The biggest economic question facing Brazil, as for most developing countries, is when it will achieve its potential economic growth. For Brazil, there is a simple, most relevant comparison: its pre-1980 - or pre-neoliberal - past.

From 1960-1980, income per person - the most basic measure that economists have of economic progress - in Brazil grew by about 123 per cent. From 1980 to 2000, it grew by less than 4 per cent, and since 2000 it has grown by about 24 per cent. It would be difficult to exaggerate the importance of this economic ''regime change.'' Of course, economic growth is not everything, but in a developing country it is a prerequisite for most of the social progress that most people would like to see.

If Brazil had continued to grow at its pre-1980 rate, the country would have European living standards today. Instead of about 50 million poor people as there are today, there would be very few. And almost everyone would today enjoy vastly higher living standards, educational levels, and better health care.

Was this a possible outcome? Absolutely. South Korea, which was as poor as Ghana in 1960, grew very rapidly like Brazil until 1980, but unlike in Brazil this growth didn't collapse after 1980. Today South Korea has the per-capita income levels of a European country.

The policies implemented over the last 30 years in Brazil have included vastly higher real interest rates, tighter (and sometimes pro-cyclical) fiscal policies, and massive privatizations. Inflation targeting by the central bank has also slowed growth and led to periodic overvaluing of the currency, which hurts industrial and manufacturing growth and development by making Brazil's imports too cheap and exports too expensive. And the government also abandoned most of the industrial policies and development strategies that had led to the country's prior successful growth.

Brazil has been named a ''BRIC'' country, but it is different from Russia, India, and China. From 1998-2008, the Russian economy grew by 94 per cent; China by 155 per cent; and India by 99 per cent. Brazil grew by 39 per cent.

There has been some significant progress during Lula's presidency, with cumulative per capita GDP growth of 23 per cent, as compared to just 3.5 per cent during the Cardoso years (1995-2002). Measured unemployment has dropped considerably, from over 11 per cent when Lula took office to 6.9 per cent today. From 2003-2008, the poverty rate fell from 38.7 to 25.8 per cent, according to the UN Economic Commission on Latin America.

For voters in the October presidential election who are concerned about Brazil's economic future, a big question would be who is going to take the country forward and adopt the policies necessary to achieve Brazil's economic growth potential? Who will stand up to the powerful private interests that oppose such changes - especially the financial sector, which favors high interest rates, slower growth, and an overvalued currency - and most of the major media? This will be no easy battle - but the outcome will have an enormous impact on the living standards of the vast majority of Brazilians.

This article was published in Folha de São Paulo, Brazil's largest circulation newspaper, on August 27, 2010. The Portuguese version is here.

September 3, 2010.