Study evaluates the Brazilian Federal system

Although the Federation is centralized, it allows local governments to innovate in public policy, says researcher.

By Fábio de Castro

Agência FAPESP – The Brazilian federal system is centralized, but it permits states and municipalities to play important roles in implementing public policy.

This is the main conclusion of the book Democracia, Federalismo e Centralização no Brasil [Democracy, Federalism and Centralization in Brazil] by Marta Arretche, professor in the University of São Paulo (USP) Political Science Department and director of the Centro de Estudos da Metrópole (CEM), one of the FAPESP Research, Innovation and Dissemination Centers (CEPIDs).

The result of studies conducted at the CEM since 2006, the book was released on August 1 in Gramado (RS) during the 8th meeting of the Brazilian Association of Political Science (ABCP). The study, published by Editora Fiocruz and the Fundação Getúlio Vargas’ Editora FGV with CEM funding, was also released in Rio de Janeiro at the Fundação Oswaldo Cruz on August 8.

According to Arretche, when the Federal Constitution was promulgated in 1988, most specialists interpreted it to mean that the federal government, in contrast to the dictatorship’s centralization, would strengthen democracy through decentralized public policy operations.

However, the researcher says that strong criticism of the decentralized system had already begun to appear in the 1990s. State and municipal autonomy, if exaggerated, could become an obstacle to democracy by making unified action more difficult and generating an imbalance between the spheres of government.

“The book shows the long tradition of the Brazilian State—echoing back to the 1930s—of concentrating decisions in the central government but at the same time using mechanisms to moderate its influence, allowing states and municipalities to be important players in the execution of public policy,” Arretche told Agência FAPESP.

The book points out that the government’s role of coordinating and formulating fiscal policy as well as its redistributive functions for reducing inequality between states and municipalities were minimized by interpretations emphasizing the decentralized characteristics of the Brazilian federal government.

 “The study shows that the federal states don’t necessarily produce dispersed political authority. Throughout the 20th century, the Brazilian Federation became highly integrated even though each level of government gained its own political authority. The process of constructing the national State operated through the centralization of political authority,” she affirmed.

The research analyzed two dimensions: the veto power of constituents in central decision-making arenas and the autonomy of the sub-national governments to determine their own policies.

“One of the main arguments used to say that the Brazilian Federation is effectively decentralized is that governors hold great veto power, meaning that the president would have to subordinate herself to the state governments to approve legislation in her interest,” said Arretche.

To verify this argument, Arretche studied legislation of federal interest from the beginning of the 1990s to the present by examining decision-making processes in the House of Representatives and the Senate.

The analysis showed that the federal government has ample legislative authority to initiate legislation in any area of politics, whereas the legislative authority of states and municipalities is quite limited.

“The central government has a great capacity to impose restrictions, both in the formulation and design of public policy and from the perspective of imposing fiscal losses on governors. The state governments don’t have that much power because the Federation can interfere at any political level,” said Arretche.

According to the researcher, regional interests would weigh more heavily in the decisions made in Brasília if the state delegations in Congress voted in a cohesive manner and stood up for regional interests. However, this is not what happens in practice.

“The delegations are divided among parties. The coalition supporting the president backs up initiatives run by the federal government. Parliamentarians don’t vote according to their regional constituencies, but rather according to their political parties,” she said.

Levels and dimensions

The second dimension of the study addressed the other side of the question: the central government’s standardization of policies executed by states and municipalities. It is common for sub-national governments to request federal presence and coordination. To evaluate this aspect, Arretche studied policies and spending by municipal governments in all areas that affect the provision of social services to citizens.

“I examined coordination initiatives that pass through the state government and the Senate, and I concluded that there is strong incentive for the Union to assume the coordination and execution of basic health policy, fundamental education, trash collection, public transport and urban infrastructure. In these areas, the municipalities depend on resources that are constitutionally transferred by the federal government without the need for political negotiation or partisan alignment,” Arretche said.

However, the central government has financial resources to encourage local governments to align themselves with the federal agenda. “This way, the central government ends up playing the role of regulating policies carried out by municipal governments. This conclusion counters the traditional interpretation of Brazilian federalism, of a federal government weakened by decentralization,” she said.

Arretche said the study’s results show that the central government does not have excessive power but that it is also neither paralyzed nor weakened. The author concludes that the Union is already strong, and it is not necessary to reformulate the federal arrangement to bolster it.

“The Union is strong in its capacity to regulate national programs executed in a decentralized manner. However, the sub-national governments have progressively strengthened their institutional capacity to execute policy. Each level of government has strength in its own dimension of producing public policy,” said Arretche.