Editorial, by Stone Korshak
RIO DE JANEIRO, BRAZIL – The Cidade Maravilhosa (Wonderful City) is easy to fall in love with, as a visitor you are struck by the amazing sweeping beaches lined with palm trees and flanked by towering mountains of plush green tropical forest. The weather helps, with an average annual temperature of 23 °C (73 °F), and a typical sunny summer day reaching 35 °C (95 °F).
Yet the city of some 6.3 million aspires to be more than just a tourist destination. For the last half century Rio de Janeiro has been passed over by industry for São Paulo, and politically hung out to dry by Brasília (which took over hosting the nation’s capital in 1960).
In the last decade though, since the Workers Party (PT) lead by ex-President Luiz Inácio Lula da Silva (aka ‘Lula’), and the current President Dilma Rousseff, along with the state level PMDB party (with governor Sérgio Cabral) have been in power, the alliance between parties at the federal and state has thrived and paid off for Rio.
What has really helped foster the success and progress for the city and state of the same name, has been the discovery of vast oil reserves in 2007. Buried deep in the “pre-salt” layer under the ocean floor just a few hundred kilometers off the coast of Rio (as well as Espírito Santo and São Paulo states to the north and south), predictions put Brazil in the top three petroleum producers in the world by 2020.
For Brazil and Rio it has resulted in a windfall of foreign and domestic investment, and the PT’s socialist agenda has helped spread the wealth in unprecedented levels. Public welfare programs like Bolsa Familia and affordable housing program Minha Casa, Minha Vida are credited with lifting millions from extreme poverty.
For most of the last decade the public spending has been tremendously popular. One needs to remember, just in Rio some 22 percent of the population live in favelas – which literally translates to slums or shantytowns – but represents a wide socioeconomic variety of communities.
Yet, the PT, and all Brazilian government, is also known for their legendary corruption. Current president Rousseff saw seven of her ministers ousted under corruption allegations in her first year, and last year the landmark Mensalão scandal gutted the PT for a monthly cash-for-votes scheme. The real surprise was that political figures were actually convicted and started serving jail time.
Even so the political environment in 2013 was dominated by the public unrest which brought millions to the street protesting in June last year, sparked by a R$0.20 increase in bus fairs. The root cause being that Brazil has one of the most expensive governments in the world, and their tax revenue is breaking records, this year reaching R$1 trillion (or US$410 billion – up 3.63 percent over last year). However the people are not seeing key progress in infrastructure, education and health.
In short, the rich are getting richer, and the poor – and new middle classes – are becoming increasingly unaccepting of institutionalized corruption and sharp increases in the cost of living. Promises have been made by the government but the patience of the population has been tested and with the 2014 FIFA World Cup arriving in June, the threat of more protests looms.