Business, politics, and public opinion tend to be an explosive combination. Where the role of government is to balance the economic interests of workers, innovators, entrepreneurs, investors, and corporations through sound public policies, unhealthy competition between these various interests groups is often the cause of improper governance. In Latin America, the ideological conflict between capitalism and socialism of the Cold War rages on. The sharp divide hinders the ability of government to balance the economic interests of their nations and Peoples. Facing bitter political rivalries, these countries are hotbeds for political and economic instability.
In Brazil, for example, widespread corruption and conspiracies have resulted in a political crisis that inhibits economic reforms. Acting President Michel Temer cannot hope to blunt the economic and political troubles of the South American nation. For violating campaign laws himself, Temer cannot run for public office for eight years. As the ultimate lame duck President, Temer’s capacity to govern is limited to managing Dilma Rousseff’s policies and ushering in new elections. Whether Rousseff returns or a new President takes office when elections are eventually held, Temer’s austerity and privatization agenda will be reversed.
The empowerment of Michel Temer may please Brazil’s wealthy and Wall Street analysts, but the Brazilian People are the ones who matter as they are the ones who determine if Temer’s policies survive. Forcing dramatic austerity measures onto Brazilians is going to result in increased political and economic instability. By instituting a free market political agenda, against his former boss’s socialist agenda, Temer is sowing the seeds of instability, which is exactly what drives fickle investors away. As such, Temer’s efforts to cut Brazil’s national budget can only help alleviate Brazil’s national debt, not solve its economic issues. He will starve government-dependent Brazilians and the economy of the consumer participation it needs.
Fiscal burdens and overreliance on government money are issues best addressed over long periods of time. People, businesses, and communities need time to adapt to the withdrawal of government funds to give people and their larger economy sufficient time to create jobs, which also requires the proper conditions. In forcing drastic shifts in social welfare spending, government causes insurmountable financial troubles for their Peoples, which hurts the overall economy. Brazil’s fiscal issues may be weighing down Brazil’s economy, but suppressed commodity prices are what drive Brazil’s macroscopic economic woes.
Due to economic issues, Brazilians face a loss of what income they may have. In seeking to slash government spending under the guise of an economic crisis, Temer is enacting on unsustainable political agenda. If Temer was interested in creating greater stability, he would pursue the so-called “Operation Car Wash” investigations, which resulted in Rousseff’s downfall. Unfortunately, Temer has demonstrated a thorough lack of commitment to cleaning up corruption by appointing several political leaders under investigation for corruption. This demonstrates his unwillingness to address Brazil’s real problems.
Brazil currently faces two major threats: economic recession and a political crisis fueled the state of the economy and corruption. Brazil’s economic troubles can only be fixed over time with changes in global market conditions and the adoption of public policies that can be sustained with the support of the Brazilian Peoples. Brazil’s political issues cannot be solved unless powerful men like Temer and his allies allow investigators to expose and prosecute corrupt political leaders. Brazil may have an uncomfortably high level of public debt and public welfare obligations for investors, but corruption is a far heavier burden that will prevent Brazil from building a healthy, stable national economy.
Brazilians need an economy that serves their financial interests. They need economic policies that help develop a modern workforce. Above all, they need to empower innovative and enterprising individuals to generate new industries and businesses that support jobs and economic growth. Government corruption simply empowers a political class that blocks innovative and enterprising individuals from contributing to Brazil, thus hindering Brazil’s economic growth. Capitalism only works when people freely embrace its principles, but corruption will always undermine an economy, whether the government is run by socialists or capitalists.
Read old posts