Health workers are on the front line in the fight against the pandemic, putting themselves at risk every day, while earning low wages, to save the lives of those in the public health system. They are public servants, just like teachers, social workers and others who provide essential services to the Brazilian people.
Are these workers, mostly women and blacks, to blame for social inequality and the public accounts deficit? Or are the super rich, the bankers and big capitalists, a tiny minority (less than 1% of the population) who concentrate most of the national wealth while paying next to no tax at all, to blame? This editorial is dedicated to answering this question.
Dismantling public services
The campaign to cut public spending (and for its redirection) has been part of a permanent offensive by the ruling class in Brazil for the past thirty years, insofar as it constitutes one of the pillars of neoliberal prescription. Its fundamental objective is to make it impossible for the universal rights (education, health, social security, etc.) inscribed in the Constitution of 1988 as a result of the social struggles fought in the 1980s to be realized in practice. This is therefore a push to direct state action more and more toward serving the immediate interests of the big capitalists and bankers to the detriment of the social rights of the majority of the Brazilian people.
A first significant victory in this bourgeois offensive was obtained with the passing of the Fiscal Responsibility Law (LRF – Complementary Law No 101) in 2000. The LRF limited the percentage of the public budget that could be allocated to government employee expenses and made it difficult to create new social security mechanisms.
In 2016, the government of Michel Temer guaranteed a new victory to the financial market magnates through the promulgation of the so-called Emenda Constitucional do Teto de Gastos (Constitutional Amendment to the Spending Ceiling). This rule limits changes in public spending and investment to no more than the previous year’s inflation rate. This means that there is no possibility of these expenses growing in real terms, which affects social investment above all else. It is also worth noting that neither the LRF nor the Teto de Gastos (Spending Ceiling) has imposed any spending limits when it comes to the payment of Brazilian public debt to large creditors and speculators.
In the current conjuncture, this issue acquires central importance as it makes up one of the axes of the economic policy of Paulo Guedes and Jair Bolsonaro. In effect, a new squeeze on investment in public services would result in a deepening of the economic recession and the social crisis. Moreover, it would mean the further scrapping of health, education and other public services, and the widening of social inequalities through the directing of more public resources to private financial accumulation. The then precarious nature of these services would help to justify the push for new rounds of privatization.
It is no coincidence that in recent weeks, political agents linked to the most powerful capitalist factions in the country, such as Economy Minister Paulo Guedes and President of the Chamber of Deputies Rodrigo Maia, have publicly spoken out on the matter of public spending. In their defense of the maintenance of the Spending Ceiling, both have referred to the need to limit the scope of the cash transfer program that Bolsonaro wants to continue on the basis of the R$600 (US$113) emergency aid now being paid during the pandemic.
They claim that the reason for the country’s brutal social inequality is mainly the fault of “privileged” government employees. Of course, they forget to mention who are the truly privileged: the super rich, the bankers and the public debt speculators, who accumulate gigantic profits and assets by paying one of the lowest tax rates in the world, and so perpetuate perverse and enormous social inequality.
From a strategic point of view, the declarations made by Guedes and Maia also act to reinforce the neoliberal framing of this issue, and set the stage for a more favorable conjuncture for moving forward on the projects of administrative reform now being drawn up. Anticipating mechanisms such as reductions to the wages of public servants, the extension of time for the achievement of stability, and the spread of the contracting out of jobs through the Consolidação das Leis Trabalhistas (CLT – Consolidation of Labor Laws), this reform seeks to deepen the attacks initiated through the LRF and the Spending Ceiling.
The lies that underpin the neoliberal offensive
In order to give this project greater legitimacy, the neoliberal offensive of the bourgeoisie seeks to win over the majority of public opinion through a set of constantly repeated lies. Among them, the one that stands out the most is the presentation of the public service as a bloated and privileged sector.
Such fallacies can be easily refuted by resorting to concrete information. For example, data provided by the Organization for Economic Cooperation and Development (OECD) indicates that the share of public servants among the Brazilian working population (12%) is well below the average of a wide range of countries (21%). In this respect, we are behind countries that don’t even make up the most developed core of capitalism, such as Slovakia (23%) and South Africa (17%), and are on the same level as other Latin American nations, such as Mexico (12%) and Chile (11%).
The numbers available from the Ministry of Labor show that in 2018, half of all public servants received no more than three times the minimum wage, or a little more than R$3100 (US$585) in today’s value. This is still a long way off what the Inter-Union Department of Statistics and Socioeconomic Studies (DIEESE) calculates to be the minimum wage necessary for a working family, which is now around R$4300 ($US811). The reality is therefore far removed from the ‘maharajahs’ that the big business press and various bourgeoisie spokespeople often put forward.
While the vast majority of government employees receive low or modest wages, the report released in July by OXFAM shows that 42 billion Brazilian billionaires have seen their fortunes increase by R$189,486 billion (US$35 billion) in the midst of the pandemic. Data from the Ministry of Economy in 2016 shows that about 25,700 people (with no government employees among them) who make up only 0.2% of the adult population in the country have an average individual fortune equivalent to R$52.2 million (US$9.75 million) and among them concentrate 16.6% of all of Brazil’s declared wealth. A slightly bigger group of 324,000 people (1.2% of the population) has an average income of R$52,800 (US$9,850) and concentrates 32.9% of all declared net wealth.
The effects of the lies
Even though they do not correspond to concrete reality, the lies told by the government, big business and the mainstream media are extremely useful. Their main effect is to foster divisions within the working class. The purpose of the ideological campaign is to make workers in the public and private sectors fight amongst themselves, instead of becoming allies in the fight against the truly privileged – the bankers, the super rich and big business.
Beyond that, the neoliberal ideological offensive obscures the fact that there can be no quality public service without a broad and well-paid layer of government employees. Thus workers in the private sector pushed into opposition to the public service, end up legitimizing the precarious nature of public services whose main users are these very same workers, especially their most impoverished and oppressed sectors.
As a result of the combination of the objective precariousness of services and the neoliberal ideological propaganda, some sectors of the working class embrace the alternative and end up using private services in areas such as education and health. This movement consumes a large part of the budgets of working families on services that are all too often of limited quality but operate as powerful sources of profit for their owners and investors. Furthermore, the segmentation of access for workers to services based on the public/private binary reinforces the logic of a radical breakdown in social solidarity that characterizes capitalism in its neoliberal form.
For an anti-capitalist program to guarantee public services
From an anti-capitalist perspective, the issue of public investment must be approached in an entirely different way. It is necessary to tackle and reverse the combined processes of increasing precariousness and commercialization of services and the continual looting of public funds by private capital. The provision of universal and free quality services to the population must be made an absolute priority. The public budget must be at the service of the needs and interests of the majority of the Brazilian people and not a minority of big capitalists.
Financing public services through the budget cannot continue to be a tool of ideological and practical division of the working class. On the contrary, it is necessary to wrest the necessary resources from the bourgeoisie. In this sense, measures such as auditing public debt (with the suspension of payments to bankers and big creditors), the overturning of the Teto de Gastos (Spending Ceiling) and the taxation of large fortunes are crucial.
Without a doubt, this is a fundamental battle in the current climate of a rapid deepening of the economic and social crisis. The picture becomes even more dangerous if we consider that the offensive of reducing public spending and scrapping public services is something that unites the entire ruling class. Faced with this scenario, a decisive struggle around the issue can only be fought through the unity of the working class expressed by a united front of its political parties, unions and social movements.
This article is an English translation of “Quem são os privilegiados: funcionários públicos ou super-ricos?”, Esquerda Online (EOL), 29/08/2020.
Translation: Bobby Sparks
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