, no. 74
2
Current Intelligence Weekly Summary
SPECIAL ARTICLES
BRAZIL'S SIX MONTHS UNDER GOULART
Goulart, who is scheduled lo visit Washingtonpril, has retained most of tha authority theoreticslly tranafarred rlM minister by tha const ltutlonal amendment paaaad laat September vben ha succeeded to tbe presidencyQuadros resigned. Tancrcdo Neves, who became primeafter thoarliamentary system of government tomilitary opposition to Goulart's leftist tendencies, has not exercised the power conferred on this office.
At the same time, however. Goulart appears to have had no clear Idea of what to attempt as president, beyond tattingand maintaining aa much political patronage aa In his many years aa political protege of former dictator Getulio Targaa and as vice presideat ueder Kubltechck and Quadros, he bad never really concerned himself with Questions of national policy, in Goulart's first months in the presidency, the Chamber of Deputiesrofits-remittance bill inexcluding new foreignfrom the country, and tbe Senate Initiated action to emasculate SUDENE, theestablished for thedevelopment of theexplosive northeast. Goulart, possibly because of his uncertain politicaltook no action. Inhe gave bis activeto the pro-Communist alate which von the national labor confederation election*.
A steady rise in public criticism of the leftistof bis presidencycaused Goulart to change his tack later in the month and
'hrow his Influencehreatened general strike in Sao Paulo. Public opinion also caused swift passage of SUDEHE's master plan and first-yeardoapltv theopposition to thoon.
Goulart's efforts early this year to reassure the more conservative elements of the country appear to have badsuccess. In mid-January he mat withof the Commercialof Rio de Janeiro and listenedresentation of their concern over Communist Infiltration throughout the country. Subsequently, although Goulart had apparently onlythe aasoclation president reported favorably on thecalling Goulartan of the center."
Goulart almu engaged Ineffective conciliation talks with opposition governors lo the states of Sao Paulo, Parana, and Rio Grande do Norte. Onebruary he received what was generally Interpreted In Brazilisplay of growing military support for hlasben only about five ofeneral officers failed to appear at the celebration of an armed forces holiday, la recent weeks numerousBrazilians of pro-American and antl-Communlst stamp have expressed the conviction that Goulart is resolved toomestic policy along moderate, progressive lines snO anpro-American foreign policy. Goulart recentlyigh-ranking Brazilian Foreign Ministry official that it was easy and even popular to be anti-Americanhe had nobut that as President
he knows it Is essential to the country's future to work with the United States.
During this seme period, however, Goulart insisted on meeting with Cuban President Dortlcos immediately prior to the Punts del Kate conference, gave no sign of breaking with fila pro-Communist labor allies, and replaced tn anti-Communist withneutralist as bead of Brazil's politically important petroleum monopoly, Petrobras. moreover. Goulart has taken no action against Communists In the governmental structure.
The Return of Quadroi.
Quadros' return to Brazilarch has been generally interpreted aschallenge to Goulart. Quadros apparently hopes next October to wintoa keythen to become prime minister, but his lonu-awalted television address onarch was sldely appraisedmeaningless bombast and evoked little favorable.
Quadros, however, has on previous occasions recovered completely from seemingoblivion, and for this reason open opposition to him in Brazil Is likely to be ampaign for federal deputy--whlcb ha would almost certainly win because of the proportional represent*tloo system--he may goneratesupport from continuing opponents of the regime and from those who support theattributed to Qua-dros--that Brazil needs a
Status of Parliamentary System
The failure thus far of parllnmantary government to
cake firm root was highlighted onarch by President's public request to congress to holdnational plebiscite on whether to continue the system. Goulart almost certainlyhis request am an effort to blunt Quadros' effort toprime minister.
If prospects appearfor continuing theaystem, the entiremay resign soon, since, according to the constitution, cabinet ministers may not run for congress unless Ihey r- t least three months prior to elections. Host of theministers were chosenthey held seats in the Chamber of Deputies, and they can be expected to seekeveo if theirthreaten the country's political stability.
Under the parliamentary system, elections to the lower house will be harder fought than previously, since this house is the source from which ministers are most likely to come and la lhe body with power to oust the Council of Ministers. Gains in popularity mado by leftistforces in Brazil In recent years could be refleotedubstantial increase and possible control by this element.
foreign Relations
The Goulart government, like thai of Quadros, nooks to appeal to Brazilian nationalism by demonstrating thatpolicy is independent of US policy. Formulation ofpolicies appears to be In tbe bands of Foreign Minister Ssdigh official of Brazil's fascist Integrallsta parly and more recently the intellectual leader of the leftist Labor party. The regime has not
Indulged in the petty i ndic aotl-USaetivitiea of the Quadros government, but neither la It Interested in reassertingtraditional clals to be the best friend of the United States lu Latin America. At tbe Punta dal Este conference. Foreign Minister Dantan took the moat pro-Castro position of any chief delegate. Damaa now la heading Brazil'stonatlonconference In Geneva and appears inclined toore neutralist position thantbe only other Latin American country at the
The Goulart government has continued Quadros' policy of developing closer relationsthe Slno-Sovlet bloc.had added to Brazilian repreaentatlon in Easternconfined to Czechoslovakia andestablishing relations with Rumania, Bulgaria, Hungary, and Albania. He bad alsodiplomatic negotiationsthe USSR and tradeCommunist China. The Goulart regime re-established relations with the USSR last November andanking and payments agreement with Communist China inoviet industrial exposition la scheduled for Brazil In May.hinese Communlatlm to take place In August. Soviet First Deputy Premier Mikoyan Is reported planning to attend the May exposition and nay offer Brazil large-scale economic aid at that time.
Gubernatorial Autonomy
indl.ldual Brazilian states have considerable autonomy, and recent activities of several governors have furthertbe nationalist pressures
affecting foreign policy in Governor Brlzola of Rio Grande do Sul, for example, onebruary advocated theof all foreignin Brazil, including banks. Be announced preparations forocal subsidiary of an American-owned poser company. The governor took over aof International Telephone and Telegraph Corporation earlier in February, and in9 he seized the American and Foreign Power outlet In his state
The governor may have timed these moves to embarrassGoulart, his political rival and brother-in-law, prior to Goulart's visit to the United States. Brlzols, however. Is also seeking to build hispolitical reputation by exploiting widespread Brazlliao dislike for foreign ownership of utilities. Me hopes to win election aa fedaral deputy in October and then to be chosen prime minister.
T INTELLIGENCE MEEKLY SUMMARY
problem of foreign utilities la highlighted by the repelled suggestion of Parana Governorderate--to American officials that one of the great-eat steps the US Government could take to promote better relations would be to facilitate the ssle of US privately owned public utilities to local Peraambuco Governor Sampalo and Rio Grande do Horte Governor Alves--membor* of the generally conaervatlve Rational Democraticreported preparing to tales early action against foreign-owned utilities in their states.
Governors also show their autonomy by negotiatingfor economic aid from foreign countries. Brlzola. for example, haa been negotiating with the last Germans forwith tho telephone system of his stats; Alves has negotiated with Polishfor industrialand Governor Aurello do Carmo of Para1 and appears to haveredit of at
The Land Reform Issue
The land reform problem Is becoming an Increasingly acute political issue. It bas already resulted In small-scale violence and may cause serious outbreaka. In view of reported arms distribution to passant groups both in the northeast and In Bio Grande do Sul. The diversity of agriculturalIn Brazil seems likely todalay enactment ol anynational agrarian reform
while stimulating action bystates. Sao Paulobas full-scale legislation on the problem, and In several other states some distribution of state lands and colonization Is programed.
ore demagogicto land reform, Brlzola has encouraged landless farmers to seize two tracts of land--one belonging to private Uruguayans and one largely state-owned, Brlzola andboth own vast tracts of land. In his politicalof the land question, Brlzola has encouraged theof peasant leagues on the model of those formed in the Brazilian northeast over the past two years by pro-Castro Francisco Jullao.
While peasant leagues now exist In most Brazilian states, most of them ore In the key northeastern state of Peruam-buco, where thoyotal membership ofhe most active league In tbe northeast, however, and the one reported most likely to resort to violence la In Sape, In the state of Paraiba. Itembershipnd apparentlyucleus of opposition to the localdominated by the National Democratic Union.
Orthodox Communists have expressed some disapproval of Jullao because he advocates more violence than the party wants at this time when it is seeking legality. TheIn1 from the Communist party of high-level popular members who advocate
Mar
a more revolutionary line and
'ho, with Juliao.
ic to Chinese Communist methode has resulted In the formationissident Communist group. Tbe dissidents nay provideand financial support for peasant agitation.
Economic Disequilibrium
Brazil has for some years faced fundamental economicin Its balance of payments as *ell as an erratic but rapid rise in the cost of living which contributes totensions. The balance of payments problem arises from the failure of export revonues to rlae sufficiently over the past ten years, while -rossproduction has increasedercent annually and has been reflected In an increasing demand for imports.
Under both Quadros and Goulart. tbe Brazilianhas attempted to increase exports, find substitutes for Imports, and expand net reiolpts from foreign Loans. In all three aspects of its effort to improve its balance of payments, Brazil under Quadros and nowGoulart has sought help both from free world and frombloc countries.
Brazil's effort1 to expand exports--whlcha alight rise in trade with the bloc--resulted in anexpansion of receipts. The export products that showed better than average Increases were sugar, iron ore, cotton, tobacco, meat, castor-seed oil,
of uv.vaotr ot mo di mniho
menthol, and miscellaneous prod ucts (which include the rapidly growing manufactured goods
Petroleum is tho single commodity which flgurea largest in Bror.ll's imports. Theof domesticfor petroleum imports would contribute greatlya solution of tbe balance of paymentb difficulty. imports amountsixth of the cost of Brazil's totalimport*. his cost, tin! Brazilian military reportedly found supplies of petroleum Inadequate for their operations during the political military crisis Some in.;ii officials now areexploitation of thelargo reserves of oil-bearing shale, possibly with US or Soviet assistance. rogram, if it promised to be successful, would have strong support from political andleaders who have lon^dependence on foreign sources of oil,
Brazil's efforts toforeign borrowing metsuccess inbecause ofIn1 andfrom theFund, US agencies,creditors.
Brazil's foreign exchangeIs still critical, sincerevenues barely equal the cost of imports, and debtIn the next few years may come torercent of export receipts.
Original document.
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