It’s hard to draw a line between Brazil’s arts institutions and the corporations that finance them. The Brazilian arts world depends on private funding initiatives — the result of a 1991 measure nicknamed the “Rouanet Law.” The measure gave companies and individuals who donate to cultural institutions up to a 100 percent tax rebate on their investments. Reacting to criticism that the measure fails to prevent corruption, aggravates the cultural funding divide, and incapacitates government oversight, Brazil’s Culture Ministry is on track to replace it. However, cultural financing will only be effective once the Culture Ministry itself is reformed — something that has become unlikely in the country’s current turmoil.
The Rouanet Law was meant to revive an independent cultural sector that was stunted during Brazil’s most oppressive era of military government in the 1970s. In 1968, cultural movements had a central role in mobilizing public dissent, almost toppling Brazil’s military regime. The leadership at the time then regained control with a decade of heavy-handed repression and censorship. In the latter half of the 1970s, the military government reimagined its support of the arts to fit its political and propagandistic needs and strong-armed artists and intellectuals into joining a number of establishment-controlled art and cultural institutes. When democracy returned to Brazil in 1985, the country’s newly founded Culture Ministry began the difficult process of disassembling cultural organs without financially suffocating the country’s arts scene.
Aside from its growing pains, the Culture Ministry also faced a host of setbacks in its nascent stages, ranging from corruption scandals to tumultuous leadership changes. In 1991, President Fernando Collor de Mello rallied for a market-driven solution that would make up for the Culture Ministry’s incapacity to formulate and follow a mandate. The Rouanet Law spurred the creation of countless independent cultural projects, allowing the country to shield its arts world from bureaucratic hindrance.
The euphoria over Brazil’s economic growth largely muted alarm bells sounding off on corruption and inefficient use of funds across government bodies. Accusations of poor oversight and overfunded projects began to show how easy it was for private entities to abuse the Rouanet mechanism. In 2012, the Brazilian federal accountability unit condemned the Culture Ministry for having no evaluation or follow-up mechanism for the 3.8 billion reais — $2.13 billion at the time — worth of tax cuts doled out by the Rouanet Law. Even without regulatory help from the Culture Ministry, the federal accountability unit still found ample evidence of misconduct and investigated more than half the projects approved for Rouanet funding between 2003 and 2010.
The Culture Ministry’s dependence on Rouanet rebates, now accounting for more than 80 percent of arts spending, leaves little space for other comprehensive policies. Current Culture Minister Juca Ferreira has called Rouanet the “egg of the serpent of neoliberalism.” But the three decades of tax-incentivized cultural funding did little to guarantee the public’s “permanent access to culture.” Culture Ministry policies failed to spread culture funding outside the cultural and financial poles of Brazil’s Southeast; the states of Rio de Janeiro, São Paulo, and Minas Gerias together receive 90 percent of all Rouanet funding, with Rio and São Paulo’s capitals alone receiving 60 percent of total funding. The rest of the country, which holds 58 percent of Brazil’s population, must share the remaining 10 percent. Some states, like Amazonian Amapá in the north, receive virtually none.
Since 2008, Ferreira has laid the groundwork for reforming the Ministry, specifically by shoring up its accountability. Ferreira has been preparing for the transition from a Rouanet-centered policy to one dependent on a new entity — the National Program for Promotion and Incentivization of Culture, or ProCultura. According to Ferreira, ProCultura’s funding mechanism will introduce “a complex system of criteria, including proportional representation depending on population density, cultural wealth, and number of projects.” The 100 percent Rouanet rebate mechanism will be removed, requiring cultural projects to self-fund at least 20 percent of their budget. Under the new system, ProCultura will earmark 10 percent of funds to each of Brazil’s five regions, splitting the remaining half among “municipal and state funds.”
The fate of Ferreira’s reform, however, is tied to the fate of the Culture Ministry as a whole. In September, the Ministry was narrowly saved from being shut down as a cost-cutting measure. And in order to maintain a majority in Congress, President Dilma Rousseff may have to yield the ministry’s leadership to an ally party, jeopardizing Ferreira’s projects. The Culture Ministry’s funding is already smaller than that of private institutions like the cultural wing of the São Paulo Social Service of Commerce, and recently saw its budget cut 21 percent further as an emergency deficit reduction measure. The drastic cuts in funding suggest culture will be a low priority for Rousseff until Brazil’s economic prospects improve. A stream of corruption scandals and internal conflicts in the past months only add to the sense that ProCultura will struggle to function.
By largely eradicating the cultural funding system instituted after Brazil’s dictatorship, Ferreira’s policy may in fact return the culture debate back to where it was in the 1980s. But today, the future of the Culture Ministry also depends on whether it can survive a metastasizing political crisis and an era of vicious spending cuts. As with many current issues in Brazil, good governance will be the basis for any lasting progress. Unfortunately, the country’s current political situation makes optimism difficult.
Art by Roland High