... Rousseff’s electoral bread-and-circus tactics suggest the brand of paternalistic politics Brazil can expect if she wins again.
Let’s start with the circus. Rousseff’s administration recently postponed a planned tax increase on beer and soft drinks until after hosting the World Cup next month. The president knows that the success of the global soccer tournament will affect her chances at the ballot box. Brazilians are already furious about overspending on unfinished stadiums that many feel came at the expense of social programs and public services.
Then there’s the bread. Last month, the president raised cash transfers to the poor by 10 percent (well above Brazil’s 6 percent inflation rate), under the popular Bolsa Familia welfare program. She also cut personal income taxes. Higher cash handouts irked opponents so much the government was forced to publicly defend their legitimacy...
But Rousseff has already done plenty to set back Brazil. For starters, state meddling in the economy and misguided incentives have inflicted so much harm that Brazil’s labor productivity sits at levels little changed since the 1970s. Investment in Brazil fell to 18 percent of gross domestic product...
Sadly, Rousseff seems to want more state intervention...
Brazil needs more than cheap beer and energy subsidies... Red tape and rigid labor laws make Brazil one of the world's most costly countries for running a business.
Rousseff may be worried about her political future, but she could still get re-elected in a runoff vote. Brazilians should be concerned about a president who seems to be unaware of how much her policies have hurt Brazil.
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