RIO DE JANEIRO — Brazil’s central government voted to amend to the country’s constitution to combat Brazil’s mounting debts and soaring inflation rates. The austerity measure will effectively freeze social spending for 20 years and restrict public servants’ salaries.
Four hours later, a small group of protesters gathered under the brooding, humid sky outside Rio de Janeiro’s legislative assembly. With approximately 40 protesters in front of the scaffolding, demonstrators were far outnumbered by the 80, bored-looking military police leaning indifferently on nearby buildings.
This angered Patricia Navega, a woman in her 40s who stood tall as she held the microphone in front of her fellow protesters. “You police always say you cannot join the protests because you need your salaries,” she said. “After this, what salaries?”
Protesters have termed the amendment, known as PEC 55, the ‘Constitutional Amendment for the End of the World’ because of the particular threat it poses to social welfare, public health care and education.
The sole carer for her 14-year-old son, Navega depends on federal financial aid to supplement her income. “Our whole quality of life will change because of these cuts,” she said, shaking her head.
The weak showing at the protest contrasts with larger demonstrations elsewhere in the country, and the massive protests in October and November. As the first round of federal voting took place in Brasilia on Nov. 29, protests outside congress buildings escalated. Demonstrators smashed shop windows and set cars on fire, and police were criticized for liberal usage of pepper spray, tear gas and rubber bullets.
PEC 55’s spending cap will attach any increase to social assistance programs to the previous year’s inflation rate, rather than to GDP. Brazilian human rights NGO Conectas has stated that these “cuts in public spending will worsen inequality and violate the fundamental rights of the most vulnerable populations.”
The U.N. has also condemned PEC 55’s retrogressive stance. Days before the vote, the U.N.’s special rapporteur on extreme poverty and human rights Philip Alston called the move, “a radical measure, lacking in all nuance and compassion.”
“It will hit the poorest and most vulnerable Brazilians the hardest, and will increase inequality levels in an already very unequal society,” Alston said. His statement also says the duration of the cap is “completely inappropriate” and that it will be tricky for the country to respond to changes in the global economy.
The U.N. and Conectas both assert that PEC 55 violates several international treaties signed by Brazil, including the International Covenant on Economic, Social and Cultural Rights and the Convention on the Rights of the Child.
Senators from Dilma Rousseff’s increasingly unpopular Workers Party are PEC’s main political opponents and mostly represent the country’s north and northeast where inequality is more extreme. Prior to the vote, Roraima state Sen. Angela Portela said that if enacted, “for the following 20 years, the situation looks likely to worsen.”
Despite these assertions and recent survey findings showing that 60 percent of Brazilians oppose the amendment, the measure passed with an overwhelming majority by Brazil’s federal government, with 53 votes to 16. Politicians and economists alike seem to feel that fiscal austerity is the only way to salvage the country’s tattered economy.
“At the economic institute here, we are in favor of PEC,” Francisco Eduardo Pires de Souza, an economics professor at Rio’s Federal University, told Humanosphere.
International economists agree: Capital Economics’ emerging markets expert Edward Glossop told Humanosphere that the vote is “a positive step” but that more must be done.
“The hard work has really yet to begin,” said Glossop. “Reforms to the pension and welfare system unveiled by government earlier this month will be critical to ensuring the spending cap is actually met and that public finances are ultimately brought under control. If these reforms fail, this could set off a calamitous sequence of events.”
But Paulo Sena, chamber of deputies legislative advisor, said he believes that PEC will “condemn generations that will be the economically active population here 20 years.” While fiscal austerity guarantees little in terms of economic improvement for Brazil, the combination of an aging population and a 20-year freeze to social spending is likely to make social mobility more difficult.
“Fiscal consolidation typically has the short-term effect of reducing incomes, raising unemployment and increasing income inequality,” U.N. rapporteur Alston concluded in a statement. “In the long-term there is no empirical evidence to suggest that these measures will achieve the objectives suggested by the government.”
After receiving an overwhelming majority vote, PEC 55 was signed by President Michel Temer on Thursday, and budget adjustments will be made over the next year for implementation from January 2018. Temer’s political opponents have said that they will challenge the measure at the Federal Supreme Court, which could lead to direct elections if successful, but is unlikely to reverse the measure.