BRAZIL: In the Red

"Nationalism is my banner," says Brazil's President Getulio Vargas. "No one shall ever snatch it away from me." Last week it was plain that Vargas' nationalism is plunging Brazil ever deeper into an international-trade crisis.

Brazil is half a billion dollars in the red—mainly because she cannot produce nearly enough to pay for what she needs from abroad, and lacks the investment capital to increase production. Vargas' Finance Minister Horacio Lafer has tried to balance the books by slashing imports in half—but that has not been enough. With all existing export industries except coffee too high priced to compete in the...

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