Coronavirus Reverses Brazil's Economic Revolution
Free marketeer Paulo Guedes discovers Mike Tyson’s truth: “Everybody has a plan until they get punched in the mouth.”
Plan B looks like the opposite of Plan A.
Photographer: Andre Coelho/Getty Images South AmericaWhen Paulo Guedes, Brazil’s University of Chicago-schooled economy minister arrived at his desk in January of 2019, he came with an aggressive market-friendly vision for re-founding Latin America’s biggest economy. His plan, cheered by captains of finance and industry: Slash the federal bureaucracy, hurl down trade barriers, curb the nation’s fiscal eating disorder and sell everything. Brazil’s state owned companies? “Runaway children who are now addicted to drugs,” he quipped. All those public sector employees? “Parasites.”
The coronavirus has torn up Guedes’s textbook assignment. A rare economic liberal in a hemisphere of dirigistes, he is now the warden of a nearly $100 billion bailout, one of the biggest rescue operations in the emerging markets. The big state is even bigger. Those truant public institutions and their civil servants are all that stands between Brazil and the economic ventilator.