SAO PAULO, Brazil
-- Over the years, we have applied various labels to
countries like Brazil: "Third World," "developing,"
"emerging" and "newly
industrialized," to name a few. But even a brief visit here (my first)
shows
how our vocabulary has been overtaken. What you find is some First World,
some Third World and much in between. The economic transformation of the
world's poor regions -- now dubbed "globalization" -- is one
of the great
stories of our time. But its very messiness defeats easy stereotypes.
The Sao Paulo metropolis is Brazil's commercial, industrial and financial
center. Depending on whose figures you believe, it ranks somewhere between
the world's third- and sixth-largest urban concentration. It's certainly
smaller than greater Tokyo (33 million) and New York (20 million), and
at
almost 18 million, is in the general vicinity of Seoul, Mexico City and
Bombay.
Though not handsome, the city isn't squalid, and outwardly, much of the
population is bustling toward middle-class consumerism. Downtown has the
usual office and apartment towers, luxury stores and restaurants. Cell
phones
are widespread. At rush hours, there are the familiar traffic jams.
Middle-class Brazilians
confess (or brag) that they're compulsively borrowing
on their credit cards at an astonishing interest rate of 8.5 percent a
month.
Outside the city center, some working-class neighborhoods look like the
Bronx: clusters of small homes and apartments mixed with stores, repair
shops
and warehouses.
In 2000, Brazil's
economy expanded 4.2 percent, feeding optimism that strong
growth can continue. I talked with several editors of Exame, the country's
major business magazine, who cited several reasons for confidence.
Perhaps the most important
is the conquest of hyperinflation, which -- until
the mid-1990s -- seemed invincible. Monthly inflation regularly reached
20,
30 and 40 percent. In 1994, it was 2,076 percent for the year. Hyperinflation
exhausted Brazil's morale and energy. The middle and upper classes were,
understandably, obsessed with protecting the value of their money. People
shopped daily, before prices rose. Similarly, people moved their earnings
instantly into accounts indexed for inflation. The introduction of a new
currency (the real) in mid-1994 gradually tamed the monster. Last year,
inflation was 7 percent.
The second reason
is Brazil's sheer potential. With about 170 million people,
it is the world's fifth-most-populous nation (after China, India, the
United
States and Indonesia). As recently as 1985, Brazil's per capita income
of
$5,500 was almost equal to South Korea's. By 1998, it was about half of
South
Korea's $13,300. (For comparison, the U.S. figure was $32,000; all numbers
are in 1998 dollars.) The Latin "debt crisis" of the 1980s and
hyperinflation
caused a "lost decade." On paper, there's vast untapped demand
for housing,
cars, appliances, roads, schools or almost anything. The company that
publishes Exame -- Editora Abril -- demonstrates the possibilities. It
started in the 1950s by translating comic books (including "Donald
Duck")
into Portuguese; now it employs 10,000, has a portfolio of magazines,
produces music CDs and co-owns a major Internet service.
Brazil's longstanding
ambition is to achieve First World status, writes
Lincoln Gordon in his book "Brazil's Second Chance." Based on
Sao Paulo's
prosperity, the dream seems plausible, but as Gordon -- an ex-U.S. ambassador
to Brazil -- points out, it's hardly inevitable. Rural poverty is crushing,
and most cities are pocketed with slums and favelas (squatters'
neighborhoods). Two reporters from O Estado, the city's largest paper,
gave
me a tour of one of Sao Paulo's.
Jammed between a highway
and a food warehouse, it's a tangle of unpaved
alleys. Perhaps 1,000 people live in 200 or so meager dwellings. The
flimsiest are shacks with wooden sides and tin roofs; the sturdier homes
are
made of cinder blocks. This favela has been around since at least the
1980s.
It has two small churches,
and I counted three tiny food stores. Iraneide, a
short woman of 30 who is our guide, says that life is much better in the
city
than in northeastern Brazil, from where she migrated a year ago. She is
probably right. Most shacks have TVs and stoves. Still, it's desperately
poor.
Many of these neighborhoods
exist on the edge of the law. In 1999, greater
Sao Paulo had 9,000 murders, says Norman Gall, an American who has lived
in
Brazil since 1977 and heads the Fernand Braudel Institute of World Economics.
That's slightly more than half the number for all the United States (about
17,000 in 1998). Violence breeds security-consciousness. Houses and
apartments in wealthy neighborhoods are typically walled and gated,
frequently with security guards.
Brazil's economic
and social prospects depend heavily on foreign investment,
which in turn depends heavily on the global economy and political stability.
The first is faltering, and an economic crisis in neighboring Argentina
compounds the uncertainty. Meanwhile, politics remains a question mark.
Between the mid-1960s and the mid-1980s, Brazil was ruled by the military.
Until the election of Fernando Henrique Cardoso in 1994 -- he was reelected
in 1998 -- popularly elected presidents had floundered. But Cardoso can't
run
again in 2002.
"We Brazilians
think that we are a country of promise, but that the time of
promise is always passing," says Lourival Sant'Anna, a respected
journalist.
"My parents were part of a generation in the 1950s who felt that
they were
building the country. But they became completely disillusioned by the
military, high inflation and the lost decade."
The larger lesson
is that there is no simple path to the First World. Each
country takes its own journey, shaped by history, culture and chance.
The
consequences are rarely preordained or predictable, which is why all our
generalizations and stereotypes usually don't fit the facts on the ground.
