A reader writes:
I think the readers who wrote in about the protests in Brazil are somewhat biased. These protests are not like Turkey’s: President Dilma Rousseff has not restricted any liberties or tried to impose a moral code on her people. More importantly, they are not really about inequality or corruption; the GINI coefficient in Brazil has declined every single year since 2001.
Not to sound too much like Paul Krugman, but these protests are about simple economics. Over the past 10 years, Rousseff and her predecessor Lula Da Silva have presided over an amazing feat, engineering both rapid economic growth and a decisive narrowing of inequality. They did this by creating huge and revolutionary social welfare programs, like the Bolsa Familia. All of this has done amazing things in Brazil, but now the bills are coming due. The high budget deficits run by the governments and the low interest rates making credit available to poor entrepreneurs have led to scarily high inflation. As a result, the government has had to raise some revenue and decrease the availability of credit. Thus, the hike in bus fares.
I don’t blame the Brazilian protesters for being angry; economic stagnation is not very fun, especially after years of boom times. But Brazil remains a remarkably liberal country which continues to make amazing progress improving on inequality. The other choice for Brazil, to refuse to change any of its spending habits or raise revenue or interest rates, is to become like Argentina.
The Dish 