export (172, MLA)) but soaring debt, record high inflation levels, and rising inequality 1974 and after
1964-1967 – Humberto de Alencar Castello Branco
– attempted to maintain democracy and not stay in power beyond the remainder of Goulart’s term; planned to restore civilian rule in 1966 yet military argued for a prolonged stay in power
– forced by military hard-liners to purge Congress of left-wing and populist supporters
– credited with laying the foundation for the economic growth seen in the 70s, dubbed the “Brazilian Miracle”; banking system overhauled, Central Bank created, stock market and government securities market institutionalized, export regulations simplified; Campos (planning minister) argued that “capitalism had not failed in Brazil because it hadn’t yet been tried” (172, Modern Latin America)
– suppressed populist left but laid foundation for future authoritarian governments
– Ato Institucional (Institutional Act) 1: executive has unchecked ability to change the constitution and remove anyone from office, AI 2: president elected indirectly (essentially current president hand picks next president)
– Abolished political parties and replaced them with the military government’s party (National Renewal Alliance Party) and a single opposition party (Brazilian Democratic Movement)
See below link for an interesting article from Time magazine in 1965, praising Castello Branco and his Minister of Economic Planning, Roberto de Oliveira Campos’ economic reforms which entailed eliminating of government subsidies, ending wage hikes, increasing foreign direct investment in the country and gaining the aid and support of the World Bank, IMF and the US.
1967-1969 – Artur da Costa e Silva
– Institutional Act #5: suspends habeas corpus, shuts down branches of government other than the executive, declares nationwide state of siege
– 1969 – US Ambassador to Brazil kidnapped, rebels demand release of imprisoned dissidents, increase in protests leads to greater measures of counter-insurgency
– avid recruiting of foreign investment, repression of labor unions (i.e. authoritarian regime used to carry out its harsh/rapid/unpopular version of economic development)
1969-1974 – Emílio Garrastazu Médici
– by the end of 1970, minimum wage so low, Brazilian workers with their wages tied to it lost 50% of purchasing power compared to 1960
– Brazil broadens its international presence
– Time of great economic growth – the Brazilian Miracle (1968-1973); GDP growth up to 11% annually
– Greatest human rights abuses – persecution and torture of dissidents, harassment of journalists, and press censorship
- Perpetrators of human rights abuses have not yet been brought to justice, and current presidents have taken much less action than in neighboring countries such as Chile and Argentina
1974-1979 – General Ernesto Geisel
– less oppressive rule – “the maximum of development possible with the minimum of indispensable security”
– continued large investments in infrastructure such as highways, dams, and telecommunications
– opens Brazil up to foreign oil companies for the first time since the 1950s
– economic policy of import-substitution industrialization with export expansion
– 1973: World oil shock
- early 1970s: overvalued currency
- oil crisis leads to huge debts (lots of foreign borrowing necessary to finance the current account)
- for more useful graphs, see http://www.econ.utah.edu/~vernengo/papers/After_Neoliberalism.pdf
– 1977: Geisel renounces military alliance with the US
– creates electoral college, allows exiles to return, restores habeas corpus, repeals extraordinary powers granted by AI #5
1979: Amnesty Law signed which granted amnesty to those convicted of political crimes between 1961 and 1978
Second oil shock of 1979 further increases Brazil’s debt burden
1980s – fall of other Latin American dictatorships, chronic inflation and stagnant economy, pro-democracy movement gains hold
1979-1985 – João Baptista
– continues democratization
– in 1982, Brazil has the largest foreign debt in the world, $87 billion (172, Modern Latin America)
1983-1985 – government imposes austerity program in conjunction with IMF (see specific conditions on pages 339 and 340, Galano) , enables Brazil to make interest payments on debt and earn a trade surplus, but leads to economic decline and increasing inflation (rising to triple digit levels in 80s, up to record high 2,398% in 1990)
1984 – democratic presidential elections held, José Sarney becomes next president
– Tancredo Neves elected with Sarney as vice-president but Neves fell ill the day before the inauguration so Sarney took office; Neves died one month later
1988 – democratic Constitution of 1988 passed
1891 -Old Republic: November 15, 1889 Marshal Deodoro da Fonseca deposed Emperor Dom Pedro II, declared Brazil a republic.
- Brazil became twenty states, creating sovereignty within each state with the exception of Presidential intervention in the case of threatened separation, foreign invasion, or conflict with other states.
- The government was a constitutional democracy with limited voting capability by citizens.
- 1915 it was apparent the wealthy few continued to play an important and monopolist role in political policy. Before 1930 only 3.5% had the ability to vote in the presidential elections, the conditions allowed only literate male adults the ability to cast votes.
- Key regions such as Sao Paulo and Minas Gerais played an important role in elections and much of the power shuffled between both regions. This was called “Cafe com Leitte” or “coffee with milk” after the agricultural products of the two states.
- 1929 affected the coffee exports of Brazil and seriously devalued its currency. The demand for Brazilian coffee decreased dramatically from 75% of the world market in 1900 to 67% in 1930. The decline of the coffee market most obviously influenced by the great depression encouraged political, social, and economic advancements while devaluing the state currency heavily.
- New industrial development concentrated in “light” industry (food processing, small shops, and textiles) doubled from 3,000 in 1907 to 5,940 by 1918.
1930-The Vargas Era, new era begins in 1930 and ends in 1945.
- 1931 Revolution leading to the election of Getúlio Dornelles Vargas.
- During the Vargas era there are three phases play out over his time within power.
- 1st the period of provisional Government from 1930-1934, he becomes head of the provisional government.
- 2nd the period of the new Constitution by the Constituent Assembly of 1934 elects Vargas as president and rules alongside democratically elected legislature.
- Beginning of populism within Brazil, promoting middle class concerns and promoting industry. - Sought to rebuild Brazils economy after the collapse of the coffee market in the great depression, focused on economic stimulus, utilizing tax breaks, lowered duties, and advocating heavy tariffs.
- 3rd, the period in which the “Estado Novo” of 1937-1945, where Vargas seeks to preserve his position of power by creating and assuming dictatorial powers.
- Centralized control over economic development and organization change.
- State enterprises were created, along with a new labor code, censorship of the media, and new restrictions placed on foreign investment within Brazil.
- During the Estado Novo Vargas suspended Congress and Political parties.
- Implemented large scale urban planning, and created industrial concerns, such as the
- National Oil Advisor
- The Administration Department of Public Service
- National Iron Smelting Company
- Rio Doce Valley Company
- São Francisco Hydroelectric Company
- The National Motor Plant.
- 1941 Brazil under Vargas aligned itself with the American states during WWII, the Brazilian participation helped to influence a second rubber boom in the economy.
- Vargas was unable to secure support and was deposed in 1945 by his own War Military, and the second republic was born.
1946- The Second Republic 1946-1964
- The concerns for this time period were chiefly economic in nature. President after president was replaced as the economy continued to suffer.
- 1946 to 1951 General Eurico Gaspar Dutra was elected president and served during this time period.
- Vargas returned to politics in 1950 to win the presidential elections for 1951.
- Ambitious industrialization plan and pursued a policy of nationalization of the country’s natural resources. Petrobras was founded as the Brazilian state oil enterprise.