Published online by Cambridge University Press: 02 January 2018
If the federation does not shrink to fit
within the GNP, there is no reform that will save Brazil.
—Ives Gandra da Silua MartinsBrazilian tax law scholar, 1997
Federalism has increasingly shaped Brazilian politics in the 1990s. Because the military regime of 1964 to 1985 heavily centralized government in Brasília, civilian political forces since 1985, in reaction, have expanded decentralization in the name of representation and participation. Institutional reforms, free-market (“neoliberal”) policies, and privatizations since 1990 have moved the country away from the legacy of statist authoritarian rule. The executive has lost power to the legislative and judicial branches, the union to states and municipalities, and the state to society, private enterprise, and market forces. The Constitution of 1988 recognized the local government units called municípios (loosely, municipalities) as component parts of the federation and shifted considerable political power and tax resources from the federal government to the states and municipalities (Selcher 1989).