Why Brazil is still a sorry underachiever

David Samuels – Star Tribune, 7/31/2015

Brazilians have a self-deprecating sense of national pride. They sheepishly accept Brazil’s inability to join the club of rich and powerful nations with the oft-heard joke that “Brazil is the country of the future … and always will be!”

This national frustration is borne of long experience. Brazil had the world’s fastest-growing economy in the first half of the 20th century, but by the 1970s growth had stalled. As the population boomed, wages fell. Crumbling infrastructure, a protected domestic economy and burdensome regulations made it hard for Brazilian products to compete on the world market. Inferior schools and a weak job market left millions in poverty, and by 1980 Brazil was competing with Haiti for the title of most-unequal country in the world.

Brazil appeared poised to finally shed this reputation as a perennial underachiever in the 1990s, when its leaders implemented smart economic policies. It got its fiscal house in order, and by the 2000s the economy was booming. Wages went up, while inflation and inequality went down. The government expanded social-welfare programs, unemployment fell and millions entered the middle class. Brazil was also lucky, discovering massive oil deposits in its offshore waters. It also played the global public-relations game well, winning both the 2014 World Cup and the 2016 Olympics.

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Young, Black, Alive – Breaking the silence on Brazil’s soaring youth homicide rate

Atila Roque – Live Wire, 11/26/2014

Earlier this week, many people around the world waited with bated breath for a grand jury’s decision in a case where a police officer shot dead an unarmed young black man on the street. While the 9 August shooting of Michael Brown took place in the US suburb of Ferguson, Missouri, the case has a deep resonance here in Brazil. The tragic course of events leading up to the teenager’s death could just as easily have played out on the streets of our cities orfavelas.

Of the 56,000 homicides in Brazil every year, 30,000 are young people aged 15 to 29. That means that, at this very moment, a young person is most likely being killed in Brazil. By the time you go to bed, 82 will have died today. It’s like a small airplane full of young people crashing every two days, with no survivors. This would be shocking enough by itself, but it’s even more scandalous that 77 per cent of these young people are black.

Since 1980, more than 1 million people have been murdered in Brazil. According to Global Burden of Armed Violence 2008, in the period from 2004 to 2007, more people were killed here than in the 12 main wars worldwide. However the violence doesn’t impact Brazilian society equally. Murders are rampant in poor and marginalized communities. Prejudice and negative stereotypes associated with the favelas and city outskirts have a key role in perpetrating this violence.

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Sao Paulo’s Luxury Neighborhoods Ignore Brazil Recession

Cristiane Lucchesi and Blake Schmidt  – Bloomberg, 09/22/2014

Sao Paulo’s most expensive real estate got even pricier this year, surging 10 percent as wealthy buyers in search of safe neighborhoods ignored Brazil’s recession, according to one of the city’s biggest brokerage boutiques.

Apartments in high-end communities such as Vila Nova Conceicao are selling for about 25,000 reais ($10,600) per square meter, said Amir Makansi, partner and chief executive officer at Anglo Americana Consultoria de Imoveis S/C Ltda, which caters to high-net-worth individuals, banks and multinational corporations.

“The market for wealthy individuals is always surprising,” Makansi said in an interview.

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Brazil’s poor earning more, but still ignored

Deutsche Welle , 11/13/2012

Few countries can boast income inequality quite like Brazil. Now, current research shows that the incomes of low earners in Brazil have risen rapidly. But, will the improvements really help the country’s poor?

The perception that social inequality has been declining in Brazil can now be backed up with data. A study from the Institute for Applied Economic Research (IPEA), a Brazilian institution that works closely with the national government, shows a rapid retreat in economic disparity over the last 10 years. Inequality is now at its lowest point since census data began in the 1950s, the researchers say.

During the period between 2001 and 2011, income levels for Brazil’s poorest increased much faster than for the richest. The poorest 10 percent of the population nearly doubled their income during that time, while the richest increased their earnings by just one-sixth.

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The next crisis will arise in the BRIC countries

Ignacio de la Torre – Forbes, 07/14/2011

A steep rise in credit; rapid increases in house prices to levels way beyond available income; use of overvalued property as further collateral to demand additional funding from the banking system, resulting in even higher levels of debt; an increase in the amount of credit needed for the marginal growth of gross domestic product; a constrained installed capacity that yields to inflationary tensions; a labor force with double digit wage rises; limitless liquidity flowing into sectors with low productivity, such as real estate; a relaxation of the rules for granting loans; a rapid increase in corporate debt as a consequence of accelerated investment, mergers, and acquisitions, all fanned by the intoxicating feeling that demand will just keep going up; a central bank incapable of containing such a self-complacent liquidity binge, with interest rates far below those recommended by the Taylor rule; a political class living off an apparent bonanza, refusing to carry out the reforms needed to avoid disaster when the cycle eventually changes, ignoring calls for serious cutbacks in spending, or rises in taxes that could counteract the exuberance.

Spain in 2006? The U.S.? Britain? Iceland, Greece, Ireland? No. I am talking about emerging countries, in particular Brazil, Russia, India and China, the four known collectively as the BRICs. In my opinion, the BRICs are repeating many of the same errors committed by Europeans and North Americans in the lead-up to 2007, namely the following:

A housing bubble. Lax monetary policy has allowed unsubstantiated rises in the price of housing vs. available income, fuelled by bank loans. The growing value of houses has in turn brought about rampant consumerism coupled with even greater mortgage debt, piling yet more pressure on house prices.

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Brazil tackles ‘entrenched inequalities’

Fabiola Ortiz – AlJazeera, 05/15/2011

Jane de Meneses Coelho, whose son Julio Cesar died in a police operation, cries as Amnesty's Secretary General Salil Shetty watches during a meeting for victims of police violence at Cidade Alta slim in Rio de Janeiro. Photo: Reuters

Despite “considerable progress” made in reducing poverty, “stark inequalities” remain in Brazil, as well as high levels of police and gang violence in poor urban neighbourhoods, Amnesty International warns in its annual human rights report, released as it reaches its 50th anniversary.

The “Annual Report 2011: The state of the world’s human rights” documents specific restrictions on free speech in at least 89 countries, cases of torture and other ill-treatment in almost 100 countries, and unfair trials in at least 54 countries.

In the chapter on Brazil, the London-based global rights watchdog says the country’s “favelas” or shanty towns continue to face “a range of human rights abuses, including forced eviction and lack of access to basic services.”

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Six South American countries with the worst income distribution inequality

Kayla Ruble – Santiago Times, 11/01/2010

A newly released regional report on economic inequality ranked Chile as one of the top 15 countries in the world with the worst inequality of income distribution and declares Latin America and the Caribbean to be the region with the worst inequality worldwide.

According to the report, which was put together by the United Nations Development Program, 10 of the 15 worst countries in terms of inequality are in Latin America or the Caribbean, with the rest in Africa.

The Latin American country that ranked the worst in the UNDP report was Bolivia, with an index of 60 out of 100, a score it shares with Madagascar and Cameroon.

The ranking measures the distribution of per capita household income within countries and places them between Zero (absolute equality) and 100 (complete inequality).

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