Brazilian WI: No Encilhamento?

[Vinization]

The Encilhamento was economic crisis that engulfed the young Brazilian republic in the last decade of the 19th century, caused by a government policy of unrestricted loans in an attempt to foster industrialization. This led to rampant speculation and inflation, and it wasn't until the presidency of Campos Sales (1898-1902) that the crisis was brought under control with harsh fiscal austerity and a British loan full of strings attached.

So what if Ruy Barbosa (the finance minister who started/exacerbated the Encilhamento) either had a better understanding of economics, listened to people who did or just straight up wasn't put in charge of the Brazilian economy? How could this affect the Old Republic in its formative years?

For example, would president Deodoro da Fonseca still declare a state of siege in November 1891? Alternatively, could a stronger economy (and thus fewer tensions) mean Congress is less afraid of him launching a coup d'état, and is thus more willing to vote for Prudente de Morais in February that year?

@Gukpard @Guilherme Loureiro @Aluma @Taunay

 

[Taunay]

Could this kill Coffee-with-milk politics in its cradle? If so, expect more immigration and an industrialization that is both bigger and less concentrated in São Paulo

 

[Vinization]

Could this kill Coffee-with-milk politics in its cradle? If so, expect more immigration and an industrialization that is both bigger and less concentrated in São Paulo

You're fast! 😯

I'm afraid this would be quite difficult to avoid given São Paulo and Minas Gerais' economic and political strength, but who knows. Even with a better economy the early Republic will still be very unstable - the Federalist Revolution and the Canudos War will almost certainly still happen.

 

[Vinization]

Some more thoughts.

Even if Deodoro doesn't shut down Congress and thus doesn't kick off the events that caused his resignation, his presidency would likely still be short - he died in August 1892 IOTL. Assuming he dies in office and Floriano Peixoto takes office in better circumstances than OTL, would the Revolt of the Armada still happen? If it doesn't, then I doubt the Federalist Revolution will spill out of Rio Grande do Sul ITTL.

Canudos will still be a bloodbath, however, since national politics had nothing to do with its creation.

 

[Aluma]

I think Canudos will definitely exist but doesnt necessarily has to be a bloodbath

It was a combination of lack of resources and the city being flooded with people looking for a better life under Conselheiro's promised land that led to it having to raid other cities and face the province's government, which is what got the attention of the national government

As far the state was concerned before that, it was a insignificant community in the middle of Sertão following a fringe cult, no reason to bother with it

The poverty that led to it existing wouldnt disappear, nor would Conselheiro's cult, but without the hyperinflation it is possible that the city could sustain itself with less people displaced moving to it, avoiding the worst of the pillaging which got it into trouble

Of course I wouldnt bet on that, chances of the same still happening still exist, but a sightly better economic situation could led to the community surviving a little longer

The Federalist Revolution, like you said, would likely still happen for factors unrelated to the economic situation but with the economy not being thrown into a sink I could see it ending sooner due to less support

No changes in the Revolt of the Whip in my opinion, that situation was completely unrelated to the economy and had everything to do with the navy being a hellhole where everyone was treated like shit, so there's that

I think the most significant change is that the Empire's slow push towards industrialization wouldnt die off due to Ruy Barbosa's own ham-fisted attempt at a quick "Brazilian Meiji" only to pick up again during the Vargas Era, with GDP per capita and wages not collapsing due to the economic collapse brought by that policy

I think the end result is the First Republic keeping the growth from the Imperial Era and pushing towards modernization still(Ruy Barbosa not implementing Encilhamento doesnt change the government's set priorities) but still under a Café com Leite oligarchy with Vargas's own rule butterflied away altogether

 

[Aluma]

Also kudos to you for being the one to address the Encilhamento crisis, its a fucking underrated POD

 

[Vinization]

Canudos stuff

A longer lasting Canudos would be awesome due to its social, economic and political effects, but ultimately I'm afraid its fate was sealed the moment it was formed. Its mere existence was a symbol of resistance to the coronéis, and they controlled every aspect of government.

I think the end result is the First Republic keeping the growth from the Imperial Era and pushing towards modernization still(Ruy Barbosa not implementing Encilhamento doesnt change the government's set priorities) but still under a Café com Leite oligarchy with Vargas's own rule butterflied away altogether

I wouldn't be surprised if he (Ruy Barbosa) became president ITTL. He was always a respected figure from what I know, and he performed very well in 1910.

 

[Aluma]

A longer lasting Canudos would be awesome due to its social, economic and political effects, but ultimately I'm afraid its fate was sealed the moment it was formed. Its mere existence was a symbol of resistance to the coronéis, and they controlled every aspect of government.

It would, but yeah
Then again I would argue the power of the military was still larger than the coronéis, so it's fate would depend on wheter the army thinks its worth it losing troops in what they see as a worthless wasteland for the sake of said coronéis, which depends on how much they're willing to bribe them for it

I wouldn't be surprised if he (Ruy Barbosa) became president ITTL. He was always a respected figure from what I know, and he performed very well in 1910.

He did
And considering the mess Deodoro was I could see Ruy Barbosa being seen as the real founding father of the Brazilian Republic if he did well