The PEC dos Bilhões will give more money to at least 20 million families. The laws that messed up state and federal taxes will cut down a tiny bit on electric bills and the cost of filling up the world’s gas tank.
It is debated whether such money will improve the assessment of Jair Bolsonaro. But could they also prevent the economy from going into the red? In the most reputable forecasts in the market, or usually less wrong, GDP would begin to fall in this third quarter.
If the idea of GDP seems abstract, then consider the unemployment rate. In those forecasts, the unemployment rate would increase from now until December. Unemployment generally falls throughout the year. It usually only increases in recessions.
Tax reductions and extra spending on aid can increase household disposable income from R$37 billion to R$52 billion in the third quarter (until just before the election), in the event that the reduction in fuel taxes reaches the full year. consumer. The variation in the estimate is due to the fact that the new benefits may not be paid as early as July.
It’s not little money. The release of the partial withdrawal of the FGTS and the anticipation of the 13th of the INSS benefits must have increased total income by R$ 86 billion in the second quarter. It may be that the resources from the PEC package will offset part of the damage forecast for the second half of the year. There will be damage.
The effect of reopening the economy after the end of official health restrictions tends to be less and less. Household savings fall. Interest rates get saltier. The wind in favor of the world economy is passing — in the first quarter, it prevented the Brazilian GDP from going into the red.
On average in May, the dollar cost R$ 4.96. Last week, it had returned to R$ 5.30. Money wholesale interest rates have increased. It is as much the effect of the sour world market as it is of things like the PEC of Billions.
But maybe things won’t get so bad soon. Countries that sell commodities (food, oil, minerals), such as Brazil, may suffer less from the downturn in the world economy, at least immediately.
The number of employed people grows more than expected. The average salary remains a horror, still almost 6% lower than last year, but getting worse (the annual low was almost 9% in November 2021). The mass of earnings (the sum of everyone’s earnings from work) has also been increasing since November, now up 4.6% per year. In May, the number of people with some type of work was 9.4 million higher than in May 2021.
Business and consumer confidence grew even in June, according to FGV. The mood hasn’t even reached the level of optimism, but it still rises.
Yes, ma’am, the social situation is horrible, but we are talking here about downturns, about relative improvements from the bottom of the well.
It is possible that the money from Bolsonaro’s electoral fraud, which has been ratified by the opposition from the left to the right, is not enough to compensate for the cold and contrary wind that is beginning to blow in this third quarter. Moreover, these predictions may be wrong. After all, estimates of GDP growth in 2022 made by more reputable people range from 0.9% to 1.8%. A lot of difference, even for a growth shilling.
Still, it is reasonable to speculate that the postponement of the recession and the PEC of Billions could have some electoral effect. Who knows, maybe give Bolsonaro two pairs of points in the polls, enough to avoid defeat in the first round. The worsening of the crisis is for 2023. It is electoral fraud.
I have over 8 years of experience in the news industry. I have worked for various news websites and have also written for a few news agencies. I mostly cover healthcare news, but I am also interested in other topics such as politics, business, and entertainment. In my free time, I enjoy writing fiction and spending time with my family and friends.
