Brazil’s fledgling democracy is in peril of failing. Meanwhile, its political economy, at the federal and the local and regional levels, is mired in illegal conduct. In a modern democracy with a robust political economy, such as that found in Canada, politics and economics are fundamentally inseparable, mutually interdependent, not dichotomous, and political actions influence economic outcomes.

Moreover, political economy is fundamentally interdisciplinary, drawing from economics, political science, law, history and other social sciences. Whereas, in Brazil, a colony of Portugal for over three centuries, there was no democracy at all until recently. And political economy was colonial in nature. In 1985, an election ushered in civilian rule and thus began the expected democratization of the country, and with it a nascent and post-colonial political economy started to slowly take shape. Progress, however, has consistently been hampered by endemic corruption, a breakdown of law-and-order, the spread of the coronavirus, and the weaknesses of a fledgling democracy.

In January 2019, Jair Bolsonaro, a former military officer, was elected president on the promise of tackling law-and-order problems. He had campaigned on a fresh start that would purge corruption, crime and other illegal conduct. Instead, corruption and scandals have rocked his presidency by implicating him, directly and indirectly, and his conduct is increasingly viewed as illegal. Exacerbating this situation is the comprehensive impact of the coronavirus on all aspects of life, governance and democracy in Brazil. This has prompted the nation’s political economy to take shape in a manner that is exposing actions that are not founded on good governance but rather on shenanigans, political maneuvering, right-wing values (as was the case during colonial times), and the promotion of Bolsonaro’s personal and ideological agendas.

Meanwhile, the country’s economy is in a tailspin because of the economic, social and political impacts of the coronavirus, which he has not handled well, dismissing it as nothing more than the common flu, and therefore not worthy of concern, even when deaths and cases of infection have mounted daily throughout the country.

Another concern is that, over the last three months, Bolsonaro’s government has been rocked by the resignation of the highly-regarded Justice Minister Sergio Moro, who has implicated the president of wrongdoing in the firing of Maurício Valeixo, the federal police chief – that is, the dismissal was without cause or justification.

Also, it was overreaching by Bolsonaro as his decision was outside his designated area of responsibility (for the police chief is independent of the presidency). Both Moro’s resignation and Valeixo’s firing were especially damning for Bolsonaro, who is currently being investigated for impeachable conduct in Valeixo’s dismissal. In mid-April this year, Bolsonaro fired the health minister for advocating social distancing policies to address the spread of the coronavirus.

All three of these recent developments have undermined democratic principles and Brazil’s young democracy is under attack by its own president. To make matters worse, three of his sons are being investigated by the federal police for possible wrongdoing (including corrupt actions, such as money-laundering by one son, and spreading fake news attacking justices of the Supreme Court by the other sons).

Furthermore, the economic, political, social and cultural impacts of Bolsonaro’s extreme right-wing policies in the reckless development of the Amazon, especially with total disregard for the welfare and survival of indigenous populations, is worrisome and contrary to enlightened and democratic governance.

His failure to address environmental issues is also another serious concern. Bolsonaro’s view of Brazil’s political economy is shaped by his personal and political ambitions (especially, his goal of re-election in 2022) and his business agenda (e.g. restarting the economy prematurely and recklessly, tied to his designs for re-election). These developments, coupled with his values, dictate what political and economic policies are to be advanced.

Indeed, Bolsonaro’s response to the spread of the coronavirus, and his aggressive and fast-paced development of the Amazon at all costs, epitomize his policy stance, strategy and corresponding actions. Consequently, Brazil’s political economy is actually exhibiting both weak convergence (in terms of the cornerstones that encompass leadership, government, ideology, and the business sector) and simultaneously, divergence – in terms of politics and economics being interdependent but separate.

As a result, the governance of Brazil is showing signs of a de facto return to a blatantly colonial-type political economy, especially where two separate nations, one largely “non-indigenous”, and the other indigenous, are exposed. These developments also mean that Bolsonaro displays a façade where politics and economics are seemingly not dichotomous, though in reality dichotomy and divergence are the new norm. This situation bears some resemblance to the case of Bolivia where, as a result of its November 2019 military coup, a return to a colonial-era political economy is aggressively and rapidly taking hold.

To understand the nature of political economy at the local and regional levels, I turn to the case of Itaboraí, an urban center with a population of a quarter of a million, located 30 miles east of Rio de Janeiro. Corruption casts a long shadow on that city and shapes its political economy.

Douglas and Valle have reported in Bloomberg Businessweek (April 23, 2019) that militias, comprised of bands of rogue and off-duty police and security officers, starting operating in Itaboraí as well as in Rio’s impoverished western neighbourhoods a while back. “Politicians either turned a blind eye or collaborated with the groups”. These militias charge for a wide array of services, including security, cooking gas, internet access, and cable TV. They have also cornered the market in contraband tobacco and have forced vendors to sell it. These gangs are now active across Rio and fourteen other cities in the state, affecting the lives of millions of people. More generally, but importantly. Douglas and Valle state:

“Corruption exacts a punishing cost throughout Brazil. Graft consumes as much as 2.3% of gross domestic product, according to the Federation of Industries of the State of São Paulo. That’s about $38 billion a year. . . we have systematic corruption on all levels. It is a practice that’s deeply embedded in the country, and in public security, it is no different.”

Compounding this problem is that many state governors and city mayors do not endorse Bolsonaro’s policies. When the governance apparatus, the supporting systems, and the policies and regulations foster deep-rooted corruption and crime at the local and regional levels, there is a profound failure in governance. Political economy has a reinforcing role to play at the various levels of governance (small urban area, rural area, city, region, and nation). Upholding and advancing the tenets of democracy is therefore a profound challenge in Brazil in more ways than one.

Finally, as the coronavirus is unleashing havoc on all fronts in the country, the dismal situation is prompting Bolsonaro to conduct his affairs in an undemocratic manner, with clear indications of his leaning towards a colonial-type political economy.