Brazil is a strong test of the barriers to Third World
military-industrial growth. Unable to adjust to changing domestic and international
structures, the Brazilian defense sector experienced declining output, technological
stagnation, and the collapse of established roles and rules governing its earlier growth.
In the absence of a dramatic reorientation of both domestic and international structures,
the sector’s prospects remain bleak.
By Ken Conca
When you talk about materiel for military use, domestic industry, and the Armed
Forces, that combination is a great platform for giving development a boost, with
applications in many other areas. Technical know-how radiates out into the civilian area.
There is no doubt that the Armed Forces play an important part in the country’s
development.
General Benedito Onofre Bezerra Leonel, Chief of Staff, Brazilian Army
Development is a voyage with more shipwrecks than navigators.
Eduardo Galeano
Brazil’s military industries expanded dramatically during the 1970s. In a single decade
a country heavily dependent on foreign military suppliers became a significant arms
exporter and a Third World leader in military R&D. A substantial
military-technological infrastructure emerged, anchored by separate R&D institutes for
each branch of the armed forces. By decade’s end sizable industries in aeronautics,
armored vehicles, and shipbuilding were supplying both Brazil’s military and the
international market with a range of medium-tech weapons systems. Nuclear and space
programs straddling civilian and military applications also flourished. The international
defense press heralded "Brazil’s Arms Industry on the Move."
Ambitious new programs propelled Brazil’s defense sector to new heights in the early
1980s. Plans were laid to make Brazil the first Third World producer of several advanced
weapons systems, including a state-of-the-art battle tank, a NATO-standard ground attack
aircraft, a small nuclear submarine, and a satellite-launching vehicle with
ballistic-missile capabilities. These programs deepened Brazil’s ties to multinational
defense contractors and stimulated a domestic network of high-tech supplier firms.
By the mid-1980s the international defense press routinely heralded Brazil as a new
force in the global arms economy, and scholars regularly pointed to Brazil as one of a new
wave of Third World suppliers transforming the international arms trade. Even critics
accepted the likelihood of sustained defense-sector growth, worrying about the effects of
military-industrial development for Brazilian diplomacy, regional peace, and domestic
spending priorities in a nation of widespread poverty.
A few years later, the contrast could not have been more striking. Arms exports, after
peaking at somewhat less than $1 billion annually in the late 1980s, slowed to a trickle
by the early 1990s. The three firms making up the core of Brazil’s military-industrial
base were effectively bankrupt, and the ambitious programs launched a decade earlier were
nowhere near their production goals. The battle tank stalled at the prototype stage, then
vanished in the financial collapse of the armored-vehicle industry. The ground attack
aircraft did enter series production before decade’s end—but delays, technical
difficulties, and enormous cost overruns staggered the aircraft industry and made the
plane far too expensive to export. The satellite launcher became mired in cost overruns,
technical snafus, and political controversy; it failed to meet its target of putting a
Brazilian-built satellite in orbit by 1989, and has yet to reach the launching pad. The
nuclear submarine, stymied by the stagnation of naval shipbuilding and political
controversy in Brazil’s nuclear program, remains a vision on a distant horizon. Even the
defense sector’s boosters were acknowledging that it had become "a pale shadow of
what it was a short time ago."
How can we explain the dramatic rise and precipitous decline of Brazil’s defense
sector? What does the Brazilian experience tell us about the prospects for
military-industrial development in the Third World? Can the increasingly sophisticated
defense sectors that emerged in several developing countries during the Cold War be
sustained in the post-Cold War era? Or is Brazil a harbinger of formidable constraints
facing Third World military industrialization?
The answers will influence the prospects for conflict, international security,
development, and North-South relations into the twenty-first century. It has long been
recognized that sustained Third World military-industrial development would transform the
structure of the international system. This recognition first crystallized with nuclear
weapons: China’s 1964 nuclear test ushered in the era of nonproliferation, and India’s
successful test a decade later heightened international concern. During the 1980s the
focus shifted to ballistic missiles and conventional arms, with research, development, and
production springing up in several Third World countries. Many scholars began to describe
this incipient military industrialization as an indicator of more fundamental change in
the international system, with power being redistributed from North to South. The
post-Cold War collapse of the international arms trade, which hit Third World producers
with particular force, has tempered such claims of system transformation. But the spread
of conventional arms-production technology to the Third World is still described as
"the next proliferation challenge," and enduring concerns about Third World
nuclear and missile programs reflect the pervasive belief that the South’s
military-industrial development has global ramifications. Third World programs influence
public debates, defense budgets, and force postures throughout the industrialized world.
Moreover, the salience of these programs is not limited to the security realm.
Typically, Third World military industrialization has a strong developmental orientation
as well. The skepticism of Northern academics notwithstanding, the belief remains
widespread in the South that military-industrial programs can provide tangible economic
and technological benefits as well as enhanced military security.
The idea that the defense sector can be a springboard for economic development has been
particularly strong among the more technologically advanced countries of the Third World.
In South Korea, the development of heavy industries in the late 1970s was closely tied to
military-industrial initiatives. Broadly similar examples can be cited in countries facing
widely varying security contexts, including Taiwan, South Africa, Israel, and Brazil. Even
in countries with outdated military-industrial enclaves, including Argentina, Egypt,
India, and China, a shift was seen in the 1980s toward greater integration of military and
civilian activities.
Historically, the industrial countries themselves have been powerful examples of
governments perceiving a symbiosis between defense and development: the use of Atlas and
Titan ICBM boosters to launch Mercury and Gemini spacecraft was certainly noticed by Third
World governments today using national space programs to develop both space-launch and
ballistic-missile capabilities. The issue is typically not posed as one of guns versus
butter, but rather of finding a developmental path that can yield more of both.
This book has two purposes. The first is to present the basis for my skepticism about
the prospects for sustained military-industrial development for most of the Third World.
In adjusting to the discontinuities of the post-Cold War era, foreign policies and
security institutions of the industrialized countries have turned their gaze from East to
South. The distorted lens through which the South is viewed magnifies the North’s fears,
in that it projects chronic instability and social conflict combined with weapons
proliferation. But this picture frequently overstates and mischaracterizes the South’s
military-industrial emergence, promoting the continued militarization of North-South
relations.
I view Brazil as a strong test of the barriers to Third World military-industrial
growth. What has been seen in Brazil is nothing less than the deinstitutionalization of
defense production. Unable to adjust effectively to the turbulence of simultaneously
changing domestic and international structures, the defense sector experienced declining
output, technological stagnation, and the collapse of established roles and rules
governing its earlier growth. More importantly, the sector’s problems were worsened by the
same institutional features that made previous growth and internationalization possible.
In the absence of a dramatic reorientation of both domestic and international
structures, the sector’s prospects remain bleak. I doubt that an institutional formula can
be found by which it becomes possible to simultaneously promote military-technological
development, restore the sector’s financial base, shore up its political support, adapt to
market conditions, and keep path-defining control in military hands. Because all of these
elements are necessary for military production to thrive in Brazil, I am skeptical about
the prospects for sustained growth.
It is difficult to generalize an argument that stresses the role of domestic political
structures and practices. But the twin pressures Brazil has faced—for democratic
political reform at home and economic competitiveness abroad—are shared by most of
the more technologically advanced countries of the Third World. Even though the specific
adjustment challenges facing individual countries vary substantially, Brazil’s experience
casts fundamental doubts on the viability of traditional military-industrial strategies
across a wide range of national settings. Both for Brazil and those who seek to imitate
it, a formula for sustained military-industrial growth is likely to remain elusive.
A second purpose of this book is conceptual. The emergence of Third World military
industries has been subjected to competing and often contradictory interpretations. For
all that has been written, we still lack explanations that convincingly link the goals
driving military-industrial growth to the political, economic, and social conditions that
permit or inhibit such growth. One reason is that Third World defense sectors straddle key
conceptual borders that shape our understanding of the international system—they lie
somewhere between the state and the market, and inherently straddle the boundary between
what is domestic and what is international. One goal of this work is to study Third World
military industrialization as a historical process shaped by the interplay of global and
local forces. At the heart of the defense sector lie institutions that must adjust
effectively and often simultaneously to changing conditions on both the domestic and
international levels if they are to thrive. Applying this model to the Brazilian case
illuminates the multiplicity of forces conditioning military-industrial development, and
helps to unravel the puzzle of Brazil’s boom and bust.
Misunderstanding Third World
Military Industrialization
Despite the salience of emerging defense sectors for questions of security,
development, and North-South relations, convincing explanations are lacking for recent
patterns of Third World military-industrial growth. This inability to explain the trends
is not for lack of effort; returning to the Brazilian example, there is no shortage of
explanations for that country’s military-industrial fortunes. A diverse and often
contradictory set of explanations have been invoked, stressing both economic and political
variables, domestic as well as international levels of analysis, and a wide range of
inferred goals and strategies.
Some analysts saw geopolitical goals at the heart of Brazil’s expansion. Defense-sector
growth has often been described as part of a more general quest for power in international
relations. But within this broad rubric there has been little consensus on the specific
underlying goals—described variously as security against external threats, arms
supply independence, regional hegemony, or recognized great-power status. Other observers
have seen an underlying goal of economic development, but again with little consensus on
specifics: Some see a quest for export-led growth; others see a search for technologically
driven industrial development; and still others see a quest for stable expansion in an
economy beset by chronic problems of inflation, debt, and declining productivity.
Other observers have inclined toward structural interpretations: Brazil’s emergence has
alternately been described as part of the transnationalization of global arms production,
or as the emergence of a new market niche for medium-tech weapons systems, or as a
byproduct of the militarizing effects of superpower rivalry, or as another example of
dependent development through transnational industrialization. Still others have invoked
domestic structures, ranging from the armed forces’ organizational culture to the
emergence of dynamic public-private partnerships. Not surprisingly, some analysts have
presented models in which military-industrial growth was produced by a convergence of
economic and political factors, or by a combination of domestic and international
structures. These interpretations differ, sometimes dramatically, in the way they describe
the goals and priorities that drove military-industrial strategy during Brazil’s growth
phase. They also vary widely in their description of the constraints on the pursuit of
this multiplicity of goals, and they often present contradictory descriptions of power,
authority, and organization in Brazil’s defense sector.
If Brazil’s rise exposed a lack of consensus as to what makes Third World military
industrialization possible, its subsequent fall has exposed our poor understanding of what
makes military industrialization sustainable. According to the conventional wisdom, Brazil
was probably better positioned to sustain defense-sector growth than any other emerging
supplier of the 1980s. During its growth spurt the defense sector enjoyed an unparalleled
combination of favorable conditions: a diversified industrial base with a well-developed
technological infrastructure; a large pool of inexpensive but skilled labor; supportive
state policies that, unlike many broader technological innovation efforts in Brazil,
stressed a pragmatic, market-oriented approach to technology development and industrial
expansion; close and longstanding ties to a wide range of U.S. and European multinational
defense firms; and the backing of a military establishment strongly committed to
defense-sector expansion. Why did Brazil’s defense sector fall so quickly and so far, when
none of these basic conditions changed?
Many observers have cited the faltering of the global arms trade in the early 1990s to
explain Brazil’s collapse. This is a reasonable hypothesis, given the export dependence of
many Third World defense industries. Demand for armaments in the Third World, where most
Brazilian exports were sold, declined rapidly: The Stockholm International Peace Research
Institute (SIPRI) estimates that Third World purchases of major weapons systems fell by 41
percent from 1989 to 1993. But the onset of serious problems in the Brazilian defense
sector predated the drop in global demand by as much as five years in some programs and
industries. And several important activities, including those in aerospace, nuclear, and
shipbuilding, exported little or nothing during their growth phase; clearly, the loss of
export markets cannot explain their difficulties. Indeed, the real puzzle is why Brazil’s
defense sector did not thrive, or at least hold steady, at a time when the accelerated
internationalization of defense production had emerged as a clear global trend. Brazil
should have been able to ride out the downturn in the international market, and perhaps
even exploit market restructuring to deepen its integration into the global arms economy.
If the changing international context cannot explain the Brazilian collapse, perhaps
domestic politics holds the key. National defense sectors typically require extensive
state support, which in turn requires political support from a coalition of military and
civilian interests. A complex, halting transition to civilian rule dominated Brazilian
politics during the period in question: The military regime withdrew from formal power in
1985, and the gradual institutionalization of civilian authority had picked up speed by
decade’s end. To be sure, civil society in modern Brazil has never maintained full and
effective control of the military; the history of the armed forces for most of the
twentieth century is that of an organization growing more internally driven, more
autonomous, and more closed to civilian influence. But the transition to civilian rule did
put an end to the military’s status as the hegemonic force in Brazilian politics. Perhaps
democratization reined in the ability of the military to support key defense programs and
industries, or otherwise derailed the strategy underlying Brazil’s impressive gains.
Again, a plausible hypothesis—but a closer look at Brazilian politics suggests
just the opposite. Certainly domestic political change had major consequences for the
defense sector. But the slow and complex transition to civilian rule strengthened several
aspects of military control over key military-industrial activities during the
period in question. Retaining control of the defense sector was a goal the military
pursued explicitly and with great success during the transition period; civilian elites
offered little or no resistance. Indeed, the defense sector would emerge during the second
half of the 1980s as an important lever for the military’s enduring political influence in
postauthoritarian Brazil. This influence can be seen in the way civilian politicians
routinely stress the value to the nation of the military’s technological
endeavors—often as a way to curry favor with the armed forces. Domestic politics has
changed, but not in ways that one would expect to undermine military-industrial growth.
In other words, the factors generally thought to favor Third World military-industrial
growth were abundantly present in Brazil even as the defense sector collapsed. And neither
market change at the global level nor political transitions at the domestic level provide
a straightforward explanation for the sector’s decline.
An Alternative
Conceptualization
The failure to explain patterns of military industrialization in Brazil and throughout
the Third World is largely conceptual. Third World defense sectors straddle some of the
most cherished analytic borders that delimit the disputed terrain of the social sciences.
Two such borders are the distinction between state and market (or more generally, between
politics and economics), and the boundary between what is domestic and what is
international.
Beyond State
Versus Market
One source of confusion is the widespread desire to distinguish between the political
and economic forces governing military-industrial development. Interpretations grounded
conceptually in strategic studies have stressed the political and geostrategic factors
underlying military-industrial growth. Such frameworks generally view defense-sector
expansion as the logical product of the strategic goals of state elites. Interpretations
grounded in international political economy have taken a very different approach,
stressing global market forces, the transnationalization of production via multinational
corporations, and the international availability of technology, financing, and markets.
The conceptual divide between political economy and strategic studies has generally meant
adopting static assumptions that market conditions determine political relations or vice
versa.
But treating Third World defense sectors as an extension of the security-maximizing
state or as one sector in a late-industrializing economy cannot capture the essence
of a process that inherently blurs the distinction between politics and economics or state
and market. As Samuel Bowles and Herbert Gintis point out, the desire to "identify
one sphere of social life as `economic’ and another as `political"’ often obfuscates
more than it clarifies:
This convenient division of social space, favored by liberal social theory and academic
convention, appears arbitrary given the evidently political nature of corporations,
markets, and other institutions commonly termed "economic," and in light of the
transparently economic activities of the state.
Nowhere is this blurring more evident than in the global arms economy. On the one hand,
states are key economic agents, and arms markets are highly politicized given the
extensive state presence. On the other hand, defense firms are often influential political
actors, and economic considerations loom large in strategic decisions. Under these
circumstances, key actors cannot be assumed to respond to a purely economic or political
logic, and the relevant structures shaping military-industrial development cannot be
characterized simply as economic or political. Crucial institutions such as the market and
the state live in both worlds at once. Under these circumstances, the central dynamic of
military industrialization is likely to be the balancing of diverse economic and
political interests, rather than the consistent subordination of one to the other.
Straddling the Domestic
and the International
A second traditional distinction that produces conceptual confusion involves the
boundary between domestic and international. Systemic-structural and domestic-comparative
approaches often present starkly different images of Third World defense sectors. Seen
from the systemic point of view, the South’s military industries are generally understood
as an expression of their countries’ limited political and economic power in the
international system. In this view, the military-industrial capabilities that do exist in
the Third World are the product of the transnationalization of the developed countries’
defense industries. The North, driven by a range of economic and political motives, has
fueled the South’s military-industrial expansion through licensing agreements,
coproduction, joint ventures, and technology transfer arrangements. Seen in this light,
the fate of Third World defense sectors is determined by whether the South’s structural
weakness is offset by pressures in favor of military-industrial globalization. Although
observers differ on the likely future balance between these forces, there is a shared
emphasis on Third World military industries as derivative sectors; their strengths
and weaknesses are defined not by their own choices but by power and purpose lying at the
core of the world system.
Where the system-level view sees an expression of international structure, a
domestic-comparative perspective on military industrialization is likely to see an
expression of state purpose. As Ayoob suggests, Third World security policies are heavily
influenced by the broader economic, social, and political process of state making. But the
purposes of state are tempered by the formidable technical and economic barriers to
military-industrial development. Thus the question of state capacity becomes central to
the domestic-comparative perspective—just as it has to the broader question of
explaining differing levels of Third World economic development.
To be sure, military-authoritarian regimes of the sort that predominated in Latin
America and Asia in the 1970s and early 1980s often displayed a natural affinity for
military industrialization. But they varied greatly in their willingness and ability to
shield fledgling defense sectors from domestic political pressures and economic vagaries,
and to steer resources in directions conducive to defense-sector growth. Such differences
can have a self-reinforcing effect over time: A very different configuration of material
benefits began to flow from defense-sector policies in those states able to stimulate
military-industrial development, solidifying important political bonds between the
military, civilian industrialists, and transnational interests.
In other words, Third World defense sectors sit at the intersection of domestic
and international structures. The strongly transnationalized character of most Third World
military industries means that their growth is at least partly an extension of
evolutionary trends in the global arms economy, and that this will be the case as long as
Third World arms producers remain dependent on external sources for technology,
investment, and markets. To focus solely on domestic conditions or the goals of domestic
elites would overstate the autonomy of domestic actors in a thoroughly transnationalized
process. But the global vantage point cannot explain why the defense sectors of states
occupying similar niches in the global political-economic hierarchy have so often followed
different developmental trajectories. Why did Brazil’s defense sector expand much more
rapidly and dramatically than, say, Argentina’s? System-level analysis may explain why no
Third World producers have joined the ranks of first-tier arms suppliers, but beyond this
blunt insight it tells us little about variance across individual cases. The
global-structural approach fails to consider key domestic variables: the extent of state
involvement in defining the sector’s trajectory, the role of the military in domestic
politics, the nature of public-private interactions within the sector, and the particular
mix of goals expressed in state policies.
Global Access and
Domestic Control
Because Third World defense sectors sit at the intersection of global and local
structures, they balance diverse economic and political interests. But what are the
relevant structures? Internationally, "structure" could mean the regional
security context, key bilateral relationships, the division of labor in the global
economy, or the distribution of military and political power among states. Domestically,
the term can refer to the distribution of economic power, the organization of the state,
or the nature of state-society relations. While all of these contextual factors matter in
some sense, particular attention should be paid to structures governing access at the
international level and control at the domestic level—structures I describe as global
markets and domestic politics.
At the international level, arms transfers have always been based on a complex
intertwining of economic, military, and political factors; this will continue for as long
as governments value both military power and economic growth. But the fundamental question
for Third World defense sectors has been one of access to the technologies,
investment capital, and export markets they require to sustain military industrialization.
Certainly this has been the case for Brazil: As subsequent chapters will show, growing
access to each of these elements in the military-industrial equation fueled
military-sector expansion in the 1970s, and changing patterns of access were critical to
the deepening sectoral tensions of subsequent crises. Moreover, as discussed in Chapter 5,
growth in the number of suppliers, internationalization of production, and
commercialization of transactions have combined to create an intensely competitive
system—literally, a global arms economy—that operates on the basis of exchange
at least as much as on that of persuasion, authority, or coercion.
Describing international structures in market terms does not mean that other structural
factors—the balance of power, external threats, alliance formation, or rule-based
cooperation through international regimes—are irrelevant. But the global-market
approach does make claims about how these factors shape military-industrial growth. When
governments in the industrialized countries have opposed Third World military
industrialization, they have generally invested more energy and political capital in
restricting access on the supply side—in particular, access to production
technologies—than they have in more direct coercive, persuasive, or rule-based
interventions among would-be military industrializers. International regimes on nuclear
and missile proliferation are, in essence, assertions of oligopolist power in the form of
suppliers’ cartels. Referring to international structures as global markets does not mean
that politics does not intrude, but rather that the political intrusion has sought to
change patterns of market access.
At the domestic level, the fundamental issue is not access but control. State policies
play a critical market-creating role, even in the most export-oriented defense sectors.
Key inputs such as skilled labor, investment capital, and technology are also highly
sensitive to state policies. Thus the principal issue is who controls the political
resources that determine patterns of market performance within a set of state-constructed
and highly state-dependent market arrangements. Certainly this was the case in Brazil
under military rule: The state explicitly created the conditions for production and
strongly influenced the character of sectoral demand. One consequence is that the domestic
economic relations that grew up around the defense sector have themselves been conditioned
by the structure of Brazilian domestic politics, as seen in the historical strength and
intrusiveness of the state, the weak and state-dependent character of Brazil’s industrial
bourgeoisie, and the traditional insularity and autonomy of the military. To the extent
that these features differ in Brazil from other countries, so will the institutional form
of Brazil’s defense sector.
Detailed case studies of Third World defense industries or security policies (of which
there are few) point to the salience of domestic political structures. Barnett stresses
the role of the state’s capacity to mobilize resources in his comparative analysis of
Egyptian and Israeli security policy. Reiser’s study of Israel’s military industries
reveals the importance of a diverse coalition in mobilizing domestic political support for
defense-sector expansion. Gupta, writing about India, points to diverging civilian and
military priorities as a recurring barrier to effective military-industrial development.
Nolan, in a comparative study of the Taiwanese and South Korean defense sectors, points to
the key role in each case of effective leadership by domestic political elites.
In other words, from the perspective of Third World defense industries, the most
important international structures are those that govern access to the critical resources
of technology, financing, and markets. And the most important domestic structures are the
political institutions and relationships that define who controls military-industrial
policies. The fate and form of the defense sector lie in the space between these global
and local structures.
The Problem of Adjustment
and the Role of Institutions
The foregoing suggests that promoting defense-sector expansion involves a difficult
balancing act. A path of growth and development must be found that will satisfy both the
demands of a competitive international political-economic context and the demands of the
domestic coalition supporting military-industrial ventures. One way to describe this
process is as a two-level game. Decision makers must play an international game of
bargaining for access to technology, financing, and markets, and a local game of building
support for military-industrial policies among various domestic groups: the military,
industrialists, bureaucrats, civilian scientists, and labor unions. Clearly, each
"game" affects the other: Successful international bargaining can create
resources needed to build a winning domestic coalition, just as "winning" on the
domestic level may build support for policies that will "win" internationally.
But moves in one game can also complicate the other game. For example, if winning
internationally means attracting foreign investment and winning domestically means
garnering military support, actions seeking the former (e.g., cutting budgets to create a
favorable macroeconomic climate for investment) may complicate the actions needed for the
latter (e.g., increasing the size of the defense budget).
In the short run, the challenge is to find a "win-set," or a set of policy
"moves" that will produce a favorable outcome in both games. But
military-industrial development is not a short-run process. The game metaphor breaks down
because the key to success is not simply the implementation of effective policies but
rather the institutionalization of effective rules and roles. Military
industrialization demands stable institutions—routinized sets of rules, roles,
procedures, and practices—because, even on the lesser scale seen in most Third World
countries, the defense sector brings together a heterogeneous array of manufacturing and
supply firms, civilian and military bureaucratic organizations, research institutes, and
other groups. Producing military-technological artifacts involves a diverse array of
activities, such as military R&D, the training of technical personnel, coordination of
supplier industries, arms production, and the testing, demonstration, and marketing of
weapons systems, that create a complex division of labor among these groups.
Institutionalized rules, predictable routines, unquestioned goals, clear divisions of
responsibility, and established hierarchies of authority are needed to give order and
predictability to this highly complex process.
The centrality of technology also creates a demand for stable institutions. The
expansion of military-technological capabilities requires internalizing a broad and
heterogeneous set of abilities; more generally, technology development involves carrying
previously developed abilities forward to new settings. This view presumes that technology
is, as Dahlman suggests, "to a large extent embodied in people and institutions, not
just in physical objects, and hence to acquire technological capability is mostly a matter
of building up skills and institutions, not of buying hardware." The sunken costs
inherent in path-dependent learning (investments in people, process technologies, and
forms of organization) mean that past choices typically curtail current options sharply,
and current choices cast a long shadow onto the future. The number of directions in which
one can embark to build upon past learning are limited. Military-technological endeavors
therefore tend to follow path-dependent trajectories, typically organized around the core
weapons systems of a particular military service.
For military-industrial development to succeed, stable roles, rules, and routines must
be institutionalized. But in most Third World settings, the task of creating and
maintaining stable institutions is complicated by rapid change and frequent instability on
both the domestic and international level. Their dependent integration into a dynamic
global arms economy forces Third World producers to adjust repeatedly to processes of
technological change and economic restructuring they cannot control. At the same time,
domestic political instability creates its own challenges of adaptation. Thus, over time,
the problem of finding a path that works both internationally and domestically is likely
to be superseded by a larger problem of institutional adjustment to structural change. The
challenge facing individual programs, particular industries, and the defense sector as a
whole is to maintain or, more accurately, to continually reproduce a set of institutional
practices that reconcile prevailing global-market and domestic-political conditions, in a
way that is conducive to sector growth and expansion.
The focus on institutions suggests three keys to understanding military-industrial
growth and decline: identifying the defense sector’s institutional core of roles, rules,
and procedures; examining their relationship to the most important international and
domestic structures conditioning defense-sector performance; and observing whether and how
they adapt to structural change. Because identifying the relevant institutional practices
is difficult, two cautions are in order. First, institutions may be nested at different
levels of social organization—in this case, individual weapons-system programs,
particular industrial segments, or the defense sector as a whole. Second, institutions are
not synonymous with formal organizations, and may be embedded in less formal, uncodified
arrangements. This distinction is particularly important in the context of Brazilian
politics, where, as Schneider points out, rapid bureaucratic circulation weakens
organizational loyalties and increases reliance on personal ties, a factor that in turn
further undermines formal organization…. Since officials’ preferences do not necessarily
coincide with those of the agency in which they happen to work, traditional perspectives
in bureaucratic politics (based on organizational interests and procedures) are of limited
use.
A guide for where to look for key institutional practices can be found in the
influential work of March and Olsen, which lists three general insights from the study of
political-economic institutions: (1) institutional rules and routines play a crucial role
in shaping behavior; (2) institutions not only respond to their environments, but often
actively shape those environments; and (3) rather than responding precisely and
immediately to changes in the external environment, institutions tend to exhibit
"stickiness" as actors cling to established practices, proven procedures, and
established technologies.
First, institutionalists stress how rules and routines shape and constrain the
capacities of actors. This points our attention to the hierarchy of authority defined by
those rules, and to the division of labor that results from their repeated application.
How is authority distributed and acknowledged among R&D organs, firms, state agencies,
and the military itself within the principal military-industrial segments? What division
of labor has evolved among them?
Second, institutionalists stress that institutions both respond to and shape their
environment. This calls attention to the nature of the defense sector’s external boundary
and to the types of linkages that transcend it. How are the key military-industrial
programs separated from or tied to a range of actors outside the defense sector, including
other Brazilian industries, multinationals operating in Brazil, foreign suppliers, the
civilian scientific establishment, Brazilian universities, and organized labor? How stark
is the delineation between outsiders and insiders? Does the definition of an insider
change over time?
Third, institutionalists study the role of norms, belief systems, and socialization in
shaping behavior. These conditioning processes create institutional stickiness, meaning
that change is often episodic and punctuated rather than continuous and incremental. What
are the enduring aims of military industrialization? What goals go unquestioned for
extended periods? In particular, what norms govern beliefs toward technology development?
Do general themes such as "technological autonomy" take on broadly consensual
meanings that in turn shape behavior?
Reinterpreting
Brazil’s Experience
Combining these two observations—that both domestic and international structures
shape the defense sector, and that stable institutions are central to military-industrial
growth—produces several hypotheses about military industrialization in Brazil and
throughout the Third World. First, military-industrial expansion is more likely when there
is a favorable convergence of domestic and international conditions. Second, sustaining
growth will require either unusual structural stability at both of these levels or
effective institutional adjustment to change at one or both levels. Third, institutional
stickiness makes effective adjustment difficult, particularly when both domestic and
international structures are changing simultaneously.
Applying this framework to the Brazilian case reveals a clear pattern. In the early
stages of defense-sector development, it was possible to pursue a developmental strategy
that was viable in both the domestic-political and global-market contexts. Under these
circumstances, the sector not only thrived, but also took on an institutional character
and a technological trajectory that reflected this structural convergence between the
global and the local. The result was not only military-industrial growth but also the
institutionalization of several notable characteristics of Brazil’s defense sector: its
penchant for state-led growth, its limited links to civilian activities, its aggressive
but pragmatic approach to technology development, its embrace of a highly commercial logic
for production choices, and its subjugation of strategic choices and sector policies to
military control.
These features proved critical to sector growth. But their deep institutionalization
would greatly complicate the problem of adjustment when global markets and local politics
began pulling the defense sector in contradictory directions in the late 1980s. The result
was a series of doomed efforts at adaptation, which have in turn produced a pattern of
chronic instability, chaos, and deinstitutionalization that continues to this day.
2
The Origins of
Military Industrialization
Brazilian arms production has a venerable history, dating to the colonial era. The
emergence of a sugar-based economy in the sixteenth and seventeenth centuries stimulated
shipbuilding in the northeastern territory of Bahia, as Portuguese shipbuilders adapted to
the use of tropical woods. The discovery of gold in Minas Gerais in 1695 stimulated a
southward movement of the fledgling shipbuilding industry to the increasingly important
commercial center of Rio de Janeiro. The Naval Arsenal of Rio de Janeiro was founded in
1763 and completed its first warship in 1767. Dagnino reports that prior to this time
cannon and other war material were already being manufactured for Portuguese use. Cannon
were also produced and used by the bandeirantes—the explorers, soldiers of
fortune, and traders in Indian slaves who carved their way into the interior of the South
American continent. A more important stimulus came in 1808 when the Portuguese court,
fleeing Napoleon’s armies, left Portugal to take up residence in Brazil. One of the first
acts of João VI upon arriving in Rio de Janeiro was to establish a gunpowder factory.
Brazil’s first military academy was also opened during this period.
Upon Napoleon’s defeat the liberals who assumed power in Portugal sought to reassert
colonial control over their rapidly growing South American colony, but in doing so they
met opposition among Brazil’s landowning elite. A revolution fought to preserve the status
quo against renewed Portuguese interference yielded Brazil’s independence in 1822. In 1824
Brazil established a constitutional monarchy and installed as emperor the Portuguese
king’s son, whom the king had left behind as regent when the court returned to Lisbon.
The military needs of the tenuously independent nation did sustain a modest upsurge in
military-industrial capacities. An army arsenal to repair guns was installed in Rio Grande
do Sul in 1828, and lingering Portuguese control in Brazil’s northeast accelerated the
shift of the emerging naval construction industry to the south, in Rio de Janeiro. But
economic and political developments for most of the nineteenth century had a less salutary
effect on military-industrial expansion. The emergence of a coffee-based export economy
marked another historical cycle of commodity-based economic growth, paralleling the
earlier sugar and gold cycles. But the coffee boom carried with it cheap imports of
British-manufactured goods, inhibiting the development of a domestic manufacturing base.
Political developments also inhibited military-industrial growth. The early years of
imperial rule saw the formation and rapid growth of the Guarda Nacional at the expense of
the army, which the emperor considered to be politically unreliable. In the early years,
the guarda played an important role in establishing imperial control, but it
remained a decentralized tool of the rural oligarchy. The central state was not strong
enough relative to rural elites to build a professional army for use in further
consolidating federal control. Thus the army remained a weak and unprofessional
institution, while the militias that eclipsed it lacked the central administrative
structure necessary for a meaningful expansion of military-industrial capacity.
An important military-industrial stimulus came with the War of the Triple Alliance
(1865-1870). The war pitted Brazil, Argentina, and Uruguay against Paraguay in a bloody
conflict that killed perhaps half of Paraguay’s male population, and in particular
indigenous peoples. Pressed for an effective means of controlling Paraguayan rivers,
Brazil became the second nation (after the United States) to produce warships with
reinforced armor plating. A team of European-trained Brazilians designed and built six
such craft for the war, using imported machine tools and iron girders. Naval production
had reached a relatively advanced technical level, though lacking a broad industrial base.
The war forced expansion of army production of cartridges, shells, and powder. More
significantly, the war transformed the army, which emerged as an important actor in
Brazilian politics. The postwar period found Brazil with an army that was larger, more
vocal in its dissatisfaction on a range of issues affecting the military, and painfully
aware of the organizational weaknesses exposed during the war.
The Old Republic
In 1889 the empire was overthrown by a coalition that included the army, the coffee
barons of São Paulo, other segments of the rural elite, and the new urban classes whose
growth had been stimulated by war. The ensuing four decades, known as the Old Republic,
were an uneasy compromise among elite factions with divergent interests. During the
drafting of the new constitution, for example, the army and rural elites disagreed sharply
on the appropriate definition of the army’s constitutional duties. Economic disputes also
emerged. Tariff protection to pay the cost of war with Paraguay did generate a
"spurt" of industrialization in the 1870s, but for most of the period
exchange-rate policies designed to maximize coffee revenues hindered the development of a
domestic manufacturing base.
In marked contrast to the war-driven expansion of the 1870s, the Old Republic saw
little growth in military-industrial capabilities. Again, the reasons were both economic
and political. Naval production stagnated as the advent of steam propulsion and steel hull
construction rendered the Rio shipyards obsolete by the early twentieth century. At the
same time, the navy’s political influence waned as the army’s ascended. Elements within
the navy opposed the army officers who served as the first two presidents of the Republic,
Marshalls Manuel Deodoro da Fonseca (1889-1891) and Floriano Peixoto (1891-1894). An
unsuccessful naval revolt was mounted against Floriano’s government in 1893 and suppressed
by the army, further weakening the navy’s position. Declining political fortunes led in
turn to a sharp decline in resources available for defense production or technological
modernization.
The limited number of contracts for naval fleet expansion in this period went to
foreign firms. European firms were the chief suppliers before World War I (including two
British dreadnoughts in 1910), to be supplanted by the United States after the war. An
attempt was made to consolidate naval construction in a new Rio shipyard, beginning with a
contract awarded to a French firm in 1910. But arsenal construction was slowed by
financial constraints and disrupted by World War I, and navy building programs were
further derailed by the financial crises of the 1920s.
Unlike the navy, the army played a crucial role in the founding of the Republic and
remained a key political actor during the Republic’s early years, controlling the
presidency until 1894. But the election that year of a civilian São Paulo politician,
Prudente de Morais, marked a shift in the civil-military balance. Reduced defense
expenditures of the post-1894 civilian-led governments further weakened the army’s
position. Military expenditures, which had peaked at 31.8 percent of the federal budget
during Marshall Floriano’s last year in office, fell to an average of 13.9 percent between
1898 and 1921. These cuts worsened the factionalism within the officer corps that had
sharpened during the army’s years in power.
The budget cuts occurred as the various political crises engulfing successive
governments were keeping the army heavily occupied. Beginning with the naval revolt of
1894, the army was used repeatedly to intervene in regional conflicts around the country,
to break local resistance to federal authority, and to suppress movements threatening the
prevailing order or national integration. Key episodes included the Canudos affair of
1897, a bloody clash between the army and religious separatists in Bahia; the salvages campaigns
of 1911-1914, launched against local oligarchies in a number of states; the Contested of
1912-1915, a separatist movement in Paraná and Santa Catarina; several clashes with the
emerging labor movement in the early 1920s; barracks revolts sparked by junior officers
(the "lieutenants’ movement") in 1922 and 1924; and the "Prestes
column" of 1925-1927, a 15,000-mile guerrilla march and campaign by rebellious
troops. A revolt toppled the Old Republic in 1930, but the pattern continued: A failed
counterrevolt was mounted in 1932, and a communist-inspired barracks revolt in 1935
stimulated a new wave of repression against leftist groups. Although such activities
stimulated demand for arms and ammunition, they also repeatedly exposed the army’s
incompetence as a military unit and the deep political divisions within the organization.
The army also suffered a persistent generational gap within the officer corps. This
period saw the growth of strongly nationalist, professional, modernizing sentiments within
the junior ranks. Although this trend is often traced to the emergence of a Comptean,
positivist ideology among the junior officers after the Paraguayan war, organizational
changes also played an important role. The officer corps, which was bottom-heavy with
lieutenants and captains, grew rapidly during the Old Republic, nearly tripling in size
between 1892 and 1927. The higher educational levels of the younger officers subverted the
traditional hierarchy, as did the superior training received by a group of junior officers
in Germany during 1910-1912. The co-optation of senior officers by political elites, the
hardships of army life in the lower ranks, and the perceived incompetence of senior
officers all contributed to generational tensions. A series of barracks revolts in the
early 1920s reflected this internal tumult, and also foreshadowed the army’s growing
dissatisfaction with the prevailing political system.
Given these political conditions and the same lack of industrial infrastructure that
plagued the navy, the army was unable to support or manage an effective expansion of its
domestic production capacity; dependence on foreign suppliers remained the norm. Krupp and
other German firms were the army’s principal suppliers prior to World War I, a link
strengthened by the training of a cadre of young Brazilian officers in Germany in the
early 1900s. After the war French influence eclipsed German. The French installed a
sizable military mission in Brazil and filled the arms supply gap left by Germany’s
defeat.
An independent munitions supply was a higher priority than weapons manufacture during
this era, but here too barriers were encountered. At the turn of the century the armed
forces maintained three army arsenals, three navy arsenals, and three munitions plants
(one for cartridges and two for powder). Attempts to expand met with only limited success:
A modern powder factory was built in the state of São Paulo in 1908, and the army sought
to upgrade its Realengo cartridge facility near Rio de Janeiro. A Department of War
Material was formed in 1915 to coordinate activities. But equipment purchases to establish
a new Arsenal de Guerra in Rio de Janeiro and boost output at existing facilities were
stymied by a lack of skilled labor and an interruption of machinery imports during World
War I.
After the war, the goal of arms independence attained the status of official policy. By
1930 some progress had been made in increasing output for uniforms, ammunition, and
supplies. Some success was achieved in attracting private capital to these productive
efforts; Dagnino reports that by 1930 private firms supplied half of the army’s munitions.
The São Paulo revolt of 1932 exposed the continuing inadequacy of domestic munitions
production, however, and reliance on foreign suppliers remained the norm for anything
beyond ammunition.
The ambivalence of private domestic capital exacerbated stifling shortages of financing
and skilled labor. In the absence of a strong state guaranteeing a market, private
investors were reluctant to enter seemingly unprofitable ventures. For its part, the
military remained divided on the role of the private sector in defense production. Hilton
identifies military sentiment for a privately owned military industry, and argues that
during this period "naval authorities echoed army spokesmen in arguing in favor of
civilian predominance in defense production." McCann, however, points out that the
influential army journal A Defesa Nacional was calling for a state-owned steel
industry to boost arms output.
The Vargas Era and
the Estado Novo
The 1930s marked a turning point for both military politics and industrial development
in Brazil, and thus for Brazil’s military industries. The global depression, which had a
devastating impact on agro-export revenues (and thus foreign exchange), spurred
import-substituting industrialization. The state played a lead role in the emergence of
basic industries during this period. The National Steel Commission, an organ of the
Ministry of War with mixed civilian and military representation, was formed in 1931. Under
the commission’s guidance, and stimulated by protective tariffs and falling exchange
rates, Brazil’s small steel industry nearly tripled its output between 1934 and 1940. A
"Law of National Similars" prohibiting imports of manufactured goods similar to
those produced in Brazil stimulated import-substituting industrialization on a broader
scale.
The 1930s also marked a political watershed. An armed revolt against the federal
government in 1930, sparked by a disputed presidential succession, toppled the uneasy
regional balance of the Old Republic. The revolt supplanted the São Paulo elite that
controlled the presidency in the Republic’s final years, installing in its place a
coalition led by Getúlio Vargas, previously governor of the southern state of Rio Grande
do Su1. Vargas is the dominant figure of twentieth-century Brazilian politics. He assumed
the presidency in November of 1930 and successfully put down a counterrevolt launched
by the São Paulo elite in 1932. In 1937 he used military backing to seize essentially
dictatorial powers and declare the Estado Novo (New State), remaining in power until being
deposed by the military in 1945. Vargas then returned to power via the ballot box, winning
the presidential election of 1950 and serving until attempts to force him from office led
to his suicide in 1954.
During his tenure Vargas consolidated federal control over the regional oligarchies,
laying the foundation for state-driven industrial growth. His regime also established a
clientelistic pattern of negotiations between elites and the state, bypassing political
parties and the legislature. In doing so, Vargas established a pattern of interaction
between a dominant state and a divided, state-dependent capitalist class that would last,
in its basic outlines, to the present day. The result was a new trajectory of economic
development and sociopolitical change, marked by what has often been described as
conservative, industrializing modernization: industrializing in that it extracted a
surplus from the agro-export sector to subsidize industrial growth; modernizing in that it
yielded a fundamentally new political terrain, marked by the emergence of urban industrial
capitalists, a new middle class, and a strong central state; and conservative in the sense
that policymaking continued to be a top-down process of elite definition and negotiation,
despite Vargas’s frequent manipulation of nationalist sentiment and populist imagery.
Although the army eventually removed Vargas from office, the military was a key partner
for most of the 1930-1945 period. As Skidmore suggests, the army high command’s
goal—a "strong army within a strong state"—converged with Vargas’s own
ambitions. The revolt of 1930 produced an accelerated turnover of the officer corps, with
rapid advancement for junior officers who had supported Vargas. Badly polarized by the
internal and external disorder of the 1920s, army hierarchy and discipline were restored
to some extent after the failed São Paulo counterrevolt in 1932 led to expulsion of 10
percent of the officer corps. In 1935, an insurrection triggered by a left-wing National
Liberation Alliance (ANL) including the Brazilian Communist Party (PCB) further unified
the military and pushed it closer to the Vargas government. The link was cemented with the
elevation of two Vargas allies: Generals Goes Monteiro to army chief of staff and General
Dutra to minister of war. The insurrection also yielded military-backed revisions to the
National Security Law and to the Constitution. A National Security Tribunal was formed,
and the constitution was amended to allow the president to declare a state of emergency
and purge "subversives" from the ranks of the civilian bureaucracy and the
military. These changes proved to be precursors to Vargas’s seizure of broader powers with
military backing in 1937.
As Camargo describes the goals underlying the Estado Novo:
The strategic objective… was to strengthen the power of the state and rationalize
the decisions of the government, thus reducing the extreme fragmentation of the political
system, which was ineffective and formally controlled by the power of the states…. It
would be difficult to accomplish these goals through the old regional alliances, the
parties, the Congress, or the prevailing institutional system. It was necessary to
disarticulate the institutional system in order to promote reorganization of the state,
and to urge on the process of state-building—rearticulating alliances, redefining
actors, inflating the power of some and deflating that of others.
The military, and the army in particular, would be among the principal actors thus
"inflated." In addition to being the power that guaranteed the continuation of
the Estado Novo, the military took on a new and important role in the planning
commissions, bureaucracies, and other organs of the state emerging during this period.
Along with growing organizational cohesion and bureaucratic involvement, the 1930s saw
the military articulating a vision of a modern, industrialized Brazil. The increasingly
loud, clear, and unified voice that emerged was a precursor to the so-called
security-and-development ideology of the 1950s. Three central components stand out in
military discourse during this period. The first was a growing self-image of the armed
forces as a national institution above partisan politics, with an expansive role to play
in the political and social life of the nation. A second, related theme emphasized the
inextricable coupling between national security and economic development. Security, given
its broad economic, political, social, and even psychological components, was contingent
on development; and development in turn required shielding the nation from external
threats and internal subversion. The final component was a brand of economic nationalism,
emphasizing strong state leadership and the need to implant basic industries.
One early articulator of this vision was General Goes Monteiro, military chief of the
1930 revolt and later army chief of staff and minister of war. He described the army as
an essentially political organ…. General policy, economic policy, industrial and
agricultural policy, the system of communications, international policy, all the branches
of activity, production, and collective existence, including the instruction and education
of the people, the political-social regime—all ultimately affect the military policy
of the country…. The policy of the Army is war preparation, and this preparation
interests and involves all the manifestations and activities of national life, in the
material realm . . . and in the moral realm.
These expansive notions of security, development, and the armed forces’ role in
national life were by no means unique to Brazil. And as McCann points out, many of these
basic ideas had been articulated in Brazilian military circles prior to World War I. The
significance of the 1930s was the sociopolitical context within which these ideas
flourished. An increasingly cohesive officer corps strengthened its political ties to a
restructured civilian elite, representing interests far more compatible with those of the
military than had been the case historically.
The military’s ascendant political influence translated into growing budgets, and the
imposed stability of the Estado Novo allowed a shift in attention to reequipment needs. A
full-fledged program for nationalization of defense production emerged in this period. But
growing industrial capacity and a strengthened political position from which to pursue
goals of nationalization did not translate immediately into military-industrial growth.
Shortages of financing and skilled personnel continued to plague defense production, and
reliance on foreign suppliers remained the norm for heavier equipment in the 1930s. The
government concluded agreements with a number of foreign suppliers in the latter part of
the decade, including a major purchase of U.S. civilian and military aircraft, a contract
for three British destroyers, and a five-year, $100 million arms pact with Germany as part
of a reciprocal trade agreement.
Some important precursors to expanded domestic production were also being established,
however. Three new war materiel plants were initiated in 1933. Army aviation began
assembling Brazilian-designed planes featuring U.S. engines, while the navy began
assembling Focke Wulf training planes with German technical assistance in 1936. The
Ministry of Transportation established an aircraft assembly plant at Lagoa Santa in Minas
Gerais in the late 1930s; this facility passed to the fledgling Brazilian Air Force with
the formation of the Ministry of Aeronautics in 1941. Naval ship construction also resumed
during the latter part of the 1930s; the Rio shipyards launched a monitor and six
minesweepers, and began to assemble three U.S.-designed destroyers.
World War II accelerated the trend toward domestic production, increasing both
financial support for, and political pressure on, national industry to respond to surging
demand. Assembly of U.S.-manufactured planes (including Fairchild PT-19B Cornell trainers
and T-6 Texans) was begun at Lagoa Santa on a cost-plus, profit-guaranteed basis. By the
end of the war, planes were being assembled at the rate of one per day. A national engine
factory was also established, and output from the war materiel plants reached a new high.
American refusal to share sonar technology for tracking German submarines led to a crash
development program that marked the onset of collaboration among the navy, the University
of São Paulo, and Brazil’s small but capable physics community. This collaborative effort
helped lay the foundation for the navy’s subsequent efforts in nuclear technology and
microelectronics.
The Return of
Competitive Politics
In 1945 Vargas, increasingly at odds with his former military backers, was forced from
power by the army high command on the eve of a presidential election featuring two
military candidates. Vargas’s successor, General Eurico Dutra, flirted with orthodox
liberalism, but then returned to the proindustrialization policies of his predecessor,
including exchange controls, import restrictions, and subsidized credit. These policies
were continued for most of the next fifteen years, which included Vargas’s elected return
to power (1951-1954), a brief period of economic orthodoxy under Vargas’s successor Café
Filho (1954-1955), and the resumption of aggressively proindustrial policies during the
presidency of Juscelino Kubitschek (1956-1960).
Not all issues of economic policy enjoyed a broad consensus among elites during this
era, as reflected in bitter debates on the role of foreign capital in the petroleum and
mineral industries. But the growing economic and political strength of industrial
capitalists and urban labor—a coalition first cultivated by Vargas in the
1930s—had produced a definitive shift in the political balance. Policies stimulating
the development and expansion of basic industries continued.
As part of Brazil’s reward for entering World War II, the U.S. Export-Import Bank
financed construction of a modern steelworks at Volta Redonda. The mill, which began
production in 1946, accounted for 49 percent of the 700,000-ton national output of
finished steel by 1951, and provided a new capacity for heavy and specialized steel. The
state-owned oil company Petrobrás was founded in 1953, and the Brazilian auto industry
was established with foreign capital soon thereafter. The petroleum and auto industries in
turn stimulated the development and growth of supplier industries in electrical equipment,
machine tools, and steel, and also enhanced growth in the engineering and skilled
technical-labor force. Another important development during this era was the emergence of
planning as a central instrument of economic policy (a trend that would peak during
military rule in the 1970s). Key steps included the joint U.S.-Brazil Economic Development
Commission (1951-1953), the five-year plan of Finance Minister Horatio Lafer (1951), and
formation of the National Bank for Economic Development to coordinate strategic investment
(1952).
In terms of military politics, the 1950s saw consolidation of the technocratic role
that had emerged during the Estado Novo. At the same time, political trends were producing
a growing apprehension within the officer corps. The trajectory of conservative,
modernizing industrialization took on increasingly populist overtones in Vargas’s final
years, and by the end of the 1950s a decaying cross-class coalition gave way to
accelerating left-right political polarization. These developments were increasingly out
of step with the elite, nonparticipatory ideology of national progress that held
majority sway within the officer corps.
The military’s increasingly technocratic tendencies and its enduring antipopulist
sentiment were both reflected in the Escola Superior de Guerra (ESG). Founded as a war
college in 1949, the ESG quickly emerged as the focal point for the development of
military doctrine. The main tenets of the ESG’s self-labeled discourse on segurança e
desenvolvimento (security and development)—that security and development were
mutually determining, that there existed "permanent national objectives" outside
the realm of political bargaining, and that adverse material conditions and "cultural
delay" were threats to national security properly understood—bore a strong
resemblance to earlier trends in military thought. Markoff and Baretta, for example, link
security-and-development ideology to the notions of "order and progress" that
emerged in the latter part of the nineteenth century:
What is Segurança e Desenvolvimento after all but a variation on Ordem e
Progresso [Order and Progress]? The slogan of the ESG is simply an updated version of
the old Positivist catch-phrase, another version of the search for a dramatic formula for
modernization without mass involvement, with order (or security) enjoying pride of place.
The significance of the ESG lies less in what it said than in what it represented: a
first attempt at interservice communication on matters of military doctrine, and an effort
to engage the civilian elites attending its courses and lectures in dialogue, albeit
dialogue on the military’s terms.
There were some new wrinkles in the ESG discourse, including the Cold War-induced
concept of "total war" and greater attention to the notion of strategic
planning. One enhanced theme directly relevant to defense production was growing emphasis
on the technological variable. While one can only speculate on the source of this
heightened emphasis, plausible factors include the experience of the expeditionary force
that fought in Italy during World War II, as well as the reinforcing effects of internal
lobbying by the growing cadre of technically trained personnel in each service. The air
force, for example, formed in the midst of the "victory through air power"
mentality of the early 1940s, had a strong technological orientation from its inception,
and established a technical school for the training of aeronautical engineers almost
immediately. These personnel in turn formed an important lobby for subsequent aeronautics
and aerospace development programs.
Whatever the impetus, the 1950s marked the beginnings of a national science and
technology policy, with the armed forces playing a leading role. The foundations for the
modern military R&D system of both the air force and navy were established during this
period, and the navy took an active lead in stimulating national nuclear-energy and
electronics programs after World War II. The National Research Council (CNPq) was founded
in 1951, largely through the efforts of Admiral Álvaro Alberto da Mota e Silva, to
consolidate state control of nuclear activities. CNPq would later evolve into a broader
organ of support for science and technology. Other important developments during this
period were the Executive Group for Computer Applications (GEAC) and the Organizing Group
for the National Space Activities Commission (GOCNAE). GEAC was a mixed military-civilian
group under the direction of Roberto Campos, who would become Planning Minister in the
post-1964 military regime, while GOCNAE provided an administrative link between the
National Research Council and the fledgling rocketry activities of the air force’s
Aeronautics Technological Center.
Ambitious defense production plans also emerged after the war. The U.S. government
transferred production lines for the small arms received during the war through the
Lend-Lease Program. With American assistance, the navy established an artillery factory
and torpedo factory. By the 1950s the services had adopted policies favoring domestic
procurement whenever possible, and postwar contracts with European arms suppliers included
technology-transfer provisions meant to increase the nationalization of production.
Conditions in the global arms economy would undermine these ambitions, however.
American-made weapons systems continued to flow to Brazil under the Military Assistance
Program (MAP), undermining the military’s plans to invest in domestic production. The
famine that followed the feast was equally disruptive: U.S. mobilization for the Korean
conflict made it difficult to obtain production machinery and equipment internationally,
repeating the pattern established by the two world wars.
Domestic barriers also emerged. The goal of importing complete defense factories during
this period was largely thwarted; Hilton speculates that the principal obstacle was the
reluctance of Brazilian private capital to participate. Military budgets also failed to
keep pace with growth in overall spending during this period, falling from 15.1 percent of
government expenditures in 1952 to 5.7 percent in 1964. By the early 1960s, Brazil’s
industrial infrastructure was increasingly in line with what was needed to undertake
meaningful defense-sector expansion. The missing ingredients—sustained access to
foreign technology and strong state actions to guarantee markets and attract
investment—awaited future developments.
Interpreting
Military-Industrial
History
Some enduring barriers to military-industrial expansion can be seen in this brief
historical sketch: a chronic lack of investment capital and skilled labor, severe
infrastructural limits, and the absence of supplier industries. Key twentieth-century
economic developments, including the expansion and internationalization of Brazilian
industry, the growth of crucial sectors (steel, autos, petrochemicals), and the emergence
of an infrastructure for research and development, helped to lessen these barriers. But
the historical relationship between defense-sector growth and Brazil’s overall
industrialization is not a simple correlation; there have been periods when
military-industrial expansion moved ahead of the broader pace of industrialization, and
other periods when it lagged behind the emergence of civilian production capabilities.
Within the long-term secular trend toward greater military-industrial capabilities are
significant oscillations between growth and stagnation. Some of the most important factors
shaping these swings have been political: the availability of political allies with which
the military could unite in pursuing its developmentalist agenda, the willingness or
reluctance of the state to intervene in promoting industrial development, and the
penetration of the state bureaucracy by the armed forces.
In the twentieth century, two developments foreshadowed post-1964 military-industrial
expansion. First, as domestic production of major weapons systems became a real
possibility, the fate of military-industrial development became increasingly intertwined
with the availability of foreign technology and financing. Second, the defense sector’s
boom-and-bust cycles became compressed, as its fortunes became caught up in the deepening
political turmoil and rapid economic changes engulfing Brazil.
Ken Conca is assistant professor of government and politics at the
University of Maryland at College Park, where he specializes in international relations,
environmental politics, and the politics of science and technology.
Excerpted from Manufacturing Insecurity _ The Rise & Fall of
Brazil’s Military-Industrial Complex, by Ken Conca, Lynne Rienner Publishers, 1997,
284 pp.
