FOCUSING on the perpetual trouble in Central America leaves only peripheral vision for events in countries farther south. Yet Brazil, with an economy 12 times as large as the five Central American republics combined -- and six times their population -- is going through its own period of flux. Social change there is less convulsive than in Nicaragua or El Salvador, but, for the future of peace and progress in Latin America, no less important.
It is tempting to fix on Brazil's enormous debt. And occasionally the press takes on the country for its economic superlatives and the ``can do'' spirit of its people: vibrant Sao Paulo the transformation of its economy from coffee to a more diversified base, the development of gasohol, booming frontier expansion, and the ``economic miracle'' of the 1960s and much of the '70s.
Even now President Jos'e Sarney has difficulty keeping up with the good news from his economic advisers. His planning office estimated in May that agricultural production will be 2.1 percentage points higher this year than the 4.9 percent growth forecast in 1985, and its gross domestic product will grow an average of 7 percent annually up to 1989 instead of the 6 percent predicted at Mr. Sarney's inauguration last year. The economy grew 8 percent that year.
The recent optimism stems largely from Sarney's 1986 economic package, which brought about falling consumer prices in March and April. (Curbing inflation in Brazil is about as difficult as stopping the water flow over the Itaipu Dam.) Also, tax revenues are up, interest costs have declined, and the 1986 trade surplus (used to cover debt service) should surpass that of 1985.
But this progress is alloyed with baser substances:
Investment is stalling, threatening the prospects for growth.
Distribution of recent income gains among Brazil's 135 million people is extremely uneven.
Even though Brazil has the eighth-largest economy in the world and some feel it might surpass the economies of Italy and Canada by 1990, its social problems put it in the same category with some of the Central American countries. El Salvador and Brazil, for instance, both had infant mortality rates of 70 per 1,000 in 1983; the rate in Japan was 7 and in the United States, 11. In addition, El Salvador had the same life expectancy at birth (64 years) and mortality of children aged 1 to 4 (6 per 1,000) as Brazil.
An estimated one-half to two-thirds of Brazil's population is thought to suffer from malnutrition. At the taproot of this problem is not food shortage but inadequate income. And when domestic customers cannot buy what they need because they are out of work, because they have too little land, or because it is too expensive, food is exported. In Brazil, social programs to feed the hungry are virtually nonexistent.
The ``trickle down'' from rich to poor which economists feel results from higher rates of average income growth in Brazil is only a drop every now and again. Available data show that the country's income distribution is among the most unequal in the world: The richest 1 percent of the population earns as much -- about 13 percent -- as the poorest half of the population.
Such distribution problems were recently highlighted in ``Brazil 2000,'' a report on social conditions that somberly but methodically concludes that Brazil is reaching ``the limits of peaceful coexistence betweeen rich and poor.''
But while Brazil burns, the parliament in Bras'ilia fiddles. Land reform is but one example. Sarney has been acting as boldly as he dares on the issue that helped bring down the Goulart government in 1964. At that time, talk of land reform ushered in two decades of military rule. Some feel Sarney's leadership in the recent congressional debate on agrarian reform was not decisive. The news weekly Veja noted that his technique was ``to let the waves beat so he could study the foam.''
Now land-reform issues are enjoying a reprise, but the problems are 20 years more serious. While the agricultural sector is shrinking and rural problems are transferred into city favelas (shantytowns), population in rural areas is still growing. In 1978, about 6.7 million farm people were either landless or had plots too small to afford them a living; this number was 10.6 million in 1984. This latter figure is equal to about half the total population of Central America.
Another difference on the contemporary stage is that this time the church -- despite objections from its conservative wing -- is with the President in the forefront of public opinion on land reform. And despite opposition from many sectors, there is evidence that decisive middle-class support for the much-watered-down land reform has developed.
Between President Sarney's version that was introduced in May 1985 and the legislation that passed in October, the bill went from being a robust giant to an anemic weakling. The original bill had called for expropriation of latifundia (defined as extremely large or unproductive farms, or both) on about half of Brazil's land area, or 1.186 billion acres, and benefiting several million peasants over a period of 15 years.
Last month President Sarney issued a decree with more-modest goals, limiting reform to seven states, to 4.2 million acres, and to 45,300 landless peasants.
Whether the government will be able to administer even this decree is an open question, but it is not generating the furious right-wing opposition that this subject has sparked throughout the year. Some landlords feel that they can now influence the government to their advantage; others, that all may be lost to peasant-generated chaos if some minimal reforms are not put through.
Even so, rhetoric is still extravagant, with landlords calling the church's support for reform ``terrorism,'' a term well on its way to being the most debased of the year. For their part, some peasant groups, organized by the church, are inflamed by the thought that more than 250 peasants have died in the struggle for property, often at the hand of landlord militias, since the Sarney government came to power.
Brazil is of world-class economic potential; it is one of the countries in the third world nearest to having a true democracy. Both will be out of its grasp until more of its own citizens can take part more meaningfully in its political and economic institutions. This is one reason that a progressive administration of the land reform decree is now needed.
William C. Thiesenhusen is professor of agricultural economics at the Land Tenure Center, University of Wisconsin-Madison.