Is Laissez-Faire too Radical for Brazilians? - Bruno Gonçalves Rosi (Mises Daily)

Is Laissez-Faire too Radical for Brazilians?
by Bruno Gonçalves Rosi
Mises Daily, April 19, 2016
http://mises.us1.list-manage.com/track/click?u=bf16b152ccc444bdbbcc229e4&id=09c46afd35&e=bbc3f0dda2

Following some months of political indecision, it seems impossible to reverse the movement toward the impeachment of Brazilian president Dilma Rousseff. Despite expected criticism from her political support group, the impeachment process goes according to Brazilian law and Dilma’s position becomes ever more indefensible as new evidences of corruption surrounding her and her government arise. But as I wrote some months ago, it is not clear that removing the president can lead the country to really pro-market policies. Many of the politicians who voted Rousseff out in the House of Representatives are themselves accused of corruption. This in no way casts doubt on the legality of the impeachment process (as Dilma’s supporters claim), but shows the difficulties Brazil will still have, even without Rousseff in office.

Rousseff and her mentor, Lula da Silva, are the first left-wing presidents in Brazilian history. As Ludwig von Mises noticed long ago (and as empirical evidence has confirmed), interventionist governments cannot help but to grow the state continually. And with a bigger state, the greater are the chances of corruption.

One possible mistake in analyzing the present scenario would be to assume that removing Dilma from office can solve all Brazilian political problems, or even to believe that Dilma and Lula in their political ideology are greatly different from much of Brazilian political history.

Brazil’s Long History of Interventionism
Since its independence from Portugal, Brazil’s tendency has been toward big government. The country’s first head of state (and government), Dom Pedro I, was himself Portuguese and an heir to statist policies implemented in Portugal since the late eighteenth century. Although a liberal in outlook, Dom Pedro I disfavored the more libertarian wing of Brazilian politics at the time and allied with the statists. Brazilian politics in the nineteenth century were mostly dominated by the Conservative Party, which despite its name, was not conservative in a Burkean sense, but mostly statist.

Brazilian politics in the republic (corresponding roughly to most of the twentieth century) were also mostly statist. Until 1930, politics were dominated by a coalition of coffee farmers in São Paulo and Minas Gerais that used the state for economic gain. After that, and until 1945, the country faced the dictatorship of Getúlio Vargas. Vargas and his legacy would still play a major role until 1964, when the country entered a period of military government that lasted until 1985. The new republic that arose from this period showed indecision between continuing the tradition of government interventionism or following the Washington Consensus.

Libertarians Are the Revolutionaries
Conventional politics in Brazil has long opposed groups considered to be either revolutionary or conservative. One might even claim that Lula and Dilma could pass as a great novelty in Brazilian politics, with their proclaimed (revolutionary) democratic socialism. But Lula and Dilma aren’t really all that different form what’s been tried before. Although their socialist approach does have peculiarities that are worth considering, much of the statism in it was already present in the Conservative Party of the empire, the oligarchies of early twentieth century, Varguistas from the 1930s to the 1960s and many of the military governments in the 1960s, 1970s, and 1980s. And most important today, this statism is also present in the opposition to Rousseff that is managing to impeach her.

The true radicals and revolutionaries in Brazil today are the libertarians who are attempting to move Brazil away from its traditional managed economy that always benefited certain elites. Indeed, libertarians in Brazil have suffered politically from being considered too radical.

A Fear of Leaving People Alone
From the 1820s to this day, one thing is constant: the fear of “anarchy.” In the late eighteenth century Adam Smith popularized the concept of “the invisible hand” which was considered too radical for Brazilian ruling elites. They feared that if the country had the level of individual freedom observed in the US, the result would be anarchy. Therefore, more state control was called for. F.A. Hayek later updated the concept as “spontaneous order” and “fatal conceit.” Even more, Rothbard defended market anarchism under a Misean framework. Brazil, on the other hand, pursued “third way” populist developmentalism.  

Many of the opponents voting Rousseff out of office justify their vote saying that she failed to implement policies to control the economy and give welfare to the poor. Although vice-president (and heir apparent) Michel Temer is talking about a (sort of) liberal (i.e., libertarian) political agenda, it is unclear that there is room for truly libertarian policies at this moment.