Oh, Brazil. The land of samba, sun, and apparently, a deeply ingrained belief that politicians can magically conjure affordable steak. The recent wire story from NPR highlights a delicious, albeit entirely predictable, economic drama unfolding south of the equator: the saga of picanha, its price, and the ever-revolving door of political promises. It seems former President (and current candidate) Lula da Silva, a man who once assured his populace they'd all be able to afford their beloved picanha again, is finding that the market, unlike a campaign speech, doesn’t bend to rhetorical will.
Four years ago, Lula pledged a return to bovine bliss, an era when the nation’s favorite cut of beef would once more grace every barbecue. Now, as he angles for another term, Brazilians are discovering that the picanha, much like economic reality, has a stubborn tendency to follow its own course, regardless of who occupies the presidential palace. One might be tempted to call this a surprise, but for anyone who’s ever glanced at a basic economics textbook—or, indeed, the lamentable history of government intervention—it’s about as shocking as a bureaucrat inventing a new regulation.
The very premise of Lula’s promise was flawed from the outset. Governments, despite their pretensions to omnipotence, do not control prices; they merely distort them. When a politician declares that a certain good *should* be affordable, what they're actually implying is that they intend to manipulate the levers of the state to achieve that outcome. This usually manifests as price controls, subsidies, or an inflationary expansion of the money supply, each of which invariably leads to unintended consequences that would make even the most dedicated central planner blush, if they were capable of such a thing.
Ludwig von Mises famously articulated that government intervention, intended to alleviate perceived market failures, almost always creates new and more complex problems. He observed that once the state interferes, it’s then compelled to intervene further to correct the distortions its initial actions caused, leading to an ever-expanding spiral of regulation. Lula’s picanha pledge is a perfect, savory example. If the market price of picanha was too high for some, the cause was likely an imbalance of supply and demand, perhaps exacerbated by global factors, domestic agricultural policies, or even a weakening currency – all things that central planning tends to mishandle with spectacular ineptitude.
Instead of allowing market forces to adjust, perhaps encouraging increased domestic production through reduced regulations, or fostering international trade to diversify supply, the political instinct is to apply a clumsy, heavy hand. Subsidies might temporarily lower prices for consumers, but they burden taxpayers and distort production incentives. Price ceilings might make picanha "affordable" on paper, but they often lead to shortages, black markets, and a decline in quality, as producers are incentivized to produce less or cut corners. The market, like nature, always finds a way, and it rarely cooperates with the whims of politicians.
The real tragedy here isn't just the price of a steak; it’s the continued belief that government is the appropriate arbiter of such things. When voters empower politicians to make such promises, they effectively hand over control of their economic lives to those least equipped to manage them. As F.A. Hayek so eloquently warned, the fatal conceit is the belief that central planners can possess all the dispersed knowledge necessary to orchestrate a complex economy. They cannot, and the result is always a less efficient, less prosperous society.
So, as Brazilians ponder their barbecue options ahead of the next election, perhaps they should consider what kind of "picanha paradise" they truly seek. Is it one where the market, guided by individual choices and free enterprise, determines a fair price, allowing for innovation and genuine abundance? Or is it one where politicians continue to promise steak, only to deliver, year after year, the same tired recipe of state-induced shortages and economic disappointment? My bet is on the latter, as long as the electorate keeps falling for the former. The state, it seems, is still very much the embarrassing relative who insists on cooking Thanksgiving dinner despite burning the turkey every single time. And the picanha, like the truth, will continue to stubbornly reflect that reality.