Kea Terms Definition
- Democracy is a form of the government elected by the majority of people and guaranteed equal rights for everybody.
- Democratization is the process of democracy development.
- A dictatorial regime is a form of the government when all the power is held by one person (a dictator).
- Economic performance is a success of economical growth regarding the value of money and wealth and the level of inflation and debt.
- Industrialization is the process of economic transformation to one which is based on goods production and different industries’ development.
- The military regime could be defined as a political regime when the military holds the power.
- The political regime could be defined as a form of the government which provides rules and regulations, social and cultural norms regarding personal freedom, property, and locus of power.
- The slavery regime is a political regime that allows people (“slaves”) to own and free using.
- The statist economy could be defined as the economy which is controlled by the government.
Democracy and Successful National Economic Performance
Brazil had different political regimes during its history. At times when Brazil was Portugal’s colony, the slavery system caused significant economic growth. Brazil was a world leader in sugar growing and export. However, the slavery system provided a “massive wealth for the white minority” (O’Neill 625). The gold boom in the 17th century brought a significant wealth increase but just for the elite of the population (O’Neill 626). The vestiges of that system remain up to date. Nowadays, much of the Brazilian population lives in poverty, while a minority (mostly white) controls the majority of wealth.
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In 1889, the new regime was established, and all the power was concentrated in the military’s hands. In 1937, this regime was broken, and a new Vargas’s dictatorial regime called Estado Nôvo (New State) was established (O’Neill 627-628). Brazil’s economy at this period could be defined as capitalistic. Estado Nôvo regime resulted in urban workers’ wages increase. The process of industrialization occurred in Brazil. Also, particular measures for national industry protection from the foreign competition were provided. This policy resulted in an industrial boom after 1930. After Vargas’s regime, the military government was established in Brazil. Brazil’s political crisis resulted in an economic decrease. The reasons for it were inflation and growing debt. Finally, the democratic republic was created in 1985 (O’Neill 626).
Brazil’s economy after the Estado Nôvo establishment and during the military regime could be defined as capitalist (O’Neill 653). However, it was controlled by the state. Furthermore, the state government continues to control the economic development in the present. It provides a policy of import limitation, credit regulation, currency control, and wage regulation. The result of the governmental policy is a significant growth of Brazil’s economy, compared with the past.
However, the statist system has several limitations and is considered to be a reason for several economic problems of the country. Three major problems of Brazil’s economy are inflation, growing debt, and unemployment (O’Neill 654). It could be claimed that the process of democratization addressed some problems. The role of the state in the economy reduces gradually. However, this process was not as intensive as in other Latin American countries. Thus, significant economic problems still affect the population (O’Neill 656).
It could be concluded that Brazil’s economic performance was occurring simultaneously with political development and was affected significantly by the political regime. Economic growth depends on the process of democratization. In Brazil, the statist economy was dominated during the major part of the XX century. Moreover, nowadays, the role of the state remains significant, which might be one of the reasons for the economic problems of the country. Therefore, democracy development might result in national economic growth.
O’Neil, Patrick H., et al. Cases in Comparative Politics. 5th ed., W.W. Norton & Company, 2015.