Fernando Alcoforado *
It can be said that Getúlio Vargas was responsible for the unleashing of the Industrial Revolution in Brazil that occurred from 1930 to 1956 with a delay of more than 200 years in relation to the 1st Industrial Revolution in England. World War I served as a driving force for industrialization in Brazil because the traditional exchange relations (export of primary products and imports of processed products) were hampered by the world conflict and also caused the suspension of foreign capital inflows. Until 1930, the participation of industry in the Brazilian economy was insignificant. The country’s economy remained highly dependent on the agro-export sector, especially coffee, which accounted for approximately 70% of Brazilian exports.
The political forces that took power in Brazil in 1930 under the leadership of Getúlio Vargas supported and implemented an industrialization project with the objective of withdrawing it from the economic backwardness and pushing it towards progress with the establishment of its own industrial park, in the molds of developed European nations and the United States. It was the first time in Brazilian history that a government made such an option. Vargas invested heavily in the creation of industrial infrastructure with the base and energy industry. The National Petroleum Council was created in 1938, Companhia Siderúrgica Nacional in 1941, Companhia Vale do Rio Doce in 1943 and the Companhia Hidrelétrica do São Francisco in 1945.
Industrialization in Brazil developed through the process of import substitution, that is, producing in the country what was formerly imported from abroad. In the first phase of industrialization from 1930 to 1940, the emphasis was on the production of immediate consumer goods (non-durable goods). As a result, small factories and medium-sized industries in all the inhabited points of the country, where there was reasonable demand from consumers, with greater emphasis on the more populous centers and where there was a greater presence of European immigrants who had some knowledge of this type of economic activity. The main branches of Brazilian industry were food, clothing (fabrics, footwear, hats, etc.), household utensils, work tools, simple equipment, household goods, beverages, etc. The lead of the industrialization process was assumed by São Paulo and Rio de Janeiro.
- Impacts of technology in the Vargas Era
The Getúlio Vargas government fostered industrial development and protection of nascent industry. In political terms, it co-opted the urban bourgeoisie and promoted the incorporation of the proletariat into modern society. The Vargas government’s proposal was to promote technological development for industry and the training of the ideal worker in the mold of the new subordination of labor to capital. Investments in science and technology are dominated by the public sector, which avoids the nefarious policy of previous governments to reduce resources in R & D, promotes innovation and incorporates new technologies to avoid lag in relation to technical progress in world economy.
The advance of Brazilian industrialization in the 1930s was a dynamic element in the development of science and technology in Brazil. The period of the first Getúlio Vargas government (1930-1945) can be considered as the key moment in Brazil’s economic modernization process. The overcoming of the industrial lag of Brazil in relation to developed capitalist countries occurred exactly during this period. It should be remembered that the 1st Industrial Revolution occurred in England in the eighteenth century (1780-1830) and that the 2nd Industrial Revolution occurred in the period from 1860 to 1900.
The system of technique and work of the 2nd Industrial Revolution is the Fordist, a term that refers to the businessman Henry Ford, creator of the assembly line in its automobile industry in Detroit, United States, a system that has become the paradigm of technical regulation and work known all over the industrial world. The characteristic technology of this period is steel, metallurgy, electricity, electromechanical, petroleum, explosion engine and petrochemical. Electricity and oil are the main forms of energy.
The union among science and industry constituted an integrated system of scientific production in the capitalist countries developed since the end of the nineteenth century covering the industrial system engaged in the production of technical innovations and universities and research institutes, which has made science and technology inseparable and reciprocally stimulating new developments. In Brazil, the strategy of state intervention in the economy had its historical milestone in the first government of President Getúlio Vargas (1930-1945). The Brazilian State, within the political parameters of the time (early 1930s), recognized the importance of science and technology for the country’s economic development, that is, of technological knowledge for industry. And it is in this historical ballast that lies the genesis of science and technology policies in Brazil.
The Getúlio Vargas government promoted the creation of scientific councils, technical councils with the participation of entrepreneurs, applied research institutes and acted, above all, in the training of the national worker to attend the emerging new industry in the country. The practical effect of the worker’s qualification was desired in the context of the new world economic processes and, internally, at the moment when an urban and bourgeois society was consolidated in Brazil. If the modernization of the country involved urbanization and industrialization as integrated and interdependent processes of scientific and technological development, labor regulation was an absolutely new proposal in the Brazilian political-social framework, hitherto marked by representation of the rural oligarchy, by clientelism and still due to lack of labor legislation.
The development model of the second Getúlio Vargas government from 1951 to 1954 continued to be characterized by industrial development, nationalism and state dirigism. During this period, the Brazilian State was restructured, with the creation of new agencies focused on the formulation of economic policies, such as the Economic Advisor of the Presidency of the Republic and the Industrial Development Commission (CDI). The economic policy of the Vargas government involved an Economic Reorganization Plan and an industrial program with the formulation of various sectoral policies. In the field of infrastructure, the National Road Fund and the National Coal Plan were created. A policy of reorganization of ports and railways was also formulated, the National Electrification Fund was created and Eletrobras was proposed, which would only be approved in 1961. The highlights were the creation of Petrobras and the National Bank of Economic Development (BNDE).
- Impacts of technology in the Contemporary Era
After the 1st Industrial Revolution that occurred in England in the eighteenth century (1780-1830) and the 2nd Revolution that occurred in the period from 1860 to 1900 in England, Germany, France, Russia, Italy and the United States, the world met the 3rd Industrial revolution in the 1970s, based on the technical-scientific revolution inspired by the Toyota Production System of Japan that was the main model of productive restructuring that replaced the Fordist system inaugurated in the early twentieth century and has as its main characteristic and aim at producing only the necessary and in the shortest time. It’s just-in-time.
Today, the world experiences the Informational or Post-Industrial Revolution that is called by some, also, as 4th Industrial Revolution, Revolution 4.0 and Digital Revolution. This revolution expands exponentially the differences in the ability to treat information and turn it into knowledge. Experts believe that the intelligence of machines (computers) will match that of humans by 2050, thanks to a new era in their ability to learn. Computers are already beginning to assimilate information from collected data. This means that we are creating machines that can teach themselves and also communicate by simulating human speech, as with smartphones and their virtual assistant systems. The immediate consequence of the progress of artificial intelligence is the advancement of unemployment.
In 2013, researchers at Oxford University published a detailed study of the impact of computing on employment in the United States, considering recent advances in machine learning and mobile robots. The researchers concluded that only a third of current workers are saved from replacement by smart machines in the coming decades. Faced with the prospect of replacing workers by machines, the solutions that are presented to mitigate the effects of unemployment generated by the technological advancement in the current developmental frameworks of capitalism concern the adoption of the Creative Economy, the Social and Solidarity Economy and the Transfer Program of Income. These would be the solutions to be used as long as capitalism exists to alleviate the social problems generated by technology until a new post-capitalist society is established in which the contradiction among technology and workers is eliminated.
The term “Creative Economy” refers to activities with socio-economic potential that deal with creativity, knowledge and information. In order to understand it, it is necessary to keep in mind that companies in this segment combine the creation, production and commercialization of cultural creative assets and innovation such as Fashion, Art, Digital Media, Advertising, Journalism, Photography and Architecture. The Social and Solidarity Economy is a new model of economic, social, political and environmental development that has a different way of generating work and income, in several sectors, be it community banks, credit cooperatives, family agriculture cooperatives, fair trade, exchange clubs, etc. On the basis of the Social and Solidarity Economy, there is the possibility of recovering companies from the bankruptcy mass, and give continuity to them, with a new mode of production, in which profit maximization ceases to be the main objective, giving rise to the maximization of quantity and quality of work.
The workers’ income guarantee policy proposed by Friedrich August von Hayek, an Austrian economist and philosopher, inspired the neo-liberal income transfer program of the Lula and Dilma Rousseff governments in Brazil, the Bolsa Família. In addition to the need to provide a basic net security, there is a powerful argument for the adoption of the income guarantee policy because the technological advancement, besides promoting mass unemployment and vertiginous social inequality, threatens capitalism itself with the prospect of a vertiginous fall of consumption. The income guarantee policy would provide the conditions for unemployed workers to consume.
- Conclusion
Just as in 1930, when Brazil had to face the challenge of overcoming the technological gap in order to industrialize, the challenge is even greater today with the need to halt the country’s ongoing process of deindustrialization and to update itself technologically by following the gigantic technological advance that takes place in the world. Brazil needs to incorporate into its production systems the technological advances resulting from the Third Industrial Revolution and the Fourth Industrial Revolution or Informational or Post-Industrial Revolution. Therefore, it is urgent to adopt an industrial policy and scientific and technological development that will contribute to leverage the industrial sector that can only happen with the replacement of the neoliberal economic model responsible for the economic disaster in which Brazil lives by the national development model similar to that adopted by the Getúlio Vargas government strongly supported in the domestic market and in the development of the national industry.
* Fernando Alcoforado, 78, member of the Bahia Academy of Education, engineer and doctor in Territorial Planning and Regional Development by the University of Barcelona, university professor and consultant in the areas of strategic planning, business planning, regional planning and planning of energy systems, is the author of 13 books addressing issues such as Globalization and Development, Brazilian Economy, Global Warming and Climate Change, The Factors that Condition Economic and Social Development, Energy in the world and The Great Scientific, Economic, and Social Revolutions that Changed the World.
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