The casinos were much more than just roulette and baccarat. They represented splendour, music, light; they were the perfect place for people to enjoy themselves and mix with different groups. They were frequented by the middle classes, rich businessmen, politicians and diplomats. Traditional families played side by side with the nouveau riche, expensive prostitutes, local celebrities and members of the jet set. But above all the casinos were an important work market, essential for Brazilian musicians. With President Dutra’s decree, around 40,000 people all over the country lost their jobs. Many people tried to persuade the president that the loss to the country would be great and that gambling would continue clandestinely, but he would not change his mind. There was no alternative. The Dutra government was very attentive to prayers, but was impermeable to social demands.
THE RETURN TO CATETE
Getúlio Vargas openly broke with President Dutra in December 1946. Out of the limelight, he had withdrawn almost into self-imposed exile on his ranch in São Borja. But he continued to live and breathe politics, and remainded popular. In 1946 he was elected as both deputy and senator with a record-breaking number of votes. The fact that he had deliberately maintained his distance from the Congress and the work of the Constituent Assembly – he did not even go to Rio de Janeiro to sign the final text of the new constitution – made no difference at all to his prestige and capacity to mobilize the workers to support his new presidential campaign. But his political stance changed a great deal. Getúlio Vargas had left the presidency and joined the opposition. He needed to patch up his differences with President Dutra and the liberals of the National Democratic Union (UDN) and gain support for his future programme: increasing government intervention in the industrialization process, guaranteeing full employment, and combating poverty without sacrificing economic growth.41
In 1949, when the time came for officially nominating the candidates for the 1950 presidential elections, Getúlio Vargas was ready. He had already modified the main points of his old nationalist programme to accommodate the demands of the new international context. His new programme had two central aims: development and social welfare. The goal was nothing less than economic independence for the country, one of the greatest aspirations of the Brazilian people, especially during the Cold War. Furthermore, his focus on fighting inflation and increases in the cost of living identified his campaign with the segments most affected by President Dutra’s economic policy. Furthermore, he managed to get the business community’s support for his industrialization policy, which prioritized the industrial base. At sixty-seven years of age, Getúlio Vargas was in a hurry. He had every intention of returning to the presidential palace, the Catete, democratically elected, ‘in the arms of the people’. The campaign slogan was a triumphant piece of political communication: ‘He will return!’ The campaign began with his parading in an open car along the Rua da Praia, at the time the most elegant shopping street in Porto Alegre and often the scene of political protests. In the following two months Getúlio Vargas visited every single state and all of the largest cities in the country. He also made the most astonishing agreements and alliances. To attract votes from the north and the northeast, for example, he chose as his vice-president a politician who was virtually unknown in the south: a lawyer called Café Filho who had actively participated in the National Freedom Alliance and was a fierce opponent of the Estado Novo.
Getúlio Vargas was more concerned with striking agreements than with being tied down to a party. In Pernambuco he made an alliance with the National Democratic Union. In São Paulo he worked with Governor Ademar de Barros, who had once been a political opponent. Ademar de Barros had a great capacity for communication with the masses, was politically ambitious, and controlled the small but very efficient Social Progress Party (PSP), which was well organized in the interior of the state. Getúlio Vargas’s strategy of alliances was intended to produce short-term results, but it was risky, and he would pay a high price for it later on. Nonetheless, in the short term it worked: his candidacy was not identified with any one party; it brought new and old politicians together; it was supported by businessmen who were interested in the benefits of industrialization; and it had the electoral strength of the working class, as well as that of the new lower middle class, which was emerging in the country’s major cities.
Furthermore, his adversaries showed little resilience. The National Democratic Union still had not got over being defeated by General Dutra, and once again nominated Eduardo Gomes as their candidate. But the Brigadier was incorrigible. For the second time, with a single declaration, he put an end to any chances he might have had of winning. At a political rally in June he announced he was against the minimum wage, and in favour of contractual freedom.42 Meanwhile, the Social Democratic Party (PSD) had nominated its own candidate, the Mineiro Cristiano Machado, whom they soon realized had no chance of winning. Their solution was typical: while maintaining him as their official candidate, they worked on getting votes for Getúlio Vargas, leaving Cristiano Machado stranded, with very little support and even fewer votes.
Members of the National Democratic Union were disappointed, but Carlos Lacerda was enraged. ‘Mr. Getúlio Vargas is a senator!’ he ranted. ‘He can’t be a candidate for the presidency. As a candidate, he shouldn’t be elected. Once elected, he shouldn’t take office. Once in power we will have to resort to revolution to prevent him from governing.’43 Mr Lacerda meant what he said: during the following years he continued his tirades using the newspaper that he owned, the Tribuna da Imprensa, to attack the Vargas government. But there was no denying Getúlio Vargas’s victory. He received almost four million votes, 48.7 per cent of the total, as compared to 29.7 per cent received by Eduardo Gomes and 21.5 per cent by Cristiano Machado. On 31 January 1951, Getúlio Vargas entered the Catete presidential palace once again, this time as the democratically elected president of Brazil.44
At the end of 1951, President Vargas sent the draft law creating Petrobras to Congress.45 It was this legislation, more than any other, that convinced his contemporaries (and future generations) that his aim was indeed to guarantee Brazil’s independence by creating an independent economy. The law was central to the entire government policy. The demand for oil and its derivatives made them Brazil’s largest imports; the benefits of the country no longer having to depend on them were self-evident. The campaign for the nationalization of oil and minerals had started in the 1930s and had the ardent support of all Brazilians.
In the words of the Brazilian novelist Monteiro Lobato, at the beginning everything is either madness or a dream. And at times it can even be both. In 1937 when Monteiro Lobato wrote his children’s tale The Viscount’s Well, the idea of state-run oil prospecting and exploration in Brazil seemed like a dream, or at most, a good plot for a storybook. ‘The discovery of oil on Dona Benta’s farm has shocked the whole country,’ Monteiro Lobato jokingly declared.46 Perhaps he was not addressing the adults, but only the children, on whom Brazil’s future economic independence depended:
Nobody looked for petrol there because no one believed that petrol existed in that enormous area of eight and a half million square kilometres, all of it surrounded by the petrol wells of its republican neighbours. But as soon as the petrol burst out of Caraminguá nº 1, they all looked like fools and murmured ‘Well I’ll be damned! We had it all the time.’47
Monteiro Lobato, who died in 1948, did not live to see the expression on the faces of those who had denied the existence of petrol. Nor did he live to see the oil exploitation become the central issue of Brazil’s political and economic life. However, by 1951, things had radically changed: the defence of a state monopoly of oil exploration had been transformed into one of the largest public opinion campaigns in Brazil’s history. The Petrol Campaign, as the movement became known, took the form of major civic mobilization in defence of Brazil’s national resources. Vast numbers of people from different segments of society united around the idea that Brazil’s economic independence d
epended entirely on the political will of the Brazilians.
The subject of natural resources and oil in particular penetrated deeply into the collective imagination of the Brazilian people. It also contributed to the emergence of a sense of national sovereignty. This was one of the few mass movements in the country’s history that brought together everyone on the ideological spectrum. It attracted military officers, communists, socialists, Catholics, members of the Brazilian Labour Party (PTB), and even a few from the National Democratic Union, chanting in unison the National Students’ Union slogan: ‘The petrol is ours.’48
Petrobras started operating in January 1954, while Getúlio Vargas was still president, as a state-owned company with a monopoly of the prospecting and exploration of oil. The oil industry represented one side of President Vargas’s offensive to speed up the process of industrialization; the other was the generation of electric power. But whereas he had been successful in founding a state-owned oil monopoly, President Vargas did not succeed in completing the necessary procedures for the establishment of a state electricity holding. Eletrobrás was only to begin operating in 1962. But it was the Vargas administration that provided the infrastructure and financial support that allowed the country to increase its electric power generation throughout the following decade.
Hydroelectric plants require at least five years of operation before producing results. This was the reason why the national consumption of electricity did not increase more during the Vargas government: it was 5.8 million kilowatts when he took power in 1950, and had risen to 8.3 million kilowatts by the end of his term.49 But it did not prevent his administration from executing a far-reaching industrialization programme, with special emphasis on two areas. The first of these was the expansion of key industries, especially steel. The second was the production of trucks and tractors, made possible through an agreement between the National Motor Factory and a group of international companies. The agreement foresaw the gradual nationalization of production and had a very positive impact on the vehicle industry in the country, which was implemented by President Vargas’s successor.50 However, the proposal to create state companies in strategic areas, such as prospecting for and exploration of oil and the production of electric power, meant clashing with deeply entrenched interests, mostly those of foreign companies: Standard Oil, in the case of petrol, and the Light and Power Co. and the American & Foreign Power Co. in the case of electric power generation. With its successes and its failures, the Vargas government highlighted the clash between two proposals for modernization – his own, which was nationalist, and that of the opposition, which was in favour of an association with international capital. These were the two fundamentally different ways of looking at the role of the state which would divide Brazilian society during the following decades.
The first issue that divided these two approaches was the extent to which the state should implement social inclusion policies through legislation to bring thousands of new workers into the market. The second was the question of to what extent the country should rely on foreign capital as the driving force for its economic development. The ideology of the Vargas government was one of nationalist development,51 state intervention in economic activities considered to be of national interest, and prioritizing industries that would lead to a diversification of the domestic market.
Brazil urgently needed to create a new role for itself on the international market that would free the country from reliance on agricultural exports – this was the raison d’être of the Vargas programme. The political costs were considerable: the programme clashed with the interests of foreign companies as well as with those of local industries and finance and that were associated, or about to become associated, with international capital. It also alienated important landowners who still had political power in their regions. All of these groups were hostile to government intervention and to regulatory measures in the economy. Nor did they want policies that led to the concentration of wealth and to the limitation of foreign capital in areas of the economy that were strategic for national development. Furthermore, they believed labour legislation constituted an excessive burden on companies.
Getúlio Vargas was a highly skilled politician, but he was authoritarian. Accustomed to dictatorial solutions, confident in his own charisma, widely experienced in uprisings and coups d’état, he simply was not cut out for working in a democratic environment. His strategy of not identifying with any single party and placing himself above political parties in general, had been highly successful during the electoral campaign, but was disastrous when it came to managing the country. The Brazilian Labour Party (PTB) was torn apart by internal disputes and the Social Democratic Party (PSD) was at times unable to respect its alliance with President Vargas due to interminable regional disputes. The National Democratic Union (UDN) took advantage of the situation by aligning with a group of smaller parties – the Liberation Party, the Republican Party and the Christian Democratic Party. Essentially, they created an opposition alliance that obstructed government initiatives.
The positions of the National Democratic Union were both radical and intransigent. Detrimental economic factors affecting the day-to-day lives of Brazilians contributed to the National Democratic Union success in opposing the government: high inflation and low workers’ wages played into their hands. Starting in 1952, President Vargas’s economic growth programme faced problems beyond his control: the Eisenhower government began to focus its Cold War strategy on Korea, Lebanon and Egypt, all of which were under imminent threat of becoming Soviet satellites. The United States withdrew its support of the Brazilian investment programme and, as if that were not enough, the World Bank insisted on the payment of overdue instalments. The consequences were not long in coming: rising inflation, increased cost of living, growth in public spending and collapse in wages.52 President Vargas had lost control.
Despite the deterioration of the economic situation, the workers did not decamp and move over to the opposition, but they made it clear that their support was not unconditional. On 18 March 1953, 60,000 workers marched in protest in São Paulo, from the main cathedral square in the historic centre of the city (Praça da Sé) to the governor’s palace, the seat of the state executive. The March of the Empty Pans, as it became known, which condemned the high prices and demanded higher wages, was just the beginning. Ten days later the whole city came to a halt and President Vargas finally realized the workers were in earnest. The Strike of the Three Hundred Thousand53 lasted for almost a month and was coordinated by São Paulo’s five largest trade unions: textile workers, steelworkers, printers, glassmakers and carpenters. The strike achieved an average increase in wages of 32 per cent, and provided a model for the organization of mass movements until the military coup of 1964. Support for the strike came from all around the country, including from the students, and led to the creation of the first joint trade union. This organization included trade unions from different sectors that came together in the name of political action, which was forbidden by law. It also created a trade union centre. By the end of the strike, more than one hundred trade unions in São Paulo alone had joined the recently founded Trade Union Unity Pact.
Getúlio Vargas may have been authoritarian, but he was no fool. In March there was the Strike of the Three Hundred Thousand, followed in June by a dockworkers’ strike that paralysed Rio de Janeiro. Before the month was over, he appointed João Goulart as Minister of Labour.54 João Goulart, president of the Brazilian Labour Party (PTB), was an excellent speaker and a patient negotiator, and his party maintained very close ties with the trade union movement. President Vargas intended to show the workers the significance this appointment had for him: Jango, as Goulart had been nicknamed since he was a child, was his chosen political successor. When the new minister took office at the presidential palace after the end of the dockworkers’ strike, President Vargas declared to a committee of trade union leaders ‘I am Jango!’ And he continued, ‘He will be representing me in ever
ything he says. You can trust in him as if he were me.’55
President Vargas appointed João Goulart to work with the social sectors that had supported him since the 1930s. The last thing that he wanted was to lose the political backing of the workers while he was battling for the economic and social development of the country. And the appointment was a success. João Goulart managed to bring the trade union movement and the government together again, to decrease employer pressure on the trade unions, and to build strong backing for President Vargas’s policies. However, with the aggravated economic situation, the new minister’s role was restricted to one of negotiation; it was impossible to prevent the outbreak of further strikes. And João Goulart was targeted by the opposition. With every step he made towards bringing the trade unions and the government together, he suffered an avalanche of criticism and denunciations by the press.
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