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Cps Brazil

The document outlines the political history of Brazil from its independence in 1822 to recent events, highlighting key milestones such as the establishment of various constitutions, the rise and fall of political leaders, and significant corruption scandals. It discusses the impact of protests in 2013 that led to increased accountability measures and the eventual impeachment of President Dilma Rousseff in 2016. Additionally, it provides insights into Brazil's geographic and demographic context, emphasizing its diverse society and the challenges faced by its democratic institutions.

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370 Brazil

CHRONOLOGY of Brazil’s Political Development

1930
1822 Getúlio Vargas gains
Dom Pedro I declares 1950
power after a coup
himself emperor of Vargas is elected
led by military and
Brazil, peacefully
political leaders. His president. 1960
ending 300 years 1888 period of dictatorship Scandals Jânio Quadros
of Portuguese Abolition of precipitate his
(1937–1945) is known becomes
colonial rule. slavery suicide in 1954.
as the New State. president.

1800 1850 1900 1930 1950 1960

1824 1891 1945 1956
Constitution A new constitution establishes a Vargas calls for Juscelino
drafted directly elected president. general elections. Kubitschek
General Eurico becomes
1889 Dutra of the president.
Dom Pedro II, who assumed throne in Social Democratic
1840, is forced into exile; landowning Party wins.
elites establish an oligarchical republic.

THE MAKING OF THE MODERN

1
SECTION

BRAZILIAN STATE

Focus Questions Politics in Action

●● Why has the authority
of government varied In 2013, four years after the decision of the International Olympic Committee (IOC)
between the central to award Rio de Janeiro the 2016 Summer Games, and a year before Brazil prepared
state and subnational to host the prestigious 2014 World Cup of Football (soccer), massive protests on
authorities from the streets of major Brazilian cities galvanized the world. The protestors, many of
independence to the
present?
whom were young and college educated, directed their anger at the corruption of the
political class and big construction firms that were seen as having benefited directly
In what major ways
from the large infrastructure projects needed to host both international sporting
●●

has Brazilian democ-

racy been limited events. Pressed by these protests, President Dilma Rousseff and the Brazilian con-
since independence? gress passed anticorruption legislation during the summer of 2013 to expand the
powers of investigatory institutions such as public prosecutors and the Federal Police.
Little did they anticipate that they were inadvertently strengthening accountability
institutions that would soon train their powers on them. During the next three years,
federal prosecutors, judges, and courts of auditors would uncover systemic corrup-
tion involving the state oil company, Petrobras, the major political parties, and the
largest construction companies in Brazil. Rousseff’s own presidency ended abruptly
in August 2016, when she was impeached for fudging the federal budget.
Her vice president and immediate successor, Michel Temer, and his cabinet would
struggle under the weight of continued investigations, leaks from plea bargained tes-
timony, and numerous search and seize operations against even cabinet ministers and
the leaders of congress. As the public was deluged with evidence that their political

370 CHAPTER 9 Brazil

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1964 1984 1988 1992 2010 2015
A military coup Diretas Já!, A new Collor is Dilma Rousseff, The “car wash”
places power a mass constitution impeached; Lula’s former (Lava Jato)
in the hands mobilization grants new Vice President 2002 chief-of-staff, is corruption
of successive campaign, social and Itamar Franco 1998 Lula da Silva elected Brazil’s investigation
authoritarian calls for direct political assumes Cardoso is is elected first woman engulfs much
regimes. elections. rights. presidency. reelected. president. president. of the political class.

1970 1985 1990 1995 2000 2010 2016

1961 1985 1989 1994 1999 2006 2014 2016
Quadros resigns. Vice-presidential Fernando Fernando Henrique The Real Lula is reelected Rousseff is Rousseff is
João Goulart gains candidate José Collor Cardoso is elected Plan after surviving reelected impeached
presidency despite Sarney becomes is elected president after his weathers a a corruption president. and her
an attempted president on the president. Real Plan controls financial scandal. vice president,
military coup. sudden death of inflation. crisis. Michel
elected president Temer,
Tancredo Neves. becomes
president.

leaders and the executives of some of the most successful companies have benefited
from systemic graft, popular revulsion has raised questions concerning the quality of
Brazil’s democracy. Is Brazilian democracy failing, due to systemic corruption, and is
it becoming more ungovernable as so many members of the political class are investi-
gated? Or is Brazilian democracy moving through an important transition in which
the strength of accountability-enhancing institutions secure a less corrupt and more
responsive form of government in the future?

Geographic Setting
Larger than the continental United States, Brazil occupies two-thirds of South
America. Its 206 million inhabitants are concentrated in the urban southern and
southeastern regions; the vast northern Amazon region, with 5.3 million, is sparsely
populated.
Brazil includes thick rain forest in the Amazon valley, large lowland swamps (the
pantanal) in the central western states, and vast expanses of badlands (the sertão) in
the north and northeast. The country is rich in natural resources and arable land. The
Amazon has an abundance of minerals and tropical fruit; the central and southern re-
gions provide iron ore and coal; and offshore sources of petroleum are significant and
will become even more so as they are exploited. Brazil’s farmlands are highly fertile.
The Amazon’s climate is wet, the sertão is dry, and the agricultural areas of the cen-
tral, southeastern, and southern regions are temperate. Natural resource e xploitation
make the fragile ecology of the Amazon a matter of international concern.
Immigration of Europeans and Africans has contributed to an ethnically mixed
society. Approximately 48 percent of the population is white, 43 percent mulatto
(brown), 8 percent black, and 0.5 percent Asian.1 These numbers probably ignore
people of mixed race, who are sometimes classified erroneously as being white or mu-
latto. The indigenous people of the Amazon basin are estimated to number 250,000.
The Asian population, which numbers just over 1 million, is dominated by people of
Japanese descent who immigrated from 1908 through the 1950s.

SECTION 1 The Making of the Modern Brazilian State 371

FIGURE 9.1 The Brazilian Nation at a Glance

Brazil is a blend of different cultural influences, although Portuguese as the

common language helps keep Brazilians united. Brazilians are not greatly divided
over religious differences. About 65 percent of the population professes Roman
Catholicism, although the Church plays only a secondary role in politics and society
(see Section 4). Evangelical Protestants have recently made inroads. Protestants now
compose about 22.2 percent of the population. Afro-Brazilian and indigenous reli-
gions also operate alongside the Catholic liturgy (see Figure 9.1 and Table 9.1).
moderating power
(poder moderador)
A term used in Brazilian
politics to refer to the
Critical Junctures
situation following the
1824 constitution in The Brazilian Empire (1822–1889)
which the monarchy
Brazil was a Portuguese colony, not a Spanish one, and it escaped the violent wars of
was supposed to
act as a moderating independence that afflicted the Spanish colonial system. Brazilian independence was
power, among the declared peacefully by the Crown’s own agent in the colony in 1822 after the King of
executive, legislative, Portugal left his own son to rule. With this monarchical connection, Brazilian inde-
and judicial branches of pendence could be secured without the violent rupture in the Spanish cases.
government, arbitrating
To control its sprawling territory, Brazil centralized authority in the emperor,
party conflicts, and
fulfilling governmental who acted as what Brazilians call a moderating power (poder moderador), medi-
responsibilities when ating conflicts among the executive, legislative, and judicial branches of govern-
nonroyal agents failed. ment and powerful landowning oligarchy. This centralization contrasted with other
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SECTION 1 The Making of the Modern Brazilian State 373

Table 9.1 Political Organization

Political System Federal republic, presidential with separation of powers.

Regime History Democratic since 1946 with periods of military authoritarianism, especially
1964–1985.

Administrative Federal, with twenty-six states plus the Federal District, which also functions as a
Structure state. Subnational legislatures are unicameral. State governments have multiple
secretariats, the major ones commonly being economy, planning, and infrastructure.
The states are divided into municipalities (about 5,570), with mayors and councillors
directly elected.

Executive President, vice president, and cabinet. The president and vice president are directly
elected by universal suffrage in a two-round runoff election for 4-year terms. Since
1998, the president and vice president may run for a second term.

Legislature Bicameral: The Senate is made up of three senators from each state and from the
Federal District, elected by plurality vote for an eight-year term; the Chamber of
Deputies consists of representatives from each state and from the Federal District,
elected by proportional vote for a four-year term.

Judiciary Supreme Court, High Tribunal of Justice, regional courts, labor courts, electoral
courts, military courts, and state courts. Judiciary has financial and administrative
autonomy. Supreme Court justices are subjected to mandatory retirement at 75.

Party System Multiparty system including several parties of the right, center-right, center-left,
and left. Elections are by open-list proportional representation. New parties must
register with the Superior Electoral Court after having acquired sufficient signatures
to meet a minimal threshold in at least nine states.

postcolonial Latin American states, which suffered numerous conflicts among ter-
ritorially dispersed strongmen (caudillos).
Imperial Brazil enjoyed several features of representative democracy: regular elec-
tions, alternation of parties in power, and scrupulous compliance with the constitution.
Liberal institutions only regulated political competition among rural, oligarchical elites;
most Brazilians, who were neither enfranchised nor politically organized, were left out.

The Old Republic (1889–1930)

In 1889, came the peaceful demise of the empire, the exile of Emperor Dom Pedro
II, and the emergence of a republic ruled by the landowning oligarchy. The decline of
slavery and the rise of republicanism ended the empire. The coffee economy created
a growing economy autonomous from the state. The coffee planters, who consti-
tuted a wealthy oligarchy, embraced liberal political values to limit centralized politi-
cal authority. As these elites grew suspicious of attempts to centralize power, they
d iscounted the need for a moderating power in the national state.
The Old Republic (1889–1930) was based on the influence of coffee growers and
a small urban industrial and commercial class linked to the coffee trade and a ranch
economy that produced meat and hides. The constitution of 1891, inspired by the
U.S. model, established a directly elected president, guaranteed separation of church
and state, and gave the vote to all literate males (about 3.5 percent of the population
before 1930). The legitimacy of the republican political system was established on
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374 CHAPTER 9 Brazil

© Cengage
governing principles that were limited to a privileged few, but no longer determined
by the hereditary rights of the emperor. The states gained greater authority to formu-
late policy, spend money, levy taxes, and maintain their own militias.
Although the constitution expressed liberal ideas, most Brazilians lived in rural
clientelism areas, where the landed oligarchy squashed dissent. As in the southern United
An informal aspect of
States and in Mexico, landed elites manipulated local politics. In a process known
policy-making in which as c oronelismo, these elites, or colonels, as they were known, manipulated their poor
a powerful patron (for workers so they would vote to elect officials favored by the elite.
example, a traditional These ties between patron (landowner) and client (peasant) became the basis of
local boss, government modern Brazilian politics. In return for protection and occasional favors, the client
agency, or dominant
political party) offers
did the bidding of the patron. As cities grew, and the state’s administrative agencies
resources such as land, expanded, the process of trading favors and demanding political support in return
contracts, protection, became known as clientelism.
jobs, or other resources In contrast to the centralized empire, the Old Republic consecrated the power
in return for the support of local elites. Governors and mayors were empowered to control areas of economic
and services (such as
labor or votes) of lower-
policy delegated by the federal government.
status and less powerful
clients. Corruption,
preferential treatment,
The 1930 Revolution
and inequality are As world demand for coffee plummeted during the Depression of the 1930s, the cof-
characteristic of clientelist
politics.
fee and ranch elites faced their worst crisis. Worker demonstrations and the Brazilian

Communist Party challenged the legitimacy of the Old Republic. Among the discon- interventores
tented political elites, a figure emerged who transformed Brazilian politics forever: In Brazil, allies of
Getúlio Vargas (see “Profile: Getúlio Dornelles Vargas” in Section 3 of this chapter). Getúlio Vargas (1930–
Vargas came to power as the head of a new “revolutionary government,” but it 1945, 1950–1952),
favored a dissident elite. That is why Vargas swiftly crushed middle-class and popu- who were chosen by
the dictator during his
lar dissent. He built a political coalition around a new project of industrialization first period of rulership
led by the central government and based on central state resources. Unlike the Old to replace opposition
Republic, Vargas controlled regional governments by replacing all governors with governors in most
handpicked allies (interventores). The center of gravity of Brazilian politics swung states. The interventores
back to the national state. represented a shift of
power from subnational
Vargas believed he could win the support of landed elites, commercial interests, bu- government to the
reaucrats, and the military by answering their demands in a controlled way. They were central state.
allowed to participate in the new political order, but only as passive members of state- state corporatism
created and state-regulated unions and associations. This model of state corporatism
A system of interest
rejects the idea of competition among social groups by having the state arbitrate all con- representation in which
flicts. For instance, when workers requested increases in their wages, state agencies deter- the constituent units
mined to what extent such demands would be met and how business would pay for them. are organized into
By 1937, Vargas had achieved a position of virtually uncontested power. During a limited number of
singular, compulsory,
the next eight years, he consolidated his state corporatist model by establishing labor
noncompetitive,
codes, creating public firms to produce strategic commodities such as steel and oil, hierarchically ordered,
and pursuing paternalistic social policies. These policies were collectively called the and functionally
New State (Estado Nôvo). differentiated categories,
recognized or licensed
(if not created) by
The Populist Republic (1945–1964) the state. These
organizations are granted
The increasing mobilization of segments of the working and middle classes, and U.S. a representational
diplomatic pressure forced Vargas to call for full democratic elections to be held in monopoly within their
1945. Three political parties competed in these elections: The Social Democratic respective categories in
exchange for limiting
Party (PSD) and the Brazilian Labor Party (PTB) were pro-Vargas, while the National
their demands and
Democratic Union (UDN) stood against him. The PSD and the PTB, which oper- allowing the state to
ated in alliance, were both creations of the state, while the UDN brought together recruit their leaders.
regional forces that wanted a return to liberal constitutionalism. The campaign was
so bitter that the military forced Vargas to resign, two months before the general
election.
The turn to democracy in 1946 did not break with the past. The new constitu-
tion guaranteed periodic elections, but the most important economic and social poli-
cies were still decided by the state bureaucracy, not by the national legislature.
Populism, but not democracy, defined the new political order. In Brazil, the
terms populist and populism refer to politicians, programs, or movements that seek
to expand citizenship to previously disenfranchised sectors of society in return for
political support. Populist governments grant benefits to guarantee support, but dis-
courage lower-class groups from creating their own organizations. Populists do not
consider themselves accountable to the people.
Brazilian workers supported Vargas for his promises to improve the social insurance
system, and elected him in 1950. However, economic limitations and opposition claims
that he was preparing a new dictatorship made Vargas politically vulnerable. He was soon
swept up in a bizarre scandal involving the attempted assassination of a popular journalist.
During the crisis, intense accusations of Vargas’s complicity in the assassination increas-
ingly wore him down, and he committed suicide on August 24, 1954. Under Vargas’s
democratic successor, Juscelino Kubitschek (1956–1960), the economy improved due to
a post-war boom in manufacturing. Kubitschek was a master of political symbolism and

nationalism nationalism, promoting images of a new, bigger Brazil that could create “fifty years of
An ideology seeking to development in five.” This was symbolized by his decision to move the capital from Rio
create a nation-state for a de Janeiro to a planned city called Brasília—a utopian city. The project rallied support for
particular community; a Kubitschek’s developmentalist policies.
group identity associated The presidents who followed Kubitschek proved much less competent. João
with membership is such
Goulart, for instance, began an ill-fated campaign for structural reforms, mainly
a political community.
Nationalists often in education and agriculture. In response to what they perceived as threats to their
proclaim that their state interests, peasant league movements, students, and professional organizations orga-
and nation are superior to nized protests, strikes, and illegal seizures of land. As right-wing organizations bat-
others. tled leftist groups in the streets of the capital, the military ended Brazil’s experiment
with democratic populism in March 1964.

bureaucratic The Rise of Bureaucratic Authoritarianism (1964–1985)

authoritarianism (BA)
The military government installed what the Argentine political sociologist Guillermo
A term developed by O’Donnell termed bureaucratic authoritarianism (BA).2 Such regimes are installed
Argentine sociologist
to respond to severe economic crises and are led by the armed forces and key civil-
Guillermo O’Donnell to
interpret the common ian allies, most notably professional economists, engineers, and administrators.
characteristics of BA regimes limit civil rights and other political freedoms, sometimes going so far
military-led authoritarian as wholesale censorship of the press, torture of civilians, and imprisonment without
regimes in Brazil, trial, all for the sake of economic development.
Argentina, Chile, and
The military government first planned a quick return to civilian rule and even
Uruguay in the 1960s
and 1970s. According to allowed limited democratic institutions to continue. After being purged in 1964 of
O’Donnell, bureaucratic the BA’s opponents, the national congress continued to function, and direct elec-
authoritarian regimes led tions for federal legislators and most mayors (but not the president or state governors)
by the armed forces and took place at regular intervals. In November 1965, the military replaced all existing
key civilian allies emerged
political parties with only two: the National Renovation Alliance (ARENA) and the
in these countries in
response to severe Brazilian Democratic Movement (MDB). ARENA was the military government’s
economic crises. party, and MDB was the “official” party of the opposition. Former members of the
three major parties joined one of the two new parties.3
The powers of these democratic institutions were severely limited. The military
government used institutional decrees to legislate the most important matters, pre-
venting the congress from having an important voice. Few civilian politicians could
speak out directly against the military for fear of being removed from office.
In economic policy, the military reinforced the previous pattern of state interven
tionism. The government promoted state-led economic development by creating
hundreds of state corporations and investing enormous sums in established public
firms. Brazil implemented one of the most successful economic development pro-
grams among newly industrialized countries. Termed the “Brazilian miracle,” these
programs demonstrated that, like France, Germany, and Japan in earlier periods, a
abertura
developing country could create its own economic miracle.
In Brazil, abertura
(as it is known in
Portuguese; aperture in The Transition to Democracy and the First Civilian Governments
Spanish) refers to the (1974–2001)
period of authoritarian
liberalization begun After the oil crisis of 1973 set off a wave of inflation around the world, the economy
in 1974 when the began to falter. Increasing criticism from Brazilian business led the last two rul-
military allowed civilian
ing generals, Geisel and Figueiredo, to begin a gradual process of democratization.
politicians to compete
for political office in the Initially, these leaders envisioned only a liberalizing, or opening (abertura), of the
context of a more open regime to allow civilian politicians to compete for political office. As was later the
political society. case with Gorbachev’s glasnost in the Soviet Union, however, control over the process

George Holton/Science Source

Brazil’s capital, Brasília. The planned city was designed by the world-famous Brazilian architect Oscar Niemeyer.

of liberalization gradually slipped from military hands and was captured by organi-
zations within civil society. In elections in 1974, the opposition party, the MDB,
stunned the military government by increasing its representation in the Senate from
18 to 30 percent, and in the Chamber of Deputies from 22 to 44 percent. Although
the party did not have a majority in congress, it did capture a majority in both cham-
bers of the state legislatures in the most important industrialized southern and south-
eastern states.
In the following years, the opposition made successive electoral gains and ob-
tained concessions from the government. The most important were the reestablish-
ment of direct election for governors in 1982, political amnesty for dissidents, the
elimination of the government’s power to oust legislators from political office, and
the restoration of political rights to those who had previously lost them. In the gu-
bernatorial elections of November 1982, the opposition candidates won landslide
victories in the major states.
The military wanted to maintain as much control over the succession process as
possible and preferred to have the next president selected within a restricted electoral
college. But mass mobilization campaigns demanded the right to elect the next presi-
dent directly. The Diretas Já! (“Direct Elections Now!”) movement, comprising an
array of social movements, opposition politicians, and labor unions, expanded in size
and influence in 1984. Although the movement failed to achieve its goal of making
the founding elections of the new democracy direct, the effort inspired a genera-
tion of movement leaders with gender, racial, religious, and issue-based orientations.
More immediately, the military lost supporters, who backed an alliance (the Liberal

Front) with Tancredo Neves, the candidate of the opposition PMDB (Party of the
Brazilian Democratic Movement, the successor to the old MDB). Neves’s victory in
1984, however, was marred by his sudden death on the eve of the inauguration. Vice
President José Sarney became the first civilian president of Brazil since 1964.
The process leading to Sarney’s presidency disappointed those who had hoped
for a clean break with the authoritarian past. Most of the politicians who gained posi-
tions of power in the new democracy hailed from the former ARENA or its mislead-
ingly named successor, the Democratic Social Party (PDS). Most of these soon joined
Sarney’s own PMDB or its alliance partner, the Party of the Liberal Front (PFL).
A political transition that should have produced change led to considerable continuity.
A chance for fundamental change appeared in 1987 when the national Constituent
Assembly met to draft a new constitution. Given the earlier success of the opposition
governors in 1982, state political machines became important players in the game of
constitution writing. The state governments petitioned for the devolution of new au-
thority to tax and spend. Labor groups also exerted influence through their lobbying
organizations. Workers demanded constitutional protection of the right to strike and
the right to create their own unions without authorization from the Ministry of Labor.4
Soon after Sarney’s rise to power, annual rates of inflation began to skyrocket.
The government sponsored several stabilization plans, but without success. Dealing
with runaway inflation and the removal of authoritarian politicians became the key
issues in the 1989 presidential elections, the first direct contests since the 1960s.
Once again, Brazilians would be disappointed. Fernando Collor de Mello,
became president after a grueling campaign against Lula da Silva, the popular

left-wing labor leader and head of the Workers’ Party (Partido dos Trabalhadores,
or PT), who would lead the leftist opposition for another decade before rising to
the presidency himself. Collor’s administration embraced structural reform, such as
privatization of state e nterprises and deregulation of the economy, but it failed to
solve the nagging problem of inflation. Collor was eventually impeached in late 1992
due to his involvement in bribery and influence peddling.
Collor’s impeachment brought Itamar Franco to the presidency. Franco’s most
important decision was naming Fernando Henrique Cardoso, his finance minister.
Cardoso, who was a renowned sociologist before entering politics in the 1970s, rose
to prominence as one of the key leaders within the PMDB and later the Party of
Brazilian Social Democracy (PSDB) during the democratic transition. In July 1994,
Cardoso’s Real Plan finally stopped inflation by creating a new currency, the real that
would be managed closely by the Central Bank (see Section 2).
Cardoso rode the success of the Real Plan to the presidency, beating out Lula
and the PT in 1994 and again in 1998. He proved adept at keeping inflation low and
consolidating some of the structural reforms first started by Collor. But Brazil’s bud-
get and trade deficits increased, and financial crises in Asia and Russia in 1997 and
1998 eventually led to a crisis in the Real Plan. In January 1999, although the value
of the real collapsed, the currency soon stabilized, and hyperinflation did not return.
The Cardoso administration was also able to pass the Law of Fiscal Responsibility in
2000, which limited spending by state and municipal governments and even made
it a crime to submit inaccurate budgets to auditors. It was a violation of this law that
became the basis for Dilma Rousseff’s impeachment in 2016.

Brazil after September 11, 2001

September 11 and the collapse of the Argentine economy, one of Brazil’s chief mar-
kets, that same year produced a crisis of confidence. Argentina’s crisis threatened

to destabilize the recovery of the real. Meanwhile, Washington’s war on terror threat-
ened to displace social and economic priorities in Brazil’s relations with the United
States. Diplomacy with Washington became particularly bitter over the Bush admin-
istration’s insistence on going to war with Iraq and its heavy-handed approach to
dealing with foreigners.
The election of Lula da Silva as president in October 2002 reflected how far
Brazilian democracy had come. This former industrial worker-turned-party organizer
and opposition agitator, succeeded in capturing the presidency and then launch-
ing an expansion of social welfare and economic promotion policies that produced
high growth with lower levels of inequality and poverty. He did so while embracing
Cardoso’s anti-inflation policies. But like his predecessor, he faced a congress prone
to gridlock. Major social security reforms were watered down in 2004. Worse still,
PT-led municipal governments, once a model of good governance in Latin America,
were accused of procuring kickbacks to fund electoral activities. PT leaders sur-
rounding Lula were implicated in a second scandal (known as the monthly retainer,
or mensalão) involving the purchase of votes in the congress for reform legislation.
However, Lula won reelection in 2006 anyway, and he continued to garner high pres-
idential approval ratings well into his second term. He expanded public expenditures
on infrastructure and industry as part of his Plan for the Acceleration of Growth.
Lula’s successor in 2010 was his chief of staff, Dilma Rousseff. Rousseff became
Brazil’s first woman president. A former militant against the authoritarian regime,
Rousseff was jailed and tortured in 1970 and 1972. After obtaining her degree in
economics, she ventured again into politics during the New Republic but as an
appointee in municipal and state government in Rio Grande do Sul and its capital,
Porto Alegre. She joined the PT late in her career, in 2000, and was plucked from
obscurity by Lula in 2002 to become his Minister of Energy and later his chief of
staff. Having no real experience in elected office, her first experience as an elected
leader was the presidency.
As much as Rousseff’s government sought to build on the successes of Lula, nei-
ther the economy nor political institutions proved so accommodating. Growth slowed
after 2011 due to decreasing commodity prices and China’s own slowdown, plunging
Brazil into a near depression with rising unemployment and high interest rates to keep
inflation at bay. The euphoria of hosting the 2014 World Cup and the 2016 Summer
Olympic Games was squashed by an expanding corruption investigation known as
“Operation Car Wash” (Lava Jato). As part of a routine investigation focused on a
notorious money-launderer and car-wash owner, Alberto Yousseff, federal prosecutors
uncovered a broader ring involving a cartel of construction companies and the state
oil company, Petrobras. Cartel members would overcharge Petrobras for products and
services in return for contracts, while proceeds from the extra payments would be
laundered and distributed to the professional and personal accounts of political parties
and their leaders involved in the graft. Most of these parties were allied to Rousseff’s
government, including the Workers’ Party. Led by the telegenic federal judge, Sérgio
Moro, and Deltan Dallagnol, a lawyer for the Federal Public Ministry, the investiga-
tions have uncovered the involvement of more than half of the sitting members of con-
gress and scores of executives in the largest construction companies. The top executive
of the biggest of these firms, Marcelo Odebrecht of the Odebrecht Company, received
a 19-year sentence in 2016. Along with dozens of other executives and former politi-
cians, Odebrecht continues to offer plea-bargained testimony in return for a reduced
prison term. Such plea bargaining, which was made legal only in 2013, has provided a
treasure trove of evidence sufficient to convict many of the accused politicians before
the Supreme Court, the only venue that can try politicians for such crimes.

The Four Themes and Brazil

Brazil in a Globalized World of States
Both international and domestic factors have influenced the Brazilian state’s struc-
ture, capacity, and relations with society. During the empire, international opposition
to slavery forced powerful oligarchs to turn to the state for protection. The coffee and
ranch economies provided the material base for the Old Republic and were intricately
tied to Brazil’s economic role in the world. Even the Estado Nôvo, with its drive to
organize society, was democratized by the defeat of fascism in Europe. The return to
democracy during the 1980s was part of a larger global experience, as authoritarian
regimes gave way all over Latin America, Eastern Europe, southern Europe, and the
Soviet Union. As Brazil’s economy has grown in size, it faces greater responsibilities
in the globalized world of states, both in foreign economic and security policy.

Governing the Economy

The entry of the working and middle classes as political actors reshaped the Brazilian
state during the twentieth century. Vargas’s New State mobilized workers and pro-
fessionals. Populist democracy later provided them protection from unsafe working
environments, the effects of eroding wages, and the prohibitive expense of health
care. Public firms employed hundreds of thousands of Brazilians and transformed
the development of the country. During the 1980s and 1990s, neoliberal reforms
dramatically altered the role of the Brazilian state (see Section 2). Brazil’s gover-
nance of the economy highlights the strategic role of the state in the maintenance
of growth. State-led growth built the foundation for governing the economy, and
developmentalism moved Brazil from a predominantly agrarian economy into an
industrialized one. With the slowdown in the global economy, state companies find
themselves under multiple pressures. Fiscal cutbacks and corruption investigations
have limited their expansion in the current development model.

The Democratic Idea

Brazil certainly has the formal institutions of a democracy, but patrimonialism,
populism, corporatism, and corruption undermine them. Brazilian politicians typi-
personalist cally cultivate personal votes (personalist politicians) that challenge the creation of
politicians strong parties and alliances (see Section 4). But despite its shortcomings, Brazilians
Demagogic political appreciate that democracy gives them more say in policy-making. Thousands of new
leaders who use their political groups, social movements, civic networks, and economic associations have
personal charisma emerged in recent years. The Brazilian state is highly decentralized into twenty-six
to mobilize their states, a federal district, and 5,570 municipalities. Each center of power is a locus of
constituency.
demand-making by citizens and policy-making by elites. Numerous judicial, audit-
ing, investigatory, and prosecutorial authorities have proven crucial to deepening
democracy and rooting out corruption.

The Politics of Collective Identity

In assessing the politics of collective identity, the first question to answer is who are the
Brazilians? This has always been a vexing issue, especially because heavy flows of inter-
national commerce, finance, and ideas have made Brazil’s borders obsolete. One com-
mon answer is that the symbols of the Brazilian nation still tie Brazilians together:

carnival, soccer, samba, bossa nova, and a common language. Even though these
symbols have become more prevalent, they have lost some of their meaning because
of commercialization. Catholicism is a less unifying force today, as Pentecostalism and
evangelism have eaten into the church’s membership. Women have improved their
social position and political awareness as gender-based organizations have become
important resources of civil society. Yet even here, Brazil remains extremely patriar-
chal: women are expected to balance motherhood and other traditional roles in the
household, even while economic needs pressure them to produce income.
Race remains the most difficult issue to understand. Racial identity continues
to divide Brazilians, but not in the clear-cut manner it divides blacks and whites in
the United States. Categories are multiple, with nonwhites adopting variations of
racial identities, including white. Afro-Brazilians see themselves in complex ways as
members of different classes, status groups, and mixed races that are neither strictly
white or black.
Class continues to separate Brazilians due to high income inequality. Like India,
Brazil’s social indicators consistently rank near the bottom in the world, although
these indicators are improving. Income disparities mirror racial differences. The poor
are mostly blacks and mulattos while the rich are mostly white.

Themes and Comparisons

As a large, politically decentralized, and socially fragmented polity, Brazil pres-
ents several extraordinary challenges to the study of comparative politics. First, the
Brazilian state has varied in its degree of centralization, producing distinct capacities
for promoting development, democracy, and social distribution. Although politi-
cal centralization has made the French state strong, decentralized states such as the
United States and Germany have proven successful as well. The Brazilian case pro-
vides lessons for how other large, decentralized states in the developing world, such
as India, might reconcile the needs of development and democracy.
The challenges posed by Brazil’s democratic institutions provide rich material for
comparative analysis. Along with Russia, Brazil demonstrates how the lack of a co-
herent party system can endanger democracy. Yet unlike Russia, Brazilian democracy
is relatively protected by a network of judicial and legal institutions that are largely
autonomous from politics and that have proven adept at rooting out corruption and
enhancing accountability. Although high social inequality cuts against even these
democratic strengths, it is reassuring to see the powerful come to justice. The com-
plex divisions afflicting Brazilians’ collective identities challenge attempts to address
the country’s problems. In this regard, Brazil presents an interesting puzzle for theo-
ries about collective identities: How has such a socially fragmented society remained
a coherent whole while sustaining democracy?

Where Do You Stand?

The Estado Nôvo and the bureaucratic authoritarian periods were associated with the
industrial development of Brazil. Do you think that this suggests that economic develop-
ment may sometimes require authoritarian rule?
Supporters of Cardoso and Lula disagree on which leader did the most for Brazil. Which
one would you say did more to address the needs of democracy, the economy, and social
development?

2
SECTION

POLITICAL ECONOMY AND DEVELOPMENT

Like most developing countries, Brazil’s politics has always been shaped by the quest
Focus Questions for economic and social development. Two processes have left enduring legacies:
●● How did the Brazilian the pattern of state intervention in the domestic market and the effects of exter-
state’s role in nal economic change. External economic crises have compelled the state to inter-
promoting develop
ment change as the
vene through protection, subsidies, and even the production of goods it previously
country moved from imported. These policies made Brazil one of the faster-growing newly industrialized
import-substitution countries of the world, alongside India and China, during the first decade of the
to market-oriented twenty-first century. Yet changes in commodity prices and globalization trends have
reform? also slowed the country’s growth in recent years, bedeviling its political leaders and
●● Identify some of the promoting social and economic dislocation.
persisting problems
of Brazilian economic
development and how
progress has been
State and Economy
made during the New
Republic in address- Brazil’s economic development prior to the New State depended on export-led
ing them. growth, that is, on the export of agricultural products. During the Old Republic,
international demand for coffee gave Brazil a virtual global monopoly. Cotton, sugar,
export-led growth and cereals also continued to be important export products.
Coffee linked Brazil to the world market with minimal state involvement in the
Economic growth
generated by the
period before the Great Depression. Export receipts provided a reservoir of capital
export of a country’s to build railroads, power stations, and other infrastructure. These investments then
commodities. Export- spurred the growth of light industries, mostly in textiles, footwear, and clothing.
led growth can occur Public finance had a minor role.
at an early stage of The state became far more interventionist during the 1930s, when international
economic development,
in which case it involves
demand for coffee declined. As exports fell, imports of manufactured goods also
primary products, such declined. These forces prompted import substitution industrialization (ISI), a
as the country’s mineral model of development that promoted domestic production of previously imported
resources, timber, and manufactured goods. At first, Brazil did not need large doses of state intervention.
agricultural products; This so-called light, or easy, phase of ISI focused on products that did not require
or at a later stage, when
industrial goods and
much capital or sophisticated technology such as textiles and footwear. Most of these
services are exported. industries were labor intensive and created jobs.
At the end of World War II, the ISI model expanded through the promo-
interventionist tion of heavy industry and capital-intensive production. A new generation of state
An interventionist state technocrats, inspired by the United Nations Economic Commission for Latin
acts vigorously to shape America (ECLA), sought to “deepen” ISI by promoting capital-intensive sectors
the performance of major through industrial policies including planning, subsidies, and financial support. State
sectors of the economy. agencies promoted the quick growth of these industries.
import substitution During the 1950s, Brazil was a prime example of ECLA-style developmental-
industrialization (ISI) ism, the ideology and practice of state-sponsored growth. The state promoted private
investment by extracting and distributing raw materials for domestic industries at
Strategy for industriali
prices well below the international market. Other firms that were linked to sectors of
zation based on domestic
manufacture of previously the economy receiving these supports would benefit in a chain reaction.
imported goods to satisfy Growth rates achieved impressive levels, especially during the 1970s (see Table 9.2),
domestic market demands. but the first serious contradictions of ISI emerged by this time. Protection led to

noncompetitive, inefficient production, in which

growing industries depended too heavily on pub- Table 9.2 Governing the Economy:
lic subsidies. ISI also became import-intensive. Average GDP Growth
Businesses used subsidized finance to import
technology and machinery, since the government
Rates
overvalued the currency to make import prices 1940–1949 5.6%
cheaper. But this overvaluation hurt exports, by
making them more expensive. Because the ex- 1950–1959 6.1%
port sector could not supply much-needed rev- 1960–1969 5.4%
enues to sustain growth, the government printed
money, which in turn led to inflation. 1970–1979 12.4%
The failures of ISI during the 1960s inspired 1980–1989 1.5%
many Brazilian academics to adopt the view,
then popularized as the “dependency school,” 1990–1996 2.1%
that underdeveloped or “peripheral” countries 1997–2000 0.8%
could not achieve sustained levels of industri-
alization and growth in a world dominated by 2001–2003 1.0%
“core” economies in North America and Western 2004–2007 3.2%
Europe. ISI’s failures, it was argued, were due to
2008–2010 5.7%
the ill-fated attempt to adjust marginally the in-
herently exploitative structure of world markets. 2011–2013 1.9%
In order to confront this situation, the depen-
2014–2015 −2.0%
dency school advocated delinking Brazil from
the world economy. While this view was widely Source: IBGE and the World Bank.
popular among leftist economists in Brazil and state technocrat
elsewhere, it did not become a basis for policy. A career-minded
From 1964 to 1985, the state continued to promote industrialization, especially bureaucrat who
administers public policy
durable consumer goods for the domestic market. Multinational firms also invested and
according to a technical
transferred technology. Industry accounted for 40 percent of Brazil’s GDP by 1980. rather than a political
Parastatals (public or state firms) played a crucial role in the ISI development rationale. In Mexico and
model. Large-scale projects were financed and managed by bureaucratic agencies, Brazil, these are known
state firms, and foreign companies. Peter Evans characterized these complex relations as the técnicos.
among the state, foreign investors, and domestic capitalists as a “triple alliance.”5 But developmentalism
the state remained the dominant partner.
An ideology and practice
Partially due to the slowing down of ISI and the accumulation of debt and higher in Latin America during
inflation, the democratic governments after 1985 turned to a more market-oriented or the 1950s in which the
market-friendly approach, dubbed neoliberal policies. These involved reducing tariffs on state played a leading
imports, deregulating parts of the economy, and privatizing some large companies in role in seeking to foster
sectors such as steel, telecommunications, and transport. As export prices for commodi- economic development
through sponsoring
ties such as soy, oil, and iron ore increased during the 2000s, Brazil became flush with vigorous industrial policy.
capital, allowing the Lula and Rousseff presidencies to pursue a hybrid model of export
growth that combined openness of the domestic market to foreign investment along with parastatals
large investments by the state in infrastructure and energy. The end of this commodity State-owned, or at
boom after 2011 coincided with low growth and corruption investigations involving least state-controlled,
many of the private and public firms that benefited the most during the boom period. corporations, created to
undertake a broad range of
activities, from control and
marketing of agricultural
The Fiscal System production to provision of
banking services, operating
As the Brazilian economy became more complex after the 1960s, new opportunities airlines, and other
for evading taxes emerged. An informal economy of small firms, domestic enterprises, transportation facilities
street vendors, and unregistered employees proliferated, outside the taxable economy. and public utilities.

informal economy Economists estimate that the informal economy could be as large as 20 percent of
That portion of the Brazil’s gross domestic product ($420 billion). It may employ 40 to 60 million people,
economy largely outside and may represent a loss of $70 billion annually in forgone tax revenues.
government control, in The new constitution of 1988 allowed states and municipalities to expand their
which employees work collection of taxes and to receive larger transfers of funds from Brasília. Significant
without contracts or
gaps then emerged in tax collection responsibilities and public spending. Although
benefits and employers
do not comply with the central state spent less than it collected in taxes between 1960 and 1994,
legal regulations or Brazil’s 5,570 municipal governments spent several times more than they collected.
pay taxes. Examples Subnational governments also gained more discretion over spending, since the fed-
of those working in eral government required few earmarks. State governors also used public banks held
the informal economy
by the state governments to finance expenditures, thus expanding their debt.
include casual employees
in restaurants and hotels, The Cardoso administration had the most success in recovering federal tax rev-
street vendors, and day enues and reducing the fiscal distortions of Brazil’s federal structure. The Fiscal
laborers in construction Responsibility Law of 2000 set strict limits on federal, state, and municipal expen-
or agriculture. ditures. A combination of improved tax collection and an expansion of economic
growth during the 2000s kept public debt in check, but debt exploded with the
end of the commodity boom, pressuring the post-impeachment presidency of Michel
Temer to pursue more austere fiscal policies (see Figure 9.2).

The Problem of Inflation

Inflation accompanied state-led devel-
opment because the state, business,
and unions all distorted the value
of goods and services by manipulat-
ing prices, interest rates, and wages.
Successive attempts to control inflation
fell apart as different interest groups
attempted to retain these controls. No
FIGURE 9.2 Governing the Economy: Brazilian Public Debt to fewer than seven “stabilization” plans
GDP, 2006–2015 between 1985 and 1994 collapsed,
Source: Based on numbers produced by the Central Bank of Brazil.
sometimes generating “hyperinflation”
(600 percent or more annual inflation).
Figure 9.3 illustrates this terrible
track record.
Only Cardoso’s Real Plan
proved successful. The Real Plan an-
chored the real, allowing it to float
within a range set by the Central
Bank. The exchange rate rose and
fell, generating an acute but not
lasting crisis in 1999. However,
hyperinflation never returned, and
the government moderated public
spending growth. Renewed growth
during the Lula administration
kept the public debt under control.
But the Rousseff government raised
FIGURE 9.3 Governing the Economy: Monthly Rates of Inflation, public spending, jeopardizing this
1985–2013 record of fiscal and price stability.
Source: Author’s design based on Brazilian Central Bank figures.
Average annual inflation became 6

percent, which is slightly worse than the average in developing countries. Low and
even negative growth combined with high interest rates kept inflation in check.

Society and Economy

Between 1950 and 1980, employment in industry jumped from 14 percent to 24 percent,
while employment in agriculture declined from 60 percent to 30 percent. Nevertheless,
the jobs created in industry did not begin to absorb the huge number of unemployed.
Many new jobs required skilled and semiskilled specialized labor. In the late 1980s and
1990s, even skilled workers faced losing their jobs because of intense industrial restruc-
turing that caused manufacturing to employ 48 percent fewer workers. With the rapid
expansion of the economy during the 2000s, urban unemployment fell dramatically from
18 percent to 5.4 percent by 2012, but it has doubled since then as growth has stalled.
Industrialization also failed to eradicate the racial inequalities inherited from
slavery. Despite the impressive industrial development of Brazil, Afro-Brazilians con-
tinued to make less than their white colleagues and had fewer opportunities for up-
ward mobility. According to one study, nonwhite men and women in Brazil have made
real gains in their income because of improvements in education and occupation, but
the gap separating nonwhite income from white income remains significant.6 On
average, blacks make 41 percent and mulattos make 47 percent of what whites make.
Women make up 28 percent of the economically active population and continue to
enter the labor market in record numbers. Working women typically have more years
of schooling than men, but they still receive lower salaries for the same job. Brazilian
women make only 70 percent of what men make, and black women do even worse at
40 percent. In rural areas, women are substantially disadvantaged in the granting of
land titles. Female heads of families are routinely passed over by official agencies dis-
tributing land titles to favor oldest sons, even when these are minors. Thirty-four per-
cent of illiterate women earn the minimum wage or less, versus 5 percent of illiterate
males. Although recent economic growth and rising median incomes have begun to
reverse decades of worsening inequality, income remains more unequally distributed
in Brazil than it is in most other developing countries (see Table 9.3).

The Welfare System

In a country of startling social inequalities, welfare policy plays a remarkably small
role, even though expenditures on health care and education stand at 25 percent of
GDP. The effects of this spending are uneven. Salaried formal sector workers receive
most benefits, including pensions and the best access to both private and public health
care. Workers in the informal sector generally do not collect welfare benefits since the
federal government does not consider them employed. Corruption, clientelism, and
outright waste prevent benefits from going to the people who need them the most.7
More people need welfare than actually contribute to the welfare state. That
means the government must finance the shortfall. More serious is the unevenness of
the system. More than 70 percent of all income transfers are retirement benefits that
go to middle-class and upper-class individuals. The indigent receive only 1.5 percent
of these funds. Informal workers and the unemployed must use public health ser-
vices, while formal sector workers access the public health care system for expensive
procedures and retain private insurance for less expensive care.
The Cardoso administration laid some of the groundwork for reversing poverty and
inequality. In addition to several programs to provide grants directly to poor families

Table 9.3 Governing the Economy: Brazilian Income

Distribution in Comparative Perspective
10% 20% 20% 10%
Country Richest Richest Poorest Poorest

Brazil 41.8 57.4 3.3 1.0

Mexico 38.9 54.1 4.9 1.9

Chile 41.5 56.7 4.6 1.7

China 31.4 47.9 5.2 2.1

Nigeria 32.7 49.0 5.4 2.0

India 29.8 44.0 8.3 3.6

United States 30.2 36.4 5.1 1.7

United Kingdom 24.7 40.1 7.5 2.9

France 26.8 41.2 7.8 3.1

Russia 32.2 48.3 5.9 2.3

Source: World Bank, World Development Indicators 2016 (Washington, DC: World Bank, 2016).

to improve their health and the education of their children, Cardoso also targeted
the rural poor. The Family Health Program, for instance, provides community health
workers for areas that have historically been underserved. Some studies have shown that
this program accelerated the decline in infant mortality and improved prenatal care and
family reproductive medicine, including reductions in the rates of HIV/AIDS.8
The Lula administration focused even more on social reform. In the fall of 2003,
the government passed a social security reform that raised the minimum retirement age,
placed stricter limits on benefit ceilings, reduced survivor benefits, and taxed pensions
and benefits. Issues including the taxation of social security benefits for judges and mili-
tary officers and the reduction of survivor benefits for the latter group became stum-
bling blocks in cross-party negotiations. The government made concessions on these
and other issues, but the total annual savings were less than half of the original target.
The most notable social reform is Bolsa Família (the Family Grant Program),
which consolidated three programs started by the Cardoso government. Lula ex-
panded the funding of Bolsa Família, which grants modest monthly sums to families
that keep their children in school and see the doctor for regular vaccinations and
checkups. Since 2003, 11.1 million families or 20 percent of the Brazilian population
(46 million people) have benefited from Bolsa Família, both in terms of improved
household incomes and legal certifications of births, and the program consumes less
than 3 percent of total social spending.9 Poverty rates have fallen as a result and both
incomes and literacy have improved. Low growth, higher unemployment in recent
years, and the Temer government’s embrace of fiscal austerity with proposed deep
cuts to social programs threaten this track record.

Agrarian Reform
Landownership is highly concentrated in Brazil with only 1 percent of landown-
ers (about 58,000 individuals) holding an amount of land equal to the size of
Venezuela and Colombia combined; that is half of all arable land in Brazil. The
poorest farmers survive on 2 percent of the country’s land, but these number over
3 million people.
The Cardoso administration expropriated some unproductive estates and set-
tled 186,000 families on them. Despite Lula’s earlier rhetoric concerning land re-
form, his administration failed to initiate anything close to a land reform. The issue
was one that energized the presidential campaign in 2010 of a former PT member,
Marina Silva, of the small Green Party, whose 19 percent share of the first-round
vote dramatically suggested that neglected social issues involving land and ecology
still remain salient issues in Brazilian politics. If Silva returns as a major candidate in
2018, these issues may become salient again.
The landless poor have swelled the rings of poverty around Brazil’s major cities.
During the 1950s and 1960s, the growth of industry in the south and southeast
enticed millions to migrate in the hopes of finding new economic opportunities. By
2015, 86 percent of Brazil’s population was living in urban areas. The pressures on
Brazilian cities for basic services and limited housing have overwhelmed local budgets
and led to extensive squatting on public land. In the largest cities, squatters have built
huge shantytowns called favelas that house a majority of the poor, most of whom favelas
work formally and informally in the metropolitan economy.10 A Portuguese-language
Regional disparities in income have remained stark. The nine states of the term for the shantytowns
Northeast have a per capita GDP half of the national average. The Northeast has 28 that ring many of the
percent of the national population but accounts for only 13.8 percent of the GDP. By main cities in Brazil. The
favelas emerge where
contrast, the Southeast has 42.6 percent of the population and 55.2 percent of the
people invade unused
GDP. The agglomeration of industry in the South and Southeast and the persistence land and build domiciles
of poverty in the Northeast have created pressures for land reform or at least poverty- before the authorities can
alleviating policies. remove them. Unfinished
public housing projects
can also become the
sites of favelas. They

Environmental Issues expanded after the

1970s as a response to
the inadequate supply of
The environmental limits of Brazil’s development model have only become more homes in urban centers to
apparent over time. During the height of the ISI period, the central and southern meet the demand caused
by increasing rural to
states of São Paulo, Minas Gerais, Rio de Janeiro, and Rio Grande do Sul became
urban migration.
sites of environmental degradation. In the 1970s, Guanabara Bay and the Paraiba
do Sul River basin, both in Rio de Janeiro state, approached the brink of biologi-
cal death. Urban pollution in São Paulo devastated the Tietê River, threatening the
health of millions. In Cubatão, an industrial city east of metropolitan São Paulo,
pollution became so bad that by 1981, one city council member reported that he had
not seen a star in twenty years.
Big development projects invaded the Amazon River basin beginning in the 1970s.
These industrial projects threatened the tropical forests, as did cattle ranching, timber
extraction, and slash-and-burn agriculture by poor farmers. By the 1980s, it was clear
that the primary result of these practices was the deforestation of the Amazon. The an-
nual rate of deforestation during the 1990s approached alarming levels, with 11,216
square miles lost in 1995 alone. After a decline during the late 1990s, the rate shot up
again to 10,588 square miles in 2004, after which it leveled off at a much lower point
of an average of 1,930 square miles per year after 2011.

Partly due to the return to democracy in 1984, new en-

vironmental movements within and outside Brazil began to
influence official and public opinion. The national environmen-
tal movement in Brazil initially gained its strongest attention
when ecological groups mobilized at the United Nations Earth
Summit, hosted in Rio de Janeiro in 1992. In the years that fol-
lowed, international advocacy networks established a presence in
Brazil, led by the World Wildlife Fund and Greenpeace. These
organizations and domestic groups pressured the government
to make commitments to reduce carbon emissions and to re-
duce deforestation, which undermines the capacity of the planet
to absorb excess CO2. By clamping down on illegal natural re-
source extraction and unsustainable slash-and-burn agriculture,
the Brazilian state was able to slow the deforestation rate to its
lowest levels in decades. Yet sustained commitment, as well as
improved policing via satellite and follow-up on the ground, are
AP Images/Victor R. Caivano

necessary to keep these rates low.

Under the Lula and Rousseff administrations, Brazil made
substantial commitments to address environmental problems.
Brazil signed and ratified all of the major multilateral conven-
tions on species depletion, climate change, toxic waste, as well as
the environmental framework agreement for Mercosul, making
Brazilian president Luiz Inacio Lula da the customs union a notable presence in international environ-
Silva is shown in this photo attending a mental legislation. Brazil has also agreed to reduce its carbon
reelection campaign wearing a cap of the dioxide emissions by 36.1 to 38.9 percent below what they would
Landless Peasant Movement (MST). As the
otherwise be in 2020. Conservation efforts also i ncreased, with a
largest rural movement in Latin America,
total of over 60 million hectares under legal protection from ex-
the MST campaigns for land rights for poor
farmers and organizes land invasions to set-
ploitation. It is uncertain if the Temer government will preserve
tle landless rural workers and their families. Brazil’s ratification of the Paris climate agreement of 2016 in the
wake of U.S. president Donald Trump’s decision in mid-2017 to
pull the United States out of the accord.
However, these commitments may also be undermined by the dominant eco-
nomic development model with its emphasis on extraction of natural resources, and
especially off-shore oil. Dilma Rousseff’s government was enthusiastic about the most
environmentally questionable projects, including the massive Belo Monte Dam in Pará.
Governmental and nongovernmental environment impact statements note that the
project will cause loss of habitat, affect fish migration routes, disrupt water supply on
the Xingú river, and violate the cultural and human rights of indigenous groups in the
area. By the time the Belo Monte Dam is finished, it will be the second largest in Brazil,
behind Itaipú, and the world’s third largest after China’s Three Gorges Dam.

Brazil in the Global Economy

Brazil has maintained strategic relations with the global market. The financing
needs of state-led industrialization required Brazil to pursue international sources
of credit, making it the largest debtor country in Latin America during the 1980s.11
When soaring inflation in the industrialized countries ratcheted up interest rates on
the debt, Brazilian growth slowed under the weight of higher interest payments.
Unlike the other large Latin American countries, Brazil initially rejected the
reform agenda proposed by the International Monetary Fund (IMF). Although the

GLOBAL CONNECTION
Governing the Economy in a World of States: The Rise of China
and Brazilian Trade
Although no more than 14 percent of Brazil’s GDP is repre- from 0 to 23 percent of imports by nonmembers. As Brazil’s
sented by exports, the roles of trade and foreign economic trade with China and other parts of the world have in-
policy have become more central elements of Brazil’s creased, trade with MERCOSUL partners declined after
development. Soon after China joined the World Trade 2006. This strengthened Lula’s and Rousseff’s efforts to
Organization (WTO) in October 2001, it became Brazil’s diversify trade relations by cultivating more South–South
largest trade partner, surpassing the United States and trade in South Asia, Africa, and East and Southeast Asia.
the European Union. Brazilian exports of soy, oil, and iron Brazil currently supplies 37 percent of all Latin American
ore have proven strategic to China’s economic boom and exports to Asia.
Chinese demand, in turn, helped sustain the longest pe- MERCOSUL remains active, but the signatories have
riod of economic growth in Brazil since the 1970s. Total failed to deepen it into a more effective common mar-
Brazilian exports to China increased from $7.7 billion in ket along the lines of the European Union due, in part, to
2005 to $46.5 billion by 2011 or 18 percent of Brazil’s total Brazil’s greater interest in cultivating ties to Asia. This
exports, though that has leveled down to $35 billion in 2015 strategy has also made Brazil more likely to defend its own
as Chinese growth has slowed and the real has lost value interests in trade disputes before the WTO against hemi-
during the current recession. spheric partners such as the United States.
The expansion of trade with China coincided with a re-
orientation of Brazil’s foreign economic policy. During MAKING CONNECTIONS Does the linkage between
the 1990s, Brazil led its neighbors, Argentina, Paraguay, Brazilian growth and the rise of China empower or limit the
and Uruguay, to create the Common Market of the South capacity of the Brazilian government to control the economy?
(MERCOSUL). Under the Treaty of Asunción (1995), the
partners agreed to reduce tariffs on imports from signa- Source: Alfred P. Montero, Brazil: Reversal of Fortune (Cambridge: Polity
tories and impose a common external tariff (CET) ranging Press, 2014), Chapter 7.

Collor and Cardoso governments implemented some of this agenda by reducing

tariffs and privatizing some state companies, Brazil’s economy retained much of its
autonomy in the global market. Tariff rates are among the highest in the developing
world, the state still owns golden shares in several large, privatized firms, and the
state engages in industrial policy, particularly through the National Development
Bank (BNDES). As its trade relations have changed, Brazil has even turned away from
some of its commitments to hemispheric trade agreements (see Global Connection:
Governing the Economy in a World of States: The Rise of China and Brazilian
Trade).
Nevertheless, Brazil’s commitment to the international free-trade system will
likely expand with the continued importance of its export sector. Maintaining a
healthy trade surplus will continue to be a major component in the country’s formula
for growth, especially as commodity prices for soy, oranges, wheat, coffee, and other
products recover. At the same time, Brazil cannot depend on the occasional “com-
modity boom” to sustain growth. It is becoming one of the major manufacturing
and agrindustry nodes in the globalized system of production and consumption with
ties to East Asia becoming more important as a target market for exports and also
outward-oriented Brazilian companies such as the airplane manufacturer, Embraer.
A frequent user of the WTO dispute resolution apparatus, Brazil will increasingly
employ the rules governing international trade to protect these interests and secure
market access.

Where Do You Stand?

Neoliberals recognize that the state has played an important role in the development of
Brazil, but they point to the failures of ISI to show that more market-oriented policies are
necessary. Do you agree more with the neoliberals or with the statists?

Brazilians like to say that the size of their economy gives Brazil the right to exercise its
influence around the world. Do you agree?

3
SECTION

GOVERNANCE AND POLICY-MAKING

Focus Questions Organization of the State

●● How has the central-
ization of power in Brazilian state institutions have changed significantly since independence. Even so, a
the Brazilian state number of institutional legacies continue to shape Brazilian politics. The most impor-
at times helped to tant is the centralization of state authority in the executive. This process began with
address the country’s the rise of Getúlio Vargas and the New State during the 1930s (see “Profile: Getúlio
problems, and under
Dornelles Vargas”). Yet old tendencies such as the politics of the governors helped
what conditions has
it worsened these shape the constitution of 1988, not to preserve the centralization of presidentialism
problems? but to reestablish the decentralization of federalism.
●● In what ways has the
The Brazilian state has traditionally placed vast power in the hands of the ex-
system of governance ecutive. The directly elected president is the head of state, head of government, and
during the democratic commander in chief of the armed forces. Although the executive is one of three
period increased the branches of government (along with the legislature and the judiciary), Brazilian presi-
accountability of elites dents have traditionally been less bound by judicial and legislative constraints than
to citizens?
most of their European or North American counterparts. Brazilian constitutions
have granted more discretion to the executive than to the other branches in enforcing
politics of the
laws or making policy.
governors
Brazil’s executive and the bureaucracy manage most of the policy-making and
In Brazil, this term refers implementation functions of government. Both the Brazilian federal legislature and
to periods of history in
state governments look to the president and to the minister of the economy for lead-
which state governors
acquire extraordinary ership on policy. The heads of the key agencies of the economic bureaucracy—the
powers over domains of ministers of the economy and of planning, the president of the Central Bank, and
policy that were previously the head of the national development bank—have more discretion over the details
claimed by the federal of policy than the president does. Recent presidents have also had little choice but to
government. The term
delegate authority to the bureaucracy since the presidency cannot control the entire
refers most commonly to
the Old Republic and the state but the president retains ultimate authority over cabinet ministers, the heads of
current state of Brazilian bureaucratic agencies.
federalism. Although the Brazilian president is the dominant player among the three
branches of government, the legislature and the judiciary have become stronger. The
1988 constitution gave many oversight functions to the legislature and judiciary,
so that much presidential discretion in economic and social policy is now subject to
approval by one or both (see Table 9.1).

PROFILE
Getúlio Dornelles Vargas
Getúlio Dornelles Vargas Vargas’s position as governor of Rio Grande do Sul cata-
(1883–1954) came from a pulted him into national prominence in 1929. The interna-
wealthy family in the cattle- tional economic crisis forced several regional economic
rich southernmost state of oligarchies to unite in opposition to the coffee and pro-
Rio Grande do Sul. Vargas’s export financial policies of the government and in favor of
youth was marked by politi- efforts to protect their local economies. The states, includ-
cal divisions within his fam- ing the state of São Paulo, divided their support between
ily between federalists and two candidates for the presidency: Julio Prestes, who
republicans, conflicts that was supported by President Luis, and Vargas, head of the
separated Brazilians during opposition. The two states of Minas Gerais and Rio Grande
Getúlio Vargas as presi-
the Old Republic. Political do Sul voted as a bloc for Vargas, but he lost the 1930 elec-
dent in 1952.
violence, which was common tion. Immediately afterward, a coup by military and politi-
Keystone/Getty Images
in the state’s history, also af- cal leaders installed Vargas in power.
fected Vargas’s upbringing. The reforms of Vargas’s corporatist and authoritarian
His two brothers were both New State after 1937 established the revised terms that
accused of killing rivals. After a brief stint in the military, linked Brazilian society to the state. Even today, his politi-
Vargas attended law school in Porto Alegre, where he ex- cal legacy continues in the form of state agencies designed
celled as an orator. to promote economic development and laws protecting
After graduating in 1907, he became a district attorney. workers and raising living standards for families to prevent
Later, he served as majority leader in the state senate. In suffering from poverty and hunger.
1923, Vargas was elected federal deputy for Rio Grande do
Sul, and in 1924, he became leader of his state’s delegation MAKING CONNECTIONS In what ways did the rise of
in the Chamber of Deputies. In 1926, he became finance Vargas respond to the perils of fragmented power in Brazil?
minister. He served for a year before winning the governor-
ship of his home state. Never an ideologue, Vargas prac- Source: Robert M. Levine, Father of the Poor? Vargas and His Era (New York:
ticed a highly pragmatic style of governing that made him Cambridge University Press, 1998).
one of Brazil’s most popular politicians.

The Executive
Although the adoption of a parliamentary regime was briefly considered following the
1987 National Constituent Assembly, Brazil remained a presidential system. Even so,
rules designed to rein in the federal executive found their way into the 1988 constitu-
tion. Partly in reaction to the extreme centralization of executive authority during mili-
tary rule, the delegates restored some powers to congress from before 1964, and they
granted congress new ones, including oversight of economic policy and the right to be
consulted on executive appointments. Executive decrees, which allowed the president to
legislate directly, were replaced by “provisional measures” (also known as “emergency
measures”). Provisional measures authorized the president to legislate for sixty days, at
the end of which congress can pass, reject, or allow the provisional law to expire. But
consistent with the assertion of congressional power, new restrictions on provisional
measures passed both houses of congress in 2001. Especially since Fernando Henrique
Cardoso’s presidency, presidents and the leaders of the largest parties in the congress
have haggled over the details of legislation, with each branch demanding patronage

from the other to secure passage. Nevertheless, Brazilian presidents, through their pre-
rogative in initiating annual budgets and employing provisional measures for other
legislation, retain considerable powers to legislate.12
The president is elected for a four-year term with the opportunity to stand for
reelection in a consecutive term and the right to run for a nonconsecutive term af-
terward. The major presidential candidates since the Cardoso presidency have tended
to be prominent government ministers or governors. These elites often capture party
nominations with the help of organizations with which they are already affiliated,
making national conventions nothing less than coronations. Political allies then shift
resources to those candidates whom they calculate are most likely to win and shower
patronage on supporters once in government. Though there are parallels with the
U.S. presidency, Brazilian presidents have different institutional powers (see “The
U.S. Connection: The Presidency”).

U.S. CONNECTION
The Presidency
Along with the U.S. president, the Brazilian president is Similar to the U.S. president, the Brazilian president is the
the only executive directly elected by all voters through- commander-in-chief of the armed forces. In practice, how-
out the country, making him or her the head of government ever, the military branches have retained some prerogatives
and head of state. The Brazilian president has powers over internal promotion, judicial oversight, and development
that exceed those of the U.S. president. Over 85 percent of new weapons systems. Brazilian presidents since Collor
of all bills before congress emerge from the Palácio do have exerted their authority over the military, restricting the
Planalto, the president’s offices in Brasília. The most autonomy of the armed forces in some of these areas.
important bill is the annual budget, which is crafted by the U.S. presidents can be removed from office by Congress
chiefs of the economic bureaucracy and the presidency through the process of impeachment, which requires
and then sent to congress. The Senate and the Chamber the House of Representatives to approve articles of im-
of Deputies may amend legislation, but that is usually peachment by a majority vote and the Senate to convict
done with an eye to what the president will accept. Like the president by a two-thirds majority. The i mpeachment
the U.S. president, the Brazilian president maintains a process in Brazil is similar. First the Chamber of Deputies
pocket veto and, like forty-four U.S. state governors but initiates the process with a two-thirds vote to accept
not the U.S. president, also has a line-item veto. Brazilian the charges of impeachment. Then the Senate tries the
presidents may also impound approved funds, which president, with the chief justice of the Supreme Court
makes legislators mindful of enacting policies in ways not overseeing the procedures. The president must step
favored by the president. Brazilian presidents can issue down for up to 180 days during the trial and, if impeached
executive orders with the force of law, but they expire on a two-thirds vote of the Senate, must do so perma-
if they are not taken up by the congress within 60 days. nently. Collor stepped down before the Senate trial, but
“Provisional measures,” as they are called in Brazil, are Rousseff was convicted in 2016 and removed from office
employed regularly and with little judicial oversight, for a “crime of responsibility” involving a violation of the
though they are often the focus of negotiations with con- Law of Fiscal Responsibility that requires the president
gressional leaders who, since 2001, have more of a say in to submit a balanced budget. Rousseff used loans from
their ratification. public banks to cover shortfalls, violating the spirit of
The president has the power to appoint upward of the law at the very least. Michel Temer then replaced
48,000 civil servants, eight times more than the 6,000 her.
appointed by U.S. presidents. Of these, only ambassa-
dors, high court justices, the solicitor general, and the MAKING CONNECTIONS How is the Brazilian presidency
president of the Central Bank are subject to Senate stronger than the U.S. presidency and in what ways is it
approval. weaker?

Since the beginning of the military governments, the ministry of economy has
had more authority than any other executive agency. These powers grew in response
to the economic problems of the 1980s and 1990s. As a result of their control of the
federal budget and the details of economic policy, recent ministers of the economy
have had levels of authority typical of a prime minister in a parliamentary system.
This power is shared somewhat with the Central Bank, which coordinates monetary
authority and financial regulations with the presidency.

The Bureaucracy: State and Semipublic Firms

Bureaucratic agencies and public firms have played a key role in Brazilian economic
and political development. After 1940, the state created a large number of new agen-
cies and public enterprises. Many of these entities were allowed to accumulate their
own debt and plan development projects without undue influence from central min-
istries or politicians. Public firms became a key part of the triple alliance of state,
foreign, and domestic capital that governed the state-led model of development. By
1981, the federal government owned ten of the top twenty-five enterprises in Brazil,
and state governments owned eight others. Public expenditures increased from 16
percent of GDP in 1947 to over 32 percent in 1969, far higher than in any other
Latin American country except socialist Cuba.
Much of this spending (and the huge debt that financed it) was concentrated
on development projects, many of gigantic proportions. Key examples include the
world’s largest hydroelectric plant, Itaipú; Petrobras’s petroleum processing centers;
steel mills such as the now-private National Steel Company in Volta Redonda, Rio de
Janeiro, and Vale do Rio Doce (today known only as Vale), which maintains interests
in sectors as diverse as mining, transport, paper, and textiles. On the eve of the debt
crisis in 1982, the top thirty-three projects accumulated $88 billion in external debt,
employed 1.5 million people, and contributed $47 billion to the GDP.
Managing the planning and financing of these projects calls for enormous skill.
Recruitment into the civil service is by competitive exams, with advanced degrees
required for those seeking management positions in the more technical economic
and engineering agencies. The National Bank for Economic and Social Development
(BNDES) remains the most important financier of development projects in Brazil.
Founded in the early 1950s, the BNDES plays a key role in channeling public funds
to industrial projects such as the automobile sector and domestic suppliers of parts
and labor. The experience of the BNDES demonstrated that, despite Brazil’s cli-
entelist legacies, the Brazilian bureaucracy could function effectively. Meritocratic
advancement and professional recruitment granted these agencies some autonomy
from political manipulation.13 BNDES’s technocracy took on larger responsibilities
during the Cardoso, Lula, and Rousseff presidencies. At present, the bank’s array of
investment and development projects make it a larger development bank than the
World Bank.
Juridical changes represent some of the most important ways in which the
role of the bureaucracy has changed. The 1988 constitution initially reinforced
certain bureaucratic monopolies, for example, the state’s exclusive control over
petroleum, natural gas, exploration of minerals, nuclear energy, and telecommu-
nications. But this began to change with the adoption of structural reforms dur-
ing the 1990s, beginning with the Collor government’s National Destatization
Program (Programa Nacional de Destatização; PND). Under the PND, public
firms, amounting to a total value of $39 billion, were sold ($8.5 billion in the steel
sector alone). The Cardoso administration went even further. It persuaded congress

to amend the constitution to remove the public monopoly on petroleum refining,

telecommunications, and infrastructure, making these sectors available for auction
or licensing arrangements with private firms. In 1998, much of the public telecom-
munications sector was privatized, bringing in about $24 billion. Under Lula and
Rousseff, state-controlled entities such as Petrobras and BNDES reasserted their
role in the economy, with the latter as the primary source of long-term finance and
venture capital.

Other State Institutions

The Judiciary
Brazil has a network of state courts, with jurisdiction over state matters, and a federal
court system, not unlike the one in the United States, which maintains jurisdic-
tion over federal crimes. A supreme court (the Supreme Federal Tribunal or STF),
similar in jurisdiction to the U.S. Supreme Court, acts as the final arbiter of court
cases. The Supreme Federal Tribunal’s eleven justices are nominated by the president
and confirmed by an absolute majority of the Senate. The Superior Court of Justice
(STJ), with thirty-three justices, operates beneath the Supreme Federal Tribunal as
an appeals court. The Supreme Federal Tribunal decides constitutional questions.
The military maintains its own court system.
The judiciary adjudicates political conflicts as well as civil and social conflicts.
The Electoral Supreme Tribunal (Tribunal Supremo Eleitoral, TSE) has exclusive
responsibility to organize and oversee all issues related to elections. The TSE has
the power to investigate charges of political bias by public employees, file criminal
charges against persons violating electoral laws, and validate electoral results. In
addition to these constitutional provisions, the TSE monitors the legal compliance
of electoral campaigns and executive neutrality in campaigns. Political candidates
with pending charges are allowed to run for office, but they are prohibited from
taking their elected seats if they do not resolve the charges. Dozens of “dirty
record” (ficha suja) candidates have been prevented from running for office, rein-
forcing the power that the TSE and its regional electoral courts have to oversee all
elections.
As in the rest of Latin America, penal codes established by legislation govern
the powers of judges. This makes the judiciary less flexible than in North America,
which operates on case law, but it provides a more effective barrier against judicial
activism—the tendency of the courts to render broad interpretations of the law. The
main problem in the Brazilian system has been the lack of judicial review. Lower
courts do not have to follow the precedents of the STF or STJ, though a compre-
hensive judicial reform act in 2004 strengthened the capacity of the STF and STJ to
set precedent and reduce the number of appeals. The reform established a National
Judicial Council to regulate the lower courts, where judges are more tolerant of nepo-
tism and conflict of interest.
These and other reforms since 2013 have also strengthened the role and pro-
fessionalization of prosecutorial and investigatory offices, especially the Public
Ministry, the federal and state prosecutors, and the auditing agencies of the federal
and state treasuries. Strict civil service guidelines, meritocratic admission and ad-
vancement, and much oversight provided by these agencies explain the unveiling
of systemic corruption in Brazilian politics. Lava Jato is the largest of several major

corruption investigations that have upended the political establishment. These inves-
tigations brought down the president of the Chamber, Eduardo Cunha, who oversaw
Rousseff’s impeachment. Some of the largest political figures in Brazil, including
Lula and Michel Temer, remain in the crosshairs of prosecutors.

Subnational Government
Like Germany, Mexico, India, and the United States, the Brazilian state has a fed-
eral structure. The country’s twenty-six states are subdivided into 5,564 municipal
governments. The structure of subnational politics in Brazil consists of a governor;
his or her chief advisers, who also usually lead key secretariats such as economy
and planning; and a unicameral legislature often dominated by supporters of the
governor. Governors serve 4-year terms and are limited to two consecutive terms
in office.
By controlling patronage through their powers of appointment and spending,
governors and even some mayors can wield extraordinary influence.14 The 1982 elec-
tions were the first time since the military regime when Brazilians could elect their
governors directly. This lent legitimacy to the governors’ campaign to decentralize
fiscal resources. In recent years, key elements of reforms have been watered down
in order to curry favor with this influential constituency. Political decentralization
further fragmented the Brazilian polity, but it also empowered some subnational
governments to sponsor innovative new policies.15 The 1988 constitution accelerated
this process by giving the states and municipalities a larger share of tax revenues.
During the early to mid-1990s, this process went too far, and it allowed states and
cities to go deeply into debt. The Cardoso administration went the farthest to halt
this unsustainable process of debt-led subnational spending. The federal government
required states and municipalities to finance a larger share of social spending. The
Central Bank took over bankrupt state banks and privatized most of them. The Fiscal
Responsibility Law of 2000 introduced new penalties for profligacy by subnational
governments.
Nevertheless, governors and mayors remain significant actors in policy-making.
These politicians remain party leaders as they are key hubs for distributing patron-
age to lower-ranked politicians. At the same time, these leaders have sometimes
demonstrated the capacity for good government. A study of one state demonstrated
that even the most underdeveloped subnational governments can promote industrial
investment, employment, and social services.16

The Military and the Police

Like many other South American militaries, the Brazilian armed forces retain substan-
tial independence from civilian presidents and legislators. Brazil has suffered numer-
ous coups; those in 1930 and 1964 were critical junctures, while others brought in
caretaker governments that eventually yielded to civilian rule. The generals continue
to maintain influence in Brazilian politics, blocking policies they do not like and lob-
bying on behalf of those they favor.
The military’s participation in Brazilian politics became more limited, if still
quite expansive, following the transition to democracy in 1985. Several laws gave
the military broad prerogatives to “guarantee internal order” and play a “tute-
lary role” in civilian government. During the Sarney administration, members of
the armed forces retained cabinet-level rank in areas of importance to the military,

such as the ministries of the armed forces and the nuclear program. Most impor-
tant, the military succeeded in securing amnesty for its human rights abuses com-
mitted during the preceding authoritarian regime. In an effort to professionalize
the armed forces, the Collor government slashed the military budget, thereby
reducing the autonomy that the military enjoyed during the authoritarian period.
Collor also replaced the top generals with officers who had few or no connections
to the authoritarian regime and were committed to civilian leadership. Cardoso
introduced a new security strategy that thoroughly professionalized the armed
forces, leaving them out of civilian processes controlling the defense budget.
In recent years, there has been a militarization of local police forces. The
state police consists of two forces: the civil police force, which acts as an investi-
gative unit, and the uniformed military police force, which maintains order. The
military police do not regulate only military personnel but civilians as well. They
often partake in specialized commando-type operations in urban areas, especially
in the favelas, and they engage in riot control. These forces are only nominally
controlled by state governors; they are, in fact, trained, equipped, and managed
by the armed forces, which also maintain a separate judicial system to try officers
for wrongdoing.
Rising urban crime rates produced a movement to “pacify” and control areas
that had once been ceded de facto to drug gangs. “Pacification units” of specialized
police forces routinely invade and patrol favelas in Rio, São Paulo, Recife, and other
major cities with destitute urban rings. The specter of criminal violence has shocked
Brazilians into voting for politicians who promise better police security. But voters
have learned that police forces themselves are often part of the problem. Despite of-
ficial oversight of police authorities, the military and civil police forces in many cities
of the northeast, São Paulo, and Rio de Janeiro often act abusively. Cases of arbitrary
detention, torture, corruption, and systematic killings by Brazilian police have been
the focus of human rights investigations.17 The police are also targets of violence,
as organized crime syndicates, especially in São Paulo, have become more brazen in
their attacks on police installations.
The federal police force is a small unit of approximately 3,000 people. It
operates like a combined U.S. Federal Bureau of Investigation, Secret Service, Drug
Enforcement Agency, and Immigration and Naturalization Service. Despite its lim-
ited size, the federal police force has been at the center of every national investiga-
tion of corruption. Thanks to the federal police and the Public Ministry, the official
federal prosecutor with offices in each of Brazil’s states and the federal district, the
federal government’s capacity for investigation and law enforcement has expanded
considerably.

The Policy-Making Process

Although policy-making continues to be fluid and ambiguous, certain domains of
policy are clearly demarcated. Foreign policy, for example, is exclusively the responsi-
bility of the executive branch. Political parties and the congress still have only incon-
sistent power over investment policies. Bureaucratic agencies retain command over
the details of social and economic policies.

Clientelism injects itself at every stage of policy-making, from formulation

and decision making to implementation. Personal contacts often shape who ben-
efits from policy-making. Quid pro quos, nepotism, and other kinds of favorit-
ism, if not outright corruption, regularly obstruct or distort policy-making.18
Complex formal and informal networks link the political executive, key agencies
of the bureaucracy, and private interests. These networks are the chief players in
clientelist circles. Cardoso described these clientelistic networks as bureaucratic bureaucratic rings
rings. He considered the Brazilian state to be highly permeable, fragmented, and A term developed by
therefore easily colonized by private interests that make alliances with midlevel the Brazilian sociologist
bureaucratic officers to shape public policy to benefit themselves. The Lava Jato and president Fernando
and other corruption scandals illustrate how the sustained inf luence of private Henrique Cardoso
interests, such as the construction companies who won bids for Petrobras proj- that refers to the
highly permeable and
ects, inf luence the bidding process and pay bribes to politicians and the campaign fragmented structure
coffers of the main parties. Odebrecht, the largest construction company, paid a of the state bureaucracy
reported $800 million in bribes on 100 projects in twelve different countries and that allows private
received $3.34 billion in new business due to these bribes. interests to make
Among the key sources of inf luence outside the state is organized busi- alliances with midlevel
bureaucratic officers.
ness. Unlike business associations in some Asian and West European coun- By shaping public
tries, Brazilian business groups have remained independent of corporatist ties policy to benefit these
to the state. Business associations have also remained aloof from political par- interests, bureaucrats
ties. Lobbying by Brazilian entrepreneurs is common, and their participation in gain the promise of
bureaucratic rings is legendary. Few major economic policies are passed without future employment in the
private sector.
the input of the Federation of São Paulo Industries (Federação das Industrias do
Estado de São Paulo, or FIESP).
The country’s labor confederations and unions have had less consistent access to
policymaking. Although unions were once directly organized and manipulated by
the corporatist state, they gained autonomy in the late 1970s and the 1980s. From
then on, they sought leverage over policy-making through outside channels, such as
the link between the Central Única dos Trabalhadores (CUT, Workers’ Singular Peak
Association) and Lula da Silva’s Workers’ Party. Attempts to bring labor formally into
direct negotiations with business and the state have failed, in part due to widening
cleavages within the union movement due to their sector’s orientation toward trade,
technology, and remuneration.
Debate and lobbying do not stop in Brazil once laws are enacted. Policy imple-
mentation is a subject of perpetual bargaining. One salient example is “the Brazilian
way” (o jeito brasileiro)—a social convention that allows any Brazilian to ask for a
temporary suspension of a rule for the sake of expediency. Although jeito is used
only for relatively minor rules, it delivers the message that the rule of law is not to be
entirely respected either by the rich or by the poor.

Where Do You Stand?

Would you consider the Brazilian state “strong”?
How does clientelism in policy-making make it easier for even massive corruption to
occur?

4
SECTION

REPRESENTATION AND PARTICIPATION

The fragmentation of legislative politics, the weaknesses of political parties, and the
Focus Questions interests of particular politicians and their clientelistic allies make enacting reform on
●● In what ways do behalf of the national interest extremely difficult. Those politicians and parties that
Brazilian political
dispense the most patronage and cultivate clientele networks are the most successful.
institutions impede
representation and More often than not, the main beneficiaries are a small number of elite economic
elite accountability? and political interests who develop ongoing relationships with legislators, governors,
●● How does the mobili-
and presidents.
zation of civil society The transition to democracy, however, coincided with an explosion of civil soci-
in Brazil enhance the ety activism and mobilization. The expansion of voting rights and the involvement of
country’s democratic gender and ethnic groups, urban social movements, and environmental and religious
governance? organizations in Brazilian politics have greatly expanded the range of political par-
ticipation. Just the same, political institutions have failed to harmonize the demands
of conflicting forces.

The Legislature
The national legislature is composed of an upper house, the Senate, with 81 members,
and a lower house, the Chamber of Deputies, with 513 members. Every state and the
federal district elect three senators by simple majority. Senators serve for eight-year
terms and may be reelected without limit. Two-thirds of the Senate is elected at one
time, and the remaining one-third is elected four years later. Senatorial elections are
held at the same time as those for the Chamber of Deputies, all of whose members are
elected on a four-year cycle. Federal deputies may be reelected without limits. Each
state is allowed a minimum of eight and a maximum of seventy deputies, according
to population. This procedure introduces severe malapportionment in the allocation
of seats. Without the ceiling and floor on seats, states with large populations, such as
São Paulo, would have more than seventy deputies, and states in the underpopulated
Amazon, such as Roraima, would have fewer than eight.
The two houses of the legislature have equal authority to make laws, and both
must approve a bill for it to become law. Each chamber can propose or veto legislation
passed by the other. When the two chambers pass bills on a given topic that con-
tain different provisions, the texts go back and forth between houses without going
through a joint conference committee, as in the United States. Once a bill is passed by
both houses in identical form, the president may sign it into law, reject it as a whole,
or accept some parts of it and reject others. The legislature can override a presiden-
tial veto by a majority vote in both houses during a joint session, but such instances
are rare. Constitutional amendments must be passed twice by at least three-fifths of
the votes in each house of congress. Amendments may also be passed by an absolute
majority in a special constituent assembly proposed by the president and created by
both houses of congress. The Senate is empowered to try the president and other top
officials, including the vice president and key ministers and justices, for impeachable
offenses. It also approves the president’s nominees to high offices, including justices of
the high courts, heads of diplomatic missions, and directors of the Central Bank.

Most legislators view their service primarily as a means to enhance their own income,
thanks to generous public pensions and kickbacks earned from dispensing political fa-
vors. Election to the federal legislature is often used as a stepping stone to even more
lucrative, especially executive, posts. After the presidency, the most coveted positions are
the governorships of industrialized states. Most members of congress come from the
middle or upper-middle classes; they have much to gain if they can step into well-paid
posts in the executive and the parastatal enterprises following their congressional service.
A mere 3 percent of seats in congress are held by Afro-Brazilians. Only 9 percent of the
seats in the Chamber and 14 percent of those in the Senate are held by women.
The deficiencies of the Brazilian legislature were highlighted in recent years
by several corruption scandals. Partly due to the fragmentation of the party sys-
tem (see below), the Lula government bought the votes of deputies in smaller par-
ties. Kickback schemes from public contracts are a common way of financing these
forms of political coordination. The Lava Jato investigation unveiled the largest such
scheme in Brazilian history, with indictments and leaks from plea bargaining testi-
mony leading the news each day.
Congress is often criticized for its lack of accountability. One response to legislative
corruption has been to use parliamentary commissions of inquiry to review allegations
of malfeasance by elected officials. Although these temporary committees have demon-
strated some influence, they have rarely produced results. The temporary committees
work alongside sixteen permanent legislative committees that treat issues as diverse as
taxation and human rights. These committees, however, are not nearly as strong as com-
mittees in the U.S. Congress. Legislative committees, both temporary and permanent,
often fail to conclude an investigation or find solutions to persistent dilemmas in policy.

Political Parties and the Party System

Many of the traditional weaknesses of the party system were reinforced after the tran-
sition to democracy. The result was to make parties anemic. Politicians switched par-
ties nearly at will to increase their access to patronage, sometimes during their terms
in office. A Supreme Court decision in 2007 ruled against this practice but allowed
switching prior to elections. Other rules of the electoral system create incentives for
politicians to ignore party labels. Brazil’s experience with proportional representa-
tion (PR), which is used to elect federal and state deputies, is particularly important
in this regard. Proportional representation may be based on either a closed-list or
an open-list system. In closed-list PR, the party selects the order of politicians, and
voters cannot cross party lines. Because voters are effectively choosing the party that
best represents them, this system encourages party loyalty among both the electorate
and individual politicians. In an open-list PR system, the voters have more discretion
and can cross party lines. Brazil’s PR system is open-list. Voters cast their ballots for
individuals not parties by inputting the candidate’s electoral number. The geographic
boundaries of electoral districts in Brazil for state and federal deputies are entire
states. There are few limits on how many individuals and parties may run in the same
electoral district. Crowded fields discourage party loyalty and emphasize the personal
qualities of candidates. Worse still, the open-list PR system creates incentives for poli-
ticians to ignore party labels, because voters can cross party lines with ease.
With so much emphasis on the personal qualities of politicians, ambitious indi-
viduals often ignore established party hierarchies while achieving elected office. As
a result, Brazil has the most fragmented party system in Latin America and one of
the most fragmented in the world. This makes parties extremely poor vehicles for

representing political alternatives. Brazil’s electoral system further fragments power

because state, not national, parties select legislative candidates, with governors exert-
ing tremendous influence over nominations.
Given the political fragmentation of the legislature and the weakness of the
party system, presidents struggle to maintain majority alliances in congress. Since
the Cardoso presidency, the distribution of cabinet ministries to leaders or notables
of parties other than the president’s has been a primary means of crafting congres-
sional alliances. While it may be the case, as some political scientists have claimed,
that this system of “coalitional presidentialism” is stable and has enabled the politi-
cal system to become more governable, the system is confusing and can easily invite
corruption.
Fundamental to the confusing nature of the Brazilian political system is the
number of political organizations that have emerged over the last few years. These
parties can be defined ideologically, although the categories are not as internally
consistent or cut and dry as they might seem (see Table 9.4).
Political parties on the right currently defend neoliberal economic policies de-
signed to shrink the size of the public sector, as well as support the reduction and
partial privatization of the welfare state. Right-wing parties are fairly united in favor
of rolling back social spending; they also advocate electoral reform—specifically, the
establishment of a majority or mixed, rather than purely proportional, district voting
system.
A loose set of conservative parties currently struggles for the mantle of the
right. Leading the pack is the PFL, which was refounded in 2007 as the Democrats
(DEM). PFL/DEM is one of the larger parties in the congress and has gener-
ally opposed center-left presidents Lula and Rousseff. Many small parties have
allied with right-wing and center-right parties or advocated right-wing issues, such
as the Brazilian Labor Party (PTB), the Progressive Party (PP), the evangelistic
Liberal Party/Party of the Republic (PL/PR), and the hard-right Social Christian
Party (PSC).
The two other largest parties in congress are the PMDB and the PSDB. These
parties, while having disparate elements, tend to dominate the center and center-right
segments of the ideological spectrum. Along with the PFL/DEM, these have been
the key governing parties during the democratic era. There is agreement that these
parties have become more solidly in favor of neoliberal reform, so they can be char-
acterized as being on the right or center-right.19 They are also the parties that led the
impeachment process against Dilma Rousseff after PMDB broke its allegiance with
her government in March 2016.
Political parties on the left not only advocate reducing deficits and inflation but
also maintaining the present size of the public sector and improving the welfare state.
Left-oriented parties want to expand the state’s role in promoting and protecting do-
mestic industry. On constitutional reform, they support the social rights guaranteed
by the 1988 constitution.
The Workers’ Party (PT) has been the most successful of the leftist parties,
having elected Luiz Inácio “Lula” da Silva twice to the presidency, followed by
Dilma Rousseff. The PT was founded by workers who defied the military govern-
ment and engaged in strikes in São Paulo’s metalworking and automobile indus-
tries in 1978 and 1979. Although the PT began with a working-class message and
leftist platform, its identity broadened and moderated during the 1980s and early
1990s. Under Lula’s leadership the party increasingly sought the support of the
middle class, rural and urban poor, and even segments of business and the upper
classes. In the years preceding Lula’s presidency, the party moderated its criticism

Table 9.4 The Democratic Idea: The Major Parties

in Brazil
Conservative/Right-Wing Parties

PFL/DEM Partido da Frente Liberal (Party of the Liberal Front)

[refounded as the Democratas (Democrats) in 2007]

PL/PR Partido Liberal (Liberal Party; refounded as the Party of the

Republic in 2007)

PP Partido Progressista (Progressive Party)

Centrist Parties

PMDB Partido do Movimento Democrático Brasileiro (Party of the

Brazilian Democratic Movement)

PSDB Partido da Social Democracia Brasileira (Party of Brazilian

Social Democracy)

Populist/Leftist Parties

PT Partido dos Trabalhadores (Workers’ Party)

PSB Partido Socialista Brasileiro (Brazilian Socialist Party)

PCdoB Partido Comunista do Brasil (Communist Party of Brazil)

PDT Partido Democrático Trabalhista (Democratic Labor Party)

PPS Partido Popular Socialista (ex-Partido Comunista Brasileiro)

(Popular Socialist Party)

of capitalism, ultimately accepting many of the economic reforms

that Cardoso implemented. During Lula’s presidency, the PT
moved further to the center. After Rousseff’s impeachment and
Lula’s deepening problems with prosecutors, PT militants began
to imagine refounding the party by abandoning politicians under
investigation and cultivating younger leadership. Yet if Lula sur-
vives legal scrutiny, he may still gain the party’s nomination for a
third presidential run in 2018.
Currently, no party has more than 25 percent of the seats in
either house of congress (see Figures 9.4 and 9.5). Cardoso’s mul-
tiparty alliance of the PSDB-PFL-PTB-PPB controlled 57 percent
of the vote in the lower house and 48 percent in the upper house.
Lula failed to organize a similar “governing coalition;” his gov- FIGURE 9.4 Share of Seats of the
ernment depended on enticing centrist and center-right parties Major Parties in the Chamber of
to vote for his proposals. His successor, Dilma Rousseff, enjoyed Deputies, as of February 2016
a larger support base in congress than Lula or even Cardoso, but Source: Data from final TSE numbers.

this failed to protect her when the economy slowed and

Lava Jato encouraged some parties to end their support of
the government.

Elections
The Brazilian electorate stands at 142 million with an aver-
age turnout of about 80 percent. These figures make it the
largest and most participatory electorate in Latin America.
Compulsory voting, improved literacy, and efforts by political
parties, especially on the left, to educate citizens on the value
of participation have expanded the electorate impressively.
Yet given the multiplicity of parties, unbalanced appor-
FIGURE 9.5 Share of Seats of the Major tionment of seats among the states, and sheer size of some
Parties in the Senate, as of February 2016 state-sized electoral districts, candidates often have few in-
Source: Data from final TSE numbers. centives to be accountable to their constituencies. In states
with hundreds of candidates running in oversized electoral
districts, the votes obtained by successful candidates are often widely scattered, limit-
ing the accountability of those elected. In less-populated states, there are more seats
and parties per voter; the electoral and party quotients are lower. As a result, candi-
dates often alter their legal place of residence immediately before an election in order
to run from a safer seat, compounding the lack of accountability.
With the abertura, political parties gained the right to broadcast electoral pro-
paganda on radio and television. All radio stations and TV channels are required to
carry, at no charge, two hours of party programming each day during a campaign
season. The parties are entitled to an amount of time on the air proportional to
their number of votes in the previous election. But some candidates gain more access
through private channels and community radio stations that family members may
own.
Despite the shortcomings, Brazilians have voted in larger numbers and have
avoided the kinds of antisystem protests seen in other Latin American countries.
Nevertheless, participation is not enough. Relatively few Brazilians identify with a
political party. (The vast majority of those who do are aligned to the PT). Most
Brazilians have no clear left-right ideology, so there is little to align political repre-
sentatives and voters other than material interests.
Not surprisingly, Brazilians remain disappointed with the results of democracy.
The weakness of political parties, coupled with the persistence of clientelism and
accusations of corruption against even previously squeaky clean parties such as the
PT, have disillusioned average Brazilians and have generated support for occasional
protests that call attention to systemic problems without calling for a change of the
regime itself.

Political Culture, Citizenship, and Identity

The notion of national identity describes a sense of national community that goes
beyond mere allegiance to a state, a set of economic interests, regional loyalties, or
kinship affiliations. A national identity gains strength through a process of nation
building during which a set of national symbols, cultural terms and images, and
shared myths consolidate around historical experiences that define the loyalties of a
group of people.

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Cps Brazil

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370 Brazil

CHRONOLOGY of Brazil’s Political Development

1800 1850 1900 1930 1950 1960

THE MAKING OF THE MODERN

Focus Questions Politics in Action

has Brazilian democ-

370 CHAPTER 9 Brazil

1970 1985 1990 1995 2000 2010 2016

SECTION 1 The Making of the Modern Brazilian State 371

FIGURE 9.1 The Brazilian Nation at a Glance

Brazil is a blend of different cultural influences, although Portuguese as the

Table 9.1 Political Organization

The Old Republic (1889–1930)

bureaucratic The Rise of Bureaucratic Authoritarianism (1964–1985)

George Holton/Science Source

Brazil after September 11, 2001

The Four Themes and Brazil

Governing the Economy

The Democratic Idea

The Politics of Collective Identity

Themes and Comparisons

Where Do You Stand?

POLITICAL ECONOMY AND DEVELOPMENT

noncompetitive, inefficient production, in which

The Problem of Inflation

Society and Economy

The Welfare System

Table 9.3 Governing the Economy: Brazilian Income

Brazil 41.8 57.4 3.3 1.0

Mexico 38.9 54.1 4.9 1.9

Chile 41.5 56.7 4.6 1.7

China 31.4 47.9 5.2 2.1

Nigeria 32.7 49.0 5.4 2.0

India 29.8 44.0 8.3 3.6

United States 30.2 36.4 5.1 1.7

United Kingdom 24.7 40.1 7.5 2.9

France 26.8 41.2 7.8 3.1

Russia 32.2 48.3 5.9 2.3

Environmental Issues expanded after the

Partly due to the return to democracy in 1984, new en-

necessary to keep these rates low.

Brazil in the Global Economy

Collor and Cardoso governments implemented some of this agenda by reducing

Where Do You Stand?

GOVERNANCE AND POLICY-MAKING

Focus Questions Organization of the State

The Bureaucracy: State and Semipublic Firms

to amend the constitution to remove the public monopoly on petroleum refining,

Other State Institutions

The Military and the Police

The Policy-Making Process

Clientelism injects itself at every stage of policy-making, from formulation

Where Do You Stand?

REPRESENTATION AND PARTICIPATION

Political Parties and the Party System

representing political alternatives. Brazil’s electoral system further fragments power

Table 9.4 The Democratic Idea: The Major Parties

PFL/DEM Partido da Frente Liberal (Party of the Liberal Front)

PL/PR Partido Liberal (Liberal Party; refounded as the Party of the

PP Partido Progressista (Progressive Party)

PMDB Partido do Movimento Democrático Brasileiro (Party of the

PSDB Partido da Social Democracia Brasileira (Party of Brazilian

PT Partido dos Trabalhadores (Workers’ Party)

PSB Partido Socialista Brasileiro (Brazilian Socialist Party)

PCdoB Partido Comunista do Brasil (Communist Party of Brazil)

PDT Partido Democrático Trabalhista (Democratic Labor Party)

PPS Partido Popular Socialista (ex-Partido Comunista Brasileiro)

of capitalism, ultimately accepting many of the economic reforms

this failed to protect her when the economy slowed and

Political Culture, Citizenship, and Identity

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