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Bolsonaro’s New Chapter of Neoliberalism in Brazil

Brazil’s 1988 post-dictatorship constitution enshrined a broad range of social rights and a modest welfare state. Since taking office a year ago, Jair Bolsonaro and his band of paranoid reactionaries have dedicated themselves to attacking and undermining those rights.

Brazil's president, Jair Bolsonaro, arrives at the Imperial Palace for the court banquets after the Ceremony of the Enthronement of Emperor Naruhito on October 22, 2019 in Tokyo, Japan. Pierre Emmanuel Deletree / Pool / Getty

Jair Bolsonaro, a far-right former army captain, has been Brazil’s president for almost one year, having ridden the wave of the far-right movement worldwide to power in the largest economy in Latin America with a strong political influence in the region and some of the most important natural resources of the planet. The impact of Bolsonaro’s policies since taking office goes well beyond Brazilian borders: he has supported Juan Guaidó’s attempted coup in Venezuela and Jeanine Áñez’s successful coup in Bolivia, as well as overseen new deforestation records in the Amazon rainforest.

Since Brazil was one of the leading countries of the Pink Tide and lifted millions out of poverty in the first decade of the 2000s, the rise of the Brazilian far right is important symbolically. Over the first year of the Bolsonaro government, it’s become clear that the “antiglobalist” agenda of Bolsonaro and other similar figures like Donald Trump is actually an elitist, neoliberal agenda. Twenty-first-century neoliberalism is using the idea of “antiglobalism,” the claims of the alleged leftist control of the global economy, to establish a new round of attacks on the Left. Assessing the logic of Bolsonaro’s governance is crucial to figure out effective long-term alternatives to this project.

Like the other authoritarian leaders who have risen to power in recent years, Bolsonaro claims to stand for the common man and woman. According to Bolsonaro, the Left has dominated world politics over the last three decades in order to destroy the traditional social fabric based on nationalism, family values, and work ethics. Bolsonaro branded himself as an outsider throughout his presidential campaign, despite his almost thirty years as a congressman.

Some days before the 2018 election, documents surfaced revealing a giant campaign messaging scheme, in which some Brazilian business owners paid around 12 million reais to spread misinformation about Workers’ Party candidate Fernando Haddad via WhatsApp. Still, his fierce supporters hold on to the narrative that Bolsonaro’s run for the presidency was the most underfunded campaign in Brazil’s short democratic history. In office, Bolsonaro has presented himself as the one who is in power to fight against Brazil’s endemically corrupt “old politics.”

But from his open nepotism and alleged involvement with paramilitary groups to endorsement of perks to cabinet members, his administration has yet to confront the practices associated with “old politics” — especially catering to oligarchs and the building of alliances to get votes for the approval of unpopular policies and measures. In fact, his agenda as president has been to completely root out the principles of the 1988 Constitution enacted at the end of the military dictatorship, the result of strong organizing and the foundation of the most progressive achievements in Brazil’s recent history.

The 1988 Constitution, “the Citizen Constitution,” frames a broad range of social rights and attributes to the state services to protect the poor and the middle class as well as guarantee fighting inequality across the country. This vision of a welfare state has long been an obstacle to the 1990s neoliberal wave. Bolsonaro’s election offered a chance to overcome it by unleashing attacks at a new level.

Guedes and Carvalho

Two elements of his agenda in particular are key to overturning the fragile welfare state project in Brazil: the approval of a harsh pension system reform that hurts the poorest Brazilians and the vicious attacks against public education, especially higher education, led by his lunatic minister of education Abraham Weintraub.

To understand Bolsonaro’s agenda and what his administration represents, consider two key figures of the government: Paulo Guedes, the current economy minister, and Olavo de Carvalho, the government’s intellectual guru.

While there are other relevant players, such as minister of justice Sérgio Moro and Bolsonaro’s sons, Guedes and Carvalho represent the two dominant wings of Bolsonaro’s government and the major shift in conservative political thought in Brazil over the last twenty years. Guedes and Carvalho respectively embody the two forces — the market and conspiratorial anti-leftism — that hold the government together (at least for now) despite Bolsonaro’s ineptitude for the position, clashes within the coalition that supported his election, and rejection by more than one-third of the population. A look into Guedes’s and Carvalho’s path, motivations, and input over the last years allows us to understand why they are the “spirit” of the current government.

Paulo Guedes graduated from the University of Chicago with a PhD in economics in 1978. At the time of his graduation, the Pinochet dictatorship was expelling and persecuting professors considered a threat to the regime. Guedes moved to Chile for one of the vacant positions at the University of Chile and witnessed the first systematic application of neoliberal policies firsthand.

Returning to Brazil a few years later, Guedes found little reception for the ideas inspired by the Chicago school of economics in the context of the emergence of a popular coalition against the dictatorship. After the fall of the dictatorship in 1985, the coalition achieved remarkable victories like universal health care and pushed for a welfare-state model in Brazil. In Chile and Argentina, the reinstatement of a democratic regime meant the confirmation of neoliberal principles at the state institutions and in the economy; in Brazil, however, the discussion in the immediate aftermath of the dictatorship advanced new political rights and principles of social justice.

These advancements were frustrated when Luiz Inácio Lula da Silva, the candidate of the coalition, lost his first presidential run in 1989, and the country moved toward the Washington Consensus throughout the 1990s under Fernando Henrique Cardoso. Rhetoric grounded in fiscal discipline, control of inflation, and structural economic adjustments grew stronger, leading to austerity policies. To Guedes and his ilk, nonetheless, the last three decades of the democratic regime in Brazil represented a clear dominance of leftist ideas in the economy. To him, there seems to be little difference between the ruling Brazilian Social Democracy Party’s program in the 1990s (opening the country to aggressive foreign investors, privatizing the country’s infrastructure and state enterprises, and flattening wages) and the Workers’ Party program in the 2000s — strengthening domestic companies, developing the country’s infrastructure through public-private partnerships, and increasing the poor’s living standards.

Left-wing critics of the Lula government and Dilma Rousseff’s after him point out several limitations in the Workers’ Party (PT) project and strategy, notably the favoring of construction companies’ interests at the expense of indigenous communities and the sidelining and even violent repression of leftist social movements. The PT’s commitment to increasing the poor’s living standards was not grounded in dispossessing the country’s wealthiest; in fact, banks greatly benefited from the trade surplus policies and exorbitantly high interest rates kept in place by both Lula da Silva and Rousseff as well as a new (yet fragile) consumer market, begun by extensive credit lines granted to the lowest strata of the population.

But considerable changes did occur once the Workers’ Party rose to power at the federal level. Guedes can only appeal to a gross mischaracterization — infused with a demonization of the Left — to sustain his claim for a profound shift further toward the market in the country’s economic policies and, most important, a change in the role of the state.

Guedes’s agenda for the first months of government consisted of approving a sweeping reform in the current pension system. The entire government took on the task. In Brazil, pensions follow the so-called pay-as-you-go system: those currently in the workforce have their income deducted and deposited into a collective fund administered by the state. In simple terms, active workers support the elders, sick, and disabled in the present and will be supported in the future by the next generation to enter the workforce. This arrangement was reinforced by the 1988 constitution and is entirely different from the system adopted in Chile, where pensions come down from one’s account according to their contribution and the fund’s performance throughout the years.

Given that the ratio between pensioners and contributors has changed due to population aging and oscillations in the job market conditions, the claim that the pay-as-you-go system is unsustainable has been constant since the mid-1990s. Throughout the 2000s and 2010s, the Workers’ Party removed important aspects of the country’s pension system by hampering future retirees’ access to full benefits — in fact, Lula da Silva’s first reform in power severely attacked public employees’ retirement benefits.

However, this administration is the first one to propose (and achieve) substantial modifications in the law: as Bolsonaro cleared the way for the reformation of old alliances among legislators and elitist personal interests, Brazil’s Senate approved legislation to progressively end retirement by contribution time, raise the minimum retirement age, and reduce the average benefit amount across the board. Numerous amendments have altered the draft by reversing some of the cuts, but the opposition was not able to shift the debate away from the fiscal discipline agenda.

The government has relentlessly stated that the reform would suppress “privileges” but has not considered collecting big companies’ billions in debt to the pension system, ending the tax relief programs that benefit them, and revising the special military retirement system that dramatically drains the budget. While Guedes’s original proposal for a full-capitalization pension system has been momentarily tabled, the recently approved reform hurts the poor and the middle class without bringing effective, long-term relief to the system.

Previous administrations have confronted immense resistance to potential changes in the pension system. This time, however, polls showed an average increase in the support to the reform proposed by Bolsonaro and Guedes, especially in the three final months when the legislation was in the House. The six months of negotiations and compromises, as well as some confusion around legal technicalities, have played a role in softening widespread hostility, but so has the misleading propaganda put forth by the government.

The other key figure of the government, Olavo de Carvalho, holds no formal position in this government. He started writing as an astrologer and literary critic for major outlets in the 1980s. He claims to be a self-taught philosopher and has published about politics since the 1990s, when he first proposed a paradigm shift for the right wing in the country. Whereas other conservative pundits focused on arguing for austerity measures in the economy, Carvalho stressed the importance of moral issues and the imperative of winning the culture war.

An Immense Socialist Conspiracy

According to Carvalho, the end of the dictatorship led Brazilian left-wingers to change their tactics: rather than pushing for open or even violent confrontation, the leftist segments allegedly moved toward quietly seizing strategic civil society institutions and slowly indoctrinating others with their ideas. He popularized the expression “cultural Marxism,” in a crooked reference to Gramsci’s theory of hegemony and war of position in Brazil.

The key leftist strongholds, according to Carvalho, are public schools and universities. But he also singles out the media — including the corporate media — and even international institutions such as the UN as left-wing bastions. The thesis that there is a worldwide socialist conspiracy resembles the dictatorship’s propaganda, expressed in Bolsonaro’s campaign slogan: “Brazil first and foremost, God first of all.”

Carvalho’s ideas also led to the spread of non-scientific theses now reproduced by other right-wing figures spread across the country — for example, flat-eartherism and climate change denial. Also remarkable, in the Brazilian case, are the wild claims against feminism, non-heteronormative sexuality, and any progressive perspective on gender — all of which are portrayed by Carvalho and the mass of right-wing influencers as a “gender ideology” to sexualize kids and destroy the traditional family fabric.

Carvalho was a fringe figure in the 1990s and 2000s. However, after his move to Richmond, Virginia, in 2005, he pioneered the use of YouTube to spread his opinions and reach a broad public. His supporters grew unnoticed until the immediate aftermath of June 2013, when massive protests swept the country. The demonstrations started with a blend of liberal and progressive tones, but right-wing ideas — and Carvalho’s views in particular — came to the surface amid the diffuse dissatisfaction with Rousseff’s government and politicians in general.

These ideas were crucial to galvanize the anticorruption protests of 2015–16 and the anti–Workers’ Party sentiment that resulted in the impeachment of Rousseff. By the time of the last presidential election, Carvalho had gathered immense prestige among the Bolsonaro family and others running for office at the legislative level. He referred several names to Bolsonaro’s cabinet, including key posts in foreign relations and education, who are now in charge of enacting policies.

Bolsonaro’s first education minister openly stated his allegiance to Carvalho and, like others who still make up the government, his ideas and proposals to the office were hostile to any form of critical pedagogy — particularly ideas associated with the educator Paulo Freire, most famous for his book Pedagogy of the Oppressed. The former minister’s claims for deeper involvement of families and religious organizations in education meant less responsibility from the state; however, the privatization drive has become much clearer with the current minister, Abraham Weintraub, and his plans for Brazilian higher education.

While Weintraub has declared independence from any interest group, he has praised Carvalho many times and shares his conspiracy theories on the alleged leftist takeover of the country. He relied on demonizing the Left and spreading lies about higher education to announce severe cuts in the budget of federal colleges and universities, scholarships, and grants. These institutions serve around 8 million students, and some of them are now struggling to pay for basic expenses such as electricity; thousands of research projects are also on the brink of collapse.

Since the late 1980s, Brazil has consolidated the higher education system that was inspired by the Argentine university reform of 1918, whose tenets are public funding for all activities, institutional autonomy with respect to the State, professors hired through open, competitive examinations and with a civil servant contract only (a tenure-like system), and freedom in curriculum development and of academic thought. While the number of private educational institutions is on the rise in the last three decades, the public universities are responsible for over 90 percent of the research conducted in the country as well as crucial cost-free health-care services through university hospitals.

In the 1990s, the Brazilian higher education system survived the defunding attempts at the peak of the neoliberal reforms and, in the Workers’ Party era, has gone through a considerable (though still insufficient) expansion. However, with Bolsonaro, Brazilians are witnessing a complete shift in the system’s public character. The government has proposed a new program, called Future-se, in which higher education institutions are pushed to reduce salaries and gather their own financial resources through real estate sales or rentals, the concession of naming rights to buildings, and proposals in grant competitions, among others. The program plans to reward the most economically efficient institutions.

The idea is to turn Brazilian public colleges and universities — a fundamental pillar of Brazil’s welfare state project — into business-style enterprises. Brazilian scholars envision that by undermining the state’s obligation to funding postsecondary education, the new program will not only affect the content of their research and teaching, but also their status as professors, not to mention students’ access and retention. That is because the civil service rules have been the main mechanism to guarantee academic freedom and some level of gender equality in the profession.

Under the Workers’ Party governments, quota systems to benefit black Brazilians were also introduced at public universities. These are now under attack by Bolsonaro. Public colleges and universities in Brazil are not only cost-free but also offer essential programs to the student body, including subsidized meals, housing, and employment opportunities for the most vulnerable student population. Under Bolsonaro and Weintraub’s new plan, the end of these programs and the possibility of charging tuition in the next years are on the horizon.

No Ideology Is Indestructible

The pension system reform and the proposal for transforming Brazilian higher education are two examples of the profound changes set in motion by the Bolsonaro administration. While the Brazilian welfare state project has been contradictory, its foundations have remained in place until now. Neither the pension system reform nor the plans for higher education would have moved forward without relying on systematic misinformation, defamation of any opposing view, and “Red Scare” tactics.

Pushing capital’s agenda even further, Bolsonaro has recently announced a list of public entities that he plans to privatize. Highlights in the list include the postal service, some landmark parks, portions of wastewater and sewage systems, and sections of the prison system. Now that the pension system reform is approved, Guedes is planning the announcement of an administrative reform that will affect the civil service career, reduce state infrastructure, and change the distribution of state funds to flexibilize currently mandatory spending on services such as health care and education. A tax reform is also on the way, and chances are slim it will alleviate the burden on the lowest strata.

Bolsonaro’s obscurantist discourse and the nonsense rants that he usually displays are nonetheless more than just a smoke screen preventing us from seeing what is at stake. When he spreads fake news or questions the credibility of any news outlet that criticizes him, for example, it results in further isolation, individualistic perspectives, and the destruction of any middle ground for collective conversations, instrumentally pushing the country away from protection of citizens’ well-being and toward neoliberal solutions. While political organizing is still going on across the country, the consolidated opposition bloc against Bolsonaro, made up by progressive political parties, social movements, and some intellectuals has struggled to expand its ranks, let alone converge toward an alternative.

Luckily, no ideology is indestructible. Bolsonaro’s lousy explanations for his polemic decisions and cries about an alleged witch hunt against him may be reaching an exhaustion point, given the decline of his approval rates and some criticism by important members of the coalition who supported his election. But there have not yet been clear signs of a turn in the tides in Brazil.

To counter his growing political isolation, Bolsonaro has left his old political party, the conservative Social Liberal Party (PSL), and announced the creation of a new one, Alliance for Brazil, with a platform heavily grounded in the “antiglobalist” discourse. The move is likely intended to invigorate his core political base — roughly one-third of the country — and prepare for reelection.

Given that he and his family are guiding the making of this new political party, it is clear that Bolsonaro wants to expand his influence in the country’s politics. However, his presidency thus far has not proven to stand for a project beyond him — so much so that other right-wing politicians, such as São Paulo governor João Doria and Rio de Janeiro governor Wilson Witzel, have indicated their desire to grab the presidency seat in 2022, provided that Brazil keeps its regular elections calendar. The effort to understand the two forces holding Bolsonaro in power — the market and conspiratorial anti-leftism — is essential to dissipate the superficial understanding that the current government is solely about promoting hate.

Bolsonaro and his crew should be defeated for the sake of minorities and the same common man and woman for whom he dishonestly claims to stand. But defeating Bolsonaro can’t be the finish line. In Brazil, the old project of aggressive neoliberalism has grown strong again. The opposition has to prepare for a marathon in order to stop the gutting of the country by Bolsonaro, his backers, and others like him. Otherwise, Brazil’s lasting hope for a better future will rest in the past.