After decades of improvements, Brazil suffers from both a decline in income and an increase in inequality

Fernando Canzain – Folha de Sao Paulo, 03/24/2016

With the political and fiscal crises that started last year, Brazil is undergoing a combination of income decline and an increase in inequality for the first time since 1992. According to specialists, there have been instances where income and inequality have worsened separately, but this is the first time in which both deteriorated simultaneously.

Unemployment, inflation, decline in investment and the fiscal crisis caused a series of negative consequences which eventually started to affect the social disparities across the country. Economists say that until 2014, Brazil had a surprising increase in income and decrease in inequality, even with all the macroeconomic problems. Yet, the recession makes these consequences inevitable, and with an expressive decrease of 3.2% in income per capita there exists the necessity for national economic readjustment.

Summarized by: Julia Fonteles and Therese Kuester

Read the Original Article in Portuguese…



Brazil isn’t growing—so why are Brazilians so happy?

The Economist, 05/07/2013

IN THE decade after Jim O’Neill of Goldman Sachs coined the acronym “BRICs” in 2001, grouping together four big countries with the potential for sustained growth, the “B”, Brazil, really put itself on the economic map. Having grown by 2.3% a year between 1995 and 2002, it grew by 4% annually in the following eight years. But Brazil then ran out of puff. It grew by a disappointing 2.7% in 2011, and a dismal 0.9% in 2012. Yet Brazilians seem blissfully unconcerned. IPEA, a Brazilian research institute, regularly finds that two-thirds to three-quarters of families say their financial situation improved during the past year, and that they expect it to get even better in the year ahead. In December Gallup, a global pollster, found that those optimistic about the economy outnumbered pessimists by a wider margin in Brazil than in any other large economy. Given that growth has stalled, why are Brazilians so happy?

The underlying reason is that even though the country as a whole is struggling, most families’ incomes are still rising fast. Unemployment is close to record lows and pay rises are comfortably outstripping inflation, partly because of big hikes to the minimum wage, but also because of that tight jobs market. Meanwhile, the gradual weaving of a social safety-net is rescuing many Brazilians from destitution. The result is falling inequality, a growing middle class — and a disconnect between GDP growth and most Brazilians’ actual experience.

Read more…

Brazil’s ‘poor’ middle class, and the poor that no longer serve them

Kenneth Rapoza – Forbes, 01/22/2013

Let me preface this by saying that this is not a jab at Brazil. This is actually a story that shows how Brazil’s rising tide is lifting all boats. The poor have more opportunities than ever before. They are earning more money (for some, how’s 56 percent sound?). And for the middle class that used to depend on them to wash their dishes and make their lunch, those days of luxury are over.

Bemvindo a vida Americana, meu bem!

Ask an expat what they love most about living overseas and they will inevitably tell you this: the taxes and the maid service. That’s right. Maids. And not for the rich, mind you, but for middle-of-the-road, beer-from-a-can drinking, 2.5 GPA achieving riff-raff professionals. Whether they’re living in Dubai, Mumbai or Brazil, they all love their maids. It’s a luxury they cannot afford back home.

Read more…

Brazil enacts affirmative action law for universities

Simon Romero –  The New York Times, 08/31/2012

Brazil’s government has enacted one of the Western Hemisphere’s most sweeping affirmative action laws, requiring public universities to reserve half of their admission spots for the largely poor students in the nation’s public schools and vastly increase the number of university students of African descent across the country.

The law, signed Wednesday by President Dilma Rousseff, seeks to reverse the racial and income inequality that has long characterized Brazil, a country with more people of African heritage than any nation outside of Africa. Despite strides over the last decade in lifting millions out of poverty, Brazil remains one of the world’s most unequal societies.

“Brazil owes a historical debt to a huge part of its own population,” said Jorge Werthein, who directs the Brazilian Center for Latin American Studies. “The democratization of higher education, which has always been a dream for the most neglected students in public schools, is one way of paying this debt.”

Read more…