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The Declining Morale of a Growing Economy: Turbulent Times in Brazil

February 6, 2016

Protests, similar in character to the ones that rocked the country in 2013, erupted in the Brazilian cities of São Paulo, Rio de Janeiro, and Belo Horizonte in early January. The protests convened in light of a new announcement that bus fares would be raised around the country. While public transportation systems are usually chronically underfunded and subjected to byzantine bureaucratic measures, this fare increase and its subsequent demonstrations are a harbinger of things to come in a nation where the citizens are being shortchanged by a failing government and ailing economy.

 

From 2002 to 2011, under the stewardship of President Luiz Inacio da Silva, the economy of Brazil rode a wave of increased demand for its commodities as the GDP increased from $427 million in 1992 to $2.4 billion in 2011. Life expectancy went up, infant mortality rates decreased, and the rate of those living in poverty decreased. Public spending on services, infrastructure, and other projects increased as Brazil reaped the benefits of being a developing country attracting foreign investment. Brazil’s elevated world stature, after a volatile second-half of the twentieth century in which a military dictatorship ruled the country for many years, saw the nation receive the World Cup in 2014 and the Summer Olympics in Rio in 2016. Brazil was coming into its own on the world stage.

 

However, in the last couple of years, Brazilian President Dilma Rousseff and her left-leaning Worker’s Party have come under intense scrutiny as economic growth slowed, debts increased, inflation skyrocketed, and budget shortfalls widened. Petrobras, the crown-jewel of Brazil’s energy industry, has seen its image tarnished and business dealings hurt as a corruption scandal implicated many of the corporation’s leaders. Coinciding with the government’s failure to get its finances in order, ordinary Brazilians have felt the biggest brunt of the impact as the well-to-do in Brasilia stumble along. Unemployment has increased from about 5% in 2013 to about 7.5% in 2015. Wages in the private and public sectors have declined in the last year as people are increasingly looking towards the government to support them in these testing times. With the Olympics around the corner and the world’s attention returning to the beaches of Rio, expect an outpouring of frustration emanating from the Brazilian populace.

 

International television crews will be firmly focused on the various track & field events and volleyball matches, but Brazilian citizens will use the next couple of months to highlight the various ways in which its government is failing to adequately support the millions of citizens who are once again suffering. As gleaming new stadiums and high-rise apartment buildings have popped up around Rio, for ordinary Brazilians these massive projects have done nothing to help them. While the Olympics carry the promise of uniting people around the flag, it seems that bus fares are doing more to rally citizens around a common cause in these turbulent times.

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