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No, Brazil is definitely not following Milton Friedman.
Brazil's finance minister, Guido Mantega, is not a fan of Milton Friedman. Guido Mantega is a kind of "neo-Keneysian", who believes in the role of the government in the economy, but he doesn't believe that "deficits doesn't matter". He thinks deficits are not good. He seeks some government intervention in the economy, but trying not to have deficits.
The key step taken by Brazilian government to reduce the social inequality wasn't Bolsa Familia. Bolsa Familia is a very important social program, aimed to fight extreme misery. But it's not the responsible for the ascension of millions of people from the poverty to the "lower middle class" (Brazilian so called "Classe C").
The main responsible for this social ascension of millions to the "lower middle class" was the economic growth, along with the successive rises of the minimum wage. The economic growth can be partly attributed to the PAC - Programa de Aceleração do Crescimento ("Growth Acceleration Program" in Portuguese), a government program that is very "Keynesian" in some aspects, and resembles the American "New Deal" in the 30's. The economic growth can be also partly attributed to the coordinated action of the government-owned banks, Banco do Brasil and Caixa Economica (along with other local scale government-owned banks).
And, last thing: Brazil is definetely a nation that seeks to to be a "welfare state". Nobody in Brazil is against welfare. The country's Constitution says it has to be a welfare state. Brazil has public hospitals everywhere, that are part of SUS (Unified Health System), a public system of free health care.
So, repeating what I said in the beginning: Brazil is definitely not following Milton Friedman.
Could you clarify some? Chile is the most well known Latin American country to follow Friedman's economics and they have one of the best economies in Latin America as a result,don't they?
Do you know why Chile has become the South American economic powerhouse it is today? It has nothing to do with Milton Friedman.
They privatized their Social Security. In 1960 Chile patterned their Social Security system after the US. By 1990 they already knew that it was not viable. Nothing more than a government-backed ponzi scheme. So they made it voluntary. Citizens must still contribute, but they had a choice - either the failing government Social Security system, or invest in with government-approved investment brokers and put their retirement into the free-market.
By 2000 only 10% of Chile's citizens remained on the now defunct government Social Security system, while Chile's economy experienced a huge boom from all the private investment in the market.
We could do the same thing in the US easily enough, if it was not for the fact that it violates the religion of the left who believe the government is the only answer for every problem.
Just to clarify a thing about the Brazilian government-owned banks:
The government owned banks in Brazil are profitable companies. They are a proof that it's not true the government-owned companies "have" to be inefficient.
Both Banco do Brasil and Caixa Economica are owned by the federal government and are efficient and profitable companies. They compete in the free market against the private banks, like Bradesco and Itau. Banco do Brasil is the largest retail bank in Brazil, with the largest number of customers, despite the fierce competition of Bradesco and Itau.
Both Banco do Brasil and Caixa Economica are profitable companies, contributing with billions of dollars in profits to the federal budget. And, at the same time, both are strategic instruments of the government to regulate the "excesses" of the free market, and to help funding the development of the nation and the economic growth. Both institutions are very important to provide credit to develop Brazilian agriculture, and to grant credit to home buyers and to homebuilders. They also provide credit to the consumer.
During the world crisis in 2009, Banco do Brasil and Caixa Economica had a strategic importance in the Brazilian financial system. While the private banks were rising interest rates and reducing credit lines, the government-owned banks did the inverse: lowered interest rates and provided more credit to consumers and enterpreneurs. This helped the country to emerge more quickly from the crisis, and also served to put pressure on private banks, that had to review their attitudes in order to not "lose territory" in the market for their government-owned competitors. Both Banco do Brasil and Caixa Economica registered a profit in 2009. They proved to be an efficient instrument against "market panic".
Most government owned companies in Brazil are profitable, including the oil giant Petrobras, the Correios (Post Office), and Eletrobras (the federal company which builds hydroelectric dams and operates high voltage transmission lines).
We could do the same thing in the US easily enough, if it was not for the fact that it violates the religion of the left who believe the government is the only answer for every problem.
Had we of allowed the neoconservatives to PRIVATIZE S.S. it would presently be BANKRUPT...........
Brazil picked up Socialism and is doing very well, they are out of debt to the IMF and are a energy self sustaining. Many of the South American nations are doing very well once they kicked out the USA. We are vampires that bleed other nations and then wonder why they hate us. LOL Really?
Brazil picked up Socialism and is doing very well, they are out of debt to the IMF and are a energy self sustaining. Many of the South American nations are doing very well once they kicked out the USA. We are vampires that bleed other nations and then wonder why they hate us. LOL Really?
Well, from the American point of view it can be "socialism", because it's the political tradition in the U.S. to call "socialist" any country that is not an "unregulated free market paradise".
But nobody in Brazil thinks Brazil is a "socialist" country. The political tradition in Brazil is more of an "European tradition". The political thinking tradition here is more like that of Germany and France.
So, we don't think we are a "socialist" nation. For most Brazilian thinkers, Brazil is a capitalist country, with a free market, but it's not an "unregulated" free market. There is some regulation, and there is some government intervention. Any entrepreneur can start a new private business in Brazil, so it's a free market in our point of view.
Brazil can be defined as "a capitalist country with social programs to reduce inequality and improve welfare, with regulation of the markets, and with some strategic government-owned companies doing business in the market".
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