Volcker’s US interest-rate hikes triggered the Latin American debt crisis and deindustrialization

Evidence

Over the next two decades, the Workers’ Party built up a base of active members who took part in internal decisions. At the same time, changes in the global economy undermined the industrial base that had created Lula’s union movement in the first place. After the US government raised interest rates under Federal Reserve Chairman Paul Volcker, many Latin American countries were plunged into debt crisis, and consequently the Reagan years were sometimes called a “lost decade” in which catch-up with the First World was reversed and factories began to close. — Vincent Bevins, If We Burn, 136

Categorization

• XREF: connects to: Rising interest rates and falling commodity prices triggered the franc zone debt crisis — Fanny Pigeaud_ Ndongo Samba Sylla, Africa’s Last Colonial Currency, 205; Volcker’s rate hike indirectly saddled Brazilians with crippling consumer financing costs — Vincent Bevins, If We Burn: The Mass Protest Decade and…, 313; US post-2008 monetary policy deindustrialized Brazil while inflating its currency — Vincent Bevins, If We Burn: The Mass Protest Decade and…, 314 (+4 more)

Broader Connections

• Volcker’s rate hike indirectly saddled Brazilians with crippling consumer financing costs #expands (0.90) — Vincent Bevins, If We Burn, 313
• Dollar-denominated debt is bankrupting the Global South during the Great Inflation #expands (0.85) — Yanis Varoufakis, Technofeudalism, 626
• US post-2008 monetary policy deindustrialized Brazil while inflating its currency #expands (0.82) — Vincent Bevins, If We Burn, 314
• US financialization emerged from state responses to 1970s governance crises. #corroborates (0.80) — Gerald F. Davis & Suntae Kim, Financialization of the Economy, 32
• Rising interest rates and falling commodity prices triggered the franc zone debt crisis #expands (0.75) — Fanny Pigeaud_ Ndongo Samba Sylla, Africa’s Last Colonial Currency, 205
• Post-2008 US monetary policy fueled Brazil’s boom via carry trade while deindustrializing its economy #corroborates (0.75) — Vincent Bevins, If We Burn, 314
• The 1980s debt crisis triggered IMF demands for CFA devaluation #expands (0.72) — Fanny Pigeaud_ Ndongo Samba Sylla, Africa’s Last Colonial Currency, 205