Energy Crisis Is Just One More Thing for Brazil

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July 1, 2001

Energy Crisis Is Just One More Thing for Brazil

By LARRY ROHTER

SÃO PAULO, Brazil — This was supposed to be the year that everything came together for Brazil. Instead everything — from politics to sports, from the economy to the weather — has gone wrong.

"The very idea of Brazil as a nation makes me tired," the songwriter and gadfly Caetano Veloso complained last month in a much-noticed interview with the newspaper O Globo that reflected the piercing of the nation's sunny disposition. "I'm fed up."

The most serious setback is a California-style energy crisis that has forced the government to ration electricity. The country's 170 million people have been warned that even if they are cutting their consumption by the 20 percent that was mandated starting June 1, they may still face rolling blackouts and unscheduled power failures unless the worst drought in decades comes to an end.

Even before the energy crisis, a wave of corruption scandals sapped public confidence in the leadership of the nation, Latin America's largest. A judge, cabinet ministers and two powerful senators, including the former president of the Senate, have been forced to step down, and new accusations of fraud have spilled out against the new Senate chief.

"We're drowning in a sea of mud, and the people governing us don't even seem to care," said Mauro Miranda de Azevedo, a metalworker here in the country's largest city. In the daily Jornal do Brasil, the columnist Millôr Fernandes asked: "In the depths of the storm, where is the helmsman?"

Just six months ago, Brazilians were optimistic. The fiscal crisis that had forced a devaluation of the currency and general belt-tightening in 1999 was receding into memory and the country appeared to be headed for a burst of growth and stability.

But signs of an economic slowdown in the United States, fears that Argentina might default on foreign debt, and now the energy crisis, have created economic uncertainty and caused foreign investors to grow wary.

As a result, in little more than three months the value of the currency, the real, has fallen more than 20 percent against the dollar, threatening the anti-inflation program that is the government's shining achievement.

On top of everything else, Brazil has also lost its longstanding world supremacy in soccer, always a psychological bulwark in times of trouble. The once dominant national team has been unable to beat lightweights like Ecuador, Canada, Japan and Australia, and as a result, the third coach in nine months has just been appointed.

"What More Can Happen?" the newsmagazine Veja asked in a recent cover story that portrayed a resentful member of the middle class made up as a clown.

A rival magazine, Isto É Dinheiro, talked of "Brazil Distraught" and warned of what it called "the sentiment of depression and disenchantment."

"I can't sleep anymore," the country's leading business executive, Antonio Ermírio de Moraes, told the magazine. "I've lost 10 years of work."

Farther down the social ladder, the feeling of malaise is much the same. "We sacrifice and sacrifice in the name of a golden future, and just when it seems that things are starting to go our way, something always happens to push it out of reach," said Maria Conceiçao Costa dos Santos, a hospital orderly.

To outsiders, especially some of Brazil's neighbors, the disappointment may look overdone. Brazil does not have to contend with the guerrilla violence wrenching Colombia, the intractable recession crippling Argentina, the political turbulence that has unnerved Peru or the risk of dictatorial rule that the Venezuelan president has broached.

Brazilians, though, have always been propelled by notions of historical destiny and national greatness that any American would recognize. But the confidence expressed in slogans such as "God Is Brazilian" or "This Is the Country of the Future" have now been replaced by a conviction that things are coming apart at the seams.

"The future that never arrives is the great mystery of Brazil," the novelist and columnist João Ubaldo Ribeiro wrote in June. "Nobody has an answer. It seems that things are getting worse and worse."

According to a poll conducted in May, 35 percent of Brazilians have abandoned the belief that theirs is "The Country of the Future" and an additional 21 percent said "that future will come, but I won't see it."

Of those polled, 43 percent said they were "very proud" to be Brazilians, down from 60 percent in 1995, and 77 percent agreed with the statement, "This is not a very serious country."

The mounting sense of disappointment has settled in, and may stay until next year's national elections. The despair contrasts with the social and economic gains registered during President Fernando Henrique Cardoso's first term. Between 1995 and 1999, annual inflation was brought down from four digits to one, and Mr. Cardoso's prestige allowed Brazil to speak with a more confident voice on the world stage.

"I voted for him twice, and believed that we finally had a government that was capable and worthy of this country," said Clementina Guarnieri Homem de Mello, a retired stenographer. "But really, at this point, I have lost all hope that anyone can run this country properly."

With the atmosphere so corrosive, a lot of finger pointing is going on. The Brazilian press and even some in government have blamed the International Monetary Fund, arguing that a $41.5 billion rescue package that Brazil negotiated in November 1998 was too harsh, a contention the I.M.F. has vigorously rejected.

"We don't tell Brazil what to do with the money it collects" from taxes, Horst Kohler, the institution's managing director, said in an interview in Veja. "The government decides the priorities."

Mr. Cardoso's government is now warning that the situation may worsen further.

There is talk of water shortages, for instance, which would be a blow to a nation that thinks of itself as the definition of abundance.

"This country is a rich country that can have a great future," said Adão Chagas, a street vendor. "But everything is going wrong, and everyone is pointing the finger at everyone else."

http://www.nytimes.com/2001/07/01/world/01BRAZ.html



-- Martin Thompson (mthom1927@aol.com), June 30, 2001


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