The upsurge of the so-called “emerging countries” is a worldwide geopolitical phenomenon at the beginning of this century. Until recently, countries were divided into First, Second, or Third World. After the fall of the Berlin Wall, the Second World concept was dropped. Now, a group of countries is integrating into a different bloc, called “emerging.”
Although not part of the First World, this group is differentiated from the other developing countries. China, India, Brazil, South Africa, Indonesia, South Korea, Mexico and others form the group, which is characterized by its important participation in international commerce, as well as in the worldwide GDP.
Beyond this, they are countries marked by low educational indices, precarious healthcare, income concentration and a high corruption index. They are emerging economically but not socially.
Even worse, they are emerging tardily and making a belated arrival in the First World.
The emergence of these countries coincides with a crisis in the proposal of the world into which they are emerging. The countries that serve as their model and define the ideal now seek new models to measure development.
We are emerging in the direction of a no-longer-satisfactory objective. It is as if a plebeian family should be emerging into the nobility in Czarist Russia on the eve of the socialist October Revolution.
The developed world is based upon four great principles: Political Democracy; Economic Growth; Social Welfare; and Technical Innovation. At the very moment in which the new countries are emerging, however, this synergy has entered into crisis due to four new factors: the Ecological Limits to Growth; the Mega-Concentration of Income; a Scientific Revolution; and the Unraveling of the Financial Sector in relation to the economic reality, as well as to the national borders.
From now on, the First World countries, rich countries, will be obliged to choose among continuing their economic growth, leading to a grave ecological crisis; restraining the social benefits in the direction of fiscal equilibrium; balancing their national economies in an integrated world; adjusting their jobs in the era of the new science and technology; dominating the mega-concentration of income without putting the brakes on the democracy; fulfilling presidential commitments to a population with a longer lifespan.
The concept of development and progress that attracted the emerging countries is seeking an alternative.
Throughout the world, the measurement of progress and, therefore, the standard to define who has emerged or who continues to lag behind, cannot now be based merely upon economic growth. The new emerging countries, concerned with emerging into the world of elevated GDP, underestimate the concern with the environment and with their people’s well-being, and they are not making the investments necessary for their own leap in the direction of innovation.
Even worse, just as these countries are emerging, thanks to production of agricultural or industrial primary goods, the developed countries are entering into an economy based upon knowledge, science and technology. The emerging nations are copying and anyone who copies is already lagging behind.
Brazil is emerging into a type of development that faces extinction. The industrial civilization consolidated in the 20th century has entered into a crisis and is preparing for a new standard of progress.
We continue, however, to be so dazzled with our emergence into the old one that we are living in the euphoria of one that is newly obsolete.
This has happened with other course changes in past Brazilian development. Brazil was a rich country producing gold and sugar at the same time that England was industrializing.
Brazil and Portugal came into wealth in the old colonial world, but they lagged behind because the Industrial Revolution was consolidating as a new way to make and define wealth.
Once again, we are repeating the same situation.
We are emerging thanks to the exportation of commodities that have left us with a strong currency, with an elevated GDP. With some exceptions, however, we continue to be importers of high-tech goods.
We are emerging as the country of “made in Brazil” at the same time that wealth is measured and defined by “created in Brazil.”
We are emerging for production and per-capita income when the world has evolved toward more free time, greater cultural production, better distribution and more quality in public services, respect for the environment; more attention to public health, to the retired and to the children; revolution in universal education and in the concept of lifelong education; concern for welfare and even for happiness, instead of the moth-eaten GDP into which we are making our tardy emergence.
Cristovam Buarque (CBUARQUE@senado.gov.br) is a professor at the University of Brasília and a senator (PDT-DF).
Translated by Linda Jerome (LinJerome@cs.com).
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Having gone through the year-end celebrations we were left with the feeling that 2011, as a whole, will not be missed: it will be marked as one of the most mediocre political years, characterized by successive crises involving the three branches of government. I don’t know which one most haunts my fears, what I know is they all exacerbate my deepest suspicion.
As has been the case in recent years, the federal government maintained its bet on an advertising avalanche to disguise the moral collapse that accompanies it since 2003.
The official propaganda distinguished itself for its distorted content, more concerned with promoting the government’s logo and for the undisguised electioneering bias. Displaying a very well articulated brazenness, Dilma and Lula were the main protagonists of the commercials that sell Brazil’s fake image.
Both also had outstanding performance in the most sordid manifestation of disrespect to the intelligence of Brazilians, designed to pretend that both the mensalão (monthly allowance) scandal as the 15 ministers dismissed for involvement in corruption, if they ever existed, had nothing to do with their administrations.
They trampled on the part of society abandoned by a silent opposition, hiding behind an alleged preservation of the institutional order and, as a tribute to cowardice, qualified itself as the main guarantor of the climate of disorder that threatens the institutions.
Fearful, this opposition betrayed the trust of voters with an exaggerated reverence for their governors and contented itself with being a privileged spectator of the billion-dollar spree provided by corrupt ministers indicated by Lula and appointed by president Dilma Rousseff.
As we enter the tenth year of the PT ruling, there is little to celebrate. TV news dressed up to stage another act of explicit adulation towards the federal government, celebrating with fanfare Brazil’s entry in the group of the six largest economies on earth.
Too much pyrotechnics and too little information because at no time they reported that the country is among the seven most developed economies since the time of the military dictatorship. The unscrupulous maneuver minimizes the naked truth: a huge void separates tens of millions of Brazilians from this supposed advancement.
It is inhuman the joy that surrounds the 6th poorest wealth of the world. There can be no joy when the numbers of the real Brazil point to a bleak picture, which shows more than 19 million bastard children of the PT opulence, who survive below the misery line.
It is immoral to justify any presumption of economic success when more than half the population has no access to treated sewage and drinking water, while another sizable portion parade down the avenue of submission bearing the banner of remunerated poverty.
Likewise, it is unacceptable to boast about a fortune that even if it overflows the coffers of the government, it does not reach the adolescents, who, unaided, wander among the miserable 40% and the illiterate 20%, a frightening reality that calls into question the future of the nation and nips at the bud the sense of nationhood.
Elected with the votes of the overwhelming majority of those humiliated by forgetfulness, president Dilma Rousseff missed a unique chance to be reconciled with her mandate evading the responsibility to communicate to the nation the success of the Brazilian economy and because of that, express her sorrow for the incompetence in the management of the available financial resources.
And, in solidarity to the miserable, tell how ashamed she is of the offense of the bullet train, of the criminal activities of NGOs belonging to those who are PT friendly, of her ministers’ diversion of over a billion reais in public money, of her embarrassing New Year’s break, which cost taxpayers more than half a million reais.
To complete the ritual of reconciliation, she should apologize for all the promises that were lost somewhere in the campaign.
Such a stance would be less compromising than isolating herself at a military base and transferring to the worst finance minister of republican history the task of explaining that if those involved in the mensalão are convicted and imprisoned, if the ministers stop robbing the public coffers and if there is no overinvoicing in the World Cup’s works in twenty years, the PT government will be ready to rescue these citizens from the condition of sub-Brazilians.
Luiz Inácio Lula da Silva, Dilma Rousseff and Finance minister Guido Mantega are the unequivocal confirmation that when it comes to human development, the sixth most powerful economy on the planet still has one of its tentacles firmly mired in the vicinity of the stone age.
Mauro Pereira is a contributor at Veja magazine.
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According to Brazilian president Dilma Rousseff, Brazil is moving into an ‘era of prosperity’ characterized by ‘income distribution and a notorious drop in inequalities.” That’s what she said in her first 2012 radio edition of ‘Breakfast with the President’, where she also dared to use the word ‘protection’ in reference to jobs and the domestic market.
“With planning and the right policies we are managing to protect our economy, our production sectors and above all jobs,” said the President.
Brazil in the last months of 2011 announced a series of measures to restrict imports of industrial goods and earmarked billions of dollars in tax exemptions, to stimulate exports.
“In a year when almost all countries lost jobs, we created over 2 million jobs. In a year in which the great world powers are having negative growth, we are going to have a good expansion,” added Rousseff.
Nevertheless some budding data shows that the impact of the euro crisis and slow growth in the US is arriving to Brazilian shores.
The Focus bulletin from the Central Bank shows that Brazil’s GDP expanded 2.87% in 2011 and is expected to advance 3.2% this year, which is 0.1% less than announced a week ago.
Far distant from the 5% anticipated by Economy minister Guido Mantega only a month ago. However President Rousseff was careful not to get tangled with numbers and percentages.
“In spite of all difficulties, thank Heaven, 2011 was good and almost certainly this year will be even better, I’m convinced we can keep advancing” said the President.
“Brazil is moving into an era of prosperity characterized by income distribution and a notorious drop in inequalities”, said Rousseff.
When Dilma took office a year ago she started with significant budget cuts (30 billion dollars) defined as “fiscal austerity” and a commitment to the good health of Treasury accounts for which the Selic basic rate had climbed to 12.5% by mid year.
But a year later Rousseff is promising “descending interest rates” with lower debt payments, which also makes analysts feel that the Selic might reach one digit, something which has not been seen in Brazil for decades.
This policy has strong supporters in Economy minister Mantega, his peer from Industry, Fernando Pimentel and the president of the Development bank, Claudio Coutinho.
This group together with President Rousseff are more identified with the so called “economic development” policy with a strong intervention and support from government, contrary to the more ‘monetarist’ and free enterprise sector predominance that could be represented by Central bank president Alexandre Tombini, who nevertheless seems to have succumbed to the other group’s influence.
This could be a crucial observation of what can be expected form Rousseff and Mantega since in the eight years of Lula da Silva, from 2003 to 2010, Central bank president Henrique Meirelles implemented an interest rates policy with far greater independence and distance from the ministries of Economy and Industry.
Mercopress
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In Brazil, three million people crossed the poverty threshold over the last six years in the six main metropolitan regions of Brazil, resulting in an 8.8% reduction in poverty percentages. The figures are included in the study Poverty and Riches in Metropolitan Brazil.
The research work was disclosed July 5 by the Brazilian Institute of Applied Economic Research (Ipea), considering figures for the capital cities of São Paulo, Rio de Janeiro, Recife, Salvador, Belo Horizonte and Porto Alegre.
The number of poor people, which was 14.3 million in 2002, rose to 15.4 million in 2003 and has been falling steadily since, reaching 11.3 million this year. In terms of percentages, the evolution was the following: 32.9% in 2002, 35% in 2003 and falling figures form then on, to the current 24.1%.
The main reasons, according to the Ipea, are economic growth, minimum wage raises and federal government income transfer programs.
The level of indigence followed the same rhythm. It was 12.7% in 2002 (5.5 million people), climbed to 13.7% in 2003 (6 million) and is now at 6.6% (3.1 million).
In 2003, the percentage of richest families, with monthly income of over 40 minimum wages, suffered a 20% reduction, returning to growth starting in 2005. According to the Ipea, last year the percentage was at the same level as in 2002 and, this year, the tendency is for it to remain stable.
The study shows, however, that "all these positive figures with regard to poverty have not evolved into productivity gains, due to the economic stability and to gains from higher minimum wages."
According to the Ipea, "the owners of means of production may be taking hold of a larger share of national income."
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Why are there rich and poor countries? Why are there rich and poor continents? Why are there rich and poor ethnic groups? Why are men usually richer than women? An entire field of social science tries to answer these questions, which encompasses academic disciplines like economics, politics, international political economy, and international relations.
In Latin America, including my own country, Brazil, a vibrant argument has focused on such questions for four decades. The pioneers of “dependency theory” in the 1960s, Argentinean professor Raúl Prebisch (1901-85) and Brazilian scholar (and future President) Fernando Henrique Cardoso, strongly advocated the idea that some regions of the planet were rich precisely because others were poor. For the dependentistas – represented later by the work of the Brazilian geographer Milton Santos (1926-2001) – this is an intrinsic quality of capitalism.
“Dependency theory” lost power in the last years of the Cold War as some dynamic east Asian economies (the “Asian tigers”) appeared to break down the rigid global dichotomy between the “center” and the “periphery”; but the issue of worldwide, systemic poverty persisted in Latin America, Africa and many parts of Asia itself.
A generation on, and after liberal policies and their associated doctrines have been tested to destruction, the search is on for a new model capable of understanding and accommodating the experience of Latin American economies in the context of new forms of globalization.
The Inter-American Development Bank (IDB) has just released in Brazil a publication, Social Inclusion and Economic Development in Latin America, which presents seventeen case-studies of social development and excluded populations in Latin America – among the latter, descendants of Africans, indigenous people, women, the elderly and handicapped people.
This work, which acknowledges the reality of large-scale impoverishment in the region by using categories of “included” and “excluded”, is a valuable contribution to a crucial debate about Latin America. It is also flawed in two important ways.
First, it makes generalizations across a very large geographical area, ignoring structural differences between different sub-regions (for example, it is hard to make meaningful comparisons between the signatories of the Central American-Dominican Republic Free Trade Agreement and the Mercosur regional bloc).
Second, it ignores a vital concern in most Latin American countries: the quality of the “public realm” and “public goods”, and consequently the effects of public allocation of resources.
A Problem of Generations
The reality of social exclusion is wide-ranging. Many of its aspects – racial or sexual prejudice, age or physical discrimination, even traditional dichotomies like native/foreigner or religious/secular – carry political and cultural consequences.
Yet as the IDB suggests, the most tangible evidence of social exclusion in Latin America does lie in the economic sphere, in a highly unequal income distribution. This both reflects and reinforces a situation of poverty far worse than that suggested by overall indices of economic development.
In the last five years, poverty has affected 44% of Latin America’s population of the region – higher than in the “lost decade” of the 1980s, when the then-dominant debt crisis helped drive income differentiation.
In Brazil, for example, the Gini coefficient – the leading measure of inequality used by professional economists – rose (according to federal data) from 0.584 in 1981 to 0.636 in 1989, and was still 0.589 in 2002.
United Nations figures reveal that Brazil’s richest 10% today receive 46.7% of the country’s income, while the poorest 10% of people get only 0.5%. This is one of the most unequal income distributions of any country in the world.
More alarming is the fact that in a similar period (1980-2000), public social expenditure in Brazil grew 43.4%, showing that the public provision of resources is not diminishing economic inequality.
Brazil, though an extreme case, is not alone: none of the region’s countries have better levels of income distribution than those verified three decades ago, and some have worse. This is true even where, as in Brazil, there has been progress at a macroeconomic level.
But Latin America was already, before the liberal framework began to guide policy, the region of the planet with the worst income distribution; thus, as the IDB suggests, income inequality has no relation to the development models popular in the region since the 1990s, or the passionate debates between liberal, Marxist and nationalist frameworks of political economy.
The high levels of social inequality in Latin America and the Caribbean, rather, are rooted in structural problems inherited and transmitted across generations.
Where is the Public?
The IDB’s diagnosis leads it to commend Brazil’s National Program of Affirmative Action, created by a presidential decree in 2002, and the new system of quotas in the country for federal jobs and universities, which guarantees vacancies for members of some minorities.
It also supports anti-discrimination laws in Mexico and Peru, and development projects working to include the Garifuna in Honduras, Mapuche in Chile, Afro-descendents in Colombia, and handicapped people in Nicaragua.
The bank correctly identifies exclusion as itself a source of poverty that carries economic costs for the region: lack of investment in human capital, cycles of human dependency and permanent diminution of individual and national incomes.
But solutions that involve affirmative action in Latin America can also be problematic, tending to privilege some sectors and interests – a distortion rather than a true manifestation of public power.
Again, the Brazilian example is notorious. In the history of the republic since 1889, public power in Brazil has never generated any public benefit for the citizen, even when it retains (as at present) almost 40% of national income.
There is no universal basic education; there is no public health; there is no public security; there is no equal access to justice.
Public power should come first, affirmative action later. Latin American countries should preserve their economic stability while allocating public resources to the provision of public benefits.
Otherwise, Latin American politics will always generate violence, corruption, and social and economic discrimination.
Arthur Ituassu writes for the Rio’s daily Jornal do Brasil and is professor of international relations at the Pontifícia Universidade Católica in Rio de Janeiro, Brazil. You can read more from him at his website: www.labirinto-rio.com.br. This article appeared originally in Open Democracy – www.opendemocracy.net.
Among the experiences presented in BrasÀlia at the 32nd Session of the United Nations Standing Committee on Nutrition, the Brazilian case study was classified as “the most advanced” in the struggle against hunger and poverty.
According to the Committee’s executive secretary, Roger Shrimpton, Brazil’s situation is the most “favorable” among the four countries that were analyzed – Angola, Bolivia, Brazil, and Mozambique.
“The indices of malnutrition among children are low in comparison with Angola and Mozambique, for example. Brazil produces enough food to meet the demand for a healthy diet. The issue, it seems, is to find solutions that guarantee needy communities access to income and, consequently, high quality food,” he observes.
In Shrimpton’s opinion, when it comes to strategies to combat poverty and hunger, one may infer that a country advances when it adopts income-transfer measures.
According to the Brazilian study, “a large-scale income-transfer policy represents the most immediate alternative for dealing with the problem in Brazil.”
According to the technical director of the Brazilian Campaign for Nutrition and Human Rights (Abrandh), Flávio Valente, the Family Grant program constitutes progress in this sense.
“Research indicates that 70% of the money these families receive from the programs is spent on food, generally on better quality food than they had before,” he affirms.
In Valente’s view, the exchange of experiences has contributed greatly to advances in the four countries that were analyzed. According to him, “when one begins to expose the difficulties and the advances, alternative routes appear.”
Shrimpton believes that the Zero Hunger program is a “very well developed” concept but needs complementation for the Brazilian program to have a bigger impact.
“There is a need that goes beyond providing food to the poor. Income distribution in Brazil is very unequal, so the Brazilian government’s effort to correct this situation through direct income transfers is admirable.
“What must be done is to combine it with other measures that will protect, in addition to those who are economically vulnerable, those who are biologically vulnerable, such as pregnant women,” he points out.
According to Shrimpton, since the Brazilian government is assuming the position of world leader in nutritional solutions, it would be “very important for other countries to receive Brazil’s help.”
“Brazil is becoming part of a more advanced society, in which income-transfer policies are normal government practices. Moreover, Brazil has the benefit of a very rich history of food and nutrition programs. The country’s current institutional situation is also favorable, something that the other countries lack.
“Therefore, I believe that Brazil can develop a supporting role for the other three countries, especially Angola and Mozambique.” he points out.
Translation: David Silberstein
Agência Brasil