Despite everything, Brazil still managed to begin the next decade on a hopeful note, with the inauguration in 1990 of Fernando Collor de Melo , the first properly elected president for thirty years, after a heated but peaceful campaign had managed to consolidate democracy at a difficult economic moment. In the last months of his administration, Sarney had presided over the take-off into hyperinflation, and it was clear the new president would have to come up with fast economic answers if he was to survive.

The campaign had passed the torch to a new generation of Brazilians, as the young Collor, playboy scion of one of Brazil's oldest and richest families, had squared off against Lula , who had come a long way since the São Paulo strikes. Now a respected - and feared - national politician, head of the Workers' Party that the strike movement had evolved into, Lula took most of the cities, but Collor's conservative rural support was enough to secure a narrow victory.

Collor's presidency began promisingly enough, as he pushed for a long-overdue opening-up of the economy and implemented the most draconian currency stabilization plan yet, the infamous Plano Collor , hated by the middle classes because it temporarily froze their bank accounts. The economy resisted all attempts at surgery, and inflation began to climb again. Collor seemed to become more unstable than the economy; he was increasingly erratic in public, and rumours grew about dark goings-on behind the scenes. Thanks to fine journalism and a denunciation by Collor's own brother, apparently angry that Fernando had made a pass at his wife, it became clear that a web of corrupt dealings masterminded by Collor's campaign treasurer, P. C. Farias , had set up what was effectively a parallel government. Billions of dollars had been skimmed from the government's coffers, in a scam breathtaking even by Brazilian standards.

Impeachment proceedings were begun in Congress, but few politicians expected them to get anywhere. Demonstrations began to take place in the big cities, led initially by students, but soon spreading to the rest of the population and numbering hundreds of thousands of angry but peaceful citizens. It rapidly became clear that if Congress did not vote impeachment through, there would be hell to pay. In September 1992, Collor was duly impeached and replaced by his vice-president, Itamar Franco . Farias was jailed, later to die in mysterious circumstances: he was allegedly murdered by a girlfriend who then committed suicide, but it is likely the full story of his death will never be known. His master, Collor, who may know more than most about the murder, lives in gilded self-exile in Miami, to the fury of most Brazilians. Specimen corruption charges failed, and his continued liberty is testimony to the weakness of the Brazilian legal system.

Franco, like Sarney before him, proved an incompetent buffoon left minding the shop. The real power in his government was the finance minister, Fernando Henrique Cardoso , who staked his claim to the succession by implementing the Plano Real in 1994. This finally tamed inflation and stabilized the economy, for the first time in twenty years. A grateful public duly gave him an overwhelming first-round victory in the presidential election later that year, when he trounced Lula in every state bar Brasília and the Distrito Federal.