The document outlines measures that a new Brazilian government should take after Dilma Rousseff's impeachment to prevent economic and political collapse. It recommends urgent economic measures like reducing spending, auditing debts, and controlling capital flows. It also calls for medium-term growth strategies like cutting taxes to boost investment and consumption. Politically, it proposes convening a constituent assembly to reform governance and ban corrupt parties and officials.

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HOW TO REBUILD BRAZIL POST-IMPEACHMENT OF DILMA ROUSSEFF
Fernando Alcoforado *
After the economic, social and political-institutional devastation promoted by PT
(Workers Party) governments of Lula and Dilma Rousseff, any new government
effectively committed to the progress of Brazil, who will exercise power after the
impeachment of Dilma Rousseff, will only be able to exercise governability if it take
place public policies that address the interests of the vast majority of the Brazilian
nation. It is important to note that governability expresses the possibility of the
government of a nation hold public policies resulting from the convergence between the
various bodies of the national State with each other and this with Civil Society. The first
measure to be adopted by the new government would be to put together a crisis cabinet
composed of people of the highest competence and the highest ethical and moral
respectability for get the respect of the nation and ensure governability. To obtain the
trust of the population and exercise governability, the future government will have to
take urgent measures to prevent the collapse of the economic system and the political
and institutional system of Brazil.
Measures to prevent the collapse of the economic system
To prevent the collapse of the Brazilian economy, the nation's future ruler should adopt
preliminary and urgent measures to prepare the basis for the adoption of complementary
strategies for the retake of economic growth, rising employment and income levels of
the population and reducing inflation. These preliminary and urgent measures are as
follows: 1) drastic reduction of public expenditure costing reducing the number of
ministries to 10 or 15 and the elimination or reduction to a minimum of commissioned
positions that are about 30,000; 2) audit of the external debt and public domestic debt of
the country to assess its authenticity; 3) renegotiation of the payment of the foreign debt
interest and public domestic debt of the country aimed at raising public savings for
investment; 4) adoption of a fixed exchange rate to replace the floating exchange rate to
protect the domestic industry; 5) control of input flow and capital outflow to prevent
excessive inflows and capital flight from the country; 6) sharp reduction in interest rates
to encourage investment in productive activities; 7) the selective import of raw materials
and essential commodities from abroad to reduce expenditures in currency of the
country; 8) reintroduction of market reserve in areas considered strategic for national
development; and, 9) adoption of a tax policy capable of ensuring the resources that the
state would need to invest in education, health, social security and infrastructure sectors,
among others, and encumber the minimum population and the productive sectors.
After the immediate measures, short-term, above, the future ruler of Brazil should adopt
measures to contribute to the nation's economic growth in the medium and long term. It
is worth noting that the Gross Domestic Product (GDP) is defined as the total value of
production of wealth in a country during one year by resident economic agents in the
country. GDP can be calculated in the currency of a particular country from the sum of
all its components: GDP = C + I + G + X – M. In this formula, C is the household
expenditure on consumer goods (private consumption) , I is the expense of enterprises
in investment, both in capital goods (gross fixed capital formation) and in raw materials
inventories and products (ranging from stocks), G is the government spending (federal,
state and municipal) in consumer goods (public consumption), X is the revenue from
exports and M is import spending.

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Based on this formula, GDP growth can be achieved with the expansion of private
consumption (C) increasing the wage bill and adopting credit policy that encourages the
consumer to buy, increased investment in productive activity (I) that may result from
reducing the tax burden and the implementation of a policy of fiscal incentives and
attractive interest for entrepreneurs, and the increase in government spending (G) with
an emphasis on investments in economic and social infrastructure. The increase in
export revenue (X) and the reduction in spending on imports (M) also contribute to the
growth of the economy. The optimal strategy for economic growth is one that is
supported on maximizing investment (I) in productive activities that contribute to the
increase in income and employment and, consequently, the household consumption (C)
and the increase of tax revenues enabling the government, consequently, to increase
government spending (G). Moreover, the optimal strategy of economic growth should
maximize the difference between revenue from exports (X) and spending on imports
(M). This was the economic strategy that boosted China's economic growth in recent
decades.
Under current conditions in Brazil, the optimal strategy of economic growth would
require the maximization of investment (I) that would be made possible by reducing the
tax burden and the implementation of a policy of fiscal incentives and attractive interest
rate for entrepreneurs that enable the increase in employment and income of the
population and, consequently, the household consumption (C). To combat the demand
inflation that could result from the increase in household consumption (C) and private
investment (I), the government should encourage the expansion of agricultural and
industrial production in productive sectors where supply is insufficient. In turn, to
reduce interest rates in the financial system, the Brazilian government should promote a
drastic drop in the Selic rate (basic rate of the economy) to contribute also to the
reduction of government expenditures for the payment of public debt and thereby
increasing the availability of public funds to destine them to meet the needs of the
country.
For the Brazilian government maximize your spending (G), it is necessary to form
enough public savings. To increase public sector savings, the government needs to
reduce drastically the Selic rate which today corresponds to 14.25%, renegotiate the
payment of the internal public debt service and make current expenditures of the public
sector be reduced or grow less than the Gross Domestic Product (GDP) to have the
resources to carry out public investments, especially in poor economic infrastructure
(energy, transport and communications) and social (education, health, housing and
sanitation). It should be noted that the renegotiation of the terms of domestic and
foreign debt is critical. Without the adoption of this measure the Brazilian government
will not be able to promote the country's economic growth given that almost half of the
Brazilian government budget is allocated to the payment of charges to the domestic
public debt. Thus, it would be created the conditions for the public sector to invest and
finance with its own resources, and not by debt as currently occurs.
It is worth noting that in the economic history of post-war Brazil until now, the dilemma
of how to increase the savings rate for the country to grow faster has always been solved
by the various governments with the use of foreign savings with the attraction of foreign
direct investment and obtaining international financing, resulting in chronic deficits in
the balance of payments current account and the consequent increase in external debt.
There has never been from the Brazilian government a genuine preoccupation nor with
the formation of public savings nor by creating incentives to boost domestic private

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savings. At the time, for Brazil to grow fast, it is essential to increase domestic savings,
especially public savings, without which the country is continually indebted to the point
of compromising their future.
Another essential medium and long-term measure is to make the Brazilian government's
current expenses be reduced or grow less than the Gross Domestic Product (GDP) of
Brazil. Therefore, it is essential to conduct a profound administrative reform that
rationalizes the public administration in the country which also contributes to the
elimination of waste and the reduction of public service costs. Only carrying out the
reform of the State and Public Administration in Brazil will be possible to correct
current distortions in public expenditure and reduce the tax burden benefiting businesses
and workers. The implementation of a model of efficient and effective management for
the Brazilian State will make its tax collection capacity be expanded. The new
management model based on the rationalization of work processes will inevitably lead
to reduction of state operating costs and, consequently, the tax burden on taxpayers.
Without putting into practice this set of measures, the Brazilian government will not
acquire the ability to invest in the expansion of the economy and to adopt social
compensation policies at the level necessary to mitigate the social inequality in Brazil.
Measures to prevent the collapse of the political and institutional system
To prevent the ongoing collapse of the political and institutional system of Brazil, urge
the adoption of the following measures: 1) Formation of a government composed of
competent people and unblemished moral that would be responsible for convening a
new Constituent Assembly Exclusive to promote reform of State and Public
Administration on a new basis; 2) Ban on political parties and parliamentarians
committed to corruption; 3) Formation of new political parties after the new
Constituent; and, 4) Call for new general elections in the country.
The Constituent Assembly Exclusive to be convened by the new government should
institute a parliamentary system of government and create mechanisms to enable the
population: 1) to exercise direct democracy in very important decisions taken by the
executive branches and Parliament at the federal, state and municipal levels approving
or rejecting through plebiscite or referendum, and; 2) to exercise control of elected to
the Executive and Legislative triggering the institutional mechanisms for the
punishment of those who eventually have betrayed the interests of the electorate opining
about their mandate cassation or not by plebiscite, among other measures. The
Constituent Assembly Exclusive should decide also by end of the Senate with the
institutionalization of the unicameral system and reducing the number of
parliamentarians and their stewardships in federal, state and municipal parliaments,
among other measures.
This set of measures aimed to prevent the ongoing collapse of the political and
institutional system in Brazil is absolutely necessary because we face a flagrant
demoralization of its political institutions, considering that we have a coalition
presidentialism moved by the corruption that has existed from the Constituent Assembly
of 1988 and proves to be unable to resolve the serious political crisis in Brazil.
Representative democracy in Brazil shows clear signs of exhaustion not only by
corruption scandals in the powers of the Republic, but especially to discourage popular
participation, reducing political activity to electoral processes that are periodically
repeated in which the people elect their representatives the which, with few exceptions,

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after the elections come to defend the interests of economic groups in opposition to the
interests of those who elected them.
These are therefore the measures to prevent the economic and political-institutional
collapse of Brazil. Without them, Brazil will have its future compromised. It isn´t
enough, therefore, to replace Dilma Rousseff by Vice President Michel Temer as
provided for should take place with the impeachment of the current president to Brazil's
problems are resolved. It is necessary that the measures here proposed were adopted to
prevent the collapse of economic and political-institutional systems of Brazil.
* Fernando Alcoforado, member of the Bahia Academy of Education, engineer and doctor of Territorial
Planning and Regional Development from the University of Barcelona, a university professor and
consultant in strategic planning, business planning, regional planning and planning of energy systems, is
the author of Globalização (Editora Nobel, São Paulo, 1997), De Collor a FHC- O Brasil e a Nova
(Des)ordem Mundial (Editora Nobel, São Paulo, 1998), Um Projeto para o Brasil (Editora Nobel, São
Paulo, 2000), Os condicionantes do desenvolvimento do Estado da Bahia (Tese de doutorado.
Universidade de Barcelona, http://www.tesisenred.net/handle/10803/1944, 2003), Globalização e
Desenvolvimento (Editora Nobel, São Paulo, 2006), Bahia- Desenvolvimento do Século XVI ao Século XX
e Objetivos Estratégicos na Era Contemporânea (EGBA, Salvador, 2008), The Necessary Conditions of
the Economic and Social Development-The Case of the State of Bahia (VDM Verlag Dr. Muller
Aktiengesellschaft & Co. KG, Saarbrücken, Germany, 2010), Aquecimento Global e Catástrofe
Planetária (P&A Gráfica e Editora, Salvador, 2010), Amazônia Sustentável- Para o progresso do Brasil e
combate ao aquecimento global (Viena- Editora e Gráfica, Santa Cruz do Rio Pardo, São Paulo, 2011),
Os Fatores Condicionantes do Desenvolvimento Econômico e Social (Editora CRV, Curitiba, 2012) and
Energia no Mundo e no Brasil- Energia e Mudança Climática Catastrófica no Século XXI (Editora CRV,
Curitiba, 2015).