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IB HL History Mr. Blackmon

Essay Modeling Worksheet Perón / Vargas 2005

Perón

34 Explain the rise and fall of Juan Perón and evaluate his impact on Argentina. (1987)

90 Who supported and who opposed Juan Perón in Argentina between 1943 and 1955? (HL)(1990)

201 What were the causes and characteristics of Peronism? (HL) (1995)

309 Why did Juan Perón become the dominant figure in the history of Argentina from 1955 to1971? (HL) (November 1999)

Perón or Vargas

385 In what ways, and with what results, did either Per6n or Vargas pursue populistpolicies? (HL) (2002)

410 In what ways, and to what extent, were the policies of either Vargas or Perónsuccessful in achieving their aims? . (HL) (2003)

433 Compare and contrast the ways in which Vargas and Perón maintained themselves inpower. (HL) (2004)

General

260 Compare and contrast the programs of two Latin American leaders in the first halfof the twentieth century and assess their successes and failures. (HL) (1998)

285 “Latin American politics depended much more on personalities than on ideologies in thetwentieth century.” Referring to at least two countries in the region show how far youagree with this statement. (HL) (1999)

335 Analyze the policies of one populist leader in Latin America in the first half of thetwentieth century and assess their effectiveness. (HL) (2000)

361 Assess the domestic (internal) program and policies of one populist leader of LatinAmerica in the period 1900 to 1955. (HL) (2001)

178 What were the basic economic problems of TWO Latin American countries in the firsthalf of the twentieth century and how did they attempt to solve them? (HL) (1994)



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238 Discuss the advantages and disadvantages of foreign investment in TWO Latin Americancountries of the period 1900-1950. (HL) (1997)

Question of the Day # 1

I. The QuestionA. In what ways, and with what results, did either Perón or Vargas pursue

populist policies? (HL) (2002) II. Key Terms

A. What waysB. What resultsC. EitherD. Populist policies

III. DefinitionA. Definition of a Populist regime according to Guillermo O’Donnell: “While there

is considerable variation in the degree to which these systems are competitive anddemocratic, they are clearly ‘incorporating.’ They are based on a multi-classcoalition of urban-industrial interests, including industrial elites and the urbanpopular sector. Economic nationalism is a common feature of such systems. Thestate promotes the initial phase of industrialization oriented around consumergoods. It does so both directly through support for domestic industry, andindirectly through encouraging the expansion of the domestic market forconsumer goods by increasing the income of the popular sector.” (Collier “B-AModel” 24)

B. (From Lambert) Parties of the Populist Type 1. “Since about 1930, . . . parties running on reform platforms but

opportunistic in their actual policy have been in the lead. They tend torally a heterogeneous backing around a prominent figure who has acquiredthe reputation of defending the underdog but whose only ideology isnationalism. . . . .Such parties, bearing the strong personal mark of apolitical figure, are called populist parties.

2. “The forerunner of this type of movement was Hipólito Irigoyen, whoassumed power in Argentina in 1916 with the Radical Civic Union. . . .Irigoyen then renamed his party . . . Union Cívica Radical Personalista. Irigoyen’s regime was characterized by a strong reaction against thecosmopolitan outlook of the Argentine oligarchic regime, which had givenfree rein to foreign, especially English, concerns. His Argentinenationalism manifested itself first by his neutrality in World War I. Another trait of the regime–a basic feature of populism–was ostentatious



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sympathy for the little man and a show of contempt for the wealthy and thepowerful. . . . After Irigoyen, the Radical Civic Union became a middle-class party and the Peronists became demagogic populists in their place.”(204-205

3. “Like Irigoyen in 1916, Vargas in 1930 found a country dominated by theoligarchy, and, also like Irigoyen, he appealed to nationalism andpresented himself as the advocate of the little man.” (205)

C. Economic Role of Populist Regimes1. “Their most earnest and systematic efforts have been aimed at economic

emancipation by means of industrialization. . . . The oligarchic regime hadbeen cosmopolitan in its outlook, since the economic interests of the rulingclass depended entirely on the exportation of agricultural products, and itsculture was that of the European capitals. The populists governmentswished to alienate neither th entrepreneurs nor the workers, and especiallynot the middle classes and the military. Nationalism was the one theme onwhich all of them could agree. At that point in Latin America’s foreignrelations, nationalism, which primarily economic, meant above allindustrialization and nationalization of the large foreign enterprises. Although this economic nationalism often inspired measures of demagogicrather than economic value, populist governments undoubtedly started theera of economic development. . . . . The populist regimes broadened theLatin American body politic.” (207)

D. Political and Social Role of the Populist Regimes1. “”The lack of any economic experience, particularly among military

dictatorships of populist inspiration, rendered the best meant programsutterly ineffectual. . . . For instance, any social policy dictated byopportunism consisted first in courting supporters by multiplying jobopenings, particularly in occupations most easily controlled by the partyand the government: civil service, public utilities, nationalized industries. .. . In order to bring about and justify the proliferation of posts and showtheir social usefulness, the populist governments have given in to thetemptation to orient labor legislation in a direction that slows productivity.. . . In order to maintain their popularity among workers and civil servants,the governments have raised the minimum wages excessively, the resultbeing almost invariably an inflation that has cancelled the raise. Theseregimes have promoted social progress through featherbedding rather thanthrough higher productivity and salaries. Even though party supportershave been disappointed by the stagnation and in some case thedeterioration in living standards, the populist regimes have lost none oftheir popularity. The people’s protectors had given evidence of their good



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intentions, and they can always blame any failures on mysterious plots ofpolitical foes and the evil scheming of international capitalism and theUnited States government.” (208)

2. “The greatest harm done by the populist regimes throughout LatinAmerica has been to widen the chasm between a chiefly urban advancedsociety and a chiefly rural archaic one by carrying out reforms in only asegment of each nation. Government by the upper class had preservedarchaic feudal structures in the rural areas until the end of the first third ofthe twentieth century. The populist leader who have followed theoligarchy have paid no attention whatsoever to rural society and have leftits feudal structure untouched, while their reforms have hastened changesin the advanced urban society, thus broadening the gap between the twosocieties instead of narrowing it.” (209)

IV. The Thesis [Class Exercise]V. The Context

A. Vargas1. “Economic Context of the 1920’s

a. The 1840 to 1930 period also saw an appreciable but irregularexpansion of light industries, notably textiles, clothing, foodproducts, beverages, and tobacco. . . .However, the manufacturinggrowth of the period did not generate significant structuraltransformations.

b. Economic growth in the nineteenth century was not shared equallyby the regions. Development and growth were concentrated in theSoutheast. The South Region also achieved considerabledevelopment based on coffee and other agricultural products. TheAmazon Basin experienced a meteoric rise and fall of incomesfrom rubber exports. The Northeast continued to stagnate, with itspopulation living close to the subsistence level.

c. Throughout the years between 1889 and 1930 the center of theBrazilian economy moved south and southwest due to the march ofcoffee, as planters found it cheaper to break new ground than torecycle the plantation soils whose yields were decreasing. . . . TheBrazilian economy grew considerably in the second half of thenineteenth century. Coffee was the mainstay of the economy,accounting for 63 percent of the country’s exports in 1891.However, sugar, cotton, tobacco, cocoa, and, at the turn of thecentury, rubber were also important. During the first three decadesof the twentieth century, the Brazilian economy went throughperiods of growth but also difficulties caused in part by World War



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I, the Great Depression, and an increasing trend toward coffeeoverproduction. The four-year gap between the time a coffee tree isplanted and the time of the first harvest magnified cyclicalfluctuations in coffee prices, which in turn led to the increasing useof government price supports during periods of excess production.The price supports induced an exaggerated expansion of coffeecultivation in São Paulo, culminating in the huge overproduction ofthe early 1930’s.

2. Social Context of the 1920’s a. Economic development in the late nineteenth century had created

an urban proletariat in three or four major cities. . . . By 1921 theorganized urban movement was in ruins. . . . Brazilian workers hadfar fewer organizing rights and welfare provisions than othersworkers in Latin America. One reason was the continuous laborsurplus in Brazil, especially in unskilled and semiskilled labor. Asanarchist and anarcho-syndicalist organizations declined due torepression, they were often replaced by communists, whoseBrazilian party was founded in 1922. The communist presencefurnished a new target for civil and military authoritarians, and by1930 urban labor, although steadily increasing in economicimportance, had no mainstream political representation.

b. The late nineteenth and early twentieth centuries also sawEuropean, Japanese, Syrian, and Lebanese immigration. MostEuropeans, approximately a third of the total, came from Italy.First the state of São Paulo and then the national governmentinitiated programs that attracted millions of European immigrants,especially during the last quarter of the nineteenth century.However, the relative size of the immigrant population neverreached the same levels as in Argentina. After 1900 immigrationgradually declined. The long-term effect of this wave Europeannewcomers was, ironically enough, not beneficial to the economy:albeit ample labor was available in the center of the country and inthe Northeast, where the number of jobs had fallendisproportionately behind the increase in workers, the Braziliangovernment paid for the transatlantic passage of millions ofEuropeans because the prophets of progress presumed that due totheir racial superiority they would be better workers and futurecitizens. [This attitude is linked to their support for the end ofslavery in the late 19th century as well] In the meantime, Braziliansfrom Minas Gerais, Rio de Janeiro, and the Northeast could not



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afford to pay their way South to fill in the labor demand. The jobsheld by transplanted Japanese, Syrians, and Europeans could havebeen held by a Brazilian from an economically moribund region,which in the long run would have boded better for the nationaleconomy.

c. Brazil remained an elitist society much like the rest of LatinAmerica, with the traditional oligarchy and burgeoning peasantry.Substantial social change would arrive in the wake of the SecondWorld War: the large-scale expansion of the industrial sector dueto the reduced supply of foreign manufactured goods, as well as theintroduction of heavy industries like steel and automobileproduction eventually created an industrial and technocrat elite andsped up the rate of urbanization, which nonetheless lagged behindthe rest of Latin America.

3. Political Context of the 1920’sa. The 1920’s were the last decade of the Old Republic (1889-1930).

The first civilian president, Prudente de Morais, had gainedstability for his regime at the expense of recognizing thelegitimacy of the entrenched oligarchy in each state. Theconstitutional decentralization created by the First Republicallowed several states with dynamic economies, especially SãoPaulo, to gain self-sufficiency and autonomy over their owndevelopment.

b. Starting with the presidency of Hermes da Fonseca (1910-14), the“politics of the governors” is challenged by bitter battles within thepolitical elite in many of the smaller states. The lines of conflictoften followed prerepublican patterns of family and classstruggles. . . . The system continued to function, at least formally,until October 1930: the official presidential nominees, endorsed bytheir predecessors, were invariably elected, and the federalCongress remained under the control of the state machines.

c. But by the 1920's the political structure of the Old Republic hadbecome targets of criticism from various factions. (1) Amongst these was a new generation of the elite, most of

whom were educated as lawyers, who denounced as corruptthe way politicians were running the republic and accusedthe republican founders of imposing a liberalism for whichthe country was unprepared. They advocated a carefulanalysis of where Brazil stood economically, politically,socially, and intellectually.



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(2) [The Tenente Movement] Aside from these intellectuals,there was also discontent amongst the younger armyofficers. There was a series of barracks revolts in 1922 and1924 led by tenentes. The rebel officers in the 1924 revoltfled into the interior and held out for two and a half years asguerrillas. Their political program advocated fair electionsand honest government, along with attention to the nation’ssocial needs; it also focused on professional militaryconcerns—anachronistic training, poor prospects forpromotion, and indifference from civilian government.[they were led by Luíz Carlos Prestes, who later convertedto Marxism and led the Brazilian Communist Party]

(3) A third faction was the Democratic Party, founded in SãoPaulo in 1926. This current of democratic liberalism asdefined in the European classical sense represented theurban professionals and wanted what the Europeanbourgeoisie had achieved in the nineteenth century:political power through an electoral system that gave thema major role in government. “ (Palomo)

d. Liberal Alliance formed around Minas Gerais and Rio Grande doSul, naming Getúlio Vargas as candidate for president(1) They represented the aspirations of regional elites outside

of the “coffee triangle.” (2) A quarrel between the Paulistas and Minas Gerais provided

the wedge to fuse these disgruntled regional elites with oneof the coffee states.

(3) It represented a demand for purification of the electoralsystem and weakening of rural clientalist structures (bothideas which appealed to the urban population)

(4) Platform was (a) Defense of personal freedom(b) Amnesty (for the tenentes)(c) political reform

(5) Vargas did not expect to win due to election fraud(6) During the campaign, the Great Depression struck

4. The Great Depressiona. Market for coffee collapses

(1) “Coffee prices plummeted from 22.5 cents a pound in 1929to 8 cents in 1931. IN the 1920's, Brazil shipped 805.8million pounds of coffee abroad, in the 1930's, only 337



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million pounds were sold. By 1930, Sao Paulo’swarehouses groaned under the weight of 26 million bags ofcoffee beans--more than the world consumed in an entireyear.” (Burns)

b. Huge drop in foreign earningsc. The coffee planters had already begun to rely on state subsidized

profits for coffee.d. Guaranteed profits led them to expand production by taking out

high interest loanse. The Depression caused a sharp drop in world coffee consumption.f. The collapse of prices could not therefore be made up from

increased sales.g. President Washington Luis held to “hard money” policies, to

maintain the convertibility of the mil reis into gold.h. The result of this is rapid exhaustion of gold reservesi. Government should have suspended convertibility

(1) Luis is influenced by his desire to satisfy foreign creditorsin an economy traditionally dependent upon exports

(2) Luis’ policies have no support from any segment ofBrazilian society

5. Military coup of 1930a. Getúlio Vargas put into power by the military

(1) The heart of the coup were young members of the LiberalAlliance and the tenentes., who although they had beendefeated in the 1920's, retained quite a lot of prestige withinthe military

(2) This is not a revolution(3) Vargas named provisional president.(4) There was no legislature, so Vargas could rule by decree.(5) Vargas had no clear cut ideology; he tends to be

opportunistic(6) There is a change in who holds power, however. From

here on, the traditional oligarches will be replaced bymilitary men, technocrats, young politicians andindustrialists

b. “A new type of state was born after 1930. It differed from theoligarchical state not only owing to its centralization and its greaterdegree of autonomy, but also because of other factors: (1)economic policy slowly turned toward the promotion ofindustrialization; (2) social policy tended to provide some sort of



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protection for urban workers, who were soon gathered into aworking-class alliance supported by the state; (3) the armed forces,in particular the army, were given a central role in support of thecreation of an industrial base and in maintaining internal order.”(Fausto 196)(1) Please note that the military, in Brazil and in Argentina,

saw itself as a truly national institution and a modernizinginstitution. Their promotion on the basis of merit andhigher educational standards contrasted sharply with thecivilian government they would replace.

B. Perón1. Economic Context

a. The Great Depression: Argentina’s export earnings fell 34% in1932, aggregate output fell 14% between 1929 and 1932, andimmigration ceased. (Rock 220) (1) Nevertheless, Argentina was not hit as badly as many other

Latin American countries. b. Gen. Agustin Justo’s initial response was quite orthodox: cut

public spending, devalue the peso (1933) to ease pressure onforeign debt payments; increase tariffs to reduce imports, exchangecontrols.

c. Loss of income from imports meant a fiscal revolution wasnecessary: Justo passed an income tax. Justo then seeks pricesupports for farmers (a policy similar to Brazil and the U.S.)

d. “Supports were administered by regulatory boards (juntas), whichwere created for grains, meat, cotton, wines, milk and other goods. Throughout the 1930s these boards performed like theircounterparts in such countries as Brazil and the United States:financing production, purchasing surpluses, and seeking topromote price stability.” (Rock 223)

e. Finance Minister Federico Pinedo establishes a Central Bank in1934, which pursued “quasi-Keynesian functions” and controlledthe money supply by buying and selling securities, rediscounting,and changing the reserve requirements. (Rock 223)

f. Roca-Runciman Agreement 1932: Great Britain, responding tothe crisis and pressure from the Empire, agrees to give preferenceto the Commonwealth in trading. This threatened Argentineexports to Great Britain. Roca-Runciman protected the level ofArgentine beef exports to Great Britain, but on terms that gavemost advantages to the British with preferential treatment in other



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areas. Roca-Runciman thus became very unpopular withnationalists.

g. World War II(1) The war led to the disruption of normal trading patterns–the

continent was cut off by blockade, and the Britishredirected all resources into the war effort rather than trade.

(2) This led to Import-Substituting Industrialization. ISIattempts to promote the growth of consumer industry toreplace manufactured products previously imported fromabroad, such as textiles.

(3) Typically, this involves higher import tariffs to protect localindustry, direct investment in companies, governmentcompanies, and favoritism to local companies.. (54)

(4) Among ISI’s weaknesses is the fact that the machineryneeded to produce the consumer goods must still beimported (thus altering but not eliminating the dependency)and the fact that consumer demand will eventually hit alimit unless a more general prosperity increases the buyingpower of the bulk of the population

2. Social Contexta. Gradually, the working class in Buenos Aires changed into one

that was primarily native Argentine, literate, and mobile. Theirsense of class consciousness rose greatly. These worker felt shutout from the political system that existed since all parties,including the Radicals and even the Socialists, were geared towardan electorate created by Sáenz-Peña, where half the adultpopulation could not vote.

b. Therefore, none of the parties had a legitimate working class base.c. Juan Domingo Perón changes that. A member of GOU, he

becomes Secretary of Labor in 1943, from which position hesought a base of popular support among the working classes.

d. He is assisted in this effort by his mistress, later wife, Eva DuartePerón Working as a radio commentator, she publicized Perón’sreforms.

e. ‘Collective bargaining was carried out under Perón’s auspices. Wage demands were satisfied, and workers were kept on the job. Should a union choose to take matters into its own hands, picketlines were dispersed and workers replaced. For this sacrifice ofindependence, unions won wage and salary increases in virtuallyall segments of the economy, including white-collar, agricultural,



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and maritime. Perón’s most dramatic device was the ‘thirteenthmonth’ of wages, a Christmas bonus.” (Adams)

f. Both his supporters and her audience saved Perón’s career whenopponents made their move in 1945. On October 10, amidincreasing demands for a return to civilian government--and evencalls for Perón to be executed--Perón was forced to step down fromall three of the posts he had acquired or created. He was ministerof war, secretary of labor and social welfare, and vice president. Perón?s power, it was clear to many, far outstripped that of thepresident, his benefactor, who was indecisive and politically weaknext to this master puppeteer of the masses. On the night ofOctober 11, with his enemies calling for his head either figurativelyor literally, Perón resigned. He did so, however, on a nationalradio hookup orchestrated by Eva”. (Adams)

g. Eva organized massive street demonstrations while Perón wasimprisoned. When newspapers called the demonstrators,descamisados, Perón embraced the term.

h. The demonstrations reach such proportions that the governmentcaved in and released Perón, restoring him to his offices.

i. The stage was set for Perón’s election as President in 19463. Political Context

a. Traditional oligarchical control(1) Dominant liberal politicians drawn from the landowning

class, and monopolized instruments of power, including thearmy and elections (via vote fraud), Controlled only party,Partido Autonomista Nacional) PAN Key decisions madeby informal agreement, or acuerdo.

(2) Dominant liberal politicians drawn from the landowningclass, and monopolized instruments of power, including thearmy and elections (via vote fraud), Controlled only party,Partido Autonomista Nacional) PAN Key decisions madeby informal agreement, or acuerdo.

(3) Sáenz Peña Law extended vote to middle classes, leadingto Hippolito Yrigoyen’s election as President in 1916.

(4) The Socialists push political action in the 1920s, theCommunists the labor movement, but the decade is notsuccessful for either.

(5) Electorate enlarged again, including all 18 year old males. Increased political participation made parties moreimportant, whose vehicle is the Congress. Reforms help



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the middle-classes since few immigrants becamenaturalized.

(6) The Radicals employ machine politics to dominant thecountry; Conservatives are disillusioned at limiteddemocracy.

(7) Yrigoyen is overthrown by the military, who are not,however, united. Gen. Agustin Justo led a faction thatwanted to return to pre-Sáenz Peña oligarchy; Gen. JoséUriburu led a faction that “wanted a hierarchical orderbased on social function . . . . Uriburu envisioned a‘functional democracy’ where the elected legislators wouldrepresent functional (or ‘corporate’) interests, such asranchers, workers, merchants, and industrialists.” (84-85)This “corporatist model” is heavily influenced byMussolini.

(8) Justo emerged as a winner in 1932, and sought “to form abroad, national government that would give him theauthority to respond to the socioeconomic effect of theworld depression.” (85)

(9) He fails because (1) the working class made continuousdemands through strikes and (2) political professionalsremained committed to partisan interests.

(10) An example was his successor, Roberto Ortiz, whostopped vote fraud and thereby allowed the Radicals to gaincontrol of Congress in 1937. Ortiz’ successor, however,Ramón Castillo, a conservative, returned to vote fraud, butonly convinced everyone that the government wasillegitimate.

(11) Dissident officers form the Grupo Obra de Unificación, orGOU. They seize power in 1942, claiming populardemand.

(12) They dissolve Congress in 1943 and all political parties by1944.

VI. Political PoliciesA. Vargas

1. Constitutional Rule 1930-1937a. Vargas replaced the governors of 19 of 20 states with his own men,

called “interventors”b. Many were former tenentes



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c. The Interventors Code restricted state power(1) States could not contract a foreign loan without federal

permission(2) States could not spend more than 10 % of their budget on

state police(3) State police could not be armed with heavy weapons

d. This is a blow to the local oligarchies which had generally runBrazil

e. The Electoral Code of 1932 provided for mandatory voting, secretballot, and suffrage for working women (illiterates, who were stilla majority of the population, could not vote)

f. The press was strictly censored by the DIPg. Separatism: The São Paulo War

(1) The Vargas interventor in São Paulo, João Alberto, tenente, alienated the Paulista elites (by advocating a 5% payincrease for workers), leading to armed rebellion.

(2) Their defeat in 1932 helps discredit separatismh. The Constitution of 1934

(1) More centrist but not radically different from previousConstitution

(2) Provisions were included for the nationalization of mines,mineral deposits and waterfalls.

(3) Labor provisions(a) Different pay for the same work (whether for age,

sex, nationality, or marital status) was prohibited(b) Minimum wage(c) Regulations on children’s and women’s labor(d) Weekly days off(e) Paid vacations(f) Compensation for unjust firing

(4) Family, Education and Culture(a) Free primary education(b) Compulsory attendance(c) Religious education would be elective and open to

all religions.(5) National Security

(a) A High Council on National Security created(b) Military service is made obligatory

(6) Vargas elected to a 4 year term



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2. Estado Novo (1937-1945)a. “Socioeconomically, the Estado Novo reflected an alliance

between the civilian and military bureaucracy and the industrialbourgeoisie. Their immediate common objective was to promoteBrazil’s industrialization without causing large social upheavals.”(Fausto 217)

b. Vargas “introduced, for the first time in Latin America, masspropaganda and indoctrination of the style recently invented byEuropean fascist states. . . . [T]hey aimed to create a central statepowerful enough to carry out integrating functions at which theoligarchical republic had so egregiously failed.” (Donghi 233)

c. The growth of (state censored) newspapers and of the radioindustry helped him communicate with the country and helpedgenerate a national consciousness.

d. The Depression highlighted Brazil’s economic vulnerability solong as the economy was dominated by a single product.(1) The solutions were

(a) Diversify the economy(b) Accelerate industrialization

(2) The two were complementary and would requiregovernment participation.

B. Perón1. Core supporters2. Perón begins by implementing corporatist principles.

a. The term “Justicialismo” is coined (1948) to describe Perón’sphilosophy.

b. The term comes from the words “justice” and “social” (Crassweller227) It was thought of as a philosophy harmonizing the claims ofthe individual with those of society and of spiritual values withmaterial values. (227)

c. It proved to be a very flexible concept3. Eva organizes the Partido Peronista Femenino (Women’s Peronist Party).

a. Women are given suffrage4. The crisis of 1949 not only brought stabilization but a toughening of

political control. The constitution was amended to allow him to be re-elected, and women were granted the vote. He is re-elected in 1951, withEvita mobilizing women for him. He becomes more authoritarian with theexpropriation of La Prensa.

VII. Economic Policies



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A. Vargas1. Constitutional Rule 1930-1937

a. Economic Centralizationb. Vargas did not abandon the coffee economyc. The National Department for Coffee (DNC) was createdd. The government bought part of the unsold coffee stocks with

money from export taxes and destroyed it in order to reduce supplyand help prices. (Note the similarity to part of FDRs AAA)

e. Between 1930 and 1944, Brazil destroyed the equivalent of threeyears of the world’s consumption of coffee.

f. He also sought bilateral agreements to sell coffee.g. Payments on foreign debts were suspended in 1931

2. Estado Novo 1937-1945a. Economic Nationalism: “The nationalists insisted that only

through economic development could Brazil become trulyindependent. . . . The nationalists realized that Brazil in fact stillretained its colonial status, that colonial economic institutions andpatterns survived. A rural oligarchy, in alliance with foreigncapital, perpetuated the mercantilist system, and the vestiges ofcolonialism arrested the nation?s development. Beginning in the1930?s, therefore, Brazilian nationalism, like that flourishing inthe rest of Latin America and in other underdeveloped areas,became increasingly characterized by resentment of foreign capitaland foreign personnel, suspicion of private enterprise, a growingpreference for state ownership, emphasis on industrialization,encouragement of domestic production, and a desire to create ornationalize certain key industries such as oil, steel, power, andtransportation.” (Burns, emphasis added)

b. Import Substituting Industrialization (ISI) program begun inearnest in 1937(1) The Great Depression stimulated industrialization in Brazil

because if she could not manufacture many consumerproducts herself, she would have to do without.

(2) World War II further strengthened this trend becausetraditional suppliers of consumer goods were devoting theirindustry to war time production.

(3) Methods used to foster ISI were “through exchangecontrols, import quotas, tax incentives, lowered duties onimported machinery and raw materials, and long-term loansat low interest rates. “ (Keen)



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(4) In 1940, the government produced a Five Year Plan toexpand heavy industry, generate hydroelectric power, andexpand the rail system.

(5) State sponsored companies(a) National Oil Company 1938(b) National Council of Hydraulic and Electrical

Energy 1939(c) National Steel Company 1941 to exploit the “iron

mountain” of Itabira (d) National Motor Company 1946

(6) Oil (and a look ahead to his second administration: “But thesymbol of economic nationalism, for Brazilians as well asfor all Latin Americans, was petroleum. The nationalistsbelieved that the discovery of oil was not onlyeconomically desirable but would guarantee Brazil?sachievement of world power status. At first, Vargasunderstood the importance of petroleum purely as aneconomic matter. He established the National PetroleumCouncil to coordinate and intensify the search for oil, andin 1939, the first successful well was drilled: oil gushedforth from the Brazilian soil. The nationalists-who wereunwilling to see the oil, or the profits from its exploitation,siphoned off to foreign countries-then called for thecreation of a national oil industry. Oil soon came todominate their thoughts, and in the words of onecontemporary nationalist, it became “the backbone ofnationalism.” In time, Vargas came to see the emotionalsignificance of oil to the nationalists, and he duly paidhomage to the symbol. “Whoever hands over thepetroleum to foreigners threatens our ownindependence,”he remarked.

(7) “During his second administration (1951-54), Vargasexploited that symbol in a bid for wider support. In 1951,he proposed the creation of Petrobras, a state monopoly onall activities connected with the exploration anddevelopment of petroleum resources. Its creation, in 1953,followed a national campaign in which the cry “O petroleoe nosso!”(“The Oil is Ours!”) echoed throughout the land. The establishment of Petrobas was a victory for thenationalists. They had triumphed over those who argued



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that it would be more economical for experienced foreigncompanies to drill for oil and pay Brazil a royalty onwhatever was pumped out. The nationalists would havenone of that argument. At any rate, the question was anemotional, not economic, one. In the words of onenationalist, “the Brazilian people . . . struggled for thecreation of a state monopoly because they believed that inthat struggle they were defending national sovereignty.” The confessed goal of Petrobas was to contribute to theeconomic independence of Brazil: Vargas’ own phrase was“to create national liberty.” The nationalists succeeded inconvincing the masses that a national oil industryrepresented sovereignty, independence, power, andwell-being. For the first time, they stirred up popularsupport for a nationalist cause. Petrobas remains the majorsingle permanent achievement of the nationalists. Theemotions aroused by its creation recall the dramaticnationalization of the oil industry in Mexico, in 1938.”(Burns)

(8) “During the years 1934-37, Brazil operated under a barteragreement with Germany. Locomotives, iron, coal, dyes,and chemicals were exchanged for Brazilian coffee, cotton,tobacco, and oils. By 1937 Germany was selling twice asmuch as Brazil as was Great Britain, half as much as theUnited States. After 1937 German trade fell off and theAmerican increased.” (Sherring)

c. Vargas aligned Brazil to gain maximum benefit from World War II3. The Estado Novo and World War II

a. “Vargas adroitly exploited Great Power rivalries to secure financialand technical assistance from the United States for the constructionof the huge state-owned integrated iron and steel plant at VoltaRedonda. U.S. companies and government agencies were notablycool to requests for aid for establishing heavy industry in LatinAmerica. But Vargas? hints that he might have to turn for help toGermany removed all obstacles. A series of loans from the ExportImport Bank made possible the completion of the Volta Redondaplant by 1946. By 1955 it was producing 646,000 tons of steel, amajor contribution to Brazil?s industrial growth. Volta Redondawas a great victory for the Vargas policies of economic nationalismand state intervention in economic life. In return for American



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assistance, Vargas allowed the United States to lease air bases innorthern Brazil even before it entered the war against the Axis. InAugust 1942, after German submarines had sunk a number ofBrazilian merchantmen, Brazil declared war on Germany and Italy. A Brazilian expeditionary force of some twenty-five thousand menparticipated in the Allied invasion of Italy in 1944 and sufferedrelatively heavy losses in the fighting.” (Keen)

b. At the Rio Conference in 1942, Brazil came out solidly on theAllied side (while Argentina still balked.

c. A Department of Coordination of Economic Mobilization wascreated in 1942 to run the economy.

d. During the war, there was major growth in textiles, chemicals, andpaper.

e. Brazil also exported foodstuffs

B. Perón1. State-directed Economic Policy: A Five Year Economic Plan is begun,

and he creates the Instituto Argentino de Promoción del Intercambio orIAPI, which is given a monopoly over the export of agricultural products.

2. IAPI bought agricultural products at low prices, then sold them abroad tofund industrialization. Perón begins to reduce foreign business interests,as promised, reorganizing the Central Bank, nationalizing the Britishowned railroads, nationalizing the telephones (from ITT) and Frenchowned docks. He paid off the entire national debt in 1947.

3. 1949 marks the beginning of crisis. Prices for Argentina’s exports drop,inflation increases sharply, and drought hurts the export sector. Prices forimports rose. IAPI’s policies had been intended to keep food prices in thecities low, but had also discouraged production. Perón responds byorthodox stabilization policies: “tight credit, reduced governmentexpenditures, and tough limits on wage and price increases.” (90)

VIII. Religious Policies A. VargasB. Perón

1. In the election of 1946, the Church supported Perón strongly. However,that changes after Evita’s death

2. “Perón struggled with the Catholic Church during his ruling. “During thelast year of the Perón regime there was virtually open warfare betweenChurch and state in Argentina” (Alexander 104).

3. On the one hand, the military leadership tended to be generally moreCatholic than the populace as a whole; thus many of the officers would be



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perturbed (if not resentful) at this conflict with the Argentine hierarchy andthe Vatican. On the other, a very loyal Perónista among the workers wasmuch more likely than an anti-Perónista to be a practicing RomanCatholic; thus the conflict with the Church in all likelihood sowedconfusion and divided loyalties among Perón’s civilian supporters”(Alexander 105).” (Giambanco)

4. 1954 (After Evita’s death, note!): Peronist radicals launch an anticlericalcrusade: “divorce is legalized and all parochial schools were placed underthe control of the ministry of education.” Anti-Church demonstrations areorganized and some cathedrals even burned.

5. This is a serious mistake–there is much too little to gain by attacking theChurch, and it helps form a rallying point for Perón’s enemies in themilitary.

6. The anticlerical crusade leads to a coup by the military in 1954: Perón isforced to resign and leave the country

7. Perón was gone but Peronismo was not defeated.IX. Social Policies

A. Vargas1. Constitutional Rule 1930-1937

a. Labor policy(1) Vargas is quite corporativist(2) “One of the more coherent aspects of the Vargas

administration was its labor policy. . . . Its main objectiveswere to repress efforts of the urban working class toorganize outside the aegis of the state and to incorporate theworking class into the government’s array of supporters.”(Fausto 200)

(3) The PCB (Brazilian Communist Party) was repressed.(4) Coopting the unions

(a) A Ministry of Labor, Industry and Commercewas created

(b) Bureaus of Reconciliation and Arbitration werecreated to mediate disputes between workers andemployers.

(c) Decrees defined unions as consultative bodieswhich worked with the bureaucracy.

(d) One trade union was given exclusive jurisdictionover its craft

(e) A representative from the Ministry of Labor had tobe present at all union meetings, and ministry



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recognition was necessary for the union to be legal.b. Support among Afro-Brazilians

(1) Afro-Brazilians, in response to Vargas’ pro-labor policiessupported him strongly.

(2) A national rights group, the Frente Negra Brasileira (FNB)is formed (a) It promoted education, vocational training, a credit

union, medical, dental, and legal assistance, and hada women’s section which strongly promoted therights of black women. (MacLachlan 95-96)`

(3) An example of a clever way to foster support and to controlthe message at the same time was his ability to cooptCarnival parades. Vargas offered float competition withprizes. The floats, however, had to have “acceptable”themes in order to win. Acceptable themes were to bebased on historical events or people (creation of a nationalconsciousness). “By including blacks in history, aspresented by approved floats, the regime required theequality of all regardless of class or color. Emotionalinclusion seemed an acceptable replacement for politics.”(MacLachlan 102-3)

c. Centralization in Education(1) One objective was to create a larger trained elite.

(a) 75% of Brazilians were illiterate (MacLachlan 101)(2) Generally supported the aims of the Brazilian Education

Association (ABE): the escolanovistas(a) decentralization(b) common curriculum from 1-8 grades(c) diversify programs above 8th grade(d) Federal, state, and local government pay a fixed

percentage of income for education (MacLachlan100-1)

(3) A Ministry of Education and Health created in 1930(a) 40,000 new primary schools were built

(MacLachlan 101)(4) The education system was authoritarian

(a) Philosophies taught were hierarchical values andCatholic conservatism

(5) Francisco Campos (Minister of Education from 1930-1932) instituted the Campos Reform which provided a



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sequenced curriculum and required both mandatoryattendance and a high school diploma to enter university

(6) New universities were founded to make them moderncenters of teaching and research(a) University of São Paulo 1934(b) University of the Federal District 1935

(7) Minister of War Eurico Dutra: “The principal objective ofeducation is to create a national consciousness,” (Burns)

2. Estado Novo 1937-1945a. The Labor Charter 1937 codified the labor provisions already in

placeb. Imposed a union tax to finance the union bossesc. Labor Court is establishedd. Broader legislation with Consolidation of Labor Lawse. Vargas used radio to portray himself as the father of the people

(“O Paizinho do Povo”) via his “Horo do Brazil”(1) He recognized the power of radio to span distance and

social class to help create a national consciousness. Representatives of DIP had visited Goebbels in Germanyand returned very impressed.

(2) One consequence of this extensive campaign is that,although Brazilians were receiving the political messageVargas wanted them to hear, they were for the first timebeing asked to think like a citizen

f. The Department of Press and Propaganda (DIP) censored thepress(1) “The Estado Novo persecuted, arrested, tortured, and forced

politicians and intellectuals into exile.” (Fausto 225)g. Administrative Department of Public Service reformed the

bureaucracy by making promotion based on merit.B. Perón

1. Corporativism: Perón’s central core was similar to Uriburu’s, except thatlabor is a full partner to the military and the industrial managers.

2. Strikes were encouraged, which Perón settled in workers’ favor; realwages rise sharply, labor’s share of national wealth goes up 25%, and thestandard of living goes up (88) Owners of capital and esp. landowners paythe cost, since IAPI bought their products at artificially low prices.

3. Evita creates the Eva Perón Foundation from whence she distributedbenefits to the descamisados personally.



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4. Eva was also given control of the labor movement, and of the nationalpress.

5. As minister of health, Eva instituted campaigns against malaria andtuberculosis.

6. “Confederacion General Economica (CGE—General EconomicConfederation)a. “The regime also organized a group to encompass most of the

country’s entrepreneurs. This was the Confederacion GeneralEconomica (CGE—General Economic Confederation), to which intheory all other business organizations—including the UnionIndustrial Argentina, the Sociedad Rural (Rural Society), theChambers of Commerce—were supposed to belong. In practice,the CGE became not much more than that organization of pro-Perón industrialists and merchants, falling far short of its goal toregiment all of the country’s entrepreneurs by the time Perón fell”(Alexander 58).” (Giambanco)

7. “The Law of the Peon [is passed], which presented minimum wages,allowed vacations to be paid, allowed one day off per week, as well asmany other benefits. (Giambanco)

X. ConclusionA. Similarities

1. Both countries dominated by traditional oligarchies in the early decades ofthe twentieth century.

2. Both countries will respond to the Great Depression by greatercentralization and ISI

3. Both men originally put into power by the military.4. Both men are influenced by European fascism (Portugal’s Salazar, Italy’s

Mussolini, Germany’s Hitler) and both employ a form of Corporativism5. Both men implement pro-labor policies.6. Both men draw support from the lower classes7. Both men lose power when they lose the support of the military

201 What were the causes and characteristics of Peronism? (HL) (1995)



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