Foreigners who still see Brazil as a nation in which a tiny elite sits astride the toiling masses struggling to earn a living amid grinding poverty should think again. Believe it or not, Brazil is now a country in which just over half the population – around 100 million people – is officially categorized as being middle class.
Statistics published by the FGV (Getúlio Vargas Foundation) business school show that almost 52% of households now earn between 1,064 and 4,591 Brazilian reais a month and are in the “C” class. (These figures amount roughly to US$ 625 and US$ 2,700, respectively.)
Although this means that statistically speaking these Brazilians are as middle class as any bowler-hatted, brolly-twirling Englishman, Brazil is still far from being a bourgeois nation in the European sense. Moreover, these results certainly do not mean that the poor are no longer with us.
The economist in charge of the study, Marcelo Néri, said the main reasons for this breakthrough were the rise in the formal workforce and the growing economy. Although President Luiz Inácio Lula da Silva is the least middle class person who has ever held or is ever likely to hold the Presidency, he can boast that his policies have lifted millions into the middle class.
The survey shows that an estimated 20 million Brazilians have moved up the social scale over the last six years. Lula will be hoping that these new upwardly socially mobile Brazilians will show their gratitude by backing his candidate for the next presidential election – Dilma Rousseff is the current favorite – and his own candidacy if he chooses to seek office again in 2014.
As for ideology, Lula is too much of a pragmatist to feel that he may have “betrayed” his socialist past by turning the workers away from revolution and class warfare and towards bourgeois respectability, a house in the suburbs and a barbecue in the back garden.
Lula certainly deserves credit for overseeing economic growth which has led to record formal employment while implementing social programs which have improved the lot of millions of the poorest citizens. Another contributory factor has been the demographic revolution which has reduced the birth rate, as former finance minister, Antonio Delfim Netto, pointed out. The average Brazilian family had 1.6 children in 2001 compared with 5.8 in 1970.
However, being middle class in a European sense is not entirely linked to income. It means having a status which families will do anything to maintain. The English, in particular, are obsessed with the issue. George Orwell once described his background as being “lower upper middle class”. The Irish playwright, George Bernard Shaw, once wrote with spot-on accuracy: “The moment an Englishman opens his mouth, another Englishman despises him.”
How the middle class cope with genteel poverty is a recurring theme of English literature from Dickens, Somerset Maugham, Orwell, John Fowles and up to contemporary writers like Ruth Rendell. Who can forget Mr. Micawber’s motto which he never managed to live up to and ended up in prison for defaulting on his debt: “Annual income twenty pounds, annual expenditure nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds and six, result misery.”
Maugham’s “Of Human Bondage” is a classic example. The decision by the main character, Philip Carey, at the end of the book to renounce all the expectations of his middle class background and marry a simple girl whose father is a waster and mother an illiterate peasant was revolutionary for its time.
Maugham’s short story “The Outstation”, set in Borneo in the 1920s, is one of the greatest portrayals of the ridiculousness of the English class system. Snobbery is personified in the character of the colonial official Mr. Warburton who dresses for dinner every evening even though he lives alone in the middle of the tropical forest and reads a six-week old copy of “The Times” at breakfast.
Orwell’s “A Clergyman’s Daughter” covers the plight of the lower middle classes trying to hang onto their respectability, with the clergyman’s daughter, Dorothy Hare, knowing that if things get any worse in her life the next level down is prostitution. The same is true for Sarah Woodruff in Fowles’s classic “The French Lieutenant’s Woman”.
J. B. Priestley’s superb novel “Angel Pavement” has a memorable scene in which an impoverished middle class clerk, Turgis, decides to kill himself but fails when his gas meter runs out and he has no money to get it going again.
This obsession with class and status is probably best seen in “The Diary of a Nobody” by George and Weedon Grossmith, which created one of the most unforgettable characters in English literature, Charles Pooter of The Laurels, Brickfield Terrace, Holloway and his efforts to maintain his station in society in Victorian England.
In Brazil’s case, being middle class is strictly related to income rather than family background, manners, the school you went to or accent. I imagine level for entry to the middle class was arrived at by multiplying the monthly minimum wage, which currently stands at 415 reais, by around two and a half times for the lower level and by 10 times for the top level.
The fact that an entire family can be regarded as middle class by having an income of just over US$ 600 highlights how low wages still are in Brazil. In world terms Brazil is in 71st place in terms of per capita income. Even within Latin America, it comes in 19th place, according to the national statistics institute, the IBGE, and the World Bank.
While the upper end of the income figure – 4,591 reais – is probably enough to give a family with two children a middle class life style comparable with that of a western European country, I am not so sure the same is true of the lower figure.
These figures apply to six big state capitals: São Paulo, Rio de Janeiro, Belo Horizonte, Salvador, Recife and Porto Alegre. I know São Paulo well and Rio to a lesser extent and cannot believe that a whole family can live a middle class life in either of these places on just over 1,000 reais a month.
In fact, entering the middle class can bring many disadvantages and borderline cases might be better off remaining in the “D” group. This may sound perverse but the reality is that the middle class pays taxes while the working class and those in the informal sector do not. Workers can earn up to 1,373 reais before they start paying income tax at a rate of 15% up to 2,743 reais when it rises to 27.5%. Contributions to the state pension scheme can range from 8% on a wage of 911 reais to 11% up to 3,038 reais.
Taxpayers get very little for their contributions and middle class people are burdened with additional expenses, usually related to school fees, private health insurance plans and security i.e. living in blocks of flats with round the clock security. All this comes at a price. It can easily cost 1,000 reais to send a child to school and the condominium costs on even a modest building can come to 1,000 reais. A decent monthly health plan for a family can also reach 1,000 reais.
To pay all this means earning piles of money or taking out loans. As the economy has expanded and price stability has become established, the government has relaxed credit regulations and loans are easy to come by. Bank and finance houses are scrambling to offer loans to working class and middle class families to buy cars, homes and electronic appliances.
This means that a “new” middle class family in Brazil may well have no real assets to fall back on in case of an emergency and may have a long line of debts to be paid off.
The magazine Época gave a good example of one of these new members of the middle class. She is a 34-year-old manicurist called Josineide Mendes Tavares who lives with her two young children in the Rocinha favela in Rio de Janeiro. She visits her clients in their homes in the rich districts of Rio and earns between 1,500 and 2,000 reais a month. She and her children live in a tiny house (“casinha”) measuring 35 square meters (377 square feet).
She has a new 29-inch television with access to cable and a DVD, a dishwasher and stylish clothes. She has just bought a fridge and freezer on credit and is about to buy her third mobile phone which she uses to keep in touch with her clients. Statistically this woman fits in with the definition of the new middle class but no European or American would consider someone living in conditions like this as being middle class.
In fact it might be better to describe these people as “middle income” and forget European ideas of class completely. As Delfim Netto, who oversaw the boom years of the 60s and 70s, put it: “The size of the income is not as important as the fact that the people feel they have made progress. A wage plus readily abundant credit allows them to buy middle class goods.”
John Fitzpatrick is a Scottish writer and consultant with long experience of Brazil. He is based in São Paulo and runs his own company Celtic Comunicações. This article originally appeared on his site www.brazilpoliticalcomment.com.br. He can be contacted at jf@celt.com.br.
© John Fitzpatrick 2008
