Why business elites might regret helping Jair Bolsonaro

Brazil has just experienced one of its most important and divisive elections since the end of the country’s 1964-1985 military dictatorship. The first presidential election to be held since the 2016 impeachment of Dilma Rousseff took place against a backdrop of political and economic turmoil. And this proved to be fertile ground for the winner – the far-right, conservative populist, Jair Bolsonaro.

Much has been made of Mr. Bolsonaro’s Trump-like, anti-establishment rhetoric and flagrant disdain for minority rights, which struck a chord with a population increasingly disillusioned with politics. But Mr. Bolsonaro also won the backing of Brazil’s business elite, which has a long history of shaping politics in the country.

We have researched how the country’s business elite has been seeking to influence Brazilian politics since 2002, leading to its recent backing of Mr. Bolsonaro. And our findings go some way towards explaining how the country has swung from the left to the far-right in a little over a decade.

When Luiz Inácio Lula da Silva of the Workers’ Party was elected president in 2002, the prospect of a left-wing government shook Brazil’s business elite and its international supporters. Big business initially withdrew its support from the Brazilian economy through a reluctance to invest, leading the stock market to tumble, the currency to collapse and the costs of government borrowing to escalate. As a consequence, Lula was forced to promise business increased macroeconomic stability, to control inflation and to seek fiscal equilibrium.

This recognition...