The long discussed plans of the military to deprive the Brazilian President João Goulart of power were finally realized on 1 April 1964. The military justified this step with the argumentation, that Goulart was a populist. His policy was marked by hyperinflation and the polarization between the right and the left wings. The coup d'état was also necessary to fight the major enemy: the communism. The dictators of the military saw themselves as guarantors for a moral, political and economical reconstruction of Brazil and furthermore as an elitist leadership that connected military values with the strong belief in progress. In the following 21 years they established a new generation of regime-dependent technocrats and bureaucrats. The
preconditions for this progressive concept were lying within the fields of national security, elimination of political opposition and communist complots. Brazil found a reliable ally against the ‘communist threat’ in the USA.On 11 April 1964 Humberto de Alencar Castelo Branco was elected to become the first president of the military dictatorship that was going to last until 1985. This paper is supposed to give an overview about the economic model that the military pursued during their dictatorship. Among that it will show the rise and fall of this model and the consequences for the population.
Table of Contents
1. Introduction
2. Period of Reforms
3. Rise and fall of Economic Miracle
3.1 The Economic Miracle
3.2 Investment in huge Projects
4. The World Economy Crises
4.2 Oil Crises
4.3 Social Crises
4.4 Searching for Solutions
4.5 The End of the Economic Miracle - the End of the Military Dictatorship?
5. The Lost Decade
6. Back to Democracy
7. Conclusion
Objectives and Themes
This paper examines the economic model pursued by the Brazilian military regime between 1964 and 1985, analyzing the mechanisms of the so-called "economic miracle," the subsequent crises, and the long-term socio-economic consequences for the Brazilian population.
- The rise and implementation of an export-oriented, state-interventionist industrialization strategy.
- The role of foreign loans and large-scale infrastructure projects in shaping national development.
- The socio-economic impacts, including rising inequality and the exploitation of labor under a repressive political system.
- The transition from economic growth to the debt-ridden "lost decade" and the eventual return to democracy.
Excerpt from the Book
3.1 The Economic Miracle
During the incumbency of President Arthur da Costa e Silva the economic model seemed to achieve success. The inflation rate was under control. More foreign companies invested in Brazil because they trusted in stability of government. As a reaction of continuous civil commotions the government became political repressive. In 1969 Emílio Garrastazu Medici became the new President.
Between 1967 and 1974 Brazil had one of the highest growth rates in the world. In 1970 the economical growth rate climbed up to 8.3%, in 1973 it even reached 14.0%. Imports of machinery and consumer goods increased. Agricultural goods were still the major export goods and were sold for over 6 billion $. The process of industrialization proceeded fast and the world became witness to the so called ‘economic miracle’ or ‘milagre brasileiro‘, which was, on the one hand, based on a close collaboration of state, companies and foreign investors in over-dimensioned projects. On the other hand it was a result of strong state interventionism: dependent public and private companies were supported by cheap long-term credits, subsidies and orders from the state. Especially the telecommunication and agricultural sector as well as the chemical, steel and automobile industry benefited.
Only with the help of foreign exchange loans the government was able to finance these high cost. The economic policy became more expansive because of large orders, which boosted the growth rate immediately. But simultaneously the national debt increased from 5.2 billion $ in 1970 up to 49.9 billion $ in 1979. For the international banks the lending was risk free, because the government guaranteed repayment, even in the case of loans made to private companies.
Summary of Chapters
1. Introduction: Outlines the 1964 military coup against President João Goulart and establishes the regime's self-perception as a force for moral and economic reconstruction.
2. Period of Reforms: Details the government's economic plan aimed at rapid industrialization, modernization, and the fundamental constitutional changes used to centralize power.
3. Rise and fall of Economic Miracle: Analyzes the high growth rates achieved between 1967 and 1974 through foreign investment and infrastructure projects, while noting the reliance on political repression.
4. The World Economy Crises: Examines the impact of the 1970s oil shocks and rising debt, which revealed the structural weaknesses and social inequalities of the economic model.
5. The Lost Decade: Documents the economic collapse of the 1980s, characterized by hyperinflation, severe debt crises, and failed structural adjustment attempts.
6. Back to Democracy: Covers the transition period ending the military dictatorship and the dire socio-economic conditions inherited by the new civilian government in 1985.
7. Conclusion: Summarizes how the regime's economic strategy led to short-term industrial progress at the cost of long-term debt and social suffering.
Keywords
Brazil, Military Dictatorship, Economic Miracle, Milagre Brasileiro, Industrialization, Debt Crisis, Foreign Investment, Social Inequality, Import Substitution, Inflation, State Interventionism, Human Rights, Abertura, Democracy, 1980s
Frequently Asked Questions
What is the core subject of this paper?
The paper analyzes the economic policies and the overarching economic model implemented during Brazil's military dictatorship from 1964 to 1985.
What are the primary themes discussed?
Key themes include the "economic miracle," the reliance on foreign debt, the implementation of massive state-led infrastructure projects, and the severe socio-economic inequality resulting from these policies.
What is the main research objective?
The objective is to provide an overview of the economic rise and fall of the military regime and to illustrate the subsequent consequences for the Brazilian population.
Which scientific approach does the author use?
The author uses a historical-analytical approach, examining political and economic developments, constitutional changes, and statistical data regarding growth and debt.
What is covered in the main section of the paper?
The main section covers the "Period of Reforms," the peak and stagnation of the "economic miracle," the impact of global economic crises (like the oil shocks), and the transition into the "lost decade."
Which keywords best characterize this work?
Primary keywords include Brazilian military dictatorship, economic miracle, foreign debt, social inequality, and industrialization.
Why did the "economic miracle" ultimately fail?
It relied on unsustainable levels of foreign debt, over-dimensioned projects, and a model that excluded the majority of the population from the benefits of growth, leading to social unrest and lack of legitimacy.
What role did foreign companies play during this era?
Foreign companies were major contributors to the industrialization process, benefiting from state subsidies, a suppressed labor force, and a protected market, particularly in sectors like automotive and chemicals.
- Quote paper
- Jana Andreas (Author), 2007, The Economic Model of Brazil during the Military Dictatorship, Munich, GRIN Verlag, https://www.grin.com/document/70561
