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FUTURE SCENARIOS FOR BRAZIL

Fernando Alcoforado *

In order to construct the future scenarios for Brazil, it is necessary to evaluate the

evolution trends of: 1) the Brazilian political-institutional system; 2) the Brazilian

public administration system; 3) the Brazilian economic system; 4) the world capitalist

system; and, 5) the Brazilian social system. For each of these systems, conservative

reference scenarios should be considered, which include maintaining the "status quo"

and alternative scenarios that contemplate the change for the better in relation to the

current situation.

Scenarios of Brazilian political-institutional system

Brazil is facing the present moment with a deep political crisis that has already launched

the country in the chaos of total ungovernability and violence and threatens to generate

political and institutional backtracking to maintain order. The political crisis in Brazil

results from the failure of the political model approved in the 1988 Constituent

Assembly, which Is configured by the fact that current presidentialism has totally failed

and generates political and institutional crises, that the country's political system is

contaminated by corruption, representative democracy in Brazil manifest clear signs of

exhaustion not only by the scandals of corruption in the powers of the Republic but,

above all, by discouraging popular participation in government decisions, reducing

political activity to mere electoral processes that repeat periodically in which the people

elects its representatives who, with a few exceptions, after the elections, defend interests

of economic groups against the interests of those who elected them.

The reference scenario for the country's political-institutional system would mean

maintaining the current model that would result in the establishment of a growing

divorce between the Brazilian State and Civil Society, putting in check governance in

Brazil. The deterioration of the country's economic system with the consequent

bankruptcy of companies, growing unemployment and the fall in government revenue

that makes it impossible to meet social demands can lead the country to an

unprecedented social upheaval. The alternative scenario is one that contemplates the

realization of changes in the political-institutional system of the country that should

occur with the celebration of new social contract in Brazil with the convening of a new

National Constituent Assembly to reorder the national life in new bases. The new

Constituent Assembly would decide on the implementation of a new political system in

Brazil that would consider replacement of the present impracticable presidentialism by

parliamentarism, replacement of the bicameral regime by unicameral with the end of the

Senate, reducing the number of parliamentarians and parties, institutionalizing social

control of those elected by the people who should have the tools to initiate processes for

the disqualification of mandates when there is a lack of electoral campaign promises by

the candidates and the participation of the population in government decisions through

plebiscite and / or referendum, among other measures. After the Constituent Assembly,

general elections would be held throughout Brazil based on the new constitutional

order.

Scenarios of the Brazilian public administration system

The management crisis in Brazil results from the bankruptcy of the existing public

administration model in Brazil. The bankruptcy of the public administration model in

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Brazil is due to the fact that the Brazilian State is inefficient and ineffective due, among

other factors, to the lack of integration of federal, state and municipal governments in

the promotion of national, regional and local development. This is one of the main

causes of the administrative disruption of the public sector in Brazil, generating waste,

delays in the execution of works and unbridled corruption. The lack of integration of the

various instances of the Brazilian State is therefore total, causing the action of the public

power to become chaotic as a whole, thus generating diseconomies of all order.

The reference scenario for the country's public administration system would mean

maintaining the current inefficient and ineffective management model. The alternative

scenario is one that contemplates the realization of changes in the public administration

system of the country that would imply in carrying out the reform of the State and of the

Public Administration in order that the Brazilian State efficiently and effectively carry

out its constitutional attributions and reduce its costs to minimize the tax burden on

taxpayers. Only then will it be possible to correct the current distortions in order to

eliminate waste and reduce public expenditures to reduce the tax burden for companies

and workers. The future capacity of the Brazilian State to invest in the expansion of the

economy and to execute programs in the social area depends to a great extent on the

administrative restructuring that is processed in it. Much of the inefficiency and

ineffectively of the state in Brazil results from the lack of integration of the federal, state

and municipal governments in the promotion of national development. Associated with

this fact is the existence of inadequate organizational structures at each federal, state and

municipal level that make the integrative effort in these instances of government

unfeasible. The reform of the State and the public administration of Brazil would be one

of the tasks of the new National Constituent Assembly.

Scenarios of the Brazilian economic system

The gigantic economic crisis that confronts Brazil at the moment results from the

bankruptcy of the neoliberal and antinational economic model. This model failed in

Brazil after provoking a real devastation in the Brazilian economy from 1990 to 2014,

characterized by poor economic growth, uncontrolled inflation, bottlenecks in economic

and social infrastructure, the deindustrialization of the Brazilian economy, the explosion

of public debt and in the denationalization of the Brazilian economy. In an attempt to

overcome the economic crisis, the Michel Temer government decided to adopt an

economic policy that is translating into deepening the recession of the economy,

increasing the public debt, the imbalance of the external accounts, the generalized

breakdown of companies and also mass unemployment.

The reference scenario for the Brazilian economic system would mean maintaining the

neoliberal model that would lead Brazil to economic bankruptcy, a major political crisis

and social upheaval. The alternative scenario is the one that considers the realization of

changes in the economic system contemplating the abandonment of the neoliberal

economic model and the adoption of the national developmental model in which the

Brazilian State would play an active role elaborating economic plans that contribute to

the retaking of the development of Brazil with the adoption of immediate measures that

lead, on the one hand, to the increase of the public collection with: 1) taxation of large

fortunes with assets over R$ 1 billion that could yield approximately R$ 100 billion per

year; and (2) an increase in the tax on banks and, on the other hand, a decrease in

government expenditures with: 1) a drastic reduction in the number of ministries and

public agencies and expenditures at all levels of government; and (2) a drastic reduction

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of the basic interest rate of the economy (Selic) in order to reduce the size of public debt

and the burden of paying interest and amortization public debt.

To encourage private investment, the Brazilian government needs to: 1) promote the use

of idle capacity / expansion of productive activity in the primary, secondary and tertiary

sectors; 2) promote a program of investment in economic and social infrastructure (R$ 2

trillion) to reduce, above all, the cost of energy and transport logistics; 3) promote a

broad export program, especially agribusiness and the mineral sector; 4) drastically

reduce bank interest rates to encourage household consumption and investment by

companies; 5) reduce the tax burden by reducing the burden of paying interest and

amortization public debt and rationalizing the government's administrative structure; 6)

reduce the cost of energy and transportation with the improvement of economic

infrastructure; and, 7) implement the fixed exchange rate to replace the floating

exchange rate to encourage exports. In addition, the Brazilian government should adopt

measures to reduce Brazil's external vulnerability with capital controls that must be

carried out with the taxation on the inflow of foreign capital requiring that a certain

percentage of the foreign investment be retained in reserve for a certain number of days

together to limit the volatility of capital flows.

Scenarios of the world capitalist system

The arrival of Donald Trump to the White House can bring about significant changes in

the future of the United States and the world. Faced with Trump's inaugural speech and

campaign pledges, the following global economic scenarios can be seen: (1)

advancement of protectionism in the United States and, as a counterpart, in the world;

2) an end to the globalization of the productive system and of free trade; and, 3)

deterioration of economic relations between the United States and China.

The scenario 1 of advancement of protectionism in the United States to be adopted by

the Trump government with the objective of defending American businesses and jobs

will cause the same to occur in the world as a counterpart. This means that scenario 2 of

the end of the globalization of the productive system will be materialized with the end

of free trade which will prevent American companies from setting themselves up in

countries where they earn more profits. Scenario 3 of deteriorating economic relations

with China lies in the fact that this country is accused by Trump of "stealing" companies

and jobs from the United States.

The protectionism to be adopted by the Trump government to protect American

companies can be problematic for the penetration of exports from Brazil to the United

States. The end of the globalization of the productive system and of the free trade may

also be an obstacle for Brazil to attract foreign direct investment from the United States.

The deterioration of the United States' relations with China can affect the growth of this

country with serious consequences for the world economy.

The reference scenario of the world capitalist system is what means maintaining the

status quo while the alternative scenario is what will result from the measures taken by

the Trump government. Most likely, Brazil would be adversely affected by the

alternative scenario for the world capitalist system. Donald Trump's inaugural speech to

the United States presidency is the expression of the failure of neoliberal globalization

in the world. The facts of reality show that few are gaining from neoliberal

globalization, among which are the globalized financial system that gains astronomical

profits thanks to the absence of global economic and financial regulation, multinational

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corporations and few peripheral countries such as China, India , South Korea and other

Asian countries that are able to attract foreign investment thanks to cheap labor and

favorable domestic legislation. On the other hand, they lose the central capitalist

countries (the United States, the European Union and Japan) and other peripheral

countries, such as Brazil, which face problems of deindustrialization, rising

unemployment, economic stagnation and growing public indebtedness. Given these

circumstances, Brazil should adopt a national development model with limited insertion

in the world economy privileging the domestic market.

Scenarios of the Brazilian social system

The scenarios of Brazil's social system depend on the reference or alternative scenarios

of the political-institutional, public administration and economic systems of the country

and the world capitalist system. The combination of these scenarios may result in

scenarios of the social system that contribute to social peace, social retreat, or social

revolution. These resulting scenarios will depend on the ability of social movements to

achieve the desired outcomes.

Conclusions

Brazil is living decisive moments in its history. It is necessary to change the failed

political-institutional system, the inefficient and in ineffective system of public

administration and the failed neoliberal economic system to promote Brazil's journey

towards economic and social progress. The future of Brazil is in the hands of the

Brazilian people.

* Fernando Alcoforado, member of the Bahia Academy of Education, engineer and doctor of Territorial

Planning and Regional Development from the University of Barcelona, a university professor and

consultant in strategic planning, business planning, regional planning and planning of energy systems, is

the author of Globalização (Editora Nobel, São Paulo, 1997), De Collor a FHC- O Brasil e a Nova

(Des)ordem Mundial (Editora Nobel, São Paulo, 1998), Um Projeto para o Brasil (Editora Nobel, São

Paulo, 2000), Os condicionantes do desenvolvimento do Estado da Bahia (Tese de doutorado.

Universidade de Barcelona, http://www.tesisenred.net/handle/10803/1944, 2003), Globalização e

Desenvolvimento (Editora Nobel, São Paulo, 2006), Bahia- Desenvolvimento do Século XVI ao Século XX

e Objetivos Estratégicos na Era Contemporânea (EGBA, Salvador, 2008), The Necessary Conditions of

the Economic and Social Development-The Case of the State of Bahia (VDM Verlag Dr. Muller

Aktiengesellschaft & Co. KG, Saarbrücken, Germany, 2010), Aquecimento Global e Catástrofe

Planetária (P&A Gráfica e Editora, Salvador, 2010), Amazônia Sustentável- Para o progresso do Brasil e

combate ao aquecimento global (Viena- Editora e Gráfica, Santa Cruz do Rio Pardo, São Paulo, 2011),

Os Fatores Condicionantes do Desenvolvimento Econômico e Social (Editora CRV, Curitiba, 2012),

Energia no Mundo e no Brasil- Energia e Mudança Climática Catastrófica no Século XXI (Editora CRV,

Curitiba, 2015) and As Grandes Revoluções Científicas, Econômicas e Sociais que Mudaram o Mundo

(Editora CRV, Curitiba, 2016) .