The most despised institution in Brazil

In “Public Rage Catching Up With Brazil’s Congress,” The New York Times gives us a pretty good idea about why the Brazilian public is so fed up with their legislators.

Maurício Santoro, a political scientist, notes that “Congress is without a doubt the most despised institution in Brazil” and a big reason for that is the fact that the legislature “has a tradition of preventing its own members convicted of crimes from ever going to jail.”

Almost 1/3 of the current Congress have pending trials in the Supreme Federal Tribunal.  Legislators can only be tried in this tribunal, which means that there are huge delays. Even this is better than pre-2001 though, when  a politician could only be tried if Congress authorized it. Wow, I can see some bad incentives arising from that law.

And what are these legislators on trial for?  Unfortunately, it’s not just a matter of unpaid parking tickets.  Here is the rundown on some of the worst offenders, past and present:

a.”There is Hildebrando Pascoal, commonly called the “chain saw congressman.” When he ran for office, it was public knowledge that he was being investigated for operating a death squad in a remote corner of the Amazon, employing tactics like throwing victims into vats of acid or dismembering them with chain saws. But he still won by a large margin and served in Congress before he was stripped of his seat, convicted and sent to prison.

b. Another is wanted by Interpol after being found guilty of diverting more than $10 million from a public road project to offshore bank accounts.

c. A congressman was convicted by the tribunal of having poor female constituents, who could not afford more children, surgically sterilized in exchange for their votes.

d. In 1963, Senator Arnon de Mello shot dead a fellow legislator on the Senate floor, only to escape imprisonment, since the killing was considered an accident because he was aiming at another senator. (!)

e. That gun-wielding senator’s son, Fernando Collor de Mello, was elected president of Brazil in 1989 and impeached amid a flurry of corruption charges in 1992. Yet in a political resurrection that dismayed anticorruption activists, he was elected to the Senate in 2006 and retains his seat, even as he remains embroiled in a case in the Supreme Federal Tribunal in which he is accused of profiting from an advertising contract scheme during his brief presidency. The article notes that “Even when lawmakers are convicted and sentenced for crimes, it can be difficult for them to lose their seats.”

f. Talvane Alburquerque, a legislator from Alagoas in northeast Brazil, was found guilty in 2012 of ordering the murder in 1998 of another member of Congress, Ceci Cunha. That killing allowed Mr. Alburquerque, Ms. Cunha’s stand-in, to temporarily take her seat in Brasília. An appeals court rejected this month a request from Mr. Alburquerque to be paroled from prison.”

The public is also unhappy with the fact that legislators make $175,000 a year, with stipends to cover housing, gas, electoral research, and up to 25 aides.  In fact, “the frustration toward traditional politicians is so high that Congress now includes Francisco Everardo Oliveira Silva, a professional clown better known as Tiririca, or Grumpy, who was elected in 2010 to Brazil’s lower house with more ballots in his favor than any candidate in the nation’s history.” 

brazil_clown

The Salad Uprising: Or What’s Going on in Brazil

brazil_protests

by Erika Robb Larkins

Brazil has captured international headlines for the last few days as hundreds of thousands of protesters across the country’s major cities take to the streets in what has been dubbed the “Salad Uprising” or “Vinegar Revolt.” Given that Brazil does not have a strong tradition of public protest, the actions have perplexed observers, including the members of the country’s ruling PT (leftist) party. Leaders seem to be openly struggling to find a balance between praising the popular demonstrations and figuring out how to best prevent protesters from interrupting the current Confederations Cup, largely considered to be FIFA’s logistical trial run for next year’s World Cup.

While I am a bit surprised that Brazilians have taken to the streets en masse, I am not at all surprised at the general feelings of outrage and discontent many are expressing. Despite the often very rosy prognostications one reads in the press concerning Brazil’s rise to economic greatness and its new role as a global power– as confirmed by hosting the coming mega-sporting events– a great number of people from all walks of life are disillusioned and frustrated. Here is some of the background story that has led up to the Salad Uprising as I have observed it in Rio, the context I know best, though much of this is clearly applicable to other Brazilian cities as well.

There is waning support for President Dilma. In fact, last week I took students to see her speak about a new federal project to invest billions in infrastructural improvements in Rio and, in particular, in the city’s famous favelas. Since I never believe the sensationalist right-wing press, who, in typical fashion, interpreted her announcement as a political response to her diminishing public support among the urban poor, I was a bit surprised to see that there were only about 150 people in attendance and some boos. As a whole, government and politicians continue to be seen by Brazilians as ridiculously corrupt and Dilma, though largely untouched by corruption scandals herself, is viewed as a distant, yet domineering, bureaucrat. Even her projects to invest money in poor communities (which on the surface can’t possible be bad, right?) are increasingly unpopular, since they fail to include the voices of the poor in decision making.

Part of the reason that these projects are unpopular is because they are widely perceived to be about applying “make-up” to deep-rooted social problems in order to put on a good face for the world. Not only are these projects for the outside to see, they are also clearly designed to fatten the wallets of an already wealthy elite. Or at least that’s who holds all the contracts for the massive amount of construction that’s clogging up the city and that’s who stands to profit most from the World Cup and Olympics. I am certainly not the first person to say this; in fact my taxi driver last week put it quite well (I edited out the profanity here) when he said that the government is increasingly in bed with a powerful business interests.

Pacification of the favelas, high-profile infrastructure “improvements” like over-priced, cable cars imported from France, revamped stadiums to the tune of billions of dollars, all this stuff is about crafting an image of prosperity and progress for the outside, while neglecting the things that all Brazilians need— like schools and healthcare! I had the misfortune of spending a few hours at a public hospital in Rio last week, and the public healthcare system really is the stuff your nightmares are made of…. you know those horror movies set in an insane asylum built in the 50s? It looks worse than that. And though healthcare is considered a human right and universal healthcare is provided for in the 1988 constitution, the only way to avoid getting treatment in this asylum is to pay for costly private health insurance.

All of this is set against a scene of daily frustration, where everything in the city is under construction, traffic is horrific, the housing bubble means that there is nowhere reasonable to live for a reasonable price, food costs more, etc. Furthermore, it is widely thought that these things are only going to get worse. In fact, I regularly found people, myself included, lamenting that if “it” was bad now, imagine for the World Cup, or god forbid, the Olympics.

So while the popular protests of the past week initially galvanized around the rise in the bus fare, this is clearly only the tip of the iceberg. City officials have just announced that they will reduce the fare to its previous rate in light of the popular outcry. But of course now it is much more than this. The bus fare is a metaphor for the system in Brazil as a whole and it is about raising the costs on something that already barely works. People have to pay a lot for something that just barely passes for functional. With protests growing in scale, another issue that has come to the forefront is that of police violence and the lack of public security in many of Brazil’s largest cities. The nickname for the protests themselves (and here is the vinegar for the salad) stems from police incompetency, as it has been widely reported that officers arrested demonstrators for carrying bottles of vinegar, said to lesson the effects of tear gas. While criticizing the police was certainly not the original impetus for the protest, police behavior in handling the uprising (openly pepper spraying people in the face, unchecked aggression, general institutional incompetence) has given protesters something to unite about.

Interestingly, many observers (journalists in particular) are claiming that that the protesters are young, white, educated, and middle class. This is clearly not a demographic that is accustomed to the kind of treatment they are receiving from the police. But the lower classes, who are clearly also present at these protests even if their participation appears to be being largely erased in the emergent narrative, are regularly on the receiving end of police brutality. What is more amazing, then, if it is true that young middle class Brazilians are protesting side by side with youth from favelas, is that middle class youth and poor youth are disillusioned and united against a common cause, challenging a long-standing politics that has depended on keeping them separate.

Perhaps part of what is incentivizing people is the fact that this current generation (across class lines) has come to age in a time of Brazilian prosperity and promise, a time where Brazil is no longer the country of the future, but of the present. To embrace this discourse and then to see all of that potential wasted by ongoing political corruption, police malfeasance, the money grubbing shenanigans of a global elite, has surely got to be maddening. Regardless of the outcome of this evening’s protests, (reports say there are a million people in the streets already!) and regardless of the spin of the political and news pundits who are surely already at the cosmetics counter purchasing more “make-up” to mask this whole affair, something new is afoot. See also:

It’s Just the Beginning; Change Will Come (New York Times)

No, I’m not going to the World Cup (video)

Latin America’s first MOOC

São Paulo University (USP) has teamed up with a start-up company named Veduca to launch two MOOCs, one in physics and the other in statistics.

This article notes that Brazilian students are some of the most “engaged” participants in US based MOOCs, but are hindered by the fact that the classes are taught in English (by the way, I don’t know what the author means by engaged or how this is measured).  These new classes will be taught in Portuguese by USP professors and will give students the opportunity to participate in live chats, watch videos, and take quizzes throughout to gauge their understanding.

One potential drawback I see is that students can only receive a certificate from Veduca confirming they passed the course if they travel to São Paulo to take the final exam.  I’m sure that will cut down on cheating and enhance the credibility of the certificate (they hope that private universities will accept it for credit in the future), but it seemingly will cut down on the number of international students who will want to enroll. Perhaps that already will be low though given the language of instruction.

 

The seen and the unseen

What accounts for a firm’s success or failure in exporting?

A new NBER working paper by Molina & Muendler investigates this question in a sample of Brazilian firms.

Here’s the abstract:

Exporters differ considerably in terms of export-market participation over time and employment size. But this marked diversity among exporters is not reflected in their workforce composition regarding commonly observed worker skills or occupations. Using Brazilian linked employer-employee data, we turn to a typically unknown worker characteristic: a worker’s prior experience at other exporters. We show that expected export status, predicted with current destination-country trade instruments, leads firms to prepare their workforce by hiring workers from other exporters. Hiring away exporter workers is associated with both a wider subsequent reach of destinations and a deeper market penetration at the poaching firm, but only with reduced market penetration at the firm losing the worker. This evidence is consistent with the hypothesis that expected export-market access exerts a labor demand shock, for which exporters actively prepare with selective hiring, and with the idea that a few key workers affect a firm’s competitive advantage.

In other words, workers in successful and unsuccessful export firms look alike on their observable characteristics, but there is a pool of exceptional workers, and the firms know who they are!

Great stuff!

If the link to the article provided above is gated or expired, an older version of the paper is available via Google Scholar.

Brazilian Bottlenecks

In its early years, the World Bank mostly financed large infrastructure projects.  After some (probably accurate) criticism over their handling of dams and village displacement, the Bank moved away from these types of projects and towards ones that focused on health, agrarian reform, education, etc.

More recently though the Bank has come full circle and has started to fund more infrastructure projects because there is a realization that these are some of the most effective ones they’ve funded.  Personally, I think that infrastructure is an understudied topic in development.  It’s clearly crucial to development but it’s something most economists seem to leave to urban planners to solve.

I was reminded of this when I read about Brazilian infrastructure woes with the port of Santos, a city of 530,000 about 40 miles from São Paulo.  Santos is the continent’s largest seaport and the incredible growth in commerce (particularly in soybeans) is causing massive logjams there.  Recently there was a 64 kilometer traffic jam of trucks who wanted to unload their soybean cargo in Santos.  The delay was so bad that China’s biggest importer of soybeans had to cancel an order of 2 million metric tons.

Port_Santos

I’m sure there is no easy solution to this problem, but it is funny how everyone seems to be blaming everyone else for the situation.

Blame the politicians: They have passed legislation that has limited the amount of hours that truck drivers can operate

Blame the weather:  Massive amounts of rain has slowed work at the port.

Blame other transportation systems: A port authority official notes that, “Capacity over the past 10 years has more than doubled but the rail, highway and river access networks are overwhelmed.”  He points out that soybean is perfect for rail transport but that only 25% of soybeans are transported in that manner.

Blame storage facilities: The aforementioned port official also complains that Brazil lacks the necessary storage facilities for soybeans: “Brazil in general can store around 60 percent of its harvest in the producing area. In the United States, they have 130 percent capacity, meaning that they can store in the producing areas the entire harvest plus 30 percent of the next one.”

Blame a shortage of trucks:  Producers want more trucks to transport the soybeans.

My guess is that all of these complaints are valid.  Infrastructure is a complex issue and while everyone can agree that developing countries should “improve infrastructure,” it seems a lot more complicated than that.