Living with Inflation

Abstract This article puts inflation at the center of the making and unravelling of Brazil’s economic miracle, a period of high growth, low inflation, fast-paced industrialization, and rising consumerism between 1968 and 1973. This so-called miracle coincided with the most repressive phase of the twenty-one-year military dictatorship (1964–1985). The military regime took the credit for Brazil’s economic triumphs, weaving a narrative that democracy was bad for economic stability by blaming prior inflationary crises on profligate democratic governments and workers’ demands for higher wages. But after 1973, chronic inflation became an everyday mathematical and material hardship for Brazilian citizens—and headache for the policymakers and economists trying to forecast and freeze prices. Focusing on inflation trends and the cost-of-living crisis in Brazil from the 1960s to the 1990s, this article shows how the military’s miracle was never as solid as its supporters claimed. It argues that inflation is more than a metric for evaluating the country’s performance. Inflation became the target of seductive myths and heterodox policy experiments, as the miracle-makers tried to rewrite economic rules. Inflation also became a source of social conflict and political pressure, framing debates about social and economic justice as the country transitioned to democracy in the 1980s.