The idea is to give money to the population for it to warm the economy. This proposal of heterodox shock, in the best Keynesian model, is of the ultra-liberal Paulo Guedes.
In addition to the release of the FGTS funds (the FGTS is a savings intended for the Brazilian worker. The fund aims to ensure the worker in difficult situations, such as dismissal without just cause), there will also be another round of PIS / Pasep withdrawals. The objective of the plan is to try to revive the economy, via consumption, still in 2019 - the government projection is GDP growth of 0.81%. The Ministry of the Economy wants to allow workers to get up to 35% of the resources of their active accounts of the Working Time Guarantee Fund. The measure is expected to inject up to R$ 42 billion in the economy.
Guedes, faced with increasingly blatant evidence that the current stagnation of the Brazilian economy occurs due to a chronic lack of demand, decides to adopt an openly Keynesian policy.
But even the economists who are progressive and close to the Brazilian left-wing believe that the measure is insufficient to remove the country from the crisis. According to economist Laura Carvalho, "such effects will be temporary and insufficient to counteract the negative impact of cutting public investments and the global slowdown on our economy."
However, economist Laura Carvalho also points to the difference between Guedes' speeches during the political campaign and his actual role as minister.
Carvalho points out that the ultra-liberal Guedes, during the presidential campaign held in 2018 in Brazil, made a "discourse filled with cliché ultra-liberal solutions, among them the radical flexibilization of labor laws, tax cuts for entrepreneurs, privatization of all public assets and indiscriminate commercial opening as a way to guarantee economic growth and job creation. " Now, faced with the reality of the Brazilian economy, Guedes decides to adopt "a measure whose rationality is supported by the Keynesian multiplier of autonomous spending."
The same happened with the government of the also liberal Maurício Macri, in Argentina. In power, he adopted unorthodox measures in the economic area.
