The Jair Bolsonaro’s supporters stormed the capital this week, a desperate effort by the far right in Brazil to bring back Trumpism.
What happened in Brazil is a blueprint for the rest of the world.
U.S., under Trump, has blamed much of global misery on China through promoting nationalism around the globe via politicized U.S. institutions and media outlets. Brazil fall to prey. Bolsonaro mimicked almost every single policy that Trump enacted. Other countries have also bought in the view that China created much of the problems and that the world will be divided into two spheres of influences.
But now, Lula da Silva is in office. He famously said he does not believe there’s a need for trade wars between U.S. and China. Under his previous terms in the office, Brazil’s economy surged thanks to its trade with China. He was able to enact many social programs due to his embrace of globalization, although things went south quickly with his successor Dilma Rousseff’s impeachment and relentless stimulus packages during COVID.
Now you may see a clear path to practicality. First, economic nationalism pioneered by Trump prompted many copycats around the world, where politicians used emotions rather than policies to persuade constituents. Then comes the economic sluggishness due to policy failures and the pandemic. Instead of walking back some of these politics, these politicians never admit any wrongdoing but further tighten protectionism. Nevertheless, relieves were needed for those hurt by these policies. That’s when they print money and subsidize industries, like Sri Lanka (we all know how that went), plunging their nations into chaos due to depleting reserves caused by reduced economic competitiveness and the Fed’s tightening cycle. Surely the GDP growth number looks great (such as Brazil), but that growth is fueled by spending increase, not productivity growth. While U.S. can get away with this due to U.S. dollar dominance, the copycats around the world plunge their economies into darkness, creating insurgencies and chaos. This is when the practicality comes back. People realize that years of adrenaline-fueled politics paid them little but chaos. Their income grows but inflation skyrocketed. That is why you see a return to practicality in those countries with pragmatic leaders being elected. There may not be a comeback for Trumpism in a decade.
From Sri Lanka to Brazil, different countries are on different stage but are on the same irreversible path to practicality. Some countries have found their pragmatic leaders while others have not.