History Blog 4
Rio de Janeiro Travel Blog› entry 2 of 2 › view all entries
In the midst of the global economic crisis,
However, President Lula agrees that cutting taxes is not a long-term solution for a stable economy. According to the online article, President Lula hopes to distribute money to the lower class of
Some Brazilian businessmen who benefit from the tax breaks do not lower the prices of their services and goods, therefore; the common consumers do not directly benefit from the tax breaks. The excess money the business industry receives from the tax breaks are kept in banks which does not help stimulate the economy. Thus, the government welfare programs are critical to enable the lower and working classes of
The IMF is known to provide aid to many countries in need. Regardless of intentions, the IMF gets rich from loaning money to major debt countries all around the world. The most popular was Argentina. The IMF provided billions of dollars in aid to help out their collapsing economy. After the collapse of the Argentina government, the IMF was limiting spending in Argentina in order to payback the IMF. This threw the economy into more turmoil. Brother country, Brazil, also borrowed money, but the IMF was not controlling their economy. It turns out that Brazil repaid the IMF and that kept the IMF away from economic decisions in the country.
Brazil borrowed billions of dollars from the IMF but was able to repay the debt back. Earth Times stated that Brazil is going to loan the IMF US$10 billion dollars. The money will be used to help other developing countries. Brazil is now one of the top 20 countries and is in a great position to be able to loan out that amount of money. Brazilian Finance Minister Guido Mantega said that he is happy to aid other developing countries and is happy to see Brazil in the economic position to do so. It was not long ago that Brazil was requesting funds from the IMF. The IMF reported that it needs US$500 billion to aid countries. China contributed US$50 billion dollars and Russia US$10 billion dollars. Brazil is now among the top nations in the world in financial contributions to the IMF.
It is interesting to see Brazilâ€™s position in the world when they were struggling decades ago. The fifty years of progress in five years can clearly be seen in the current economy.