Evaluating the way Brazil invests in Culture

June 2005 -

Helmut Batista (Brazil) states that commercial investments in culture have a negative effect on diversity.

Brazil, like most Latin American countries, has been struggling to find an identity away from its colonial past. This struggle has not been easy. Nevertheless, Brazil has a very different political and economical position in South America. It answers for more than half of South America's economic output and more than half of its population. Its Portuguese colonial background is very different from its neighboring countries. Its sheer size and geographical location make any comparison on social and cultural issues very hard to undertake, let alone to understand.

As most South American countries, Brazil still faces its recent past of military dictatorship that has left deep identity problems. This fragile situation has atrophied most struggles to find its own way on matters such as social and cultural independence. Social instability and the lack of security are still the most evident problems and will probably continue to be so for some time.

Despite these problems, Brazil is a South American pioneer in the very important issue of cultural production and sustainability. Under the government of Fernando Collor, Brazil's first directly elected but impeached president, Brazil introduced a law called 'Lei Rouanet' which gives tax incentives to companies that invest in cultural productions. It is a unique law that creates opportunities that no other South American country has.

Now that this law has been in practice for almost 20 years, the dubious impact of 'Lei Rounaet' on cultural affairs in Brazil should be analyzed.

For a few years now Brazil has been breaking its tax payer records. In 2004 almost 10% of the active population of 180 million actually declared taxes. Compared to any developed country this sounds like a joke. Official figures put its informal economy at the level of 40%. Ninety percent of its economy is in the rich south east, in Sao Paulo and Rio de Janeiro. In 2005 Brazil had the highest real interest rates in the world. Most small businesses have to work informally in order to survive.

The 'Lei Rouanet' makes it possible for a company to invest in culture, but only if it is 100% approved by tax authorities. Only a few large companies are eligible. These companies are all situated in the rich south east of the country.

In 2004, after almost two decades, Petrobras, the largest Brazilian company, has invested more in cultural production than the federal government. When we include other large companies in the list of tax deduction practices we can draw a very peculiar picture.

What is wrong about this situation is that with Petrobras being a commercial, profit-oriented organization, market oriented decisions have been implanted into the cultural agenda. This makes it virtually impossible for small and avant-garde art and culture. The government has passed its one social responsibility toward cultural affairs to a handful of private individuals who look at culture through the prism of commercial instincts.

This is indeed a very dangerous situation. The Sao Paulo Bienal is just one of the few examples that this peculiar construction has caused problems in recent years. The 2000 edition was virtually canceled due to political and commercial struggles by its bank director committee. Edimar Cid Ferreira (of Banco Santos), one of the directors of the Sao Paulo Bienal and Chairman of Brazil Connects (which has been producing large scale exhibitions throughout Brazil and internationally using the tax advantages of Lei Rouanet), has been under governmental investigation for tax evasion and other accusations since 2004.

This has caused serious damage to the Sao Paulo Bienal image and shows how dangerous it is to mix commercial private interest with cultural affairs. The intense media-oriented decisions on what is 'good' and what is 'bad' in the interest of large companies makes this situation even more critical and points towards mass-culture and annihilation of the small individual producer.

As a small cultural agitator in the field of contemporary art in the city of Rio de Janeiro it is hard to believe that this situation may change soon. What has happened is that most 'small' and 'new' productions (by organizers, curators and artists) are increasingly being psychologically eliminated by the sheer lack of opportunity. There is a tendency to believe that market forces may correct this with time. It surely will, but the price of cultural distortion and annihilation is immeasurable and unpredictable.

Capacete's activities are part of a long term interdisciplinary presence in Rio de Janeiro, which aims to research and document aesthetic, social and political processes in Brazil.

Helmut Batista is president of Capacete, an organisation of artists in the field of contemporary art in Rio de Janeiro.