Brazil entered the new millennium mired in economic difficulties. Macroeconomic conditions will have a great influence on political stability, what kinds of laws are passed, the ability of businesses to succeed, the pace at which new technology is used, the availability of jobs, and on incomes, poverty and crime. Brazil is a constitutional republic of federated states, the federal districts, and territories. This present constitution was proclaimed in October 1988, replacing a 1969 document. The states of Brazil have their own government with the powers in all matters not specifically reserved for the Brazilian government. The 1988 constitution abolished the national Security Law, which had been used to stifle political disagreement; outlaws torture. The National Security Law provided for various forms of popular voting, initiatives, and referendums; forbids virtually all forms of censorship; guarantees privacy rights and extends the right to strike to all workers. The military retains its power to intervene in the political system to preserve law and order.
Brazil has long been recognized for its large population, great natural resources, bold ideas and potential for growth. It has made progress in economic adjustment over the last several years, opening trade, reducing inflation, succeeding with privatization and garnering investor confidence. However, there have been concerns inside and outside of the country about government finances and especially public pensions, political stability and political will, vulnerability to international economic and financial developments and to the return of high inflation, relatively low investment in export industries, and the social and political consequences of income inequality. Several studies on Brazilian public opinion towards this country's vulnerability and its domestic stability prove there is consensus that vulnerability is an impeding factor to the country's aspiration to a more strategic