"CLASS, STATE, AND AUTHORITARIANISM: THE TRANSFORMATION OF ECONOMIC LAW IN THE BRAZILIAN DICTATORSHIP".
Business. Brazilian dictatorship. Reforms. Law. Economy
During the first five years of the 1960s, Brazil experienced a turbulent period, with political, economic, and social crises, which led to a disruption in its legal system. In August 1961, President Jânio Quadros resigned and, in less than a month, a constitutional amendment was issued altering the government system from presidential to parliamentary, as a condition for João Goulart's inauguration. On January 1963, a new constitutional amendment would overturn the former decision and return the presidential system of government. Such amendment came after 76.98% of the electorial college had voiced their rejection of the parliamentary system through a popular referendum The Brazilian economy was melting down, with GDP dropping from 10.3% in 1961 to 2.4% in 1964 associated with financial and structural problems, such as high inflation rates, stagnation of the national industry, exhaustion of import substitution model, shinkage of domestic consumer market, scarcity of credit, and pressure from international capital. The social crisis, characterized by an urban sprawl, the increase in unemployment rate, and the exploitation of workers were evident. Wealth distribution problems got out of control, leading to a greater concentration of means among the richest and, with the drop in minimum wage, creating a shortage of workers and increasing the levels of poverty among the population. The crisis led businessmen to form organizational entities to defend their capitalist interests. As an example, one can list the creation of the Institute for Research and Social Studies (IPÊS), one of the most prominent class organizations statuted to promote the, so called, Brazilian State reform. The group acted through financing, providing technical advice, and making ideological campaigns to implement its conservative project for modernizing the Country. At the end of 1963, IPÊS had presented to the Parliament twenty-three proposals for reforming legal structures of the Brazilian State, based on a liberal economic vision. All in contrast with the national-reformist project of the Welfare State designed by João Goulart. The long-term of democracy, however, was incompatible with the urgency of capitalism's goals. Whether it was necessary to sacrifice one or another, there was no doubt: the invisible hand of the market joined forces with the armed branch of the State creating a business-military coup responsible for overthrowing Goulart and inaugurating a dictatorship that would last for over two decades in Brazil. During this time, authoritarianism manifested itself in several ways, such as the supremacy of the Executive Branch over the Legislative and the issuance of new laws, specifically targeting the economic law. Based on the Institutional Act of April 9, 1964, the business-military joint-venture in Castello Branco’s government approved two of the main reforms drawn by IPÊS: banking and financial reforms.