Brasil 200 – is there a future for the country of the future?

Clara Figueiredo, series_ Brasília_ fungi and simulacra, national congress, 2018
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By CARLOS ÁGUEDO PAIVA*

Considerations on the formation of the Country and the impasse we find ourselves in

Introduction

The year 2022 is destined to be a national milestone. First of all, it is the year in which the country completes two centuries of existence as an independent nation. But it is also the year of a possible resumption of democratic order, seven years after the 2016 coup-impeachment and four years after the 2018 selective elections, marked by the arrest and silencing of the natural candidate of the Party overthrown from power years before. This seems to us to be a privileged moment to assess what we are and what we can become.

From a long-term perspective, Brazil does not do badly in terms of economic performance. But its social performance – evaluated in terms of inclusion and income distribution – and political performance – evaluated in terms of periods of exception and authoritarianism and the effectiveness of the institutions that, theoretically, should work for the preservation of the Constitution – are not eloquent or promising. Where are we going? Is there hope for this country?… Of course, these questions are not trivial. But these are tax questions. And his confrontation begins with a question: is this country called Brazil a nation?

 

Brazilian roots: a country in the Alentejo

Brazil's first determination is to be the largest, most populous, and most developed former colony of Portugal. Among the 260 million speakers of Portuguese (the fifth most spoken mother tongue in the world) more than four fifths live in Brazil.

Being the “heir son” of Portugal involves carrying a very peculiar DNA. If we take only the continental territory (excluding Madeira and the Azores), Portugal defines its current borders in the year 1297. It is the first European State to have its borders defined and stabilized. More: it is the first centralized European Nation-State, planner and promoter of mercantile economic development. As argued by astute analysts of Portuguese history (from Alexandre Herculano to Raymundo Faoro), the Portuguese never knew feudalism in the strict sense. The nobles were only landowners and did not have any legal and political autonomy. The nobility was not even the largest landowner. The king and the State (the patrimony of both “only” will be distinguished from the Avis revolution, in 1385) were the biggest proprietors. Followed by the Church. Fourth, came the nobility. And fifth, independent peasants (that is to say: not subject to any standard of serfdom) and small tenant farmers.

Located halfway between the Mediterranean and the North Sea, open to the Atlantic and close to Africa, Portugal was born as a trading post. And at least since the establishment of the Avis dynasty, the State has promoted commercial ventures associated with the expansion of known maritime boundaries. Infante Dom Henrique, son of King João I of Avis, receives – for his dedication to science – the right to commercially explore the Azores, Madeira and the Strait of Gibraltar (after the conquest of Ceuta). Including carrying out the privateering on those ships that did not pay the appropriate “contribution” to enter the Mediterranean. Public management, nobility, commerce and piracy have had great affinities in Portugal since its inception.

Another surprising feature: the kingdom of Portugal, from its foundation until the proclamation of the Republic in 1910, will, in fact, have a single dynasty. Formally, there were four dynasties: Afonsina, Avis, Filipina and Bragança. But, in fact, the dynasty is one. João de Avis is the bastard son (but recognized) of King Pedro I, of the Afonsina dynasty, and half-brother of King Fernando I, who dies leaving Dona Beatriz, married to the King of Castile, as his only heir. The courts of Coimbra elect João de Avis king of Portugal as a way of guaranteeing the kingdom's autonomy. The same happens after the death of Dom Sebastião I de Avis. Without descendants, there is a dispute over the inheritance of the kingdom, but the Cortes recognize the right of Felipe II (married to Isabel of Portugal) as long as the two kingdoms were kept independent. The Iberian Union (which lasted between 1580 and 1640) did not involve the creation of a single kingdom. The King of Spain was also King of Portugal; which maintained its own laws and independent foreign policy. Only when King Felipe IV of Spain (Felipe III of Portugal) took over and tried to withdraw autonomy from the Portuguese kingdom (which had already been weakened by Spain's disputes with Holland and England), the struggle for full independence resumed. The house of Bragança is chosen to be the new dynastic house. Where does it originate? The first Duke of Bragança is nothing more than … the bastard son of João I, from Avis, who was the bastard son of Pedro I, from the Afonsina dynasty. Because the Braganças are, in fact, descendants and heirs of João de Avis and, by extension, of Pedro I, Afonsiono, Dom João IV, of Bragança, is crowned king.

If we compare this peculiar history with the history of England the contrast is striking. Portugal is marked by early territorial consolidation, by the almost prejudiced resistance to the Castilian neighbor, and by the presence of a single reigning house (despite the formal dynastic changes, respectful to the official progenitors, but, “much more, to the name of the father”) . Dynastic conflicts and disruptive successions of reigning houses in England – some of them strictly foreign! – in the same period (1100 – 1700) are remarkable. Who consolidates the feudal order in England is William the Conqueror, Duke of Normandy. But the power of the nobility was always great, fueling conflicts, civil wars and countless dynastic crises. Already in 1215, João Sem Terra is forced to swear the Magna Carta. As Dom João IV is crowned, Charles I's head is being chopped off in Cromwell's republican England. And the return of the Stuarts to power is cut short by the Glorious Revolution. Which culminates with the coronation of another foreigner as King of England: William d'Orange.

More than dynastic exchanges, what is at stake in English history are open and violent conflicts between different strata of the nobility and property segments. And they are resolved in drastic and striking transformations of an institutional nature, with the growing subordination of the monarch to Parliament and the Judiciary. After all, even executive power did not belong to the prince. On the other hand, in Luso-Brazilian history, conflicts at the top tend to be resolved in a less violent way and with greater flexibility for a return to the top. status quo ante. It is not easy to identify an evolutionary line, from authoritarianism to the liberal-democratic order. In fact, there are even those who question the relevance of the category “revolution” to the histories – so intertwined and so similar – of Portugal and Brazil.

 

Transmigration, Independence and Empire: birth of a nation

The peculiarity of the Luso-Brazilian historical formation will have as its great symbol, the transmigration of the Portuguese State to Brazil during the Napoleonic wars. I believe that there is no other case in world history of a “State that abandons the Nation to remain sovereign”.

The Transmigration – which will result in the Independence of Brazil – synthesizes the three fundamental characteristics of the Luso-Brazilian historical-social formation: (1) the State is extraordinarily strong and, in a certain way, superior to the nation itself; (2) there is a very peculiar sense of nationality, which is both strong and weak: the nation allows itself to be dominated, it does not surrender; but, harassed, flees. For the State is its highest representation; (3) there is change, there is history, but it is always slow, gradual, restricted, negotiated; and there may be reversal.

These three characteristics organize the interpretation of Brazil by Florestan Fernandes and Raymundo Faoro. The two greatest books of these authors – The Bourgeois Revolution in Brazil e The Owners of Power – were the object of antagonistic criticism, despite their very similar theses. Faoro is accused of “lacking history”, of defending a (pseudo) continuity of the national political structure, from its roots in medieval Portugal to monopoly capitalism. Florestan accuses itself of seeing “too much history”, of seeing a bourgeois revolution that never took place. However, from our point of view, both defend essentially the same thesis: that, in Brazil (and in Portugal), history takes place. But it does – slowly, “from above” and permeated by the State”.

The complexity of the issue lies in the fact that the Portuguese-Brazilian State was “precocious” by Medieval standards (in which it emerged), was “exemplary” in the Renaissance (in which it consolidated itself as a trailblazer), was increasingly “conservative” ( since the Counter-Reformation) and being “backward” (as of the Industrial Revolution). If we read this story as a set of contingencies, the sequence seems to reproduce a “normal/universal” cycle of rise-peak-fall; in the line “it is not possible to be the best all the time”. However, if we read the same story from a sociological point of view – based on the idea that the events are anchored in cultural-institutional patterns – we realize that it is exactly the same characteristics that make Portugal and Brazil to be, at each moment, “precocious”, “exemplary”, “conservative” and “backward”: 1) the State is strong and, therefore, there are both laws and exceptions to the laws; 2) the State promotes profit and mercantile accumulation, but does not (and could not, with so many exceptions to the laws) promote industrial accumulation.

The collective action orchestrated through this type of State has its clearest performance in the Brazilian transition to Independence. Who made us independent from Portugal was …. the reigning house in Portugal. Dom João VI transmigrates the State and elevates Brazil to the United Kingdom. His son and crown prince proclaims independence. It is necessary to look at this story with due estrangement!

But even due to its “continuist peculiarity”, the Independence of Brazil could not cease in 1822. It was only truly consolidated nine years later, with the expulsion of D. Pedro I, in 1831. Only then, the lordship would reach its full control of the “new state”. And a still tumultuous control: the labor pains of the Liberal Oligarchic Monarchy will be expressed in the regency revolts. Parliament, aware that the only ones able to pay taxes was the lordship itself, voted for a minimum tax exaction. But each regional oligarchy demanded high public expenditures and investments in “their territories”. The distribution of scarce resources to too many territorially dispersed interests will lead to the explosion of a series of uprisings.

 

From 1817 (Pernambucan Revolution) to 1848 (Praieira), Brazil will be a powder keg…. humid.

After all, without disregarding the violence and death rates of movements such as Farroupilha and Cabanagem, the truth is that most of the regency revolts broke out and died a few months later. And the punishments for the leaders of regional “insurgent” radicals were always lenient. After all, they were part of the same elite. What was in dispute was how much booty each man had. This is something that, in Brazil in the XNUMXth century, was evaluated with the number of men and rifles that each group could count. After some disagreements, we already had an idea of ​​the size of each party. And the division of booty was redefined.

The end of the Regency revolts is inseparable from the emergence of Rio de Janeiro coffee. This coffee is slave-owning, dependent on transmigrated Portuguese mercantile capital and strongly patrimonialist in the deepest sense of the term: the Rio de Janeiro coffee barons – who led the Conservative Party and, through it, commanded the Empire – allowed the State to appropriate part of their surplus on condition that they manage the State and the distribution of benefits.

São Paulo coffee has a totally different origin. Its producers are the sons and heirs of the great landowners and pioneers who were defeated in the Emboabas War and expelled from Minas. And that they started to be producers of provisions (in particular, food) for the Mines and to dedicate themselves to the trade of troops. Alcir Lenharo has a beautiful work on the Liberal Moderado Party of São Paulo, entitled As Troops of Moderation. The book is based on Sain-Hilaire's travel accounts and on the description of the São Paulo merchant-owners whom the French traveler came across on his journey through São Paulo, Minas Gerais and Rio de Janeiro. At first, Saint-Hilaire refuses to believe that owners of thousands of hectares of land would accept to be traders and lead, themselves, troops of mules, in the triangulation between SP-MG-RJ. Until he understood that the São Paulo landowner is peculiar. He was born an Indian preacher. And when his dream of being a great miner was frustrated, he became a merchant, trader and, later, a speculator.

Rui Granziera completes Lenharo's account in The Paraguayan War and Capitalism in Brazil. This text reveals the historical weight of “random synchronicities”. Granziera shows that the completion of the Santos-Jundiaí railroad (1867) occurred precisely at the moment when Duque de Caxias took command of the troops of the Triple Alliance. Caxias had won a substantial increase in public resources to finance the Paraguayan War and was going to supply his troops with mules and food in São Paulo. With the new railroad, mules were no longer necessary to carry merchandise down Serra do Mar. And the Army's demand raised the price of redundant animals and food in such a way that the merchant-farmers of São Paulo acquired the volume of capital necessary to set up large coffee plantations without depending on the financing of commission houses and banks, which appropriated most of the part of the Rio de Janeiro coffee surplus. The new café is alien to the Empire's policy and is not willing to distribute part of the surplus to support the old order and build railroads throughout Brazil. In 1871, the Paulista Republican Party (PRP) was born. Its main flag is federalism. São Paulo coffee wants to get rid of the burden of the rest of Brazil.

 

The Republics – Old and New

In addition to the São Paulo coffee grower, there is another social agent essential to the realization of the republican project: the Army. In fact, this is the most visible and strongest (armed) portion of a new social stratum: the emerging middle class throughout the XNUMXth century. The project that these agents build has a clear positivist-Comtean character. And it involves a strong, regulatory and centralized state. The republican coup is carried out by the Army. But hegemony does not belong to this segment. Floriano overthrows Deodoro and gives power to civilians. That is to say: to civil agents with economic and financial power: the PRP. This, in turn, grants the non-coffee states an autonomy never seen before: the decadent regional oligarchies will be able to fight freely, without any interference from the central power.

The new division of labor involves a new tax order. At the time, there were only two bases for tax exaction: customs business (export and import taxes) and transactions with real estate (rural and urban territorial tax).[I]. With its political and economic hegemony consolidated, the PRP manages to impose a tax reform on the Constituent Congress in which: 1) it is up to the States to tax exports and real estate; 2) it is up to the Federal Government to tax imports. But Brazil only exported coffee! With the exception of São Paulo, the states had no real budget support base! And the import tax is a bad tribute. If the rate is high (as demanded by the emerging industry), imports are depressed and there is not enough revenue. And the cost of living goes up. If the rate is low, the cost of living drops, but the collection is low and so is the collection. Therefore, the Federal Government is obliged to operate with a tax rate that nobody likes. For the consumer, the products are too expensive. For the industry, they are not high enough.

The new order imposed by the PRP will not, however, be stable. Coffee has very special characteristics. If the price goes up, the coffee plantations expand. But production only starts after 3 years and only reaches its peak after 5 years of planting. Therefore, for 5 years, prices will remain high, without an increase in supply. And crops grow, spurred on by a price that won't be sustained once the harvests start. Overproduction crises are thus recurrent. Soon São Paulo will ask the Federal Government for help to institute a permanent coffee valorization plan. And the more the government controls stocks so that international prices do not fall, the more the vicious cumulative circuit expands. On the eve of the 1929 crisis, overproduction is frightening.

Simultaneously, the regional periphery “left to itself” begins to realize that its new federalist freedom was a sham. Discontent erupts and dissensions in the policy of the governors. The coffee came with little milk. And the milk turned sour. The middle class again claimed, now with the support of the new working class. And the lieutenant movement rescues the voice of the second arm of the republican revolution, the one that demanded a strong State: the voice of the Army[ii].

The 30s Revolution in Brazil is unthinkable without the 1929 crisis. And this too – but not so much – in the sense that, in the early 30s, the entire political-ideological-military-diplomatic system supporting the status quo is in crisis internationally. The most important point to understand is how the 29 crisis hit the regional oligarchies, allowing for a rather unusual “historical acceleration” by Luso-Brazilian standards.

The adherence of regional oligarchies to Getúlio's coup surprised and still surprises many analysts. But it has, in fact, a very simple explanation and very well presented by Celso Furtado in his Economic Formation of Brazil. Until the end of the First Republic, Brazil had only two large productive “departments”: the export department (DX) and the worker consumption department (DCT). There was no department producing capital goods (DBK), nor department producing capitalist consumer goods (DCK). It turns out that the DCT is not autonomous. If the entrepreneur pays the salary of his employees and they consume the entire salary with consumer goods produced internally, the entrepreneur exchanges “six for half a dozen”. His profit comes from wages earned in other departments!

Well, “O” (singular definite article) another Department of Brazil at the time was just the coffee complex! And it wasn't despicable. It was not only a question of those employed in agriculture, but in railway transport, in stevedoring and port business, in the trade and processing of coffee, in coffee banks, in land real estate, in the production of sacks, etc., etc., etc. The demand for charque and lard from RS, cotton and fabrics from Maranhão and Ceará, for the production of clothing and food from São Paulo and Minas Gerais came both from workers in these sectors and from workers in the coffee complex. But profits (net of wages paid) in these same sectors came exclusively from the demand of employees in the coffee complex. This is the portion of demand on DCT that transcends wage costs.

In Marx-Kalecki terms, this result is no more than claiming that the profits of the Department producing Goods Salary are equal to the wages paid in the Departments producing Capital Goods (DBK) and Capitalist Consumption Goods (DCK) . It was the coffee complex that fulfilled the role of DBK and DCK, insofar as it made possible (through the generation of foreign exchange with exports) the imports of machines, locomotives, steel, crystal, automobiles, etc.

If Julio Prestes carried out his program and put an end to the coffee support program, all economic sectors would enter the crisis together in pre-industrial Brazil. This was what business and political leaders not directly involved with the coffee business managed to understand. With the helpful assistance of Vargas. The former Finance Minister of Washington Luiz and former Governor of RS had greater knowledge of Economics than is usually intended.

The daring program of valorization of coffee set in motion by Vargas with heavy public deficits saved the economy. He created a “DG” – Government Department – ​​and financed a good part of the business community with loans. Some, lost. And he starts to create, little by little, a DBK (Fenemê, Volta Redonda, etc.). His political situation is weak and encounters resistance from São Paulo, expressed in the Constitucionalista of 32. But the rise of Roosevelt in the USA and of Hitler in Germany, and the preparations for war came to favor him, either by the consecration of intervention policies in the economy (Keynesian policies), or by weakening imperialist (im)positions. Vargas does not resist the end of the War. But he returns in the arms of the people in 1950 and prepares his third government with the support of ECLAC: the entire Plan of Goals was conceived during the last Vargas government, under his tutelage and support, in the Mixed ECLAC-BNDE commission.

Why, then, was Getúlio left without support? Because Getúlio directly controlled all the basic prices of the economy: exchange rate(s), interest rate(s) (via Banco do Brasil, BNDE and Sumoc, which acted as a Central Bank), salary rate (via control of the Minimum Wage), the most diverse taxes, the price of electricity, the price of oil, the price of steel, the price of motors, in short, it defined who won and who lost in “intercapitalist competition”. And he governed, more and more, with the PTB and CGT. It was necessary to stop him. And he was duly "suicide". His suicide prevented the coup and provided conditions for the implementation of the Plano de Metas (PM), by JK. As Furtado wrote in Organized Fantasy: JK took the plan left ready by Vargas and introduced an item: Brasilia. No appropriation or budget forecast.

 

From the Plano de Metas to the impeachment of Dilma: does the country of the future have a future?

The Target Plan was a great success. But it carried an enormous contradiction: the internalization of large multinational capital radically altered capitalist competition in the country. The PM put the fox inside the chicken coop. All the major automakers in the automotive sector – which carried out the internalization of the Department of Capitalist Consumer Goods (DCK) – were multinationals. For the national companies, it was left to produce the auto parts. Until then, so good. But peace could only last as long as there was pent-up demand. The problem with the durable consumer goods sector is that these goods …. last. You don't change cars all year round. As soon as pent-up demand was satisfied, idle capacity emerged. And automakers had no reason to make new investments. They had two alternatives for their profits: either expatriate (send to headquarters) or invest in vertical integration (replace national auto parts suppliers). This was the big problem that Jango inherited from the PM's internalization of foreign companies: if they don't invest, they expatriate (and the country goes into crisis); if they invest, they invade the territory of the national bourgeoisie. And his battle began for a law that would restrict the remittance of profits and the denationalization of the economy, at the same time that it would remove the economy from the crisis of demand. To that end, he mobilized the popular masses along with Brizola. The culture broth was ready for the accelerated reproduction of the scammer bacteria. But it took a plan and reliability.

The Government's Economic Action Plan (PAEG) Castello Branco is a work of genius. It solves the problem posed by the Plano de Metas – the introduction of the multinational fox into the chicken coop of mercantile capital and Luso-Brazilian patrimonialism – through the state administration of intercapitalist competition. First, it redefines the public sector's financing conditions by creating the monetary correction and launching the ORTNs. It controls inflation by limiting the readjustment of nominal wages. It does away with job guarantees and creates the FGTS aimed at financing civil construction. Creates the PIS-PASEP system and provides new financial bases for the BNDE. It complexifies and perfects the financial system, creating savings accounts and investment banks, and guaranteeing this sector for the monopoly of national banks. It carries out a regressive tax reform, taxing consumption and industrial production. And it starts moving the economy with major works and with investments in households through the BNH system and the expansion of consumer credit backed by bills of exchange. This is the basis of the Miracle. A new bourgeoisie – linked to Civil Construction – emerges in the country.

But already in 1973 the Miracle equation set up by the PAEG started to make water. As Florestan predicted in The Bourgeois Revolution in Brazil, the modernization and consolidation of bourgeois power without a citizen-democratic revolution would lead to income concentration, a demand crisis and the resumption of social movements driven by a new unionism. The 1974 elections – won by the MDB – signaled the regime's crisis of legitimacy. Geisel and Golbery pay back via II PND. This is not (unlike the PAEG) a plan to equate the fiscal, financial, expectations and effective demand bottlenecks that were preventing the resumption of growth. It is not a question of resuming the use of installed capacity and investments based on the redivision of work among different fractions of the bourgeoisie. It is a question of taking a new qualitative leap in the national productive structure, similar to that represented by the Plano de Metas with JK and by the creation of the first base industry (Petrobrás, CSN, FNM, Chesf and BNDE) in the Vargas governments. Despite the less favorable international conditions (from the oil crisis onwards) and the failure to set up a national private long-term financing system, the II PND is a great success. It was he who laid the foundations for facing the external financing crisis in the 80s: when the possibility of rolling over the previous debt ceased and Brazil was forced to generate its own trade surpluses – depressing imports and expanding exports – there was a adequate productive base. Why, then, is the 80s called the lost decade?

Because the export leap will take place with large devaluations of the national currency in real terms, which generates brutal inflationary pressures: imported products become more expensive. And exports too. The price at which footwear or a bag of soybeans are sold inside the country is the same as that which can be obtained by selling abroad. With the devaluation, given the dollar price in the foreign market, what the exporter receives in national currency increases. And he wants to receive the same to sell in the domestic market.

At the same time – as Florestan had predicted – throughout the 70s, a new unionism emerged in Brazil, which reacted bravely to the resumption of inflation. But it only conquers a Pyrrhic victory: the automatic wage trigger. Which puts the country in a spiral of wages and prices, which ended up leading to hyperinflation and the brutal concentration of income associated with it. Income concentration in the 1980s was much greater than during the dictatorship itself, imposing new circumscriptions on the internal market and a depression of investments in non-exporting sectors. Inflation control was temporarily obtained, in the 1986 election year, through a price freeze that was suspended shortly after the elections in which the MDB won a landslide victory for the definition of the structure of the Constituent Congress.

In the 1989 elections, the people retaliated and removed from the race all the candidates of the traditional parties – Ulysses Guimarães, Leonel Brizola, Ronaldo Caiado, Paulo Maluf, Mario Covas, Afif Domingues, Aureliano Chaves, Affonso Camargo, among others – to place face to face, in the second round, the worker Lula and the hunter of maharajas Fernando Collor de Mello.

From the point of view embraced here, the 1989 elections are a radical turning point in the consciousness of the “national political elite” (the old Faoro “estate”) regarding the destiny of the nation: redemocratization had come to place the people in the politics of a form in which he was not before. It was – and is! – radically new and, for many, unacceptable. Vargas and Jango were populist. But they were elite. They had a degree, lots of land and a pattern of party insertion that characterized them as “valid agents”. Lula, Collor and Bolsonaro are wines from another barrel. For many, it's vinegar.

In 1994, the election seemed set in Lula's favor. It was the Real Plan that changed everything. This plan is equivalent to a new social pact: hyperinflation was brought under control through a system of mobilization of reserves obtained from exports. Reserves that only came into existence (in 1994, as today) due to the accelerated growth of China. But the system set up is of great perversity for the national industry. Because all price control is done through the goods tradables (transportable). Well, Brazil is the only country in the world that can have three summer harvests. It has an appreciable mineral wealth. But it has no tradition and exemplary competitive capacity in the third sector tradable: the manufacturing industry.

FHC won two elections and did exactly what he had written and proposed as one of the alternatives for overcoming dependence: he opened the doors of the economy to welcome foreign capital with open arms. Even in sectors rigorously defended during the dictatorship, such as the financial system. The novelty is that, in his 8 years in office, he put into practice a project to dehydrate the State. A project that proved necessary to receive “the people” in power with the future victory (long “written in the stars”) of the PT. Privatization-dehydration was the guarantee that the unprepared rabble would not be able to do too much “muddle” in their (presumably short) passage through power. In the calculations of the prince of sociologists and the toucan elite, the PT would remain at most one term. … But scored 4 wins.

At what cost? At the cost of committing to maintaining the Real Plan and real independence (even if still not formalized) of the Central Bank and monetary, financial and exchange rate policy. In other words: at the cost of keeping unchanged the basic structure, the organizing matrix of the economic policy defined by the Pact-Plano Real.

Even so, the PT did a lot. The income Gini index in Brazil has continuously and sustainably fallen at very significant rates. It's just that social policy was made rather than economic development policy. The economy was “pulled” by the social (internal consumer demand) and by the gluttonous China (which catapulted our agribusiness).

Dilma tried to change this scenario with the Growth Acceleration Plan (PAC). But there were structuring problems in the overall program. As Bresser says: the PT tried to dry ice in the sun. Without exchange controls, there is no effectiveness in industrial policy. And it became increasingly dependent on subsidies and administered prices to sustain itself. Dilma controlled inflation by repressing Petrobrás' prices at the same time that she stimulated national industry by forcing Petrobrás to buy national submarine platforms at a price much higher than what could be obtained in the international market (in China and Korea).

That's where the broth spills. It is not possible to distribute income, provide subsidies and pay interest on the debt at the same time in an economy that grows little and that controls inflation through scorching interest rates and an overvalued exchange rate. … The blanket not only turned out to be short: it got shorter with deindustrialization. And the growth rate – which has never been high since the beginning of the 80s – dropped again at the end of the PT governments. Now, in a stagnant economy, any attempt to continue distributing income in favor of a portion of the population involves reducing the real income of another portion. The social pact of the Real Plan guaranteed Faria Lima's earnings. Social policy generated inclusion of those below. Who paid “the duck of this pact” was the middle class. Who rebelled against the World Cup, against high passes, against “corruption” And then came the impeachment.

 

A specter haunts Brazil: the specter of the Coup

An important aspect to emphasize in this analysis that we do is that, from our point of view, the attachment of the post-89 Brazilian bourgeoisie to the neoliberal project is not a manifestation of cultural backwardness or blindness. The project of the current bourgeoisie is the same as always: se the state is under his command, he wants it big. Se is under suspicious command, wants it minimal. It's just minimal for now. While trying to prepare a sustainable autocratic-exclusionary arrangement. A new 1964.

Another relevant point: big Brazilian capital has notorious limits in its competitive capacity vis-à-vis North American, European and Chinese capital. These limits are particularly notable at the industrial level. But this does not make the “national” bourgeoisie a zero on the left in the international dispute. Whether in the field of agribusiness (Friboi-JBS; Marfrig, BrF, etc.), or in the field of Civil Construction (Odebrecht, OAS, Camargo Correa, Andrade Gutierrez, etc.), or in the financial sector (Bradesco, Itaú-Unibanco, Safra, BTG Pactual, Sicoob, etc.), or in mining and metallurgy (Vale, CSN, Gerdau, etc.) the country has companies that operate as players international. And that they are the object of global attention and imperialist retaliation. It was not just Lula who endured a long period in jail before, during and after Dilma's impeachment coup. And these leaders know that neoliberalism is not a sustainable project. Neither in national nor in private terms. We need to disembark from the Real Plan and develop a new PAEG to break with the de-industrializing path. If the popular sectors do not assume this task for themselves, the right will.

*Carlos Águedo Paiva he holds a doctorate in economics from Unicamp.

 

Notes


[I] There was no inspection and control system to tax the value added in commercial transactions, for example

[ii] In fact, those who reconstituted the strong, interventionist state, focused on managing private affairs, were the same group that saw themselves as heralds of the new and radical republican liberalism: the São Paulo coffee bourgeoisie. The tenentista movement is just the re-presentation of an old positivist demand: the State must be strong and interventionist. But for everyone.

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  • Letter to the presidentSquid 59mk,g 18/06/2024 By FRANCISCO ALVES, JOÃO DOS REIS SILVA JÚNIOR & VALDEMAR SGUISSARDI: “We completely agree with Your Excellency. when he states and reaffirms that 'Education is an investment, not an expense'”
  • Volodymyr Zelensky's trapstar wars 15/06/2024 By HUGO DIONÍSIO: Whether Zelensky gets his glass full – the US entry into the war – or his glass half full – Europe’s entry into the war – either solution is devastating for our lives
  • PEC-65: independence or patrimonialism in the Central Bank?Campos Neto Trojan Horse 17/06/2024 By PEDRO PAULO ZAHLUTH BASTOS: What Roberto Campos Neto proposes is the constitutional amendment of free lunch for the future elite of the Central Bank
  • Introduction to “Capital” by Karl Marxred triangular culture 02/06/2024 By ELEUTÉRIO FS PRADO: Commentary on the book by Michael Heinrich
  • The strike at federal Universities and Institutescorridor glazing 01/06/2024 By ROBERTO LEHER: The government disconnects from its effective social base by removing those who fought against Jair Bolsonaro from the political table

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