Postcards From The de-Valuation Carnival

Greg Palast

By Gregory Palast for The Observer/Guardian UK

As Fat Tuesday nears, the political chit-chat above the carnival drums is about the minimum wage, which the nation’s Constitution effectively sets at US$100 per month. With currency devaluation and massive inflation of basic necessities (electricity is up 250%), the minimum should rise automatically to at least 170 REALS from 130.
Regarding this relief for the low-paid, President Fernando Henrique Cardoso, Latin America’s carrier of the Third Way torch, remains inscrutably befuddled. But his ministers, the chambers of commerce and their academics have filled newspaper columns with arguments for eliminating the Constitution’s ‘inflexibility.’

Like everything else during Carnival, the minimum wage debate is counterfeit. The issue was already decided and announced in November 1998 by the World Bank and its cousin, the Inter-American Development Bank (IDB), in a briefing to the British Council in London (whose secrecy I now happily violate).
In return for the loans used to uphold the value of the REAL — a complete failure — Brazil would have to cut government wages and pensions, especially in basic services such as health care and education services. Some state pensions and wages are set as multiples of the minimum wage – so the minimum has to be cut without mercy.
To enforce its dicta (or, as the Banks say, to ‘assist’), the IDB moved $160 million from the health, welfare and social grants for Brazil to this ‘structural’ project. Not all this money was wasted. My own expensive tour of Brazil was paid out of these funds, in coordination of the US State Department and that old CIA front, USIA. (Don’t ask.)
My job was to instruct Brazilians in democratic processes for consumers and labor unions in the basic rights of a civil society. How very American: first shoot them in the legs, then give them samba lessons.

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The fight over the minimum wage is somewhat theoretic in those northern Brazil states which surround the Amazonian basin, where any wage at all is a luxury. So I was particularly taken by the battle of a group, mostly from this Amazonian area, known simply as Housewives (Donas de Casa). The women, whose typical work is collecting food and clothes for the poorest of the nation’s poor, have put a scare into the entire international bio-industrial complex with a law suit, filed for them by lawyers at IDEC, Brazil’s consumers’ association, to block Monsanto’s sale of “Round Up Ready” soy beans.
Monsanto alters the DNA on these magic seeds to survive a heavy dousing of the company’s plant poison, Round Up. Andrea Liberio, a Housewives leader, is livid over the industry’s patronizing claim this stuff should feed poor Brazilians while she reads that UK supermarket Tesco’s won’t sell products tainted with it. At first, the Housewives’ fight looked like goldfish against Godzilla. But the little fish are winning.

Monsanto, rather than present its evidence in open court, delivered the company case to the judge at night, at his home. The company picked the wrong judge. This one, apparently, remembered the days not long past when the military government would come at night to deliver the ‘correct’ decisions to judges, or take them away. Judge Antonio Souza Prudente decided Brazilians did not struggle to remove a military dictatorship only to have it replaced with a commercial. In his courtroom, the judge denounced the night visitors and enjoined sales of the manipulated seed.
The ruling, this past AUGUST, emboldened the head of the nation’s environmental agency to side with the consumers and housewives. This was a poor good career move – President Cardoso removed him from office. This week, the government is arguing an appeal on Monsanto’s side.
But the judge’s ruling appears legally untouchable. Brazil, my US Embassy minders told me, has tougher environmental laws than either America or Britain, with large fines levied against polluters. I looked out the car window at the caustic smoke plumes that give parts of Sao Paulo the aspect of the third ring of Hades. “Oh. Every year President Cardoso issues an amnesty, so no one pays the fines.”

***
Before meeting with the deputy justice minister for Sao Paulo state, it was suggested I use the new lingo crafted by focus-group consultants. Citizens are no longer citizens, but ‘clients.’ Market power replaces human rights. “There’s a whole new attitude in Brazil towards the public.” We stepped over some clients sleeping on the hotel air vents.
The minister was glad to see me. It gave him an excuse to step out of grim negotiations with Sem Terra (the landless) and Sem Telhado (the homeless) – who had threatened to set up a permanent encampment around the ministry.
‘The roofless meet the ruthless.’ It didn’t seem to translate well.
As servants poured demitasses of coffee, the State Department man was eager to show me the Cardoso party’s progressive side. He pointed to the paper-and-sticks model of a large building which covered the minister’s desk. “That’s new government-supported housing, I suppose.”
The minister smiled. “Actually, it’s our new prison. The latest US design.”
I guess you have to put your clients SOMEWHERE.

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Interview notes. Why was that man cutting down trees? For wood for cooking. He can’t afford to buy bottled gas. Its price rose by 350% in one year.
And why was that? Because the Cardoso government eliminated subsidies and controls on bottled gas.
Why raise the price of bottled gas? So that those who could afford to choose would take piped-in gas over bottled.
Why did the government promote piped gas? To make the privatisation of the state’s gas company, Comgas, more attractive to foreign investors.
Why sell Comgas? Cardoso needed US$10 billion a month just to pay down the failed currency-saving loans.
Who bought it? Shell and British Gas.
When? A year ago, just after Peter Mandelson’s visit with President Cardoso.
Why was Peter Mandelson in Brazil? Don’t ask.

***
Lighten up, the Embassy tells me, it’s Mardi Gras. There’s President Cardoso in a little green dress and thong bikini, kneeling in front of Bill Clinton. He’s singing the Jobim ballad, ‘EU EREI O PALHIO …. I’m the clown in your Carnival.’ In some ways, the satirists in the parade are more credible than the real thing. Well, enough. I’ve got to put on my feathers. As the State Department says, “If you can’t get rich, at least you can get naked.”

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Gregory Palast writes the award-winning column, “Inside Corporate America” fortnightly in Britain’s Sunday Newspaper, The Observer, part of the Guardian Media Group, where this first appeared. For comments or request to reprint, contact us.