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Constitutional Change in Brazil: Political and Financial Decentralisation, 1981-1991

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Constitutional Change in Brazil: Political and Financial Decentralisation, 1981-1991 CONSTITUTIONAL CHANGE IN BRAZIL: POLITICAL AND FINANCIAL DECENTRALISATION, 1981-1991 Celina Maria de Souza Motta The London School of Economics and Political Science Department of Government Thesis submitted for a Degree of Doctor of Philosophy 1995 UMI Number: U615788 All rights reserved INFORMATION TO ALL USERS The quality of this reproduction is dependent upon the quality of the copy submitted. In the unlikely event that the author did not send a complete manuscript and there are missing pages, these will be noted. Also, if material had to be removed, a note will indicate the deletion. Dissertation Publishing UMI U615788 Published by ProQuest LLC 2014. Copyright in the Dissertation held by the Author. Microform Edition © ProQuest LLC. All rights reserved. This work is protected against unauthorized copying under Title 17, United States Code. ProQuest LLC 789 East Eisenhower Parkway P.O. Box 1346 Ann Arbor, Ml 48106-1346 I S F 72SS ^V om \C ^ x'cS )07&zzs% Abstract The aim of the present study is to investigate how and why a country facing issues that needed to be tackled nationwide chose to decentralise political power and financial resources when it moved from military rule to redemocratisation. Furthermore, the study examines whether the decision to decentralise taken in Brazil in the period 1981-1991 has changed the allocation of public expenditure at sub-national level, especially to education. By analysing the decision to decentralise and its results at the sub-national level, the study embodies both an upstream and a downstream approach. The upstream approach encompasses the topics related to decentralisation in the Brazilian Constituent National Assembly that sat from 1987 to 1988. Research sources are based on the archives of the Constituent National Assembly and on interviews with key political leaders in Congress and practitioners. The decision to decentralise is analysed in three dimensions: the relationship between political parties and the State; intra- and inter-party competition; and regional cleavages. The downstream approach comprises three case studies: the state of Bahia, its capital, Salvador, and its most industrialised municipality, Campari. The political analysis is based on (a) interviews with politicians in executive and in legislative positions, and officials and (b) newspaper material as a complementary source. The financial performance is based on the analysis of expenditure extracted from balance sheets. This study fills four gaps in political-science and public-administration works on contemporary Brazil. First, it deepens the understanding of how and why Brazil became such a decentralised nation. Second, it links the analysis of political and financial resources. Third, it highlights differences between levels of government in their experiences with decentralisation. Fourth, it investigates the impact of decentralisation on political arrangements and on education expenditure. The results suggest that in Brazil there was a lack of social consensus on what was to be achieved by decentralisation. They suggest that decentralisation fosters democracy but its impacts on policy results have so far been limited. The evidence further implies that decentralisation and democratisation bring about a fragmentation of power without necessarily disintegrating previous political coalitions or changing the way public resources are spent. These findings indicate that various political and economic factors influence the outcomes of decentralisation, thus exposing the limits of decentralisation on policy results. 2 Acknowledgements This study's topic began to grow in my mind when I realised that there was a connection between my personal and family trajectory and the events that led Brazil towards its path of democratisation. My grand-father was a middle-size coronet in Bahia's West and my father was a state-level politician who lived through the anguish of wanting to break his ties with Bahia's agrarian and 'parochial' past and the difficulties of building a more democratic polity and society. I have always been tempted to understand in a more scientific way how and why this change occurred. Although the development of a thesis is a personal and lonely enterprise, it would not have been possible without the direct and indirect collaboration of the researcher's family, fiiends, as well as other academics and institutions. I am indebted to many helpers during the three years and eight months that I spent researching and writing this work. My first thought goes to Aninha, Ana Lidia, Julia, Nanci, Iara and Tais for their loving encouragement over this too long journey. During my fieldwork in Brazil I had the help of the Brazilian Senate who provided several facilities that speeded up the collection of data. I owe a debt of gratitude to all the politicians, officials and practitioners for their willingness to take time from their busy schedules to share their views with me. My friends Claudia Mousinho, Carlos Antonio Ribeiro, Carmen Souza, Maria Lucia Assmar, Nelson Issa, Paulo Rogerio Gonsalves, Raimundo Moreira and Walter Macedo made many efforts to help me collect the data. They also gave me great moral support while I was here. In the academic world I am in debt to many scholars. Back in Brazil D'Alva Kinzo read with impressive attention the final version of this study. She acted as an extremely carefid reader, as a source of important references, but also as a great friend during my ups and downs. Tereza Sadek read the final version and her enthusiasm came at a moment when I especially needed it. Professor Lordello de Mello, who I had the privilege of having as my tutor in my M. Sc. course, made useful comments on the thesis's synopsis and generously shared with me his knowledge and a life's commitment to local government. In the USA, Barry Ames read earlier versions of Chapters 2, 6 and 7 and wisely advised me when I thought of changing this study's direction. Professor Chris Pickvance saved me from a possible mistake when I also thought about redirecting the thesis's approach. Professor Leslie Bethell made detailed comments on the synopsis and on Chapter 6. Laurence Whitehead's sharp remarks on Chapter 5 were very useful Professor Patrick Dunleavy commented on an earlier version of the synopsis. From a personal talk with Professor Jon Elster I found a clearer way to integrate the thesis's upstream and downstream approaches. Drs Richard Batley and Andrew Nickson have stimulated me to carry on the research with words of encouragement. Dr George Philip, who was my supervisor, provided me with the room to act, as he always told me, as my own judge. I am grateful to Professor George Jones, my joint-supervisor at the LSE. Since the beginning he had pushed me not to take for granted events and affirmations which seemed so obvious to me and which actually needed further investigation. His careful reading of my chapters made me admire him deeply. Among the friends I made in London, special thanks go to Alice Wanderley, Beth Yao, Edesio Fernandes, Jose Luiz, Tereza and Ana Ribeiro, Lilita Surewie, Marcos Vinicius Brandao, Nicholas George, Robert Annibale, Rosa Mulle, Soraya Cortes and Ziba Moshaver. Fatiha Serrour, Jo Attree, Karina Morais, Sandra Magina and Veronica Gitirana became my fnends-like-sisters. Especial gratitude goes to Cesar Baena who read every page of this work and with whom I shared many moments of joy and pain. Back home my deepest gratitude goes to Raul Paz, who died last May. Since the moment I arrived in London Raul had been my most faithful correspondent and was the provider of a monthly clipping about this study's topics. He also read every chapter of this work and I deeply benefitted from his great knowledge of Brazil's financial system. I thank my colleagues at the Department of Finance and Public Policies at the Federal University of Bahia, who replaced me for such a long time in my academic duties. The Federal University of Bahia granted me leave of absence to pursue this research. I also acknowledge the Coordenadoria de Aperfeigoamento de Pessoal do Ensino Superior (CAPES) for its highly professional performance and for the financial backing which made it possible to spend these years studying at the LSE. I dedicate this work to my late father Juarez and to my mother Maria. My father taught me to love the country, the state and the city where I live. My mother taught me that they were not the centre of the world. London, June 1995 Celina Souza 4 Table of Contents Acronyms .............................................................................................................................. 8 List of Tables and Figures ................................................................................................... 11 Chapter 1 Introduction.................................................................................................13 1.1 State of the F ie ld ...........................................................................14 * * 1.1.1 Democratisation .................................................................14 1.1.2 Decentralisation and Intergovernmental Relations . 17 1.1.3 Federalism......................................................................... 19 1.2 The Study .......................................................................................21 1.3 State of the A r t ..............................................................................24 r 1.3.1 Intergovernmental Relations (IGR)................................... 24 * 1.3.2 Decentralisation
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