Tag Archives: inequality

Economic Progress, Political Complacence, and the Tenuous Citizen-Government Connection

1 Sep

Most gringos don’t realize that Brazil and Latin America’s experience with democracy is relatively recent. Brazil has come a long way since it returned from dictatorship to democracy in the late 1980s. It only drafted its current constitution in 1988, just over twenty years ago. Today, politics is less polarized, the military has less influence, consumers have greater choice thanks to fewer barriers to imports, and most crucially, inflation is no longer the unslayable dragon it was in the late 1980s and early 1990s. “It’s the economy, stupid.” The economy is infinitely improved, which has made Brazilians disconcertingly satisfied with things. Economic and political gains are relative.

Current successes have buoyed Brazil, but they have also created complacency. Despite what many middle to upper class Brazilians trick themselves into thinking, Brazil remains a corrupt third world country with one of the world’s highest levels of inequality, regional disparities in wealth, and violence.

Complacence threatens to slow if not reverse progress that has been made. The country will have ample opportunities to set itself back. World-class sporting events are economic disasters for countries, if you haven’t figured that one out yet (see my buddy Chris Gaffney’s superb blog on the subject). Thus the World Cup and Olympics of 2014, 2016, need monitoring by concerned citizens. The “curse of oil”–the discovery of the giant Tupi oil fields–also provides a classic opportunity for corruption that Brazilians should be currently preempting. But the sense of ownership that Brazilians have over their government is still so tenuous that the result is often indifference and apathy. As I said, democracy is a recent phenomenon and participation, beyond the obligation to vote, is not well understood.

Everyone happy?

One particular example I like to use are taxes. If Brazilians were to pay all their taxes, they would have one of the highest tax burdens in the world. Brazil raises more taxes as a percentage of GDP than Canada! The question of where this money comes from and goes is one issue, another is whether Brazilians realize they’re paying these taxes. If they did, how would their expectations of government performance change?

When you buy a chocolate bar in Canada, the U.S., or other places, you can expect to pay anywhere from 5 to 16 percent on top of the listed price. When the attendant rings up my taxes on that chocolate bar, in that instant the knowledge of government’s hand in my purchase registers. I expect commensurate good government in return. When a Brazilian buys something, the taxes are already included in the price, so there is no conscious appreciation of what government is taking and what it owes the consumer-citizen. The same goes with import taxes, of which there are many in Brazil. The majority of Brazilians only have a vague notion that they pay very large premiums to the government on all electronic equipment.

There are many other examples of these sorts of tax-by-stealth tactics, which result in failed opportunities for citizens to make the government-owes-me-I-own-government connection. A pity, but only one of the many causes of citizen complacence, a theme I hope to explore in upcoming posts.

The Beach and the end of Inequality

30 Aug

Well, perhaps not the end of inequality, but the beach certainly is something of an equalizer. Although the beach has its classes and groups, it is the closest Brazilians come to indiscriminate association.

Greg and Carolina share a kiss at sunset

Where brown met white and sun dipped into the sea...

Perhaps you have a few class indicators, like a pair of sunglasses or a fancy bathing suit, but except for some very informal segmentation it’s often difficult to tell rich from poor, poor from rich. Conversations and activities among strangers intermingle.

Carolina and I observed one little fat white kid playing with a frisky group of black kids, evidently from different class sets. Even though the black kids called the little white one “gordinho,” (little fatty) he served as a half effective obstacle in front of the imaginary goal. His dramatic dives in the shallow water made the gang laugh. He was even invited by one of the kids’ mothers to grab a sandwich and a cup of coke. Unfortunately, he submerged the sandwich in a pool of seawater (but took a bite before it was summarily confiscated).

If you have not been to a busy Rio beach, it is an experience not to be missed. Not only for the diversity of people, but for what they’re selling on the beach, to walk close to the water and witness the heaving mass of multitone bodies gathered where land meets sea.

Talking about inequality…

13 Aug

Today’s Jornal do Brasil reports  “47% of the GDP in only 1% of [the country's] municipalities.” (page A17). Today, 40% of the nation’s poorest municipalities account for just 4.6% of the country’s GDP. Those are some figures to drown in.
Inequality has obviously gotten worse, not better over time. In 1920, the figure for the richest 1 percent of municipalities was 21%, versus more than double, at 47% today. Brazil’s poor may have become richer in absolute terms, but so have the rich– much, much richer.