Living in Brazil, it is easy to imagine that you have been transposed into one of those novels with alterative endings-in this instance, about how the USA might have developed if a few things had turned out differently. Both are continent-sized countries in the western hemisphere with federal democracies in which state governments have considerable power. Both were colonized by small European seafaring nations before gaining independence within 50 years of each other. Their populations are made up of the descendants of their original inhabitants, early colonists and African slaves, topped up later by European and then Asia migrants. A recent influx from neighboring countries completes the mix. Brazil’s melting-pot is, if anything, even more successful than America’s. There is no such thing as a hyphenated Brazilian. Both countries seem surprising religious to European eyes, with different Christian sects competing vigorously for believers. The most successful Brazilian multinational of all may be the Universal Church of the Kingdom of God, a Pentecostal outfit that keeps being investigated for overenthusiastic marketing and opaque book-keeping. Both places show a strong preference for consumption over saving when times are good. Brazil has a culture all of its own, but it looks for inspiration to America more than it does to its Spanish-speaking neighbors.
A place of paradoxes And yet the differences are stark. America is rich, Brazil poor, Brazil is more left-wing. America fights wars, Brazil does not. America likes its capitalism as unbridles as possible, Brazil prefers its markets with a strong government presence. Look more closely, though, and some of these distinctions become blurred. Brazil is more left-wing in theory than in practice. Next year’s presidential election is likely to come down to a choice between a candidate from the left-wing Workers’ Party and the centre-left Party of Brazilian social democracy. Even so, most of the money the government spends goes to people who are comparatively wealthy. The biggest single reason for the difference in income distribution between Brazil and America is more regressive public spending in Brazil. “we live in a paradoxical situation of a government that spends a lot and benefits a few,” said Antonio Palocci on becoming finance minister in 2003. Brazilians also have a more American approach to capitalism and free market than they might appear to at first sight. Many of their country’s success stories of the past 15 years, from the free-floating real and the autonomous central bank to the privatization of state-controlled firms that have since flourished, are products of a similar way of thinking about what economic arrangements wok best. To his credit, President Lula has not reversed these changes, as many feared he might. The clash between a growing middle class and a government that often seems to be blocking its aspirations is creating a rather American story about the determined little guy being constantly pulled back by the dead hand of bureaucracy. Many of the younger businessmen and bankers in Brazil have postgraduate qualifications from American enterprise institute or other free-market think-tanks.
If America’s doubts about free markets and Brazil’s confidence in them both continue to grow, the two may shortly meet. Even President Lula now denounces protectionism, though many foreign governments, nothing Brazil’s still fairly high import taxes, are unconvinced, Brazil’s import and exports taken together were equivalent o 22 percent of its GDP in 2007, compared with 23 percent for America. Above all, Brazil now seems confident tat a more open economy will not condemn it to a role as coffee-maker to richer countries. Like America, Brazil is so big and varied that it often seems to contain at least two separate countries. One of these is a place with ten land borders and no wars where people speak a single language in compressed item zones: where there is no religious conflict; and where three-quarters of the population turns out to vote, with election results announced the following day. This country has sophisticated economic policymaking and financial markets, as well as a growing collection of world-beating companies. It runs on sushi and is usually suntanned.