Opinion – Maria Inês Dolci: Disrespect for the Constitution flattens consumption

It is estimated that Brazil has almost 215 million inhabitants. Why is there no sustainable economic growth in a country of this size, with a very powerful agribusiness?

One of the reasons is the disrespect for article 7 of the Federal Constitution, which, among other things, determines that the minimum wage must be “established by law, nationally unified, capable of meeting their basic vital needs and those of their family with housing, food, education, health, leisure, clothing, hygiene, transport and social security, with periodical readjustments that preserve their purchasing power”.

The R$ 1,212 that constitute the national floor, currently, is equivalent to just over US$ 233, at the exchange rate of this Tuesday (15). Five states (São Paulo, Rio de Janeiro, Paraná, Santa Catarina and Rio Grande do Sul) have a higher regional floor than the national one.

According to calculations by Dieese (Inter-union Department of Statistics and Socioeconomic Studies), the minimum should be R$ 6,000, about US$ 1,153.

With flattened income, consumption shrinks, and is restricted to the most essential. Or, even worse, it is below the fundamental. Translating: there is no food on the plate, the housing is unhealthy and without sanitation, health and education depend exclusively on the State, and there is no money for leisure, clothing and transport.

This is also why large companies leave the country, as we have already mentioned – Ford, Audi, Mercedes, Sony, Fnac, Walmart, Roche and Nike, for example. Especially because the effect of sub-wage occurs in a cascade, negatively influencing the wages and income of the middle class itself.

More recently, the concessionaire RIOGaleão asked to hand over the administration of the Tom Jobim international airport in Rio de Janeiro to the Union. There was a deep recession in 2015, 2016 and 2020. The economy, which was already anemic, flounders even further with the problems caused by the pandemic. UnitedHealth, owner of Amil, one of the largest operators of health plans, tries to get out of the country.

The new interest rate hike, driven by the Selic, in order to fight high inflation, plays on the business contraction team.

If the consumer has the financial condition, diversity of products and power of choice, the economy rotates and consumption grows. The consumer needs to buy. The consumer wants to buy.

As stated in the minimum wage law, a family should have income to cover vital necessities. But there is not, and there is no serious discussion on how to solve this very serious social, economic and human problem.