Trillion-dollar interest

It's now official. The numbers are available on the Brazilian government's website. Until now, estimates and projections were used. And the accumulated figures for the last 12 months pointed to an approximation to the decimal point to arrive at the value. However, from January 30, 2026, with the publication of the... Central Bank (BC) bulletin containing Fiscal Statistics Based on consolidated figures for the fiscal year 2025, it is known that the Brazilian public administration incurred expenses exceeding one trillion reais in interest payments on public debt.

According to information released by the bank, the total volume of expenses related to the transfer of funds to holders of federal government debt securities was R$ 1,008 trillion. As President Lula would say in his most inspired moments, never before in the history of this country has the volume of financial expenses during a fiscal year reached such a level. It's madness! This amount for 2025 was 6% higher than that recorded in 2024, when the total reached R$ 950 billion.

Since the records are reported monthly, it's worth noting that the periods in the second half of the year were significantly higher than the first six months. Perhaps the main reason is the continued increase in the Selic rate at each new meeting of the Monetary Policy Committee during the year (rising from 13,25% to 14,25% and then to 14,75%), remaining at the 15% level from July onwards. This means that the impact of the benchmark financial remuneration on the growing stock of public debt was much more potent in the period from July to December than in the period from January to June of last year.

Interest of R$1 trillion: never before in the history of this country.

Thus, in the first half of the year, the volume of interest reached R$ 417 billion and jumped to R$ 591 billion over the last six months. This represented a growth of 42% between the two periods. Just for comparison, in 2024 the difference between the two semesters was 9%, going from R$ 455 billion to R$ 496 billion. Therefore, the second half of 2025 represented a growth of 19% compared to the same period of the previous year.

This shift in the volume of financial expenditures during President Lula's third term also represented a higher level of commitment of this type of spending as a percentage of the total Gross Domestic Product (GDP). The graph below shows the annual average of this type of expenditure as a percentage of the Product, according to different governments. Thus, it can be seen that during Lula's first three years, this index reached 6,6%, with a tendency to maintain this average or even increase when the statistics for 2026 are released. This is, therefore, another record never before seen for this relevant variable of economic policy.

During the first three years of the current term, the observed percentage was 50% higher than the average for the period 1997/2022, when records indicate an average of 4,3%. This data confirms that the logic of fiscal austerity and the priority given to serving the interests of finance is unequivocally manifested in the implementation of the government's economic program.

On the other hand, the figure indicated by the Central Bank for the month of December also represents a record value. Never before in the historical series maintained by the agency has a 30-day period reached the R$ 122 billion of the last monthly period of last year. This represented a 27% increase over the R$ 96 billion of the last month of 2024. This amount characterizes an expense of R$ 5,5 billion per working day of that month. Just for comparison, let's evaluate the objective presented to Lula by Fernando Haddad for achieving a primary surplus this year. The target is a 0,25% positive balance in the non-financial accounts of the Budget and was incorporated into... Budget Guidelines Law (LDO) In its second article. In monetary terms, this percentage represents R$ 34 billion. That is, in just 6 days of interest payments in December, the government spent more than the great national effort to compress social spending and investments to meet an irresponsible target that it itself set as a tourniquet.

The main argument used by the economic team to justify the continuation of the austerity policy refers to the well-known refrain of "we don't have the resources." Repeated ad nauseam in an attempt to transform lies and fallacies into truth, this narrative doesn't hold up even when presented with official data from federal government agencies. Contrary to what those who try to deceive a population unfamiliar with economic statistics claim, the resources do exist and are in the trillions.

Resources exist: what's lacking is political will.

One manifestation of this availability is found in the balance of the so-called "National Treasury Single Account." This refers to the funds available to the Executive Branch to be spent on meeting all the government's needs and public policies. The official figures for the end of 2025 will only be released during the first quarter. But they will certainly not be less than the R$ 1,6 trillion recorded in 2024 and 2023. In other words, the resources exist and are immobilized in accounting terms at the interface between the National Treasury and the Central Bank. The intention is precisely not to spend on non-financial accounts, so that resources are left over for interest payments. After all, there is no limit, no ceiling, and no contingency for this type of expenditure. This is the spirit of the New Fiscal Framework and the irresponsible austerity policy.

Lula failed to fulfill almost any of his main campaign promises in 2022. It did not, in fact, revoke the austerity-driven essence of Temer's Spending Cap., because it was replaced by Haddad's budget. The privatization of Eletrobras was not reversed.allowing the transfer of public assets and state responsibilities in the electricity sector to remain in the hands of private capital, it failed to achieve the goal repeatedly stated on several occasions. turning 40 in 4He will not leave a legacy from his third term that would be characterized by to do more and better than he accomplished in the first two years, between 2003 and 2010.And the main obstacle to this has been the flimsy excuse of the fiscal framework.

The most dramatic aspect of this entire saga of neoliberal and conservative-inspired economic policy is the normalization of trillion-dollar interest expenses. The transfer of such a large volume of resources from the General Budget of the Union to a select and privileged group in our society becomes commonplace and inescapable. Trillion-dollar interest payments are the condensed epitome of economic inequality and the concentration of income and wealth. In short, it is the calling card of the perpetuation of social injustice.

Paulo Kliass holds a doctorate in economics and is a member of the career track for Specialists in Public Policy and Government Management in the federal government.