Opinion – Vinicius Torres Freire: Lowering gasoline ignores lowering of the poor who live on R$39 per month

Opinion – Vinicius Torres Freire: Lowering gasoline ignores lowering of the poor who live on R per month

Maybe I can drive around on cheaper gas in July, say. At dawn, the minimum temperature has been around 7º here in the city of São Paulo. In July, it shouldn’t be much different. From the car, I’ll go faster past the mounds of people dumped on the icy, drizzle-wet sidewalks. Some maybe already dead.

Jair Bolsonaro guessed that a liter of gasoline will be R$2 cheaper when the tax reduction package that he and the heads of the powerful center invented to gain some points in the polls is approved. A liter of diesel would drop by R$1.

According to Senator Fernando Bezerra (MDB-PE), rapporteur for part of these bills, the reduction in gasoline would be R$ 1.65 per liter; a liter of diesel would drop by R$ 0.76.

It’s all a lowdown, really.

Last year, the income of the poorest 10% in Brazil fell by 32.6% compared to 2020. It was the lowest level in a decade, at least. It was equivalent to R$ 93 per month. Some of these people live on the icy sidewalk.

Governments will fail to collect something around R$50 billion to R$100 billion in the swindling season of electoral tax rebates, particularly on fuel. An Auxílio Brasil costs R$ 89 billion per year. But maybe the fuel won’t even get that much cheaper.

Petrobras’ gasoline price has not increased since March 11. Since then, the price of this fuel in the foreign market relevant to Brazil has increased by at least 12% (prices in reais). The difference between the price in Brazil and the international price would be around R$1 (accounts vary).

The government is putting pressure on Petrobras not to readjust prices. The thing is getting embarrassing. If the dollar continues to rise, even worse.

We don’t know where the dollar is going. The predictions are very wrong. But there is a (still) slight turmoil in the international financial market because of the American inflation and the increase in interest rates there, which could further shake the world economy, especially the Brazilian boat.

We are in a leaky boat heading for storms. Lower prices of fuel and electricity, perhaps of communication and public transport, should contain some of this year’s inflation – economists’ guesses are still mixed. The return of some taxes in 2023 will raise certain prices. Next year’s inflation should be higher, well above the target. Interest will stay high for longer.

This rabble in power further banishes the country, already in disrepute for a decade of economic regression and Amazonian savagery, the Amazon in fact given over to criminal factions, illegal mining and agriculture, in addition to global drug cartels. Aren’t the Armed Forces fighting for national sovereignty in the forest? Or are they playing shuttlecock on the beach in Rio?

Now, this bunch of economic tricks and gimmicks, worse since 2021, will discredit this place even more. Discredit has a price: higher interest rates.

It may be that the electoral trick doesn’t even yield many votes.

Although at a temporary low, inflation should stay around 10% a year until September, thereabouts. The value of the minimum wage, the floor of Social Security benefits and Auxílio Brasil will be losing almost as much purchasing power: 10% less than a minimum income.

There are worse cases. Last year, the income of the poorest 5% in Brazil was 48% lower than in 2012. In these people’s homes, the average monthly income per head was R$39 in 2021. Less than 6 liters of gasoline. Maybe it’s enough for someone to immolate himself in terminal despair.

You May Also Like

Recommended for you

Immediate Peak