Thought Breaks

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By LUIZ CARLOS BRESSER-PEREIRA*

Excerpts from the recently released book, an autobiography in interviews given to João Villaverde and José Marcio Rego.

The first theories

In the 1970s, while I was working hard at Pão de Açúcar and teaching my classes at FGV, I immersed myself in the development of new theories. First, it was the definition of Brazil's new development model, which I called the industrialized underdevelopment model. Then there was my deepening in the studies of Marx and the construction of two critical theories of Marxism using Marxist concepts: the theory of the emergence of technobureaucracy and organization as the production relation proper to the state mode of production, and the theory of distribution where the profit rate is constant in the long run and the wage rate is the residual. In this decade, I still carried out the analysis that many consider to be a pioneer of the Brazilian democratic transition, which was based on the theory of democratic consolidation that was already outlined in my mind, but that I only formulated much later.

In Brazil, the 1970s are still the years of the miracle, and, when it ends, of the Second National Development Project – of the strong association between national companies producing capital goods, state-owned companies, and the military government. It is the decade in which the military regime begins to face political problems, first, in the 1974 elections and then with the April 1977 Package. In the world, it is the decade of the humiliating defeat of the United States in the Vietnam War. It is a decade of economic crisis in the United States and the United Kingdom, of falling profit rates and stagflation. It is the moment when Keynesianism enters a crisis.

At the end of the 1970s, the neoliberal turn took place. Neoclassical theory returns to be dominant in universities, while market fundamentalism in neoliberal economic reforms starts to transfer all the cost of adjustment to wage earners, while sparing the new coalition of dominant classes – the financial-rentier coalition.

In terms of ideas, in 1969 something important happened to me. Antônio Barros de Castro is coming to São Paulo to give a conference at PUC. 54 He had returned from Chile, where left-wing intellectuals had converged with the military coups of 1964 in Brazil, 1967 in Argentina, and 1968 in Uruguay. Brazil was then experiencing the “miracle” – growth rates above 10 percent. Castro had spent some time there and says “a new discussion is emerging in Chile about the idea that Brazil would tend towards economic stagnation”, something that Celso Furtado had defended in the book he wrote in 1966, Underdevelopment and Stagnation in Latin America. Instead of stagnation, there was growth and an increase in inequality, which, however, includes the middle class. Now, this middle class served as a demand for the automobile industry or for luxury goods and, therefore, this explained the economic development that was taking place in Brazil from 1968 onwards.

Antônio never wrote this essay. In 1970, I wrote the essay “Divide or Multiply: Distribution of Income and the Recovery of the Economy” in which I defended this idea. The 1970 census was not yet available, and I used a 1968 survey on income concentration in major Brazilian cities. I quote, naturally, Castro's conference. I am not quoting the famous essay by Maria Conceição Tavares and José Serra, “Beyond stagnation”. That article, published in 1971, presented the same ideas and had great repercussions. My article was published in December 1970 in the magazine Visão. This essay ran throughout Latin America. Plinio de Arruda Sampaio, who was in Chile, read it and told me about it when he returned here.

The military had implemented a new model of economic development in Brazil. A model that caused an increase in inequality from the middle class upwards – a class that served as a market for the automobile industry. After the 1970 article on the subject, I write the essay called “The new model of development”. And for four years I write a book, State and Industrialized Underdevelopment, whose central idea is this. It is a book, which was published in 1977, in which I adopt a medium level of abstraction. You can do a very general theory or stay at a medium level. In this case, the theory fits very well with reality itself, but it is not a direct analysis of reality itself, nor is it a theory. It's a good book, but it had this flaw. It would have been better if I had limited myself to analyzing what was happening in the Brazilian economy and society.

My intellectual concerns in the 1970s were with the new model of industrialized underdevelopment that Brazil and the other Latin American countries had adopted, with the new managerial or technobureaucratic class, and with the discussion of Marx's tendency for the rate of profit to fall. The discussion of the new model was the critique of military regimes from an economic and political point of view. I was discussing the tripartite alliance that existed in Brazil between the bourgeoisie, government and multinationals.

Ignacio Rangel

I met Rangel when I was at ISEB, in the 1950s, but I didn't know him well, I wasn't his friend. I became friends with Hélio Jaguaribe, Guerreiro Ramos and Cândido Mendes de Almeida. I read The Brazilian Inflation when it was published in 1962 and I discussed it with Delfim and his team at FEA. In that book, Ignácio defended the idea of ​​cost or administrative inflation and I adopted this thesis, always relating it to him. He also showed that inflation was a defense mechanism for the economy against the Keynesian problem of insufficient demand, which he called idle capacity.

Then time passed and I lost sight of him. I only met him again in 1972, when, suddenly, he appeared at a meeting of the Brazilian Society for the Progress of Science, which that year was held at USP. This was not one of those huge meetings that would take place later on, when the SBPC helped to overthrow the military regime. But there was an Economics session, Antônio Barros de Castro was there, and suddenly Rangel appears. He had had a heart attack after all the suffering that the 1964 military coup represented for him. The end of ISEB was deeply traumatic for its great intellectuals. They began to be persecuted by the right and left – this one with the argument of dependency theory, with the thesis that those who had defended a developmentalist class coalition supported by a national bourgeoisie had committed a big mistake if not a betrayal. Absurd. Behold, at the SBPC meeting, Rangel arrived, an “old man” (laughs). What an old man! He presented a small paper on the Kondratieff cycles and the probable crisis that would ensue in capitalism.

That was 1972, mind you. And what happens in 1973? The first oil shock and with it a major economic crisis. The crisis came exactly as Rangel said it would. I was delighted with it, I enjoyed seeing it again. I became friends with Rangel from then on. I always tried to be friends with my Brazilian masters – Celso Furtado, Rangel and Jaguaribe. And I paid tribute to them while still alive with a well-prepared article about his work. I went to Rio to talk and have dinner with Rangel a few times.

At one of those dinners he said his book needed a new edition. And I gave the idea to Caio Graco Prado, who was the editor of Brasiliense, who accepted it with pleasure. The new edition came out in 1978. The preface I wrote for the new edition was of little interest; on the other hand, the afterword written with Rangel was great. He had the idea of ​​financing the large infrastructure works that Brazil needed with the receivables of state-owned companies. It was a great solution.

center left

I have always defined myself as a center-left person, I have always been a progressive: on the one hand, a social democrat concerned with social justice, on the other, a republican committed to the common good; thus, I have always been a critic of individualist liberalism who does not understand that freedom is only possible if there are republican citizens in society who are willing to sacrifice their private interests in the name of the public interest.

When I was 12, 13, 14 years old, I discussed things at Colégio São Luís with Manoel Goncalves Ferreira Filho: I read the Diary of São Paulo and he, the Estadão – the conservative newspaper of São Paulo. And we disagreed because the daily it was more progressive – not much more progressive; it was a newspaper from Assis Chateaubriand. Then I joined Catholic Action, which then brought together progressive Catholics. Then I discovered ISEB and became a center-left developmentalist. I was never on the radical left; there was a moment, in the late 1970s, when I thought: “will the socialist revolution solve the problem?”, but I never believed it. I saw what was happening in the Soviet Union – how the technobureaucracy had taken over and turned socialism into statism.

Marxism

I never really got into Marxism, but Marxism has always been a basic reference for me. At that moment I was interested in two themes, both involving a critique of Marx, but a critique that I consider internal, because I used his concepts and his historical-dialectical method. One theme was sociological, the theme of the third social class or technobureaucracy, the other economic, the question of the tendency for the rate of profit to fall.

In the 1970s I defended the thesis that a third class was emerging in capitalism – the technobureaucratic or managerial class. A class not envisaged by Marx, but whose emergence was consistent with historical materialism. A third class that implied a disturbance for political theory. One could no longer understand capitalism as simply a struggle between the bourgeoisie and the proletariat. It was impossible to understand modern society and capitalism without understanding that capitalism was now technobureaucratic or managerial capitalism in which a managing middle class had arisen among workers and capitalists.

* Luiz Carlos Bresser-Pereira He is Professor Emeritus at the Getulio Vargas Foundation (FGV-SP). Author, among other books, of In search of lost development: a new-developmentalist project for Brazil (FGV).

Reference


João Villaverde and José Márcio Rego. Bresser-Pereira: ruptures of thought (an autobiography in interviews). São Paulo, publisher 34, 2021, 400 pages.

 

 

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