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Brazil spends more on servers than it invests in the future: see the impacts and solutions.
Brazil has stood out internationally, but not for the reasons we would like. While developed and emerging countries invest heavily in Artificial Intelligence (AI), cutting-edge science and technology, our country is following an opposite trajectory. The focus here is still on issues such as the construction of public restrooms and outdated debates about taxes. After all, where are we going with this backward mentality?
In this article, we will analyze how political and economic decisions are shaping Brazil’s future, comparing our public spending and strategies with those of other countries. We will also discuss the impacts of public service on the economy, the lack of meritocracy, and the urgent need for structural reforms.
1. The Contrast Between Brazil and the Developed World
While nations like the United States invest in strategic sectors such as Artificial Intelligence, aerospace industry e cryptocurrencies, Brazil seems stuck in discussions that do not move the country forward. Recently, the president stated that building public restrooms is an investment and not an expense. But is this what will drive Brazil towards development?
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The problem is not only the lack of strategic vision, but also the absence of a culture that values innovation and meritocracy. To give you an idea, in many developed countries, the labor market is dynamic, with low taxes and ease of hiring and firing. In Brazil, the focus is still on state protectionism and the strengthening of unions, which limits market flexibility and the competitiveness of companies.
2. The Astronomical Cost of Public Service in Brazil
Brazil has 12,2 million public servants, representing 12,4% of the workforce. In comparison, countries such as Denmark have almost 30% of their workers in the public sector. But the problem is not the quantity, but the cost. Brazil spends 13,4% of TAX ID No with salaries of active and inactive servers, while the average of OECD is only 9,9%.
Comparison with Other Countries:
- Chile: 13,1% of workers are public servants, but spending represents only 6,9% of GDP.
- Mexico: 3,8% of GDP is allocated to public servants, less than half of what we spend.
- Denmark: Despite having almost three times as many public servants, it spends 15% of its GDP, but with a highly dynamic market.
Here, this difference in costs is due to stability and privileges granted to many civil servants. In Brazil, 70% of civil servants have job security, while in developed countries this practice is limited to essential functions.
3. Super Salaries and the Lack of Meritocracy
In addition to the high costs, there is also the problem of super salaries. About 25 thousand servers earn exorbitant amounts, which together cost almost 4 billion reais per year to the country. To make matters worse, a large part of these salaries are concentrated in judiciary and Legislative, which are the most expensive in the world.
However, essential workers such as teachers and nurses are paid low wages. This reflects a serious inequality within the public sector, where corporatism beat to efficiency. There is no incentive for meritocracy, and many positions offer automatic promotions regardless of performance.
4. Public Spending and the Sustainability Crisis
Another alarming fact is that 40% of primary expenditure government funds are allocated to the maintenance of public servants. In countries such as United States and the United Kingdom, this percentage does not exceed 26%. This difference drains resources that could be invested in strategic areas, such as education and technology.
Furthermore, Brazil has a system of privileged pension for public servants, with more advantageous rules than those of INSSThis further increases the weight of civil servants in the budget and reduces the margin for investment.
5. Impacts on Society and the Labor Market
With so many distortions, the private sector ends up being suffocated. Only 43 millions of Brazilians work in the private sector or are entrepreneurs. Meanwhile, more than 56 million people depend on Bolsa Família, and others 39 million are retirees or pensioners.
This dependence on the State limits economic growth and job creation. Brazil urgently needs a more business-friendly environment with reduced taxes and greater freedom to undertake.
6. Lessons from Other Countries
A France, known for the weight of its State, spends around 60% of its GDP on the public sector. However, even there, most civil servants can be dismissed when the service provided is no longer needed. In Brazil, this flexibility is non-existent. Inefficient civil servants remain in their positions, often without performing any relevant function.
Na Colombia and Mexico, spending on public services is significantly lower, despite serving a population comparable to that of Brazil. This shows that it is possible to offer quality public services without compromising the budget.
7. Necessary Reforms for a Competitive Brazil
If Brazil wants to compete on the global stage, it needs to adopt deep structural reforms. Key measures include:
- Reduction in the size of the State: Reduce the number of positions and privileges in the public service.
- Promotion of meritocracy: Implement systems that reward performance and eliminate automatic promotions.
- Investment in technology: Prioritize areas such as Artificial Intelligence, scientific education e cutting-edge industry.
- Labor market flexibility: Make it easier to hire and fire, encouraging job creation.
8. The Future Under Current Management
Unfortunately, the current government seems to be heading in the opposite direction. The president advocates increasing the size of the state and strengthening trade unions, which goes against reforms implemented in the past, such as the Labor Reform 2017. These measures were essential to increase flexibility in the market and reduce dependence on unions.
If we continue on this path, Brazil is likely to face a future of devalued currency, low economic growth e reduction of international competitiveness.
9. Do We Need to Reach Chaos to Change?
Brazil has enormous potential, but continues to waste opportunities. We need leadership that sees beyond immediate agendas and invests in the future. Will we have to wait for a collapse, as happened in the Argentina, to promote the necessary changes?
Leave your opinion in the comments: Do you believe that Brazil will be able to overcome these challenges or will it remain stuck in the past?
Absolutely right! I think we have a lot to improve on in areas that really put us on the path to development. For example, replacing fossil fuel-based energy sources and moving towards clean, renewable sources.
Tell that to those who don't have public restrooms to use... An AI to find the nearest bush?!
You certainly vote for people like Nikolas who spend public money on moral issues…