Galloping Inflation Grips Brazil

Press, Volume XCVIII, Issue 29010, 26 September 1959, Page 10

Galloping Inflation Grips Brazil

[By

JANE BRAGA,

a Reuter Correspondent}

RIO DE JANEIRO Police and President, consumers and newspapers, wholesalers and retailers are engaged in an angry tangle over galloping inflation in Brazil. Rio’s police chief is. declaring open war on merchants known as “sharks” to their victims, the consumers. President Juscelino Kubitschek has replaced the head of the Federal supply and price control body known as “Cofap” and promises action to stall the price spiral.

A Rio newspaper is lashing out editorially at everything from bad production methods to “greedy police” and “pitiless speculators.” Caught between the fire are ordinary Brazilians, both the workers and—for the first time—the prosperous middle classes.

They have watched with growing impatience while in two summer months bus fares jumped by 40 per cent., gas and electricity charges climbed by 35 per cent, the price of milk leaped 30 per cent, and Brazilian staples, like beans and fresh vegetables went up'by similar margins. The pattern of inflation is now familiar. First, retail merchants say they are going to put up the price of a given article. The Government forbids this. The article disappears from shops. Some time later the article reappears—at a higher price. Butchers wanted to put the price of meat up. “Cofap” said “No.” Meat disappeared. President Kubitschek called a halt on meat exports—the police raided Rio cold-storage plants and found thousands of tons of meat ready for distribution to retailers.

The President replaced the “Cofap” and said if necessary the police would be used to guarantee deliveries of meat to the butchers’ shops. Brazilians expect the price of meat to go up soon in spite of the warnings and promises of action. The same thing happened with black beans, • staple item

of the Brazilian diet. The Government ordered 20,000 tons of beans from the United States to under-cut speculators. The United States does not have black beans—only white, navy and kidney, which Brazilians do not like. A black market sprang up in black beans. The Government gave way, allowed the price increase and now black beans are back on sale. Wage increases are again in demand. Vice-President Joao Goulart, who is also president of the Brazilian Labour party, is promising higher wages. An increase in minimum wages, as high as 60 per cent, in some places, went into effect in January.

The new Chief of Police, Colonel Crisanto Giueiredo, is warning publicly that “The police will not give in to the sharks. The gaols are waiting for dishonest dealers.” He says that in one day eight informants denounced butchers for hiding meat in an attempt to boost prices. “If these charges are proved,” he said, “these dishonest dealers will be charged with infringement of the public welfare laws.” Brazilians are watching carefully, mainly unimpressed. “Sharks have teeth even too sharp for the police” is one comment chalked on a Rio wall. One of the subjects much in the public eye now is an investigation of charges that some police take or demand graft from shopkeepers to “close their eyes to certain irregularities.” A Congressional Committee is investigating the charges and it is headed by Deputy Menezes Cortes who was a high authority in the Police Force himself and in whom the public has faith. Witnesses are under police protection.

An editorial published in the Rio newspaper “O Globo” blames inflation on insufficient production, precarious storage facilities, deficient transportation, the “insatiable greed of police inspectors” and “some pitiless speculators.”

Lions At Vancouver.— The British Lions Rugby team arrived yesterday from New Zealand and will play a match against British Columbia on Saturday. British Columbia Rugby officials predict a crowd of 10,000 for the game in Exhibition Park.—Vancouver, September 24.