Brazil's Neoliberal U-Turn in 2015-16 (original) (raw)

Political Aspects of Unemployment: Brazil's Neoliberal U-Turn

Throughout the world, the reversion of fortune suffered by the Brazilian economy since reaching its zenith as recently as 2010 has confounded shrewd commentators, seasoned analysts and market players alike. As 2015 unfolded, ominous projections ("An Economy on the Brink", "Brazil's Economy Falters" "Worse May Be To Come") were no less widespread than expressions of bewilderment ("Whatever Happened to Brazil", "Brazilian Waxing and Waning", "Brazil's Scandalous Boom to Bust Story"), and, more recently, of alarm ("Goldman Sachs Says Brazil Has Plunged Into ‘An Outright Depression’") concerning the fate of the South American BRIC country. Despite profuse official protestations to the contrary, however, Brazil's afflictions turn out to be of its own making, as it so often proves to be the case. Looking at the set of clearly laid-out policy choices made by the Brazilian government – and the almost as clearly spelled-out political objectives underlying them – should provide enough explanatory evidence to plot the course that, starting from a situation of social welfare and prosperity, took Brazil to situation of recession and rampant unemployment within a relatively short period of time. The purpose of this paper is to examine the recent neoliberal U-turn in Brazil from the conceptual standpoint of Political Economy.

The Brazilian Post-Neoliberal Experiment

The post-neoliberal experiment in Brazil hinged on the idea that the state should take an increasingly greater role in most aspects of a country’s life, especially the economy and in its general development mode. From the early 2000s, the return of the state, powered by the so-called “New Left” post-neoliberal policies and governance stance seemed to work as a novel approach to a return of the all-encompassing socially inclusive welfare state. Until the second semester of 2015, the project of post-neoliberal inclusive development attained remarkable success. Benefitted by a benign global economic scenario, buoyed by China’s growth and bolstered by rising commodity prices, the Brazilian state created and maintained food and social security policies, and reached a certain level of improved fiscal policy and reduced external and internal debt. The tensions of overt and covert agreements between government and businesses, weak governance mechanisms and growing unsustainable social expectations foundered the experiment. I specifically examine the roles of BNDES, Petrobras, the Bolsa Família program, China as a trade partner and the Lava Jato Operation as drivers of the multiple crises Brazil faces in 2016. This article explores the unsustainability of the economic and political basis of the post-neoliberal experiment in Brazil (2003-2014) and argues that it in fact ended in the first semester of 2015.

Varieties of Neoliberalism in Brazil (2003–2019)

LATIN AMERICAN PERSPECTIVES,, 2020

The main feature of capital accumulation in Brazil during the administrations led by Luís Inácio Lula da Silva and Dilma Rousseff of the Partido dos Trabalhadores (Workers' Party-PT) was the continuity of neoliberalism of two varieties: inclusive (2003-2006) and developmental (2006-2013). The PT's attachment to neoliberalism was mitigated by the party's (shifting) commitment to (mild) developmental outcomes, redistribution of income (at the margin), social inclusion (within narrow limits), and democratization of the state (bounded by the 1988 Constitution). Achievements in these areas were further constrained by the inability or unwillingness of the PT to confront the institutionalization of neoliberalism in the fields of economics, politics, ideology, the media, and class relations. The political crisis unfolding in Brazil since 2013 and the imposition of authoritarian neoliberalism after Rousseff's impeachment can be examined from the perspective of the contradictions in the dominant varieties of neoliberalism under the PT and the limitations of the party's political ambitions. A principal característica da acumulação de capital no Brasil durante os governos ûiderados por Luís Inácio Lula da Silva e Dilma Rousseff do Partido dos Trabalhadores (PT) foi a continuidade do neoliberalismo de duas variedades: inclusiva (2003-2006) e desenvolvimentista (2006-2013). O apego do PT ao neoliberalismo foi mitigado pelo compromisso (inconstante) do partido com resultados de desenvolvimento (moderados), redistribuição de renda (na margem), inclusão social (dentro de limites estreitos) e democratização do estado (limitado pela Constituição de 1988). As realizações nessas áreas foram ainda mais limitadas pela incapacidade ou falta de vontade do PT em enfren-tar a institucionalização do neoliberalismo nos campos da economia, política, ideologia, mídia e relações de classe. A crise política que se desenrola no Brasil desde 2013 e a imposição do neoliberalismo autoritário após o impeachment de Dilma podem ser exam-inadas sob a perspectiva das contradições nas variedades dominantes de neoliberalismo sob o PT e as limitações das ambições políticas do partido.

Brazil: Towards a Neoliberal Democracy

Brazil during the neoliberal era is a particularly interesting case because it is an example of economic policy being consciously used to reform the nature of both the economy and politics of a country while simultaneously reflecting a shift in nature of policies required for electoral success. It is also an interesting case because the political leadership in the country at the presidential level was the critical factor initiating, leading, and maintaining the transformative economic policies. As will be set out in the first section, Fernando Henrique Cardoso drew on a new political reality to explicitly deploy the principles of classical liberal economics during his presidency (1995-2002) in an effort to consolidate and further liberalize democracy within Brazil while simultaneously seeking to create a stable platform upon which future years of growth might take place. The criticality of the political shift that underpinned Cardoso’s programs was reinforced by the presidency of the Workers’ Party Luiz Inácio da Silva. The cosmetic twists and turns Lula added along the way to appease his political base will be outlined in the second section. The transformation in Brazil’s profile that begins to emerge in the final section suggests that it is not liberal or neoliberal-style economic policies that are the problem per se, but that the failures stem from a lack of concomitant governance reforms, chiefly the absence of adequate institutional and regulatory reform as well as a shortage of investment in key areas such as infrastructure.

A precarious hegemony: neo-liberalism, social struggles, and the end of Lulismo in Brazil

Globalizations, 2018

Analysis of Brazil's political and economic crisis tends to emphasize the economic 'errors' that President Dilma Rousseff's Workers' Party (PT) government inherited from her predecessor Luíz Inácio Lula da Silva. It is clear, however, that political regulation is too narrow a focus to understand the current crisis. Such an explanation is unable to reveal the changes in class structure that took place during the Lula era as well as the effects of the international economic crisis. This article identifies the limits of the Brazilian development model and the main features of Lula's mode of regulation; analyses the conflicts produced by the neo-liberal regime of accumulation and the Lulista mode of regulation, emphasizing the role of precarious work in the current historical cycle of strikes and popular struggles in Brazil; and, finally, interprets the palace coup promoted by the social forces behind the impeachment of President Rousseff.

Political Aspects of Unemployment: Brazil's Neoliberal U-Turn (2015)

The purpose of this paper is to examine the recent neoliberal U-turn in Brazil from the conceptual standpoint of Political Economy. Looking at the set of clearly laid-out policy choices made by the Brazilian government under DIlma Rousseff – and the almost as clearly spelled-out political objectives underlying them – provides the necessary explanatory evidence to plot the course that, starting from a situation of improving social welfare and growing prosperity, took Brazil to a situation of deepening recession and rampant unemployment within a relatively short time.

NEOLIBERALISM AND AGGRAVATION OF SOCIAL PROBLEMS IN BRAZIL

The neoliberal economic model implemented in 1990 is largely responsible for worsening Brazil's social problems today. Social devastation has been the main result of the neoliberal economic model in Brazil inaugurated by President Fernando Collor in 1990 and maintained by Presidents Itamar Franco, Fernando Henrique Cardoso, Lula da Silva, Dilma Roussef, Michel Temer and Jair Bolsonaro. The current economic recession, social inequality, mass unemployment and the extreme poverty of the country demonstrate the infeasibility of the neoliberal model implemented in Brazil. The social devastation suffered by Brazil with social inequality, mass unemployment and extreme poverty is demonstrated through indicators of concentration of income, unemployment, social inequality and extreme poverty.

Neo-mercantilist Capitalism and Post2008 Cleavages in Economic Decision-making Power in Brazil

Third World Quarterly, 2012

The 2008 subprime crisis led to a global wave of bailouts and other political-economic measures by governments. These moves were seen as the rise of a new statism. Emerging giants, such as Brazil, introduced new growth policies and reinforced state-crediting of corporations. This article briefly discusses key institutional, structural and ideological lineages and dilemmas in post-2008 statism and capitalism in Brazil. Neo-mercantilist capitalism is visible, for example, in the new ‘National Champions’ strategy aiming to create export-focused, leading global-sector corporations via mergers orchestrated by key politicians, capitalists and state financial institutions. Changes after a bailout–merger in the paper industry suggest that, after the 2008 financial crisis, in Brazil as elsewhere the use of public funds has had multiple and complex impacts, including the saving of corporations, the concentration of power in those best connected in the political economy, and further exacerbation of class-based inequalities in economic decision making.

THE HARMFUL EFFECTS OF NEOLIBERALISM ON BRAZIL AND HOW TO OVERCOME THEM

The practice has demonstrated the impracticability of the neoliberal economic model in Brazil inaugurated by President Fernando Collor in 1990 and maintained by Presidents Itamar Franco, Fernando Henrique Cardoso, Lula and Dilma Rousseff. Low economic growth in Brazil and the disproportionate rise in federal debt during the Cardoso, Lula and Dilma Rousseff governments demonstrate the infeasibility of the neoliberal model implemented in the country. Not only FHC left a compromising economic legacy of Brazil's development. Lula and Rousseff are also responsible for this situation because they were not able to adopt an economic model that would contribute to the effectiveness of economic and social progress in Brazil. As far as the Cardoso government, Lula and Dilma Rousseff governments maintained the neoliberal model that helped to cause real havoc in the Brazilian economy from 2002 to 2014 set in: 1) the meager economic growth and runaway inflation; 2) the bottlenecks on the economic and social infrastructure; 3) the de-industrialization of the Brazilian economy; 4) the explosion of internal and external debt, the denationalization of the Brazilian economy and the deepening financial crisis in the public sector; 5) the failure of government social policy and the elimination of regional inequalities; 6) the worsening state of the environment; and 7) the resumption of privatization policy.