O Itamar Franco government was started right after the official impeachment of Fernando Collor de Mello, in December 1992. This short government was responsible for stabilizing the country politically, after the crisis of the previous government, and was responsible for stabilizing our economy through the FlatReal.
Accessalso: Government of Deodoro da Fonseca - the first presidential government in Brazil
Who was Itamar Franco?
Here in this text, we will briefly address the achievements of Itamar Franco as president of Brazil. However, to understand how this politicalminer reached the presidency, it is important for us to know his political trajectory.
Itamar Franco gained a certain political projection in the Brazilian Democratic Movement (MDB). It was in this party that Itamar Franco acquired one of his outstanding characteristics: the support for nationalism and developmentalism. Itamar Franco's political career, in turn, began before the dictatorship.
In the 1950s, Itamar was affiliated with the Brazilian Labor Party (PTB). With the 1964 coup and the implementation of bipartisanship, he joined the aforementioned MDB, party in which it took off and waselect mayor of Juiz de Fora in two terms (1967-1971 and 1972-1973).
In 1974, he was elected senator, taking office in early 1975 and being re-elected in 1982, still by the PMDB (former MDB). In the 1980s, with the strengthening of Tancredo Neves within the PMDB, Itamar Franco lost influence and abandoned the party.
This abandonment happened because Itamar launched himself as a candidate for the government of Minas Gerais by the Liberal Party (PL). He was defeated by his main opponent, Newton Cardoso, fromMDB, by a difference of just over 300,000 votes. After the defeat, he resumed the post of senator and participated in the elaboration of the 1988 Constitution.
Plate with Fernando Collor
In 1989, Itamar Franco received the invitationby Fernando Collor to compose the ticket for that year's presidential election. For this, Itamar Franco left the PL and joined the National Reconstruction Party (PRN) and, thus, Fernando Collor became president, and Itamar Franco, launched himself the vice president.
Fernando Collor was a candidate who bet on neoliberalism and the reduction of the State's action in the economy, having as one of the main causes the privatization of companies and the decrease in the number of employees public. Itamar Franco, in turn, was the opposite: he was a nationalist politician, who defended the role of the state, betting on developmentalism and nationalism.
Ideologically, therefore, Collor and Itamar Franco were not compatible, and historians demonstrate that their relationship was never the best, precisely because of these incompatibilities. Still, the invitation to Itamar Franco was important to Collor in his quest for the presidency.
This because, Collor was aoutsider (candidate who is not necessarily a traditional politician and who has an anti-system discourse that mobilizes popular indignation) and, because of that, he was not one of the big favorites to win that election. He needed the support of a traditional and well-known politician and, therefore, the invitation was made to Itamar Franco, as an alliance with himit could yield thousands of votes in Minas Gerais, one of the most important electoral colleges in Brazil.
The alliance worked, and the campaign promoted by Fernando Collor was an absolute success: the result was the victory in the second round with 53% of the valid votes. Collor and Itamar Franco took office on March 15, 1990. Collor's government, however, was disastrous, both politically and economically.
Collor Impeachment
The first accusations against Collor, published in 1992, linked him directly to corruption schemesrelated to the action ofPRAÇAyou would, the treasurer of his ticket in the 1989 election. During the government, the president continued to use this money resulting from corruption to pay his personal expenses.
It is estimated that, during the presidential campaign, PC Farias obtained around 60 million dollars of dirty money and that, during that government, the treasurer would have laundered at least 300 million of dollars|1|. The accusations against Collor led to the formation of a Parliamentary Inquiry Commission (CPI).
Through the investigations, it was decided by the members of the Legislative, the removal of the president on September 29, 1992 – Itamar Franco assumed the presidency provisionally. On December 29, 1992, it was Collor's impeachment was made official and, thus, Itamar was sworn in as president of Brazil.
Government of Itamar Franco
The scenario that Itamar Franco assumed the country was, to say the least, troubled. The first popularly elected president after 21 years of dictatorship had been overthrown by impeachment. So, politically the country needed to be stabilized, and the economy was an urgent agenda that needed to be resolved as an emergency.
Brazil was in economic crisis since the beginning of the 1980s, and inflation was very high in the period. In 1992, inflation had been 1119% and, in 1993, it was worse and reached 2477%. Between the end of 1992 and mid-1993, the government had skated in the economic area and appointed some ministers who failed in office – Gustavo Krause, Paulo Haddad and Eliseu Resende.
In May 1993, Itamar Franco invited Fernando Henrique Cardoso, sociologist who had followed a political career since the 1980s and who, at that time, was the Minister of Relations Abroad, to assemble its team at the Ministry of Finance and take the necessary actions to recover the economy of the Brazil.
The performance of FHC and his team was one of the most important moments in Brazil's recent history. FHC launched the FlatReal and through him our economy was finally stabilized.
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FlatReal
The Real Plan is probably the most important moment of the government of Itamar Franco. FHC's team counted on economists who were involved with other economic plans that failed and that had been launched in previous governments. The difference between the Plano Real in comparison with other plans was that FHC avoided using shock measures, such as freezing prices and wages, for example.
The Real Plan was marked by involving the population in the economic debate. The proposals presented to the population were explained in order to make everyone understand what was being defined. This brought popular support to the new economic plan.
The implementation of the Real Plan took place, throughout 1993 and 1994, in threephases. After the full implementation of the plan, the results began to be seen clearly. In 1994, inflation had already fallen to 916% and, in 1995, already under FHC's government, annual inflation was 22%. One new currency was also adopted: the real.
O success of the Real Plan boasted Fernando Henrique Cardoso to the presidency. In 1994, he ran for presidential election and won in the first round, thus starting the first of two terms of the PSDB politician.
Image credits
[1] Federal Senate Archive
[2] FGV/CPDOC
Grades
|1| SCHWARCZ, Lilia Moritz and STARLING, Heloísa Murgel. Brazil: A Biography. São Paulo: Companhia das Letras, 2015, p. 494-495.
