Brazil to start all over again

Dilma Rousseff's impeachment ended a political era for Brazil, which now has to start all over again

Rio’s 2016 Olympics finished on August 21st. Ten days later, Brazil’s former president Dilma Rousseff was impeached. The event, which a large portion of the population thought symbolized the entry of the country into the hall of developed nations, was merely the end of one more of its political cycles. Disappointed, Brazilians now have the difficult task to rebuild their expectations.

This political cycle began in 2001, when the Partido dos Trabalhadores (PT) – Workers’ Party – elected its first president, Rousseff’s predecessor Luiz Inácio Lula da Silva. Brazil was going through an important transition from hyperinflation at the beginning of the 1990’s to economic stability. Initially the possible election of president Lula represented a risk to this process, given the divergence of his party to the policies that were implemented in the presidential terms that preceded him. His election, however, maintained the commitment to end inflation and to control the government budget, and took a new political step with a peaceful transition from the latter government to the former, now led by a labour class leader for the first time in Brazilian history.

Brazil was just leaving behind difficult years of income stagnation. Therefore, the gains obtained during Lula’s government with the economic stabilization and growth, and also with an agenda of intensive investments in social programs, would require a symbol. The two largest sports events hosted in Brazil, the football World Cup and the Olympics, were a representation of Brazil’s growth. The choice to host events such as these, in 2014 and 2016 respectively, represented the new standards the country could now achieve; it was a sign of economic stability and social strength.

Continuous mistakes of macroeconomic policies implemented after that, however, mainly after the 2008 financial crisis, together with constant corruption scandals, obstructed an eventual change of Brazil’s status.

At the beginning of the Workers’ Party’s government, Brazil was far from the other experiences Latin America was living: the stable political transition and the continuation of the former economic platform of economic fiscal responsibility purported to have raised Brazil to a new stage of moderate but constant social reforms and improvements. A change of strategy implemented in 2008, with the use of government expenditure to artificially sprint the economy, pulled Brazil back to the anachronistic characteristics of Latin American background, a mix of political populism and economic heterodoxy. A speech against suspected nation’s enemies returned hand in hand with lack of control of government budget, inflation and probably the worst recession the country has ever faced.

As briefly mentioned above, these years have also been labeled by increasing scandals of corruption. In 2005, president Lula’s government was caught regularly bribing congressmen to approve their projects and actions. One after the other, members of the government were accused of participating directly or indirectly in the scheme, including president Lula’s Minister of Finance, one of the main characters responsible for the economic prosperity during those years, who had to leave the post in 2006. Corruption seemed to have appeared as a gradual, systematic and never-ending organic part of Workers’ Party’s methods to govern. The scandals reached their peak with the use of state-owned companies to bribe the private sector which, in turn, illegally funded political parties.

A “new” Brazil was supposed to have been born and to have grown in the last 13 years, but that was not the case. Instead, it was just another cycle that mixed populism in politics with heterodoxy in economics. John Maynard Keynes once said “The difficulty lies not so much in developing new ideas as in escaping from old ones”. Brazil unfortunately still seems to be a sad example of this.

On the other hand, this process might have taught Brazilians important lessons. Perhaps Brazilians need to be less vulnerable to touching speeches like the ones delivered during the last years of Workers’ Party government, that have no sense of pragmatism. Brazil should prefer good policies rather than good politicians.

Another lesson is that building a country takes time, and that fast and apparently simple social transformations are generally followed by frustration and an aftermath of recovering from a lower step. If Brazilians are able to understand lessons like these, the painful way from the Olympics to the impeachment at least will not have been in vain.

Diego da Silva Rodrigues

Diego is an applied economist interested in policy evaluation and quantitative methods. His main interests are around family issues, such as marriage, parenting, gender, fertility and children, being member of the International Network of Child Support Scholars (INCSS) and the Parenting Culture Studies Postgraduate Network. Diego has also publications in migration and health economics, and is currently involved with human rights and democracy activism in South America. At present, he is completing his PhD at the University of Kent, UK, and is lecturer in Economics at IESGO, Brazil.
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