A: Young people have dreams. My dream was to learn how to devote my time and my energy in creating a better Brazilian society. At the time, probably I was confusing sociology with socialism. Then when I entered the university and I started to receive lessons, I was a bit disillusioned because it was so theoretical, my training. You know — what would I do with that? It took some time for me to realize the necessity of having a better understanding of how society works and then to try to change society a little bit.
Q: Much of your academic work focused on economic development — in a way that differed from so many others in Latin America who advanced ideas of wealth redistribution and government takeover of industry.
A. Without development, it’d be impossible to solve problems. My main concern was on development as a tool to transform society. But development alone is not enough. . . . In the 1970s, the rate of growth in Brazil was very impressive. We used to speak about the “Brazilian miracle,” but if you look at data on income, you would see that income and inequality were worsening for some segments of Brazilian society. So it’s necessary to complement development with some measures of social justice. So you also need access to land for those who need land. And also a tax system that is less regressive than the system you normally have. And education. But, of course, since I believe in a capitalist society, we need to train people to have more skills and be able to compete. What’s important is more opportunities and try to use state power to become more egalitarian.
Q: This country also is struggling with income inequality and lack of opportunity. At what level of inequality does a democracy risk serious destabilization? Is there a tipping point?
A: The tipping point comes not only with what is going on materially, but also with the horizons of opportunity for the future. The lack of dreams, the lack of horizons. When you don’t see possibilities of moving ahead and the situation is worsening, then you have the possibility of a serious crisis.
Q: One of the most striking parts of your life is when you were a professor in Brazil and you were censored, threatened and essentially ostracized by the military dictatorship.
A: I know myself how difficult it is to live in an undemocratic country. Some of my colleagues were imprisoned and tortured. I was arrested and taken to prison to testify, but I was not imprisoned for an extended time. Because of my open criticism of the government, I became more popular among students, artists, intellectuals, even with some contacts with the unions. And then the opposition party asked me to become a candidate just as a protest, because I was not allowed to be a candidate since I was punished by the military regime and I had no rights. But then at the last moment, the Supreme Court . . . gave me the possibility to run, two weeks before the electoral day. I did, and I was classified number two in my party. As number two, I became deputy senator, and when the senator was elected governor of Sao Paulo I took his place. . . . That’s how I became a senator — by protesting, but not because I took a decision to become involved in political life. My decision was to continue to be a professor.
Q: An accidental politician?
A: Yes! That’s why the title of my memoir [is “The Accidental President of Brazil”]. . . . But step by step, I became involved with the political situation. Other politicians looked at me with some suspicions because I was not one of them. This was a positive card to be played, because people prefer nonprofessional political people.
Q. You later became finance minister, and you relied on austerity measures to bring the rampant inflation the country was experiencing under control. Does the situation in Europe resonate with you?
A: I was criticized for the fact that my fiscal policy was not that strict and people asked for more — more austerity. My perception of the situation was, “Well, I have to be cautious, because people have to have hope.” If I instituted tremendous austerity without opening up possibilities for the future, it would be impossible to implement the policy. So I tried to combine the hope of the people — that is to say, to keep some degree of growth and to enforce austerity. Not just austerity, but also private investment — I asked people to invest in the country. In Europe, what’s happening is that people are being asked to be more austere. They’re cutting social policies without opening up windows of possibility for the people. I think this is what provokes unrest.
As I used to say, the economy is like navigation. You have to understand what are your objectives, what do you want to do. The velocity of the boat depends on the weather. How you get to the point where you want to arrive depends on whether you are confronted by an island or an iceberg. You have to find a way out.
Q: The need for austerity measures is raised by some in this country who are worried about mounting deficits and runaway government spending. Do you understand the tea party movement here?
A: It’s difficult for a Brazilian to understand this kind of radicalization. Democracy requires some degree of compromise. Of course, you have to take into account, always, principles. But if you are in a democratic situation, you have to accept the majority rule with respect to a minority. So you have to compromise. The tea party movement seems to me without any leanings toward compromise. They have very clear views about what is good, what is bad, and they are to some extent fundamentalists and fundamentalism is bad for democracy.