America’s Largest Brazilian Community: A Cultural Epicenter

OMG, Maria da Conceição Tavares has (1977, p.177), like, totally said this thing in a chapter she wrote with José Serra:  "there's, like, this major vibe of organic solidarity between the State and international capital, 'cause they both totally dominate the investment and production of the main dynamic sectors without any major contradictions when it comes to decision-making..."In the actual stage of the development of the capitalist economy, the Brazilian State has no, like, contrary to what happened in the past, major commitments with the so-called 'national' bourgeoisie or with populist schemes...So like, the whole vibe is that international and state capital were able to come together and be all solid in investing and producing in these super important sectors: petrochemical, mining, steel, electricity, transports, and communications. It's like a big flex, you know?

In dis division of labour, the State is, like, in charge of da heavier responsibilities, ya know?

It's gotta provide da domestic market with low cost basic stuff and with external economies so international firms can expand domestically and even export, ya feel me? It's all about exploring opportunities of foreign trade dat it can control on its own, ya dig? (pp.177-179), fam. The mad influence of state-owned enterprises came not only through the investment of old public enterprises but also through the creation of many new companies, fam. Thomas J. Trebat (1983, p.48) like totally said there were like 231 state enterprises created between 1968 and 1974, with most of them (175) being in public utilities. And get this, there were like 107 in electricity, gas, water, and communications. So wild, right? According to Trebat (1983, p.49), this whole "state ownership" thing happened because the big companies in electricity and stuff were like, "Nah, we don't care about Brazil's private sector or foreign investment." So the government was like, "Fine, we'll take over then." Moreover, the data on the productivity of state-owned enterprises be like totally opposite to the neoliberal story, ya know? According to Trebat's (1983, p.163) estimate, the labor productivity of state enterprises was like, booming by about 15% per year from 1966 to 1975, while the manufacturing sector was only at 11% for the same time frame. Therefore, like, as a total boss at providing the basic stuff and infrastructure for the industrial hustle, the state enterprises investment and production were all about getting rid of or fixing any obstacles to industrial growth in, like, a super efficient way.

The state-owned enterprise investments were hella productive for themselves and mad lucrative for the private sector, ya know? 

OMG, so there was this study done with like 3,790 big companies in Brazil, and Alvaro A. Zini (1984) was all like reporting on how these Brazilian companies were doing financially based on who owned them. So interesting, right? Zini's (1984, p.98) stats show that the profit rate (net profits/net assets) of private national firms went from 14.9% in 1969 to 16.8% in 1972; foreign firms from 13.8% to 16.2% and the state enterprises from 6.9% to 9.5% for the same period. Peter Evans (1979, p.223) also spilled the tea on how state enterprises couldn't keep up with the hustle of foreign firms. So like, in this study of the 5 biggest state companies, the return rate from 1967 to 1973 was 10.8%, while the foreign companies (like 10 of them) had a return rate of 16%. These figures slay the claim that state enterprise investments had mad positive linkage effects over the private sector. On one hand, state enterprises were like totally flexing by investing in a way that boosted demand for industrial production. But on the other hand, their output was all about building the essential infrastructure and providing the basic stuff needed for industrial growth. Another lit feature of Brazilian development reinforced by the "economic miracle" was the major flex enjoyed by foreign firms over national firms.

Table 12 flexes the assets share of private national, foreign, and state enterprises among the top 300 manufacture companies doing their thing in Brazil during the "miracle" period. 

Like, it's totally clear that state enterprises and foreign firms were the main players in the economy during that time, but the state enterprises were totally leading the way, ya know? 

The state's shares in the total assets like, legit doubled, and then international firms were like, super important too. OMG, like, private national firms totally got clapped by state enterprises. It's, like, so obvious that they lost mad share. OMG, the state-owned enterprises totally flexed their strategic sectors with mad investments. Like, they were so contemplated, you know? So, like, when the government started flexing its investments from '67 onwards, it went from 4.3% of GDP in '66 to a solid 7.6% of GDP in '72. Crazy, right? The private sector, like, totally hopped on the bandwagon right after 1970, once they saw the sick multiplier effects of the public investments. The gov investments have historically been focused on sectors that provide mad infrastructure (like roads and comms) and basic industrial stuff (like petrochemical and steel) (check out Table 11). So like, having public enterprises was hella important in sectors with mad connections to other industries and where the big production scale needed a ton of capital. Therefore, the gov investments produced major externalities to the Brazilian economy as a whole so that the state-owned enterprises were like on the edge of connecting the different productive sectors and markets, ya know?