The U. S. Could Learn Much from the Brazilian State of Pernambuco – If . . .

Were We Not Too Arrogant to Learn from Brazil’s Economic Success

One of the Duller Stories on This Forum

The very quiet story in world economic development has been the rise of Brazil as a world economic power.  The story has been quiet because there is no sensational news here, just the slow triumph of good economic policy and pragmatism over ideology and extremism.  Brazil has had a center/left government for many years, implementing policy that promotes social policies and simultaneously supports and encourages business development.

The best example of this success has been in the Brazilian state of Pernambuco.  Here is a description of the area several decades ago.

IN THE 1980s an American anthropologist, Nancy Scheper-Hughes, carried out fieldwork in Timbaúba, a town in the sugar belt of Pernambuco state, in Brazil’s north-east. She described a place seemingly resigned to absolute poverty. The back-breaking task of cutting sugar cane by machete provided ill-paid work for only a few months of the year. The deaths of young children from disease and hunger were accepted “without weeping”.

Today things are different, poverty has not been eliminated but the area is booming.

Revival began with a new port at Suape, south of Recife. Its hinterland is now a sprawling industrial complex. Some 40,000 workers are building a vast oil refinery and petrochemical plants for Petrobras, the state-controlled oil company. A new shipyard and wind-power plants rise among the mangroves.

Suape is a monument to federal money, industrial policy and an alliance between Lula and Eduardo Campos, Pernambuco’s ambitious governor. But the state’s boom goes wider. Rising incomes have helped Mr Campos attract private investment. Fiat is to start work on a car plant beside the main road north of Recife. A host of smaller food, textile and shoe factories are now setting up in the state’s poor interior, including Timbaúba. While the rest of Brazil worries about deindustrialisation, Pernambuco does not: since Mr Campos became governor in 2007, industry’s share of the state’s economy has risen from 20% to 25%, and will reach 30% by 2015, he says.

And what is the government doing to keep things going?

Mr Campos has teamed up with the Institute for Co-Responsibility in Education (ICE), a private educational foundation, to reform the state’s middle schools. More than 200 of these now operate an eight-hour day, rather than the four-hour shifts common in Brazil. In return, the government has raised teachers’ salaries and added bonuses tied to results. It is also trying to chivvy mayors into improving primary schools through extra funds and other incentives. That is vital: on average, pupils arrive in middle schools aged 15 with a three-year learning deficit, says Marcos Magalhães, ICE’s founder. Pernambuco is rising up the rankings of state educational performance.

Wow, you mean government spending on public education and getting better schools is a good thing?  Somebody needs to keep this away from the Conservatives, they are going to be mad.