Opinion: Worse Before Better in Brazil

Opinion by Jeb Blount

RIO DE JANEIRO, BRAZIL – There are growing signs Brazil’s worst recession in a decade may soon be officially over. Two years of rising unemployment and economic stagnation may be close to an end.

Go ahead. Take a minute to cheer, heave a sigh of relief or succumb to a fit of teary existential giggles. There’s light at the end of the tunnel, and it looks like you, me, Brazil will survive…

… Are you done? Do you feel better? I hope so, because your happiness and relief is almost certainly going to be short lived. You’re going to need all your strength and wits for what’s coming.

Brazil is still a long way from recovery. For the moment, the economy has only stopped getting worse. As terrifying as Brazil’s economic collapse and descent into political chaos has been, the fall was easy compared with the hard work ahead to repair the damage.

Even when Brazil’s economy starts expanding again, the benefits of growth will likely take years to materialize.

Jobs are scarce, savings depleted, consumer demand weak, governments broke, credit scarce, personal and public debt high, crime is rising, politics are fractured and the credibility of leaders and institutions shattered.

With at least six years of economic growth wiped out by corruption, economic mismanagement and a plunge in commodities prices, the ability of Brazilian governments, companies and households to invest in recovery is severely limited.

Government’s ability to respond to the crisis has also been hurt by the Lava Jato, or “Car Wash” probe, which has implicated or led to the indictment of leaders of nearly every major Brazilian political party in the world’s largest-ever corruption scheme.

Not only has Car Wash graft cost Brazil’s economy hundreds of billions of dollars and distracted Congress from reforms needed to deal with the economic crisis, it has made Brazil toxic to foreign investors. Rising political risk has reduced their willingness help Brazil’s crisis hobbled governments, businesses and individuals finance recovery.

So while we should all take heart when the International Monetary Fund and Brazil’s Central Bank say the country will likely start growing again for the first time in two years in 2017, nobody should be surprised if the quality of Brazilian life continues to fall.

In Rio, the signs of decay are everywhere. Violence, while far below levels two decades ago, has been rising since 2013, continues to rise. Now, even gains made by “UPP” community-policing efforts in favelas, or shantytowns, in the upscale South Zone and North Zone neighborhoods such as Tijuca, are unraveling in the face of the bankruptcy of the Rio de Janeiro-state government.

I’ve always been aware of street crime in Rio, but the signs of danger have been rising steadily in the last year. I worked comfortably but carefully downtown for two decades, but the presence of groups of angry and threatening street people has risen sharply in the past year. For the first time in nearly twenty years I’ve witnessed people being attacked in formerly safe areas in broad daylight.

My largely safe neighborhood of Jardim Botânico is facing an unprecedented wave of street crime. Street kids who began begging in front of my neighborhood grocery store last year have taken to attacking shoppers to rob their food.

A dear friend, an actor and fashion designer and large, fit black man, has been hired as a security guard for a white businessman threatened by the growing packs of street kids who attack those walking or exercising on the sidewalk along Ipanema beach.

Take it as you may but his presence has allowed his client to exercise more freely. Still, my friend, on his way to his security walk was stopped and questioned by police searching for a man mugging pedestrians and homes in Leblon.

My sense, and that of my friends, is that police are setting up more road-blocks or document traps where the objective seems to be the solicitation of bribes rather than the suppression of crime. This hardly seems a surprise when the bankrupt state is failing to pay its employees on time.

Gunfire in neighborhoods where my maid and friends who live in favelas and poor neighborhoods continues to intensify.

No matter how encouraging the economic good news, it’s going to get worse for all of us in Brazil before it gets better. Prosperity may be just around the corner, but with crime and violence rising, so might be a mugger waiting to steal your cellphone, wallet or bicycle.

* Jeb Blount is a freelance journalist living in Rio de Janeiro. He has lived in Brazil for 25 of the last 27 years, first arriving in the country in 1991. He has worked for such news outlets as Reuters, Bloomberg, the Washington Post, Miami Herald and Los Angeles Times. Follow him on Twitter at @JebBlount