Life | For Richer, For Poorer

Sao Paulo is Brazil’s biggest city and the business hub of the country. Nestling between the sky scrapers are the favelas or urban slums housing the poor. Life went to the favela Coliseu, in the heart of one of the richest parts of Sao Paolo. It epitomizes a stark fact that has come to characterise Brazil today. The gulf between the rich and the poor is one of the biggest in the world. Almost half the country’s wealth is concentrated in the hands of just twenty thousand families, and that’s out of a population 184 million. Life assesses what progress has been made in two and a half years by Lula, the worker President.

Nestling between the sky scrapers are the favelas or urban slums housing the poor. Life went to the favela Coliseu, in the heart of one of the richest parts of Sao Paolo.

It epitomizes a stark fact that has come to characterise Brazil today. The gulf between the rich and the poor is one of the biggest in the world. Almost half the country’s wealth is concentrated in the hands of just twenty thousand families – and that’s out of a population 184 million. What separates the poor families living in this favela from their millionaire neighbours, is a concrete wall.

Brazilian version of the Berlin Wall.It’s covered in paintings by Zezinho, one of the residents. ‘This is our Brazilian version of the Berlin Wall… it’s our wall of shame. On the other side of it is the rich world’¦ while on this side there’s a world of poverty.’

Immediately behind the wall is one of the world’s most exclusive luxury shops, the Daslu department store. Only the super rich can afford it. You can only get in by car because round here, the wealthy don’t walk. Zezinho makes his living recycling waste paper and has built up a library from old books and magazines for the children of the favela.

Twenty years ago Zezinho moved to Sao Paulo from the impoverished North East of Brazil, the same area as Lula himself. Back in the 1980s, the union leader Luiz Inacio Lula da Silva helped galvanize a mass movement for workers’ rights. In 2002, he was elected President of South America’s biggest country.

In his election speech, Lula, as he is known, promised to improve education, to improve health, to make land ownership fairer but most importantly – to fight poverty. Today, Lula the President’s big project is to make a more equal society. And even though economic growth is strong, inequality still appears entrenched.

Maria Victoria Benevides, a founder member of Lula’s Workers Party explains the problem: ‘The principal problem with Brazil as a nation is the brutal concentration of wealth in a few hands. In terms of inequality, Brazil is only just ahead of Sierra Leone. The very rich are a small minority, but a minority that controls most of Brazil’s wealth – including land.’

But Brazil’s business community believes rapid growth is what is needed to improve the country’s economy. Paulo Skaf, President of the Sao Paulo State Confederation of Industry, says: ‘A country such as Brazil with 180 million people needs to grow. It needs to grow at 6% or 7% every year. There’s nothing better for resolving the issue of social inclusion, of inequality than creating job opportunities, business opportunities, and income opportunities and all this comes from growth.’

Oded Grajew, President of the Ethos Institute, disagrees: ‘Economic growth does not necessarily lower social inequality. Brazil grew more than anywhere else in the world in the last century.’

decent housing for the poor Providing decent housing for the poor is one of the biggest challenges Lula faces – especially when control of property and land is concentrated in the hands of a tiny, rich elite. According to World Bank figures for 2004, between 50 and 60 per cent of Brazilians can’t afford a proper home and without a proper response from the government it’s going to get much worse.

Along with millions like him, Pedro da Silva ended up in the city. He also lives in the favela Coliseu. He tries to make a living carving ornamental houses for the rich. ‘I came from a poor family. I didn’t go to school. I can’t provide an education for my children. It’s a chain – my father was poor, I’m poor and my children will be poor,’ he says.

Homeless families squatting in a primary school are evicted by the authorities. One squatter, Simone, says: ‘Lots of these people will have to sleep under the bridge – or even on the streets because they have nowhere to go’¦ Where am I going to sleep? I have no idea.’

Despite the gulf between rich and poor, extreme poverty is being reduced. In line with its Millennium Development Goal pledges, Brazil has halved the percentage of people living in extreme poverty – that’s on less than a dollar a day. In 1990 it was 8.8 per cent. Now it’s 4.4 per cent.

Creating more jobs is another priority for Lula – and here he has some cause for celebration. In January 2000 unemployment was 15 per cent of the working population. By July 2005 – over two and half years since Lula came to power – that was down to 9.4 per cent – two point one million people, the lowest figure for four years.

Lula has also put his weight behind another initiative, called Solidary Economy. These are workers’ groups based largely on co-operative principles. The hope is they will create more jobs and ultimately transform the economy. An entire government department has been created to manage it.

Paul Singer, who is Secretary of the project in the Ministry of Labour, says: ‘We are trying to build a data bank about the Solidary Economy in Brazil and we have provisional estimates show us at least 20,000 enterprises, all sorts of enterprises, and different types of co-operatives and collective groups which possibly employ about 2 million people.’

According to government figures from 2004, a million people are already working within the Solidary Economy movement. Paul Singer adds: ‘Competition always leads to winners and losers. I think the Solidary Economy brings some sort of alternative of a non-capitalist or post-capitalist economy which is human and democratic but compatible with markets.’

Certainly, the entrenched positions of big business of the one side and the radical militants on the other have not made life easy for Lula – and rumours of bribes and corruption haven’t helped either. But the Minister of Social Development, Patrus Ananias, claims there has been real progress: ‘Considering the time that we have had, two and half years of Lula’s government, I believe that we have advanced a lot. In this period we have changed the social face of Brazil. We have put the social issue of poverty as a priority and the mark of our government is that we are going to meet our targets of the Millennium Goals.’


Read the English pages of the Ethos Institute website. For an article on the findings of the Atlas of Social Exclusion project, click here.

SEBRAE, the Brazilian Association of Small Businesses, has a website – but only in Portuguese. For an article on the ‘Solidary Economy’, go here.

The Daslu department store has its own website. Daslu also has a Social Rsponsibility Department.

Read the World Bank’s current assessment of Brazil and its economy, and download a report Brazil: Reducing Rural Poverty by Increasing Access to Land. The World Bank has published another report entitled Brazil – Inequality and Economic Development. See also the International Monetary Fund’s pages on Brazil and the IMF.

A useful source of links on poverty issues is the World Bank’s PovertyNet Web Guide. This site also has a section on Voices of the Poor,and a section on Poverty and Health.

Visit the official Government of Brazil website (in Portuguese), and read an article by Lula da Silva on his land reform policies in The Guardian.

InfoBrazil is a great site with all sorts of information and analysis about Brazilian social issues. Brazzil (News from Brazil) is an excellent e-zine about Brazil (with Brazilian music on ‘Radio Brazzil’ buttons).

To find out more about the Millennium Development Goals, visit the Development Goals website, and the UN Millennium Project.

Read about earlier Life programmes about Brazil – Geraldo Off-line, Geraldo’s Brazil, Brazil – Winning against AIDS, The Posse, Doing the Right Thing, and Brazil’s Land Revolution.


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