Ancient history

The so-called Economic Miracle

In the government of President Medici, an economic growth measure was implemented in Brazil, the main creator of this measure was the minister of finance, who worked since the Costa e Silva government, Antonio Delfim Netto , this project was based on rapid growth. What happened to bring about this so-called “miracle” was the immense foreign capital in the country.

For several years, Brazil did not receive foreign investment, due to economic instability, inflation, political results of the government of Jânio Quadros, and the tumultuous left-wing government of João Goulart.

The reason why the resources returned to Brazil was the political and economic stability provided by the military, which also curbed “leftism”.

Foreign resources arrived in Brazil in a very large volume, with this, both private and state companies were benefited, in addition to multinationals, remembering that such resources were used in the industrial segment.

During this period, Brazilian private companies emerged that were based on the labor intensive sector (industries that have a small demand for capital and a large demand for labor), whereas multinational companies had their activities focused on the capital intensive sector (strong demand for capital and little demand for labor), state-owned companies invested their resources in the armed forces, energy and telecommunications.

To consolidate the rapid growth, an expansion of the market was implemented internally and externally, production was not only absorbed by Brazilians and third world countries, but also by industrialized countries, such as the USA and European countries.

The multinational companies that settled here had benefits in raw materials, and also in labor, since the government kept salaries always low, any demonstrations in search of salary improvements were violently responded by the government. The government stabilized the earnings of the poor and favored an increase in the income of the middle class and skilled professionals.

It was in this period that Brazil, in a concrete way, entered the industrialization process, but in a way it was a process without social planning and that worsened inequalities even more.


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