You have probably already seem in the news….Brazil is falling apart! The economical crisis we are living nowadays is extremelly serious with the risk of becoming a depression . I indeed fear for the future of my kids (and why not for my own future!). What could be the consequences for the middle class? How about the poor families? Brazil ex-president Lula claims that “never in the history of this country” (he loves to say that shit), we had that many poor families travelling by plane! F… the travelling, Lula! People now need jobs!
What we can see now is that a lot of the economical pillars at his government were made with pure sand….and now that the wind is blowing fast and furious, we are all feeling we can crash pretty bad. So here I am, with wife and 3 kids, and the fear to get layed off soon due to this economical crisis. To make things even worse, I work in the oil & gas industry (so for those of you who think the lightning will not strike the same place twice, be careful) that is laying off people severely everywhere in the world. To make things even worse (but now this is good for the country!), we have a brave judge (Sérgio Moro …click and learn some portuguese…it´s worth, the guy is doing a lot for the country!) that is extremelly ethical, intelligent and hard worker and together with the the Federal Prossecutors , lead by a young prossecutor (Deltan Dellagnol) , is making history in this country. For instance, “never in the history of this country” (suck that Lula!), we had a senator and a few of billionaries in jail as the results of the Lava Jato operation. And this is great for the country!
But let´s see how this affects the population, specially the middle class and lower classes. But I will tell you first why I think the middle class is punished pretty heavily. I don´t know if you know, but taxes in Brazil are not that high when compared to other countries in Europe or even the US. But here is the thing: if you are middle class, you get NOTHING in return from the government at the taxes you pay! I am not exaggerating at all! Let me give you some numbers.
Taxes are discounted directly from you pay check (you don´t have an option to pay and the end of the fiscal year) and goes up to 27,5% of your gross salary. And with that, you were supposed to get some decent public education, decent public health and decent security. All those 3 basic itens, even the biggest fans of small State agrees that government should provide. But all of the 3 in Brazil are crap!
A decent private school will cost you around R$ 1000,00 per month (which is now about 250$) but keep in mind that the minimum wage is R$788,00. And there are schools that can cost 5 times this price!
A decent private health care plan will cost you between R$300,00 to R$600,00 per person, and that varies a lot depending on the coverage and age.
Inflation nowadays is a bit over 10% a year, where the inflation target was supposed to be below 6%.
Gas prices are sky high in Brazil! No matter how much the oil price drops, government keeps authorizing Petrobras to raise it´s price (in contrary, when oil prices were above 100USD/bbl, we were not getting the prices adjusted properly due to governmetn subsidies. This proves we are the land of the contrary (remember Bizarre world?). The gas liter righ now is about R$ 4,00 (1 USD). (1 US Gal is ~3,78 liters, so a gallon here would cost 3,78 USD! Take that!)
If you have a car and you don´t have insurance, in a city like Rio de Janeiro (where we live) and São Paulo, you like taking risks.
So does Brazil has the risk of becoming a Venezuela? I honestly don´t think so, but I keep watching closely. And what I will do if things get pretty ugly, I lose the job and cannot find another one as quick in one month? That is the question I have been thinking over and over and that made me to start blogging. And I´ve been thinking a lot on taking the risk to become an entrepreneur…