The economic program of the Brazilian left

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By José Luís Fiori*

History teaches that there are no “right” or “wrong” economic policies in absolute terms; what exists are policies that are more or less adequate to the government's strategic objectives and immediate challenges. The same policies can achieve completely different results, depending on each situation.

In Latin America as a whole, it was only in Chile that there were governments of the left or with the participation of leftist parties in the first half of the 1932th century. In 1938, during the short-lived Socialist Republic of Chile, proclaimed by Air Force officer Marmaduke Grove. And later, during the Popular Front governments – which ruled the country between 1947 and XNUMX – formed by socialists and communists, alongside the radicals, and which was interrupted by the American intervention right at the beginning of the Cold War.

At that time, in general, the question of a “socialist management” of capitalism was not raised for the left in Latin America, nor was any type of government program discussed. The hegemonic thought was revolutionary, and the left only conceived a government that was revolutionary, according to the Soviet model, predominant at that time.

It was only after the Second World War, with the adherence of almost all communist parties on the continent to the theory of the “bourgeois-democratic revolution”, that the idea of ​​an alliance with other “progressive forces” supported by a project to accelerate development was consolidated. and the industrialization of Latin American economies. And it was this new project that forced the left to think about the hypothesis and the need to formulate concrete government programs.

In this new context of the 1950s, the dialogue of the left with “developmental thinking” began and, in particular, with the industrialization program proposed by the Economic Commission for Latin America (ECLAC), which had been created in 1949, under the the intellectual leadership of Raul Prebisch. ECLAC defended the protection of the “infant industry” and the long-term planning of investments in infrastructure and technological innovation. It incorporated some reformist proposals that recalled the “Mexican model” of the 1930s, in a technically more elaborate version, but less nationalist and less statist than the government of President Lázaro Cárdenas had been.

The left's intellectual dialogue with ECLAC's “developmentalism”, and also with the conservative “national-developmentalism” of several countries in the region, was very frequent, but in Brazil and Chile it reached a higher theoretical and technical level. In Brazil, the relationship between the left and national-developmentalism was marked by two fundamental events in the 1930s: the first was the precocious disappearance of the National Liberation Alliance (ANL) – a kind of embryo of the Spanish, French and Chilean Popular Fronts – which was dissolved after the failure of the communist military revolt of 1935; and the second was the conservative coup d'état of 1937, which gave rise to the Estado Novo and its authoritarian project of industrialization and construction of the first urban social protection systems for the working population.

Perhaps that is why the Brazilian Communist Party (PCB) was one of the last in Latin America to abandon the revolutionary strategy of the “Democratic National Liberation Front” and only fully adhered to the strategy of the “bourgeois-democratic alliance” in the 1950s. It was this inflection, by the way, that made it possible for the communists themselves to review their critical position in relation to the second Vargas government and, in particular, in relation to the national-developmentalism of their economic advisory. The same happened in relation to the government of Juscelino Kubitschek, which was transformed by many into the emblematic figure of “bourgeois-democratic industrialism” at the time of the pioneering experience of intellectual coexistence of the left with various shades of national-developmentalism, within the Instituto Superior de Estudos Brazilians (ISEB).

Later on, in the 1960s, the left had a more active presence during the short term in office of President João Goulart, and it was then that the economist Celso Furtado – of ECLAC tradition – proposed his Triennial Plan, which combined a set of reforms social policies with an orthodox fiscal policy, but which even so suffered strong opposition from conservative forces and more radical segments of the left, which at that time included its Trotskyist and Maoist “dissidences”.

In the same decade of 1960, however, the theory and strategy of the “bourgeois-democratic revolution” suffered a theoretical and intellectual attack that did not come from these classic dissidents, starting from the group of Marxist intellectuals that was responsible for the so-called “dependency theory”, formulated in several Latin American thought centers and which had the important participation of a group of Brazilian professors.

The “dependency theory” questioned the possibility of a “bourgeois-democratic” alliance and revolution, due to the inexistence or fragility of the “national bourgeoisie” itself in a continent entirely dependent on the United States. The “dependentistas”, however, who did not adhere to the Cuban revolutionary vision, did not formulate any type of alternative strategy, much less even discuss any type of non-developmentalist government program. This would only happen much later, in particular in the case of Fernando H. Cardoso, one of the formulators of this theory, on the occasion of his adherence to neoliberalism in the 1990s, already in the condition of president of Brazil.

Still in the 1970s, another intellectual segment of left-wing economists also formulated their own theory about what would be the specificities of Brazilian “late capitalism” and established a fruitful dialogue with Keynesian thought and with other “heterodox” economists who came to influence some subsequent governments, after redemocratization in 1985.

The intellectual relationship of the left with conservative developmentalism was definitively mixed up after the military regime installed in 1964 – extreme right and anti-communist – adopted, at the end of that decade, an economic strategy guided by national-developmentalist ideas and objectives, which the military themselves had helped formulate it during the Estado Novo, and also during the 1950s.

Maybe that's why, when the Brazilian left returned to the scene after redemocratization, in the second half of the 1980s, most of its young militancy came to adopt a strong anti-state, anti-nationalist and even anti-developmentalist bias; Only a minority segment, mainly from the intellectual field, bet on the possibility of a new democratic and progressive version of developmentalism, which combined some traits of the old idea of ​​“State capitalism”, defended by the French communists, with the project of a “Welfare State”. -social welfare”, advocated by European social democracy.

After redemocratization, and, above all, after the 1988 Constituent Assembly, a large part of the younger left, born during the military dictatorship, became part of “social” and “collective” movements that resumed the path of utopian socialism, with strong criticism of the traditional left and its developmental “statism”. Another segment of this same trend took the neoliberal path, defending the end of “fiscal populism” and the privatization of the state productive apparatus. This was the path taken in Brazil by those who created the PSDB, but also by an important group of founders of the Workers' Party, who shared the same criticism of the State, nationalism and developmentalism.

In Chile, on the other hand, the strength of leftist parties and Marxist thought, since the 20s and 30s, favored a more direct and “egalitarian” dialogue between the left and the “developmentalist” thinking of ECLAC, whose headquarters were in Chile itself. city ​​of Santiago, capital of Chile. Before the very creation of the UN, the communists and socialists who participated in the governments of the Chilean Popular Front had already adopted as a government program the same model as Lázaro Cárdenas, in Mexico, especially with regard to the planning and financing of industrialization policies, protection of the internal market and construction of infrastructure, in addition to labor legislation and programs for the universalization of education and public health.

In 1970, the left returned to government in Chile, with the electoral victory of Popular Unity, but this time its project was more ambitious and directly proposed the “democratic transition to socialism”. In practice, however, the government of Salvador Allende had the collaboration of several ECLAC economists who contributed to the government program pointing simultaneously in a direction that was developmental, while defending a kind of “organized State capitalism”, as an economic path towards “democratic socialism”.

The Allende government accelerated the agrarian reform and the nationalization of foreign copper-producing companies, initiated by the Christian Democrat government of Eduardo Frei, and initiated the creation of a state-owned “strategic industrial nucleus” that would lead the Chilean economy and was the embryo of a future socialist economy. Salvador Allende's "democratic transition to socialism" was interrupted by a military coup that had the decisive support of the United States, in 1973, and the theoretical and strategic debate of the Chilean left, on "democratic socialism" and on "capitalism". organized” was interrupted, becoming inconclusive.

After that, Chile became, in the 1970s, the pioneering laboratory for experimenting with the “market fascism” of which Paul Samuelson speaks. But in 1990, the Socialist Party returned to government, allied with the Christian Democrats. In this new opportunity, the Chilean socialists had already changed their position and adhered to the new neoliberal program also sponsored by the European socialists and social democrats. Its objective was no longer to “transition” to socialism; it was just running a liberal market economy efficiently, albeit with some important social corrections. Until the moment when Chile was taken from north to south, and from east to west, by the “social rebellion” of October 2019, which has not yet ended and which demands the end of the last vestiges of the ultraliberal model established by the 1982 Constitution , imposed by the military dictatorship of General Pinochet.

In the first decade of the XNUMXst century, for the first time in the history of the continent, and after the resounding failure of the neoliberal experiences of the previous decade, the left took over the government of several important countries in South America, including Brazil and Argentina – often allied with center and even center-right parties, but with new leaderships that were projected worldwide, with a discourse contrary to neoliberalism and a project of more egalitarian, sustainable and sovereign capitalist development.

But in the second decade of this century, almost all these experiences of government were interrupted by a rightist and neoliberal reversal, including coups d'état in several cases, with strong US intervention. A cyclical movement was reproduced, in the form of a “seesaw”, which has long since become a “regular pattern” in Argentina. Despite this, the great political and economic success of this pioneering experience in two small countries, Uruguay and Bolivia, should be highlighted, despite the fact that the successful Bolivian experience was also interrupted by a coup d'état jointly sponsored by Brazil and by the United States.

In the particular and extremely successful case of the Lula government, regardless of occasional variations in its macroeconomic policy, accelerated economic growth was coupled with a fall in the public sector's net debt in relation to GDP, and an exponential increase in reserves, with simultaneous increase of employment and wages, and with the fall of poverty and social inequality. All this added to an affirmative and sovereign foreign policy, with the active promotion of Latin American integration.

And even though there was a slowdown in the economy during Dilma Rousseff's government, this was not what caused the 2015/2016 coup d'état. On this controversial point, what history teaches is that there are no “right” or “wrong” economic policies in absolute terms; what exists are more or less adequate policies, once the government's strategic objectives and immediate challenges have been defined. And even so, the same policies can have completely different results, depending on each government and each country, see the case of Venezuela.

Regardless of possible political or strategic mistakes by the Venezuelan government, it is ridiculous to “academically” discuss “mistakes” in economic policy in a country that is literally surrounded and lives under the weight of “economic sanctions” imposed by the United States since its failed coup d’état. from 2002, and even more strictly from 2014. In the case of these countries that suffer “economic sanctions”, it is very difficult to find a solution that is viable and efficient, and at the same time causes the least possible social damage. The only known alternative, to this day, continues to be the “war economy” practiced by North Americans and Europeans at various times in their history, in particular during their two great wars of the XNUMXth century.

This is not an inevitable path, nor is it comfortable for anyone, but it should certainly serve as a warning to all leftist governments that are starting out in the beginning of the third decade of the XNUMXst century.

* Jose Luis Fiori He is a professor at the Graduate Program in International Political Economy at UFRJ.

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