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  • >> BY EXPLOITING ITS NATURAL

  • RESOURCES, BRAZIL'S ECONOMY HAS

  • BEEN ON A ROLL.

  • [ INDISTINCT CHANTING ]

  • BUT THE GOOD TIMES ARE OVER...

  • AT LEAST FOR NOW.

  • THE OUTLOOK NEXT ON

  • "GLOBAL PERSPECTIVES."

  • >> THIS IS

  • "GLOBAL PERSPECTIVES," WITH

  • PULITZER PRIZE-WINNING

  • COMMENTATOR JOHN BERSIA.

  • >> WELCOME TO

  • "GLOBAL PERSPECTIVES."

  • BRAZILIANS ARE A MAJOR FACTOR IN

  • CENTRAL FLORIDA'S ECONOMY.

  • BUT THE ECONOMIC ENGINE AT HOME

  • THAT HAS FUNDED THEIR UPPER- AND

  • MIDDLE-CLASS TRAVELING WAYS MAY

  • BE STARTING TO SPUTTER.

  • BY EXPLOITING NATURAL

  • RESOURCES, EXPANDING

  • AGRICULTURAL EXPORTS, AND

  • ATTEMPTING ENERGY

  • SELF-SUFFICIENCY, BRAZIL HAS

  • DEVELOPED ONE OF THE LARGEST

  • ECONOMIES IN THE WORLD AND THE

  • LARGEST IN SOUTH AMERICA.

  • BUT THE RISING TIDE HAS NOT

  • RAISED ALL BOATS.

  • AND LAST SUMMER, ANGER OVER

  • LAGGING INFRASTRUCTURE,

  • CORRUPTION, AND THE BILLIONS

  • BEING SPENT ON NEW SOCCER AND

  • OLYMPIC FACILITIES BROUGHT

  • PROTESTORS -- MANY OF THEM FROM

  • THE NEW MIDDLE CLASS -- INTO THE

  • STREETS.

  • OUR GUEST TODAY,

  • MYLES FRECHETTE, IS A FORMER

  • U.S. AMBASSADOR TO COLOMBIA, WHO

  • HAS SERVED IN VARIOUS DIPLOMATIC

  • POSTS THROUGHOUT THE REGION FOR

  • SEVERAL DECADES AND IS UNIQUELY

  • SUITED TO ANALYZE THESE

  • DEVELOPMENTS AND WHAT THEY MEAN

  • FOR THE UNITED STATES.

  • WELCOME TO THE SHOW,

  • AMBASSADOR FRECHETTE.

  • >> THANK YOU VERY MUCH, JOHN.

  • PLEASURE TO BE HERE.

  • >> SO, WHAT IS THE SITUATION

  • WITH BRAZIL?

  • IS THE WHOLE RISING POWER

  • ENVIRONMENT FOR BRAZIL OVER?

  • ARE WE SEEING A CRASH COMING?

  • OR IS THIS JUST ONE OF THOSE

  • THINGS THAT RISING POWERS GO

  • THROUGH AS THEY MAKE THEIR WAY

  • THROUGH THE WORLD?

  • >> WELL, I DON'T THINK IT'S THE

  • LATTER.

  • I DO THINK THAT MANY OF THE

  • THINGS THAT WE'RE SEEING IN

  • BRAZIL TODAY AND ARE BEING

  • CRITICIZED ABOUT THE ECONOMY IN

  • BRAZIL, HAVE EXISTED FOR A VERY

  • LONG TIME.

  • BUT BRAZIL HAS HAD, FOR EXAMPLE,

  • IN THE LAST FEW YEARS, A

  • TREMENDOUS SURGE IN THE SALE OF

  • COMMODITIES.

  • THEY'VE BEEN MAKING MONEY HAND

  • OVER FIST.

  • AND IT DIDN'T MATTER THAT MUCH.

  • HOWEVER, NOW THERE IS A ROUGH

  • PATCH.

  • NO QUESTION ABOUT IT.

  • BRAZIL CANNOT LIVE OFF SIMPLY

  • MORE EMPLOYMENT.

  • IT HAS TO BECOME MORE

  • PRODUCTIVE.

  • HOW DO YOU BECOME MORE

  • PRODUCTIVE?

  • BETTER EDUCATION SO THAT, YOU

  • KNOW, MORE BRAZILIANS CAN OCCUPY

  • JOBS IN THE NEW SECTORS BEING

  • OPENED UP.

  • BETTER INFRASTRUCTURE SO THAT

  • EVERYTHING IN BRAZIL WORKS

  • BETTER, FROM THE TRAINS TO THE

  • PLANES TO THE TRUCKS.

  • LOWER COSTS AND TAXES SO THAT

  • BRAZILIANS DON'T PAY EXORBITANT

  • PRICES FOR THINGS THAT THEY

  • WOULD LIKE IS ONE OF THE

  • REASONS, AS YOU MENTIONED IN

  • YOUR LEAD-IN, THAT BRAZILIANS

  • COME TO THE UNITED STATES SO

  • THEY CAN BUY AN AWFUL LOT OF

  • STUFF AT LOWER PRICE THAN THEY

  • CAN GET IN BRAZIL.

  • AND SO, YOU KNOW, ALL OF THESE

  • THINGS PUT TOGETHER ARE GONNA

  • MAKE FOR A NEW, MORE POWERFUL

  • BRAZIL.

  • BUT IT ALSO MEANS A BREAK IN THE

  • ECONOMIC MODEL.

  • UP TO NOW, THE GOVERNMENT HAS --

  • PARTICULARLY THIS GOVERNMENT,

  • THE WORKER'S PARTY -- HAS RELIED

  • VERY MUCH ON THE GOVERNMENT AND

  • ONLY GRUDGINGLY ALLOWS THE

  • PRIVATE SECTOR IN.

  • AND THAT'S GONNA HAVE TO CHANGE.

  • ANOTHER THING THAT'S LACKING IN

  • BRAZIL'S THE KIND OF DIALOGUE

  • THAT EXISTS IN THE UNITED STATES

  • BETWEEN THE PRIVATE SECTOR AND

  • THE GOVERNMENT.

  • AND THERE IS, FRANKLY, MORE

  • LISTENING ON BOTH SIDES HERE

  • THAN THERE IS IN BRAZIL.

  • WHEN I SERVED IN BRAZIL IN

  • SAO PAULO, I REMEMBER MEETING

  • WITH MANY, MANY BUSINESSMEN

  • BECAUSE SAO PAULO IS THE

  • INDUSTRIAL ENGINE, IF YOU WILL,

  • OF BRAZIL.

  • AND THEY SAID, "OH, THEIR

  • POLICIES ARE WRONG, AND LOOK, WE

  • OUGHT TO BE DOING THIS AND THAT

  • AND THE OTHER THING."

  • AND I SAID, "WELL, WHY DON'T YOU

  • GO TO BRASíLIA AND TELL THEM

  • THAT?"

  • AND THEY SAID, "WELL, IT JUST

  • DOESN'T WORK THAT WAY."

  • THEY NEVER WENT INTO AN AWFUL

  • LOT OF DETAIL.

  • BUT THAT HAPPENS TO BE THE

  • REALITY.

  • SO THEY'VE GOT TO DO ALL OF

  • THESE THINGS TOGETHER.

  • IT'S GONNA COST A LOT OF MONEY.

  • IT'S GONNA TAKE TIME.

  • THIS IS NOT SOMETHING, YOU KNOW,

  • LIKE A LIGHT BULB -- YOU TURN IT

  • ON.

  • THE VERY THING THAT YOU WERE

  • TALKING ABOUT EARLIER -- THE

  • LACK OF INFRASTRUCTURE, THE

  • ANGER AMONG THE PEOPLE FOR ALL

  • THE SOCCER STADIUMS THERE BEING

  • BUILT, COSTING BILLIONS OF

  • DOLLARS WHEN THEY DON'T HAVE

  • PROPER ROADS TO DRIVE THEIR CARS

  • ON.

  • >> TALK TO US ABOUT THOSE

  • BRAZILIAN TOURISTS.

  • IF THE ECONOMY SPUTTERS, WILL WE

  • SEE A DECREASE IN THOSE

  • TOURISTS?

  • OR DO YOU THINK SOME OF THEM

  • WILL CONTINUE TO COME BECAUSE

  • THEY HAVE THE INCENTIVE TO BUY

  • CONSUMER GOODS AT A MUCH LOWER

  • COST THAN THEY CAN AT HOME?

  • >> I THINK A LOT OF THEM WILL

  • CONTINUE BECAUSE EVEN IF THE

  • ECONOMY SPUTTERS, THERE'S AN

  • AWFUL LOT OF PEOPLE EARNING AN

  • AWFUL LOT OF MONEY IN CERTAIN

  • AREAS IN BRAZIL.

  • AND THEY'RE GONNA CONTINUE

  • WANTING TO COME HERE.

  • BUT SOME OF THE LOW-END ONES WHO

  • HAVE BEEN VISITING FLORIDA IN

  • MORE RECENT YEARS MAY NOT, YOU

  • KNOW -- MAY TRICKLE DOWN.

  • >> YOU'VE TALKED ABOUT SOME OF

  • THESE SPORTS FACILITIES AND

  • OTHER FACILITIES THAT ARE BEING

  • BUILT FOR WORLD CUP AND FOR THE

  • OLYMPICS AND SO FORTH.

  • PART OF THE CHALLENGE OF GETTING

  • THOSE GREAT GAMES TO COME TO

  • BRAZIL IS THAT YOU HAVE TO

  • PROVIDE WHAT IS NECESSARY TO

  • SUPPORT THEM, SO I GUESS IF YOU

  • LOOK AT THIS FROM THE SIDE OF

  • THOSE WHO SUPPORT BRINGING THOSE

  • MAJOR EVENTS TO THE COUNTRY,

  • THEN THE SPENDING IS JUSTIFIED,

  • BUT IF THERE ARE MILLIONS OF

  • PEOPLE WHO DON'T HAVE ANYTHING,

  • THEN THEY ALSO HAVE A COMPLAINT.

  • HOW DO YOU RESOLVE THAT?

  • >> I DON'T KNOW.

  • ONE OF THE THINGS, FOR EXAMPLE,

  • THAT BRAZIL HAS NOT YET

  • ADDRESSED PUBLICLY IS THE WHOLE

  • QUESTION OF SECURITY FOR THE

  • WORLD CUP AND FOR THE OLYMPICS.

  • THIS IS A REAL PROBLEM.

  • YOU'RE GONNA HAVE PEOPLE COMING

  • FROM ALL OVER THE WORLD.

  • GOD KNOWS WHAT ISSUES THEY'RE

  • COMPLAINING ABOUT.

  • BUT BRAZIL HAS GOT TO DEAL WITH

  • THIS, AND THE FOOTBALL

  • ASSOCIATION IS TALKING

  • CONSTANTLY ABOUT THIS ISSUE.

  • >> WHAT SORTS OF SECURITY

  • PROBLEMS DO YOU ENVISION?

  • >> WELL, HOW ABOUT THE ENTRANCE

  • OF TERRORISTS INTO BRAZIL TO

  • SUPPOSEDLY SEE THE GAMES, BUT

  • ARE REALLY THERE TO COMMIT

  • TERRORIST ACTS?

  • BRAZIL DOESN'T SPEND ANYWHERE

  • NEAR THE AMOUNT OF MONEY THAT

  • THE UNITED STATES OR WEST

  • EUROPEAN COUNTRIES SPEND ON

  • SECURITY.

  • AND, TO A CERTAIN EXTENT, THEY

  • TOOK A CERTAIN PRIDE IN THAT.

  • AND THERE'S ALSO A SORT OF A

  • SLIGHT FATALISTIC SENSE ABOUT

  • THIS, YOU KNOW?

  • BUT THEY'RE GONNA HAVE TO TAKE

  • CARE OF IT BECAUSE THE WHOLE

  • BUSINESS OF SECURITY'S BECOMING

  • MORE AND MORE PRESSING ON THE

  • WORLD, PARTICULARLY THROUGH

  • TELEVISION.

  • LOOK AT THIS RECENT EVENT IN

  • KENYA.

  • THIS IS SOMETHING THE BRAZILIANS

  • HAVE TO DEAL WITH AND NOT SORT

  • OF SAY, YOU KNOW, "WE DON'T

  • HAVE THAT PROBLEM," BECAUSE,

  • WELL, WHO KNOWS?

  • MAYBE EVERYBODY LIKES BRAZIL.

  • BUT I DON'T THINK TERRORISTS

  • OPERATE THAT WAY.

  • >> THERE ARE MANY BRAZILIANS WHO

  • REMEMBER AN EARLIER PERIOD OF

  • PROSPERITY IN THE 1970s THAT

  • SEEMED TO BE, YOU KNOW, THE BEST

  • THING THAT HAD HAPPENED IN YEARS

  • AND YEARS.

  • BUT IT ENDED IN A CRASH.

  • AND WHY SHOULD WE BELIEVE THAT

  • TODAY'S PROBLEMS WILL NOT END IN

  • A CRASH?

  • >> WELL, BECAUSE I HOPE THAT THE

  • PRESSURE ON MORE EDUCATED,

  • YOUNGER BRAZILIANS TO DO

  • SOMETHING BETTER WITH THEIR

  • COUNTRY -- PROVIDE A BETTER

  • FUTURE FOR MORE BRAZILIANS --

  • WILL CHANGE THAT ATTITUDE.

  • REMEMBER, BRAZIL IS A COUNTRY OF

  • BOOM AND BUST.

  • IT ALWAYS HAS BEEN.

  • I MEAN, IT BEGAN EXPORTING A

  • KIND OF WOOD CALLED BRAZILWOOD

  • TO EUROPE, AND THEN THEY

  • GOT AHOLD OF SOME PEPPER SEEDS

  • FROM INDONESIA THAT THE

  • PORTUGUESE SAILORS -- AT THAT

  • TIME, BRAZIL WAS PART OF