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O que o próximo Presidente realmente precisa fazer para SALVAR a economia? — Transcript

by Breno Perrucho - Jovens de Negócios · 7,830 words · 1,245 segments · language en · Watch on YouTube

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0:00There is a policy measure that alone
0:02impacts 18%of everything our economy
0:05produces in a year. And here is the
0:07detail: it’s a stroke-of-the-pen
0:09measure. It has nothing to do with tax
0:11reform that needs to be approved by
0:13Congress. It has nothing to do with
0:15reformulating the pension model, nor
0:17with turning the political system
0:18upside down. It’s one signature and
0:21it’s settled. And like almost
0:23everything in the world, the Brazilian
0:25economy also follows the Pareto
0:27principle: a handful of policy
0:28decisions. are responsible for the
0:31majority of a nation's economic success
0:34or failure. Some of these measures take
0:37years to manage to pass through
0:38Congress, while others are resolved
0:40just like this and have a brutal
0:44influence on your quality of life. Look
0:46at this. On the OEC, we see that almost
0:49half of the exports we make are
0:51concentrated in the hands of four
0:52destinations. China, which takes 27%of
0:56everything we export, the United States
1:00, which takes almost 12%, and Argentina
1:03, which buys 4%of our exports. Stop for
1:06a minute to think about what that means
1:08. For China to grow, it needs to
1:10increase investment in its industries
1:12and its infrastructure. And for that to
1:14happen, China then needs to buy steel
1:16for its factories. To make steel,
1:19Chinese steel mills buy our ore, and so
1:22Brazilian mining companies, especially
1:24Vale, profit more by selling iron ore.
1:27The fact is that the success of our
1:29trading partners, mainly China and the
1:32United States, is not restricted to
1:34influencing only the companies they buy
1:36from; in reality, it creates a ripple
1:38effect across several Brazilian
1:40industries. It’s simple: if Vale's
1:43purchase orders are increasing, it
1:46needs to hire more earthmoving and mine
1:48maintenance companies. It needs to buy
1:51more excavators. It is forced to spend
1:53more on electricity, and on rail, road,
1:56and port transport. It hires insurance
1:58to protect everything it has bought.
2:01And, of course, to sustain all this
2:03investment, it necessarily depends on
2:05financial services, such as bank loans
2:07and financing. And furthermore, since
2:11Vale is a publicly traded company, the
2:13increase in its profits means a
2:15distribution of dividends to 890,000
2:17shareholders who can spend those
2:19dividends, stimulating the growth of
2:21several other markets. The money earned
2:25from the growth of Brazilian companies
2:28'exports, therefore, spreads throughout
2:30society. And this is the point that
2:33most people believe comes from an
2:35ideological agenda, but it is a central
2:37pillar for the economic success of any
2:39nation. First pillar: trade openness.
2:45Trade openness means two things: the
2:47facilitation of exports and the
2:49facilitation of imports. Exporting you
2:53already understand; the more the
2:55government facilitates exports to other
2:57countries, the more they buy from us,
2:59the more competitive Brazilian product
3:01prices become internationally, and the
3:03greater the ripple effect on the
3:05Brazilian economy. And today, the
3:08majority of Brazilian products already
3:10have total tax exemptions on exports.
3:14So, that's great. Now, ease of
3:16importing. That's where the debate gets
3:20heated. Promoting trade openness would
3:23mean reducing taxes on the import of
3:26foreign products. But there is a real
3:29concern from those who oppose trade
3:31openness. They say the following.
3:33Making imports easier could destroy our
3:36national industry, alright? Brazilian
3:39products will hardly be able to compete
3:41with foreign products because they are
3:43of higher quality. So, if we lower
3:46taxes on these foreign products, they
3:49will become accessible to the Brazilian
3:51consumer. And if they become accessible
3:54to the Brazilian consumer, there is no
3:56reason for Brazilians to buy from
3:58Brazilians. Then what happens? Money
4:00will flow to those other countries that
4:02are exporting products here. And
4:05Brazilian companies will go bankrupt,
4:06jobs will be destroyed, and millions of
4:08people will lose their income. And look
4:13, this is a totally valid concern. The
4:16national industry is vital for a
4:18country's development. When it is
4:22capable of producing with enough price
4:24and quality to be competitive in the
4:26global market. What do I mean? Think
4:29about the computer industry in Brazil
4:31in the 80s and 90s. We were in the
4:33worst period of inflation and economic
4:35recession in our history. And on top of
4:38that, the government banned the import
4:40of foreign computers to protect local
4:42factories. The result: Brazilians paid
4:46high prices for technologically
4:48obsolete, slow, and outdated computers,
4:51while the rest of the world evolved in
4:53the digital age. So, the attempt to
4:56protect an industry incapable of
4:58competing held back the productivity of
5:01all other sectors that depended on
5:03technology, like agribusiness, banks,
5:06offices, and hospitals. In other words,
5:09when we specialize in sectors we are
5:11good at, we gain space in international
5:13trade because our products are
5:15competitive with the rest of the world.
5:17And if a nation exports products and
5:19sectors where it is competitive, it has
5:22the income to buy other products from
5:24other sectors from other nations. This
5:27means that with income, a nation can
5:30buy the very products it doesn't
5:32produce directly, but at a higher
5:34quality than if it were to produce them
5:37itself. It's the same thing that
5:40happens in your job. You are only able
5:43to do your job well, and the company
5:45where you work only exists because
5:47there are people there other than you
5:50who are focused on other tasks,
5:52allowing you not to worry about doing
5:54the work of legal, HR, marketing,
5:56finance, and sales, all of that
5:58simultaneously. Because if you had to
6:01do all of that, you wouldn't be able to
6:03deliver everything the company delivers
6:05today in the same volume and with the
6:06same quality. But even so, despite you
6:10only holding one position and
6:12specializing in one area among so many,
6:14the income you earn allows you to have
6:16access to what millions of other people
6:18in completely different sectors produce
6:20so you can have the very best. So, the
6:23quality of life of a nation is directly
6:26linked to its ability to acquire
6:28quality products and services, whether
6:31they are produced within the country
6:33itself or imported from another. There
6:36is a type of imported product that has
6:38a direct impact on increasing a
6:40nation's productivity across various
6:41sectors. Want to see? See if you can
6:43find a pattern in the examples I'm
6:45going to give you. GPS-guided
6:47harvesters mean bigger crops with less
6:49waste of seeds and fuel. This means
6:53cheaper food for the entire population.
6:55State-of-the-art medical equipment
6:57allows for faster diagnoses and more
6:58precise treatments. Imported industrial
7:02robots allow our factories to produce
7:04more complex parts, but faster and
7:06cheaper. An imported computer without
7:09taxes allows a Brazilian programmer to
7:11have the opportunity to create software
7:13that will be exported to the whole
7:14world. Got it? What do all of these
7:17have in common? All of this is
7:20technology. Taxing technology is
7:22shooting yourself in the foot, isn't it
7:24? It's shooting the economy in the foot
7:26. Because a government should not
7:28deprive its population of access to
7:30quality products at a low price just
7:32because the country's industry doesn't
7:33have the capacity to produce those same
7:35products competitively with the rest of
7:37the world. Of course, facilitating
7:41imports is indeed a risk to some
7:42Brazilian entrepreneurs, but it is also
7:45an incentive for these entrepreneurs to
7:47take action, make their operations more
7:49efficient, ensure their product prices
7:51are more competitive if they want to
7:53keep selling and gain market share
7:55against foreign products, and force
7:57them to differentiate themselves from
7:59those foreign products. And if the
8:02Brazilian entrepreneur cannot do that,
8:04the government should not favor them by
8:06harming the entire Brazilian population
8:08in return. But of course, it's obvious
8:10that the Brazilian entrepreneur's
8:12inability to produce competitive
8:13products doesn't just depend on the
8:15entrepreneur; it also depends on the
8:17available workforce. Now you tell me,
8:20who ensures the supply of quality labor
8:22available in the market? It's not the
8:26government. But that’s not even the
8:27problem. If we make imports easier, the
8:31flow of money leaving Brazil might
8:33become greater than the money entering
8:36Brazil from exports. This creates a
8:39deficit in the trade balance. And by
8:41the law of supply and demand, since
8:43more money will be leaving than
8:44entering, the Real will devalue against
8:46other currencies, get it? Then products
8:49here in Brazil that are influenced by
8:51other currencies, like the dollar, for
8:53example, will become more expensive.
8:55Wheat prices go up, soy prices go up,
8:57even the price of technology goes up,
8:59since it's all dollarized. And if these
9:01products become expensive here,
9:02Breninho, do you know what happens?
9:04Prices rise, brother. Everything in the
9:07economy gets more expensive due to
9:08exactly the ripple effect you just
9:10explained. But a reverse ripple effect,
9:12right? Instead of bringing the
9:14prosperity you mentioned, it actually
9:16brings impoverishment. Another
9:18absolutely pertinent argument, right?
9:20The problem is that it rests on two
9:22errors. One of these errors is a
9:25factual error because the data is wrong
9:27, and the other is a conceptual error
9:29about what really brings wealth to a
9:31nation. The factual error is that our
9:34trade balance is historically in
9:36surplus. In 2024, which is the most
9:39recent data here from SECEX, we
9:41generated 354 billion dollars in
9:44exports. And if we go here to Import
9:47Origins, we spent 275 billion dollars
9:51on imports. That gives a surplus of 78
9:55billion dollars in 2024. And this
9:57pattern repeats itself practically
9:58every year. There is a much larger flow
10:02of money from exports entering Brazil
10:04than the money leaving via imports. Now
10:08, the balance of payments over the last
10:1010 years, well, it was negative half
10:12the time. This is where the problem
10:15lies. The balance of payments basically
10:18captures every financial inflow and
10:19outflow of the country, meaning it is
10:21much broader than just the trade
10:22balance. So this includes money from
10:25Brazilian entrepreneurs leaving Brazil
10:27to go to offshore accounts. It’s
10:29money from foreign investors entering
10:31Brazil for the stock market or for
10:33building construction and corporate
10:34investments. It’s money converted
10:36into dollars when Brazilians travel to
10:38Disney. So, the truth is that the
10:41devaluation of the Real against the
10:44dollar isn't our fault for importing
10:46more than we export. We aren't. The
10:50constant devaluation of the real
10:51against the dollar happens mainly in
10:54years when there is a mass flight of
10:56capital from Brazilian entrepreneurs
10:58who feel insecure about how our country
11:00is being managed and, therefore, do not
11:03keep their money in Brazil, as well as
11:05from foreign investors who feel
11:07insecure for the same reasons and stop
11:09putting money into Brazil. This has
11:13nothing to do with the trade balance;
11:14there is still plenty of room to reduce
11:15import taxes. It has to do with other
11:18problems caused by the government,
11:20which I will address throughout this
11:22video, that drive Brazilian capital out
11:24of Brazil and repel foreign capital
11:26from Brazil. But for now, let me
11:28correct that second conceptual error, a
11:30classic one that many people make, look
11:32. Money is not the same thing as wealth
11:34. Wealth is production. Countries do
11:38not lose money when they import goods.
11:41What they do is trade their currency
11:43for consumer goods, inputs, and
11:45technology. So, if a country imports
11:48products that actually increase its
11:50production, such as machinery,
11:51industrial equipment, semiconductors,
11:53robotics, technology in general, or
11:55medicine, the trade deficit is actually
11:57good because it is bringing more wealth
11:59to the country. And as these imports
12:03allow Brazilian industries to then
12:05produce more, produce better, and at
12:08lower costs, these industries tend to
12:10grow. And do you know what happens when
12:14industries and sectors start to grow?
12:16They attract investment. Everyone wants
12:18a piece of a growing pie. And when a
12:21foreign investor wants a slice of that
12:23pie, what happens? The balance of
12:26payments starts to turn positive, and
12:28the real begins to appreciate against
12:30the dollar, which keeps the country's
12:32inflation in check. Got it? You don't
12:35stabilize the dollar price by limiting
12:37the population's access to technology.
12:39It would be the same as limiting access
12:41to education. What should be done is to
12:43create a secure business environment
12:46and lower the country's import taxes so
12:48it can become more productive. This
12:51will naturally create the effect of
12:53attracting investment here. But as long
12:56as that security doesn't arrive,
12:57capital doesn't just sit around waiting
12:59; it protects itself, and our money
13:00keeps devaluing. Look at what happened
13:03this week. Bitcoin rose 23%in 7 days.
13:07It was the largest weekly gain in
13:09dollars in the asset's history, over $
13:1114,000 in a single week, and it
13:13returned to the $ 80,000 range. Before
13:16this week, it was more than 30%below
13:18its all-time high, which was $ 76,000.
13:22And that’s how Bitcoin has behaved
13:24since it was born, right? It has brutal
13:26drops and equally brutal recoveries.
13:30And those who understand this don't get
13:32in to guess what will happen next week,
13:34they get in thinking about the long
13:35term. Because a signature can change
13:39taxes, it can change the rules, but
13:41Bitcoin is the opposite of that. There
13:43are 21 million units and that's it.
13:46It's locked in code protected by
13:48millions of machines spread all over
13:50the world. So, no president, no central
13:53bank, no decree, no hacker in the world
13:56will print the 21 millionth Bitcoin.
14:00And it's because of the structural way
14:02Bitcoin was created that more and more
14:04people, from individuals to big
14:06billionaire managers, are reserving a
14:08small slice of their portfolio to be
14:10allocated to Bitcoin and the
14:12cryptocurrency asset class in general;
14:14that is, as a long-term hedge against
14:17exactly the risks we're talking about
14:19in this video. And if you want to have
14:22your slice, the place to do it is
14:23Coinbase, which is the world's largest
14:25crypto exchange, listed on the US stock
14:27market. And it has a special offer for
14:29those taking the first step. On your
14:32first purchase of any cryptocurrency.
14:34You get 20 BRL in Bitcoin as a bonus.
14:37And, inside your Coinbase account, you
14:39can also access USDC, which is the
14:42digital dollar, earning up to 7%per
14:44year, while US interest rates are
14:46around 4%. In other words, you can earn
14:50above market rates and still dollarize
14:51a portion of your money directly with
14:53Pix, without needing to open an account
14:55abroad. The link is here in the
14:57description for you to open an account
14:59at Coinbase and start earning your 20
15:01BRL in Bitcoin. Now, protecting your
15:05own money is your choice. Enriching the
15:07whole country, on the other hand,
15:09requires a different scale. And it's no
15:12wonder some nations became powers
15:14precisely like this. Between 1800 and
15:181870, the United States was importing
15:20railroads, textile machinery, steel, a
15:23series of English technologies, and
15:26also recorded trade deficits year after
15:29year. And great, the Europeans made
15:31money from the United States, but the
15:33brutal gain in productivity that came
15:35from this transformed the United States
15:37into the largest industrial power on
15:39the planet at the turn of the 20th
15:41century. Guess what? The same thing
15:43happened with South Korea in the 60s
15:45and 70s. Deficit in the trade balance
15:49year after year, because they were
15:51importing heavy machinery, electronic
15:52components, and technology from Japan
15:54and the United States. As a result,
15:58these imports were the foundation for
16:00creating global giants that are part of
16:02our daily lives, like Samsung, Hyundai,
16:04and LG. And that's it, it's our exports
16:09that make up 18%of our GDP. Our imports
16:13make up 15%of our GDP. And along with
16:16IPI and IOF, these are measures that
16:18only need a stroke of the president's
16:19pen to solve. It turns out the
16:22president doesn't have infinite power;
16:24there's a limit to how far the pen
16:26stroke goes, and one of the biggest
16:27pillars of the Pareto principle in
16:29economics isn't influenced by it. The
16:31second pillar of economic success:
16:34fiscal austerity. What is that? Fiscal
16:36austerity. Fiscal austerity is
16:39basically a government spending less
16:40than what it earns. How do we do that?
16:43Either by collecting more or by cutting
16:45spending so there is money left over.
16:47So, how do we know which of the two is
16:49the best decision? I made a video
16:51explaining how the Nordic countries got
16:54where they are and what needed to
16:56happen for them to sustain their
16:57well-known welfare state. Just click up
17:01here and you can watch it. In the case
17:04of cutting spending, this should
17:06basically happen when a country loses
17:09its capacity to invest in itself; that
17:11is, when most of the budget is
17:13mandatorily consumed by state payrolls,
17:15social security, and interest payments
17:18on debt, leaving little or no room for
17:20investment in what really matters to
17:23society: infrastructure, health, and
17:25education. In Brazil, last year, in
17:292025, our budget was 92.4%consumed
17:35exactly in this way: state payrolls,
17:37social security, and interest payments
17:39on debt. And the consequences of this
17:42manifest in society as the population
17:44needs to resort to private alternatives
17:47to get around the poor quality of
17:49public services. Sound familiar? I
17:52understand how tempting it is to talk
17:55about issues surrounding inequality,
17:57income redistribution, and higher taxes
17:59on the rich. These are absolutely
18:02pertinent and noble points, but they
18:04are not nearly as impactful to society
18:06as the benefits of a generalized tax
18:09reduction for the population. Talking
18:11about taxing the rich when the poor are
18:14being crushed by the state is the same
18:16as recommending a headache pill for a
18:18patient who is hemorrhaging. But it’s
18:20little use just making money. Now, what
18:23to do with the leftover money? First
18:28step, reduction of public debt. Why?
18:32Reducing public debt increases the
18:33confidence of foreign investors.
18:36Increased foreign capital boosts the
18:38productive sector. If the economy
18:40produces more, there is greater
18:42availability of products and services
18:43for the population. Hence, greater
18:45competition, because there is more
18:47production. And if there is more
18:49competition, the fiercer the price war
18:51and the greater the companies'
18:53competition for employees, as they are
18:55all competing and growing. Therefore,
18:58the number of jobs increases, and
19:00salaries rise, because people need to
19:03be promoted to manage all the new
19:05people who are joining. And if more
19:08people are employed and more people are
19:10earning more, these people consume more
19:11. And the companies that sell precisely
19:14to these people sell and profit more.
19:16But of course, if companies are
19:18increasing their sales and profiting
19:20more. This attracts foreign capital and
19:22also reduces the price of the dollar in
19:24relation to the real as a consequence,
19:26which reduces the inflationary force of
19:28products that are directly influenced
19:30by the dollar. And stable prices enable
19:34the Central Bank to lower interest
19:36rates. And what do low interest rates
19:38mean? They mean more loans for
19:41companies to produce even more, more
19:43people consuming with credit,
19:45increasing their spending power, which
19:47further stimulates the virtuous cycle
19:49of prosperity in the economy. Cool,
19:52right? Second step, formation of a
19:55sovereign wealth fund. There is a
19:58well-known ill in economics called the
20:01resource curse. And this term was
20:04created to explain an absolutely
20:06curious phenomenon of some countries
20:08that seem to have been blessed with
20:10natural resources and yet still manage
20:12to make the lives of their population
20:15completely miserable. Does any name
20:17come to mind? That is exactly what
20:19happened with Venezuela. The country
20:21that has the largest oil reserves on
20:23the planet managed to go from the
20:25third-highest GDP per capita in the
20:26world in the 1950s to the worst GDP per
20:28capita in South America. Today, I also
20:32explain in depth, in this video above,
20:34what measures in Venezuela led it to
20:36economic collapse and how Norway, which
20:38was blessed with the same resource, in
20:40this case oil, was the nation with the
20:42highest HDI in the world for 16 years
20:44and, today, is one of the countries
20:46with the highest GDP per capita and the
20:48lowest economic inequality. In
20:51Venezuela, when the government took
20:53over oil production, it started using
20:55the money from oil sales to expand the
20:57state apparatus. And so it created new
21:00public positions, expanded benefits for
21:03the population, and started a series of
21:06pharaonic works. By doing all this, a
21:09moment arrived when the money coming
21:11from oil could no longer pay for the
21:13size of the public machine, because the
21:15oil money was falling, because the
21:17operation was becoming less efficient,
21:20and the costs of the public machine
21:22were increasing. On the other hand, the
21:24Norwegian government took the money
21:26from the sale of oil and did, you know
21:27what? Nothing. He put it in a fund that
21:30invested in companies from different
21:32sectors spread all over the world. This
21:35meant the Norwegian economy’s backing
21:38no longer relied on oil sales, but
21:40rather on the success of countless
21:42sectors under diverse global influences
21:44. Today, that is the Norwegian
21:48sovereign wealth fund, the largest
21:50state fund in the world; if its assets
21:52were distributed to all Norwegians,
21:54each citizen would receive the
21:56equivalent of nearly 2 million
21:58Brazilian reais. And here is the detail
22:02: Norway only incorporates 3%of the
22:04fund's total value into its annual
22:07budget, so the fund keeps growing,
22:09Norway always adjusts it for inflation,
22:12and most importantly, the fund's
22:14contribution to the economy never
22:16decreases, you see? The Norwegian
22:19government is the one that won the
22:21lottery by sitting on one of the
22:23largest oil reserves in the world, but
22:25it also had financial literacy.
22:27Venezuela won the lottery 30 times over
22:29. And spent it all. But Brazil, we were
22:32given so little, right? We barely have
22:35any fertile land, fauna, flora, climate
22:38, or resources, right man? We didn't
22:41just win the lottery once, we won it 10
22:43times, and yet our government spends
22:45more than it earns. That is why it is
22:48hard to believe that we will simply
22:50manage, in one term, to lower taxes,
22:52create a sovereign wealth fund, and
22:54make Brazilians live off passive income
22:56. Man, that is a project for decades.
22:58But there is a way to shorten that path
23:00. There is a liberalism mantra that
23:03says a government's commitment should
23:05only be to education, health, security,
23:07and infrastructure, not to business.
23:10Business is for entrepreneurs, but that
23:13is not a universal law. The problem
23:16with a government isn't deciding to run
23:17a business, because business is for
23:19entrepreneurs. The problem with a
23:21government is deciding to run a
23:23business when the political interests
23:25of those in power outweigh their
23:27commitment to the company's success.
23:30There is no rule stating that every
23:31time the government takes over a
23:33state-owned company, it will perform
23:34worse than if it were private. State
23:37control makes sense in countries with
23:39high management efficiency and low
23:41corruption. That is why being pro-state
23:45in Norway is wonderful, but they are in
23:47ninth place worldwide in economic
23:49freedom and fourth in the corruption
23:51perception index. In other words, state
23:54and entrepreneurial efficiency in
23:56Norway is a global benchmark. The
23:58problem is being state-run in Brazil,
24:01which ranks 117th in economic freedom,
24:03classified as mostly unfree, and also
24:05ranks 177th in the corruption
24:07perception index. In other words, the
24:10government thinks it’s an excellent
24:12manager of health, education, security,
24:15infrastructure, and an excellent
24:17manager of companies. Brazil is not.
24:20And you might not even own a company,
24:21okay? You might not even be a business
24:22owner, but I know you’ll be able to
24:24answer this question. Let’s say you
24:25decided to be a business owner. You
24:27hired a CEO to run your business
24:29operations. And what do you do with a
24:31CEO who makes excuses every year for
24:33missing targets and you even suspect is
24:35stealing money from the shareholders?
24:37Man, you don’t let them keep running
24:39the company, you change the CEO. Our
24:41government has met all the
24:43prerequisites on the list of how a bad
24:45CEO should behave. Look at the
24:47Petrobras case. From 2014 to today,
24:50Petrobras has had 4 years of losses and
24:522 years of operation barely breaking
24:55even. Furthermore, the use of Petrobras
24:59as a place to hand out jobs has been
25:01happening since '53 and has been
25:04religiously repeated every decade since
25:07then. Man, that means historically,
25:10instead of putting the best engineers
25:12or the best executives in charge of a
25:14state-owned company the size and
25:16importance of Petrobras, the most
25:18important board positions are
25:19distributed to approve government
25:21projects. Finally, Petrobras serves as
25:24an instrument for electoral purposes,
25:26because when the government
25:28artificially holds down gasoline prices
25:30to try to win an election, it forces
25:31Petrobras to take a loss. Have you ever
25:34heard someone say this: "Oh, come on, a
25:36state-owned company doesn't have to
25:38turn a profit, man. A state-owned
25:39company has to fulfill a social
25:40function."
25:41But that is a fundamental error in
25:43understanding economic theory. Do you
25:46know what happens when a state-owned
25:47company loses money? The taxpayer pays
25:49the bill. If a public company loses
25:52money, the money to cover the hole has
25:54to come from somewhere. Either the
25:56treasury takes money away from health,
25:58education, and security to cover the
26:00company's deficit. Or the government
26:02goes further into debt to plug the hole
26:04, and then that bill will have to be
26:05paid in the future. Or it creates more
26:08taxes to increase revenue. How does the
26:11population feel this? They feel it in
26:13the deterioration of public services
26:14and/or the increase in prices. Now,
26:17when a state-owned company makes a
26:19profit and is well-managed, part of
26:21that profit returns to the state as
26:22dividends. That’s clean money that
26:26can go into the public budget without
26:28raising taxes on the people, and it can
26:30even be used to reduce public debt,
26:32attract foreign capital, lower the
26:35dollar, control inflation, and pave the
26:37way for lower interest rates. The
26:40profit of a state-owned company is a
26:42benefit to the people, not their enemy.
26:44There is no absolute truth that
26:46privatizing or nationalizing is
26:47inherently good or bad. Nationalizing
26:50is good when management is good.
26:51Privatizing is good when management is
26:53bad. So, why don’t we just improve
26:56management and keep the state company?
26:58Man, that would be beautiful. But in
27:00Brazil, it’s hard to believe that
27:02keeping state-owned companies will
27:04improve their management. Because even
27:08if the most efficient government in the
27:09world took office, we can’t forget
27:11that political interests change with
27:13every term. So nothing stops a future
27:17election from bringing in an extremely
27:19incompetent, yet popular and persuasive
27:21manager who could destroy the company
27:23all over again, right? I like Petrobras
27:26because it seems that, specifically in
27:28its case, privatization is viewed as an
27:30unimaginable terror, right? There’s
27:32even that saying with immense
27:33popularity that
27:34the oil is ours.
27:36Great. But understand this: privatizing
27:39a company does not sell the subsoil.
27:42Oil and iron ore, in Vale's case,
27:44continue to be assets of the Union
27:45under the Constitution. "Oh, but
27:48that’s useless because the money
27:49doesn't come to us." That’s a lie.
27:51When you privatize a mining company or
27:53an oil company, you are selling the
27:55right to operate the machinery; meaning
27:57, the resource can only be extracted
28:00from the soil through the continuous
28:02payment of royalties and taxes to the
28:04Brazilian government. Let’s go,
28:06let’s talk numbers. You know Vale?
28:08Vale is Brazil’s largest mining
28:10company and was privatized back in 1997
28:11. Since then, Vale has become one of
28:14the largest mining companies on the
28:16planet. It employs 156,000 Brazilians
28:19directly and indirectly, paying
28:21billions of reais in taxes and
28:23royalties to the Union on average. And
28:26any Brazilian can own a piece of it and
28:28receive those dividends by buying
28:30shares on our stock exchange. How much
28:33is a Vale share today, to give you an
28:34idea of how accessible it is? 75 Reais.
28:37You can buy one little share, just one,
28:39on the fractional market. The ore
28:41didn't stop being Brazilian. The taxes
28:43and royalties didn't stop being paid to
28:45the Brazilian government. The
28:48difference is that since 1997, it is
28:50the private shareholders who bear the
28:52financial risk of Vale, not you with
28:54your taxes.
28:55To open up, man. But Petrobras is
28:57complicated, man. Because if the price
28:59of a barrel of oil goes up, the
29:00Brazilian government is the only
29:02protecting force for the citizen. The
29:04government, by intervening in Petrobras
29:06, can lower the price of oil to make it
29:08cheaper than on the international
29:10market. And then gas doesn't get
29:12expensive; it's good for our pockets,
29:13man.
29:14And you know what? You're right. That
29:17is actually what Dilma did. To hold
29:19back inflation before the 2014 election
29:22, the Dilma administration, as majority
29:25shareholder, kept fuel prices at
29:27Petrobras below international levels.
29:30In practice, what does that mean?
29:32Petrobras was selling for less than it
29:34cost to extract and import. So, it lost
29:38money on every sale just to make it
29:40seem like gasoline prices weren't
29:42rising, and consequently boost Dilma's
29:45popularity in an election year. It
29:48worked. Dilma was re-elected, right?
29:49But do you know what else it resulted
29:51in? It resulted in a surge of Petrobras
29:54'debt, causing it to have 4 consecutive
29:56years of losses, from '14 to '17. And
30:00in 2014, with this maneuver alone,
30:02Petrobras took the top spot on the
30:04world podium for the most indebted
30:06company. In 2015, a parliamentary
30:09inquiry pointed out that the Petrobras
30:11price freeze had already generated 100
30:13billion in losses for the company. Do
30:15you know what that is? More than the
30:17entire Lava-Jato operation, man; the
30:19damage the government caused to its own
30:21asset to win an election was greater
30:23than the biggest corruption scandal in
30:25our country's history. And corruption
30:27was also in the middle of those 100
30:28billion, okay? In the 2014 Petrobras
30:30balance sheet, more than 6 billion in
30:32losses were recorded regarding fraud
30:34involving former directors and
30:36contractors. Why? Because the Petrobras
30:39boards were packed with party members
30:41who gained positions as political
30:42favors and were not there based on
30:44merit. Do you understand what I'm going
30:46to tell you? Interfering in prices
30:47doesn't work. Dilma should have learned
30:49that from the Cruzado plan, the Bresser
30:51plan, the Verão plan, and the Collor
30:53plan. Maybe she even knew that, but
30:55it's possible she also thought that
30:56even by screwing over the entire
30:57country to secure re-election, she
30:59wouldn't face impeachment. And well,
31:01history is there to tell us what
31:03happened. In short, if you leave the
31:09company alone, without being moved by
31:10the nuances of the current political
31:12mandate, it prospers. In 2023,
31:15Petrobras returned 274 billion back to
31:18the government, of which 34.5 billion
31:21was in dividends to the Union and 240
31:24billion was in taxes and royalties. Now
31:27, look how curious this is. This means
31:30that 88%of the money that Petrobras
31:32returned to the country came in the
31:34form of taxes and royalties, not
31:36dividends. Which means it would have
31:39returned that amount to the government
31:42regardless of who the owner was. That
31:44is why for a government it is less
31:46about nationalizing or privatizing; the
31:48government would win either way. It is
31:50much more about how to ensure the best
31:52governance given the circumstances. And
31:55in Brazil, there is more evidence than
31:57not that when the owner is the
31:58government, good management will not
32:00last forever. Brazil has few periods of
32:03excellent management of state-owned
32:05companies and many periods of excess,
32:07because everything can change in the
32:09next term to serve the reelection
32:11interests of the next politician. And
32:14here in Brazil, specifically, money
32:16from privatizations could be used to
32:18reduce public debt and also accelerate
32:21the formation of a sovereign global
32:23investment fund, instead of us waiting
32:25for a miracle that, starting now with
32:27the next administration, oh no, this
32:29next leader will be the turning point
32:31that will change the management of
32:34Brazil's entire history from here on
32:36out. Example of government management.
32:39Do you think so? But you know what?
32:41There is an unpopular ingredient, okay,
32:44that nobody likes to talk about, but
32:46which makes trade opening and fiscal
32:49austerity alone not enough. The third
32:52pillar for a nation's economic success:
32:55regulatory efficiency and business
32:57freedom. Listen, you may have already
33:00heard that we have one of the most
33:02complex and bureaucratic tax and
33:03regulatory systems on the planet. And
33:05there is a reason why you heard that. A
33:07company here in Brazil spends an
33:09average of 1,500 hours. To calculate
33:12and pay taxes. For the sake of
33:13comparison, the OECD country average is
33:16160. So, it is as if every year you had
33:19to put an employee to work 8 hours a
33:21day for more than 6 months, just to do
33:23one single thing: calculate how much
33:25the business owner has to pay the
33:27government. Not to produce anything,
33:30just to report. And the reason for this
33:32is a clear and historical pattern of
33:35inefficient governments, which is that
33:37the government sees something that
33:39looks like a problem in the economy,
33:41then it tries to fix the market by
33:43taxing A to protect B and, in its mind,
33:45solve that problem. Except that, more
33:48often than not, this creates an
33:49unexpected consequence. By taxing A to
33:52protect B, it makes C more expensive,
33:54which then requires a subsidy for D to
33:56correct the problem it caused itself.
33:59The problem is that correcting the
34:00problem in E throws everything off
34:02balance, get it, man? It’s like a
34:04game of Whac-A-Mole, only played on a
34:06national scale. If you hit the mole and
34:08plug the hole, it will just pop up and
34:10open another hole somewhere else.
34:11Except in this version of the game, the
34:13mole has babies. So you need new
34:15measures to plug the new holes that
34:17appeared, and with every intervention,
34:20more holes emerge. The consequence is
34:23that when you look, there’s an
34:25ultra-complex bureaucracy with hundreds
34:27of laws and taxes trying to fairly
34:28control the economy, but now there are
34:30thousands of moles on the loose. And
34:33who pays for that? The public, who pays
34:35in the form of price hikes, and
34:36companies, which have to hire an entire
34:38team of people just to avoid falling
34:40into one of the holes the government
34:42itself created. And so, instead of
34:44focusing on what an entrepreneur should
34:46do—producing and innovating—they
34:48spend more time lobbying in the capital
34:49, trying to befriend those holding the
34:51mallet. But not every entrepreneur has
34:54the privilege of getting close to the
34:56king, right? If it were a universal
34:59right, then fine. But in practice,
35:01that's not how it happens. Imagine the
35:03lady who makes cakes at home; she makes
35:04the best cake in the neighborhood, it's
35:06selling really well. Then a time comes
35:08when she says, "Hey, I'm going to
35:10professionalize my management, I'm
35:11going to grow, become a real brand, and
35:13start hiring." Then she hits a wall
35:16with business registration, permits,
35:18accountants, and taxes she doesn't
35:20understand. Then she overlooks some
35:22regulation, and a fine arrives for her
35:24to pay. So what does she do, man? She
35:25gives up and prefers to stay in the
35:27informal sector. Much easier, right?
35:28And so her business never grows, she
35:30never hires anyone formally, and she
35:32never gets a bank loan to expand
35:33because, on paper, her business doesn't
35:35exist. Now take this cake-maker's
35:38situation and multiply it by millions
35:40of Brazilians. That is the scale of
35:43what extreme bureaucracy takes from our
35:45economy every year. And it's not just
35:47the taxes it collects; it's all the
35:48production, all the employment, and all
35:50the wealth that simply never comes to
35:52be, because just starting and staying
35:53afloat is already too difficult.
35:55Countries that simplify this, that let
35:57you open a business in a day, that have
36:00automated systems, that are
36:02implementing AI to speed up processing
36:05and eliminate roles that make no sense
36:07today, countries that make it possible
36:10to pay taxes without an army of
36:12accountants. Those countries take the
36:14foot off the throat of those who
36:16produce. That is why, despite being
36:18some of the countries with the highest
36:21tax burden relative to GDP in the world
36:23, Norway, Denmark, the Netherlands,
36:25Sweden, and Finland are at the top of
36:27the economic freedom rankings. Because
36:30in those countries, it’s simple, man.
36:31Oh, but they tax a lot. Watch the video
36:34I told you about Norway; I explain
36:35exactly the capitalist foundation they
36:37created to sustain the high taxes of
36:39their welfare state. The way they tax
36:42is completely different from Brazil.
36:44They only tax the individual after the
36:46business turns a profit, and they make
36:48it easy for anyone to get a business
36:50off the ground quickly and help it grow
36:52. In Brazil, on the contrary, we punish
36:55the company before it even turns a
36:57profit and kill it before it even has a
36:58chance to grow. In fact, the World
37:02Bank's Doing Business report showed
37:05that if you compare the amount of tax a
37:07business owner pays in Brazil with
37:09their profit, the total tax amounts to
37:1265%of their profit. In Norway, do you
37:15know what that number would be? 36%,
37:17almost half. But there is something
37:20worse than a state that gets in your
37:22way with too many rules. It’s a state
37:24where you can’t trust that today’s
37:26rule will still be valid tomorrow. And
37:28that is where we reach the fourth of
37:30the five pillars of a nation's economic
37:32success, and this one supports all the
37:34others. Fourth pillar, protection of
37:37the rule of law. The rule of law is the
37:41guarantee that the contract you signed
37:43will be honored, that the company you
37:46built is yours, that if the judiciary
37:48hears your case, it will be impartial,
37:51and its decision will be final. But in
37:54the 90s, when the social contribution
37:57on net profit, or CSLL, was created,
38:00many large companies went to court
38:02arguing that the CSLL was
38:04unconstitutional. And do you know what
38:06happened? The companies won the lawsuit
38:09. The court granted them what we call
38:11res judicata, which is a final decision
38:13that can no longer be changed. With
38:15that, those companies gained the
38:17eternal right not to pay the CSLL. Very
38:20clear, right? But in 2007, the Supreme
38:23Court decided to revisit this case and
38:25ruled generally, deciding that the CSLL
38:28was indeed constitutional and everyone
38:30should pay. The thing is, the companies
38:34that had the final judgment from the
38:3590s had won the lawsuit, stating
38:37definitively that they didn't need to
38:39pay. So, they didn't pay. Then in 2023,
38:44the Supreme Court ruled on the case
38:46again and determined that the companies
38:48that hadn't been paying the CSLL not
38:51only lost their "eternal" right but now
38:53owed all the taxes not paid since 2007,
38:56with fines and interest. Think about
39:00how absurd that is. Some companies
39:02simply followed something they had
39:04already won in court. And one night,
39:07they went to sleep with their accounts
39:08in order. The next day, they woke up
39:11owing billions of reais to the Federal
39:13Revenue Service because some people in
39:14the judiciary decided that the ruling
39:16was no longer valid. These companies
39:19paid 15 years of back taxes that they
39:21were supposedly supposed to have paid.
39:23And you know what the worst part is?
39:24This is just one case among many.
39:25It’s the government creating an
39:27export tax on oil overnight. It’s a
39:29tax benefit promised by law being cut
39:31before the expiration date by executive
39:33measure. It’s the rollercoaster of
39:35the ICMS last year. Remember when we
39:36didn't know if it was going up or down?
39:37It went up, it went down, and one side
39:39went against the other. Man, this lack
39:41of security—if you don't have the
39:43guarantee that a final decision will be
39:45respected, will you risk starting a
39:47business? You build a factory that is
39:50economically viable today, but it only
39:52starts yielding returns in 15 years.
39:55But will I have the confidence that it
39:57will be economically viable in 15 years
39:59when the factory opens? Everything
40:02could have changed by then. You don't
40:03build it, man. Money flees to where it
40:05feels safe. And a country where nothing
40:08is guaranteed accumulates nothing. It
40:10stays poor because of the lack of trust
40:12it generates in the Brazilian
40:14entrepreneur and the foreign investor.
40:16And just so you understand the
40:17dimension of the problem, right?
40:18Let’s look at some data. Brazil is
40:2078th out of 142 countries in the World
40:22Justice Project, which ranks the rule
40:25of law worldwide. In other words, we
40:28are far below what we could be. And who
40:30appoints the justices who protect the
40:32rule of law is the President of the
40:34Republic. Which means it’s not enough
40:36to choose a good candidate for
40:38president. You have to choose a good
40:40candidate who makes good choices for
40:42justices. And the most important of
40:45these choices is what supports the
40:46fifth and final pillar. one of the main
40:49measures of a nation's economic success
40:51. Education aligned with the actual
40:56demands of the market. Look, none of
40:59what we’ve discussed works
41:01sustainably in the long run without a
41:03robust foundation. And education is
41:06that foundation. The Netherlands in the
41:0917th century, Singapore, Japan, Taiwan,
41:11South Korea, Switzerland in the 20th
41:13century; all these countries lost in
41:16every lottery. They have no climate.
41:18They have no land, no natural resources
41:21, and the only thing left was for them
41:23to be forced to invest in their
41:25population's brains, which was the only
41:28wealth they had available. And they all
41:30became wealthy, and they all adopted
41:33the same recipe to escape resource
41:36scarcity. These countries didn't just
41:38dump money into education to be able to
41:40say that education is receiving
41:42billions in investment, as many
41:44politicians do. We increased it by 15%,
41:46that meant 30 billion more for
41:48education.
41:49Man, that’s just talk for those who
41:50don't understand. Who said that this
41:51money was invested in education and
41:52actually reached the ground level? Who
41:53said the investment was made with
41:55quality? Who said it was invested in
41:56the right type of education? Because
41:58yes, there is a right type. When you
42:00are a poor country and you want to
42:02increase the population's quality of
42:03life, increase purchasing power, and
42:05guarantee a better life for everyone,
42:07the right education is one geared
42:08toward a market that supplies the tech
42:10industry and creates high-value-added
42:11products. And in the case of those
42:14countries I mentioned, what they do is
42:16import raw materials from agrarian
42:18countries like Brazil. So, they import
42:20iron, silicon, lithium. They use their
42:23engineering to transform these raw
42:24materials into high-value-added
42:26products. And then what do they do?
42:29They resell the same raw material to
42:31the world, now transformed into
42:32high-value products, for dozens of
42:34times the price they bought it for.
42:37What does this do? Growth, absurd
42:38wealth expansion, it attracts foreign
42:40capital, strengthens these countries'
42:42currencies, and begins to improve the
42:44general quality of life for their
42:46population across the globe. But the
42:48point here is that it's not enough to
42:50just increase the education budget,
42:52it's not enough to just create new
42:54diplomas; we need programs that train
42:56Brazilians versed in cutting-edge
42:58technology, in artificial intelligence,
43:00in innovation and entrepreneurship to
43:02meet today's market demands. Because
43:05that is what increases the availability
43:07of skilled labor, which actually
43:08protects the Brazilian entrepreneur
43:10from global competition while the
43:12government cuts import taxes. And that
43:15is actually my life's purpose, man. I
43:17developed with Thiago Nigro and Joel
43:19Jota an educational program that goes
43:21from age 3 to 17 to teach three
43:23fundamental pillars for anyone's life:
43:25entrepreneurial education, financial
43:28education, and social-emotional
43:30intelligence. Because without that, we
43:32don't become functional human beings
43:34for society. We will make the same
43:36mistakes that the lack of this same
43:38knowledge causes for our leaders. We
43:40will spend more than we earn. We will
43:42waste money starting a business that
43:44doesn't solve anyone's real pain. We
43:46won't be able to deal with other people
43:48because we can't handle adverse
43:50situations with courtesy, elegance, or
43:52empathy. And so, if young people don't
43:55have access to this content, they
43:56become professional complainers. They
43:58play the victim, saying: "Oh, but the
44:00market is bad right now.""Oh, but
44:02someone should do something.""Oh, but
44:04I'll just wait for the crisis to pass."
44:05And, man, the crisis isn't going to
44:06pass, man. The market will always be
44:08bad and there will always be
44:09opportunity. But if we can't open
44:12people's minds to show that we are the
44:14ones who create opportunities, we
44:16become slaves to the government. We
44:19rely on other people dictating what our
44:21lives are going to be like. So, if you
44:23own a school or know a school
44:24representative who wants to learn about
44:26the program to implement it in a school
44:28you have access to, I'm leaving the
44:30link for the Lider program below. We
44:32already have over 30,000 students. So,
44:34thank God, it's a program that is being
44:35very successful and that I hope will
44:37still reach students all over this
44:38country, but for that, I need help. So,
44:40if you also have this purpose and the
44:42belief that education is above all else
44:44, go to the link below, fill in your
44:46school's details, and I'd love to have
44:48my team present the program to you,
44:50deal? So, look, there is one more thing
44:52you don't know here and you need to
44:53leave this video knowing, but let's do
44:55a quick recap of what we talked about.
44:57Here’s the thing: the policy measures
44:59with the greatest potential for
45:01economic impact in Brazil will be those
45:03associated with trade opening through
45:05lower import tariffs, fiscal austerity
45:07to reduce public debt and create a
45:09sovereign wealth fund, regulatory
45:11efficiency to increase the ease of
45:12doing business and reduce the tax
45:14burden on companies, the appointment of
45:16Supreme Court justices who prioritize
45:18the non-negotiable protection of the
45:20Rule of Law, and investment in
45:21education projects that prepare
45:23Brazilians to meet real market demands,
45:26creating added value and ensuring they
45:28are versed in the most cutting-edge
45:30technology: artificial intelligence.
45:32Unfortunately, some of these measures
45:34don't just depend on the president’s
45:36pen. If that were the case, it would be
45:38much easier for us to just vote for
45:39someone and have all the problems
45:41solved. Unfortunately, it isn't. There
45:42is a massive amount of political
45:44persuasion the future president will
45:46need to have to convince members of
45:48Congress, the Chamber of Deputies, and
45:50the Senate that the measures they want
45:52to pass are important. So, even if a
45:55candidate seems to have the best speech
45:57, seems to be the nicest, or seems the
45:59most knowledgeable, we need to
46:00understand who actually passes bills,
46:02who lives by the principles we do, who
46:04understands the importance of these
46:06measures we’ve discussed, and who has
46:08the capacity to execute them. In your
46:11opinion, who do you think is that
46:12candidate?

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