The last four decades have reconfigured Brazil’s economic infrastructure, with increased foreign dependency due to its return to specialized production and a focus on primary industry exports. The trajectory of national decline finds expression in the reduction of Brazil’s contribution to global GDP, from 3.2 percent in 1980 to 1.6 percent in 2021.
Marcio Pochmann is an economist, politician, and professor at the Universidade Estadual de Campinas in São Paulo.
Translated by Marty Hiatt and Eve Richens for Gegensatz Translation Collective.
The impacts of this on class configuration and class factions have been significant. The might of the new trade unionism that revolted against the oppression of the civil-military dictatorship and employers’ exploitation at the height of urban and industrial society at the end of the 1980s suffered a strong decline from 1990 onwards, when Brazil passively and subordinately entered neoliberal globalization.
National trade union membership, which was over 30 percent of employees at the end of the 1980s, had fallen to 11.2 percent in 2019, while the number of strikes fell from around 4,000 annually to less than 600 in the same period. With the industrial relations reforms of 2017, attacks on trade union infrastructure became even stronger, with brutal restrictions on access to the resources necessary for the minimal financing of trade union activities, as well as access to industrial relations tribunals and collective bargaining.
It is in light of this regressive situation for the working class and the structure of the representation of workers’ interests, which caused many people to think that the old trade union movement was refusing to die when a new one was ready to be born, that this article aims to explore the new trade union movement, precisely at a time when Brazil is preparing to actually enter the twenty-first century.
The currently growing recognition of the existence of another world of work, which differs from that of industrial society, reveals the horizon of the necessary reformulation of the structure of trade unionism at a time when understandings regarding a redefinition of trade unionism are advancing in the orbit of the Ministry of Work at the start of President Lula’s third mandate (2023–2026).
The Decline of Urban and Industrial Society and the Setbacks Suffered by the New Trade Unionism
When Brazil was preparing to enter the emerging digital age at the end of the twentieth century, with the establishment of a domestic microelectronics market and the technological and informational leap that was set in train by the force of the information technology law and partnerships with Japanese and German capital, there was a major national abandonment of historical scope. This happened precisely around 1980, at the height of urban and industrial society, when the new trade unionism emerged that, with its impetus to change the order of things and willingness to struggle, placed the working class on the national political agenda for the first time as a collective subject of enormous importance.
With the rapid organization of workers at the workplace level and the expansion of trade unionism, there was also a significant shift in the direction taken by rural and urban unions. At the same time, the growth in the number of strikes and collective bargaining made clear the unprecedented scale the organization of workers’ rights had reached in Brazil, and its impact on the national political scene was indisputable.
The foreign debt crisis and the adoption of a recessionary economic policy between 1981 and 1983 put an end to the cycle of productive expansion. For around a half-century, this cycle had been responsible for the wide-ranging modernization of the dominant capitalist model installed by the Revolution of 1930, which had defined, among other things, the structure of corporate trade unionism in Brazil. The combination of taking on foreign debt and the expansion of domestic public debt inherited from the final governments of the civil-military dictatorship (1964–85) established the basis upon which the financialization of the economy gained independence at the same time as the regime of hyperinflation.
In the process of the country’s passive and subordinate entry into neoliberal globalization from 1990 onwards, the drop in hyperinflation occurred by means of a renegotiation of foreign debt and the introduction of the Plano Real. It was a recipe fatal to industrialization, as higher real interest rates attractive to the entry of foreign capital increased the value of the national currency, thereby stimulating the substitution of domestic production with imports, meaning that the production of high value-added products and the decent jobs that come with it both ended up offshore.
In the digital era, the international division of labour separates two distinct groups of countries: those who produce and export digital goods and services and those who import and consume them because they produce hardly any of them domestically.
Finally, the prevalence of the tripartite macroeconomic doctrine since 1999, with a floating exchange rate, fiscal surplus, and inflation targets, ended up consolidating the introduction of foreign capital into the regime of financialization propped up by very high interest rates and a growing disconnection from Brazil’s former peripheral relationship to the countries of the centre or the Global North. In reality, under the outward-turned economic model, external dependency determines national dynamism, which is fed by a constrained domestic market, and it suffocates the production and consumption of industrial goods, which are increasingly sourced from abroad.
In the general context of the decline of industrial society, the new trade unionism suffered profound setbacks. It was largely imposed by the dismantling of the structural bases upon which Brazilian trade unionism had developed and with which it had been associated since the end of the nineteenth century, following the transition from a long-lived primitive agrarianism to a modern, urban, and industrial society.
From the launching of the 1870 Manifesto Republicano, to the Brazilian Revolution of 1930, objective conditions were created by which Brazil, together with South Korea, became the peripheral and formerly colonial country that most advanced, even if belatedly, its level of industrialization between 1930 and 1980. But with its passive and subordinate entry into neoliberal globalization from 1990 onwards, what urban and industrial society had developed up until then suffered strong setbacks, accompanied, consequently, by the destruction of the material bases upon which trade unionism had developed throughout the twentieth century.
With deindustrialization came a reversal of the expansionist economic cycle of the past, such that the country remained trapped in a long phase of stagnation based on the financialization of the stock of existing wealth and on the return of the model of exporting primary resources. With this, the creation of a growing population superfluous to the requirements of typical capitalist activities caused the freezing of wages and a renewed reduction in the levels of employment protected by social and labour rights.
The reconfiguration of activities associated with the informal and subsistence economy, characterized by small business service providers also increased, yet these are unable to generate a shared identity and a collective sense of belonging as workers. Although these are economic activities of generally limited productivity, resistance to social and labour rights has been growing, including on the part of those working themselves.
The Digital Era and Brazil’s Preparations to Enter the Twenty-First Century
A reversal of the current national situation requires setting into motion a range of policies that promote a return to independent development and are capable of reconstructing a competitive national system of production. This means achieving the necessary and strategic repositioning of Brazil in the international division of labour in the digital era and surpassing the economic model of primary resource production for export, which is dependent on the importation of goods of higher added value, produced with the application of technology and under decent employment conditions abroad.
In the digital era, the international division of labour separates two distinct groups of countries: those who produce and export digital goods and services and those who import and consume them because they produce hardly any of them domestically. Brazil is in the second group of countries that are increasingly dependent upon imports — it is currently the world’s fourth-largest consumer market for digital goods and services.
As a by-product of the low economic dynamism associated with the liberal and neoliberal policies adopted in conformity with the commodity cycle, the population that is superfluous to the needs of the typically capitalist private sector has begun to increase. The precocious advance of deindustrialization since 1990 also reduced the size of the salaried middle classes and the industrial working class across all occupations.
Trade unionism remains fundamental in the new digital age.
Instead of the agency of the capital cities and major metropolitan centres located in the country’s coastal regions, we have seen, for example, the modernizing agency of medium-sized cities, which are the privileged locus of primary resource production for export. While the might of industrial areas gave way to economic stagnation and increasingly large surplus populations who have no future and are increasingly under the influence of religious fanaticism and social banditry, a number of the cities in the country’s interior dedicated to primary resource production for export concentrated incomes and saw slightly higher levels of employment.
On the other hand, a score of unskilled and service occupations, such as security guards, domestic help, babysitters, personal trainers, carers, drivers, delivery workers, dog-walkers, pool cleaners, and others have expanded. In general, these are occupations with no professional identity or sense of collective belonging, and are both linked to the false idea of entrepreneurship and distant from trade union activities.
Moreover, the employers’ practice of using labour akin to slavery spread thanks to the presence of large swathes of impoverished workers who, having no job or stable income, relied on various kinds of welfare policies. The inclusion of impoverished masses in the public budget combined with the importing of digital goods and services favoured the modernization of consumption patterns.
Thanks to its dependence on imports rather than domestic production, in a majority of cases, Brazil has had to live with the flight of domestic income abroad, to places where employment of a better quality has been generated through the production of value-added goods and services and the application of technology. Between 1985 and 2020, for example, the fraction of the Brazilian population who received assistance from various government cash transfer programmes jumped from less than three percent to around 40 percent.
Preparing to enter the twenty-first century presupposes the political redefinition of the convergence of different capitals around the new accumulation cycle in favour of an independent development and reindustrialization in the midst of the digital age. This will be hard to make happen without breaking with the structure of neoliberal peripheral dependence driven by financialization and the over-exploitation of labour, which result from Brazil’s current position in the international division of labour as an economy organized around primary resource production for export.
The recuperation of the centrality of labour is fundamental, as the last four decades were marked by the emptying out of the relation between capital and labour, the basis of trade-union activity. A new future is taking shape within the perspective opened up by President Lula’s third mandate, which is capable of putting Brazil back on the path of economic development with social inclusion and a deepening of democratic structures.
A New Moment for Unions
The first quarter of the twenty-first century was dominated by a kind of impasse that affected Brazilian trade unionism in its entirety — so much so that labour’s agenda remained trapped in the defence of public policies of a reparative nature, committed as it was to the restoration of social and labour rights eroded by neoliberal policies and to the return of the strength of trade unionism associated with industrial society.
While justifiable and necessary, reparative proposals seem insufficient, especially if we consider the structural conditions and goals of the past, which no longer exist in the present. The reparation of labour treats the present in terms of the past, which can be important, particularly when the period of time is not subjected to structural changes.
Yet on the contrary, this seems to be happening now through the course of a change of epoch, so it is much more strategically important to understand the situation of the present in terms of the future, as the fruit of an emerging new historical epoch. That is why the new trade union moment requires that we better understand the demands that correspond to the transition from the industrial age to the digital one.
The politics of reparation tend to perceive the horizon of expectation associated with the idea that the same historical epoch predominates (the industrial age), while reality today indicates a structural change (the digital age). In this context, the everyday experience of labour is linked to demands specific to the unprecedented conception of work that emerges in the digital age.
For example, the separation between productive and reproductive labour, or between work in the home and work outside it, no longer makes sense, as digitalization invaded and contaminated the boundaries that until then had been justified during the industrial age. The occupations available become separated from the temporal axis linked to the horizon of a better future, freeing the form in which Brazil needs to reposition itself in face of the new international division of labour.
Otherwise, the work possibilities tend to be limited to the spread of precarity and become increasingly distant from the capital–labour relation. What we can see is the formation of new financial subjects who, not having access to adequate amounts of money, seek to reproduce themselves as multitudes disconnected from the prospects of obtaining a salary, such as obtained in the capital–labour relation. In its place, the debt–credit relation has gained in significance. It is compatible with typically capitalist logics of work via digital platforms, and with non-capitalist logics that generate occupations in the informal and subsistence economies.
Faced with a cost of living defined by the urban world, an appropriate survival strategy would be the adoption of actions based on credit given in a variety of forms. By the reduction and precarization of unskilled occupations associated with the economic model of exporting primary resources and characterized by low productivity, the increased flexibilization of labour made the various complementary economic activities, whether legal or not, increasingly dependent on public support and indebtedness, among other things.
It is in this sense that the scenario of an apparent absence of social classes and factions appears, which results from diffuse labour relations. By compromising identity and the sense of collective belonging, such labour relations succeeded in disadvantaging the actions of the traditional institutions for representing interests associated with industrial society (associations, trade unions, political parties).
Trade unionism remains fundamental in the new digital age. What had been structured around national industrialization tends to encounter limits in face of the digitalization of the economy and society. This demands a radical repositioning of trade unionism such that it is capable of breaking through the impasse that still keeps it imprisoned in the past, preventing it from contesting the tasks of the present in terms of the future.