Industrialists in Transition: The Plano Cruzado, Industrial Elites, and the Brazilian Developmental State, 1986-1989.

Many analyses of neoliberalism in Latin America assume that it was the debt crises of the 1980s which convinced domestic capitalists of the need for market reform and signaled the exhaustion of the developmental state. Using a combination of primary and secondary sources, this paper argues that in Brazil capitalist support for neoliberalism only emerged roughly five years after the debt crisis, in the aftermath of the Cruzado Plan (Plano Cruzado), a failed government attempt to control rampant inflation. I argue that in the context of increased mobilization and crisis following the plan, newly fortified business organizations spread a vision of neoliberalism which resonated with many industrialists in São Paulo, Brazil's economic capital, and turned them firmly against the developmental state. This period of mobilization stands in contrast to São Paulo industrialists' reaction to the debt crisis of 1981 when they remained both passive and divided over the issue of economic liberalization. Following the Cruzado Plan, however, Brazilian industrialists remained politically fragmented relative to other national bourgeoisie in the region. This continued fragmentation explains the conflict among industrialists over what "economic opening" would look like in the years following the Plano Cruzado. Thus, this paper emphasizes the relative increase in organization and mobilization which turned industrialists against the developmental state. [ABSTRACT FROM AUTHOR]