Great Depression in Latin America: Brazil- Getulio Vargas

Getulio Vargas and The Great Depression in Brazil

• Getulio Vargas was born in Brazil in 1882 and died in 1954.
• He was the dictator/president of Brazil for 18 years, from 1930 to 1945 and from 1951 to 1954.
• Vargas was born in a family of cattle ranchers and acquired a doctorate in law.

The Effect of the Great Depression In Brazil:

Brazil became a republic in 1889: its government was a federation of autonomous states led by the "Old Republic" that was dominated by oligarchies of coffee and milk. The country had a constitution democracy, but illiterates and women, who made up most of the population, couldn't vote.

World War I had been a stimulus for agriculture in parts of Latin America. Many countries made profits in 1915 to 1918 on the exportation of sugar, beans, and raw materials to the allied nations. However, Brazil's biggest export was coffee. It was reliant on foreign markets and had limited industrial development under the Old Republic.

The 1929 economic crash in the United States had devastating effects on international capitalism and Brazil. The price of coffee fell from $200,000 per bushel in 1929 to $21,000 per bushel in 1930.

The Brazillian government and president Washington Luiz tried to bail out coffee oligarchies in 1930 (the government had been protecting coffee producers since a treaty in 1908), but didn't have enough money: as a result, the national government began to collapse and Brazil's valorization (price safety net) program failed.

New classes of farmers and industry workers in Brazil called for more democracy in the country and helped create the Allianca Liberal party. They were supported by "tenants" wich were middle and lower-ranked military officials who began organizing movements in several Brazillian states. The Liberal Party nominated Getulio Vargas for the presidential election of 1930, but Julio Prestes, the Old Republic candidate, won (the election was most likely rigged).

Tenants in many Brazillian states rebelled and deposed the old president. In November, Vargas took office.

Getulio Vargas was a nationalist who favored industrialism, social welfare, centralization, and populism. Although he has been criticized for ruling as a dictator and largely without a congress, Vargas helped Brazil remain stable during the Depression and personally resisted attempts by Brazillian communists and fascists to overthrow the government.

Under Vargas:

• The economic system dominated by rural landowners was destroyed.
• The tax structure of Brazil was revised: state and local administrations became more dependent on the central government.
• Women were enfranchised and the country's electorate was quadrupled.
• Social security laws were enacted along with reforms in education.
• Workers were insured benefits including minimum wage (but the government stringently regulated "unauthorized" unions and strikes)
• Pro-industrial policies expanded Brazil's domestic industrial base and business was stimulated.
• As the provincial autonomy of paulista elites was reduced by more centralization, modernism and industrialization were no longer as obstructed.

However, Vargas didn't attempt to change the private enterprise system that was in place. Also, his social reforms did not actually help the rural poor because of poor implementation.

In 1945, he was overthrown because of a wave of democratic sentiment that affected postwar Brazil. Vargas was formerly elected president again as part of the Brazillian labor party in 1950, but this time restrained by congress and popular opinion. Eventually, dissatisfied laborers and the middle class called for Vargas's forced retirement in 1954 and were supported by the Brazillian armed forces. Instead of accept retirement, Vargas committed suicide in August, 1954

By Robin Leiter