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In 1548, still in response to much the same pressures and incentives as in 1530, the Portuguese decided to set up direct royal government in Brazil. The crown named a governor-general who took an expedition of a thousand people to Brazil, establishing a capital for the entire country in Bahia on the northeastern coast. In 1551 a bishopric was created. Thus it was not until 50 years after contact that Brazil achieved the level of institutionalization characteristic of the Spanish-American central areas almost from the beginning. The pace of development was much more comparable to that on the Spanish-American fringe.

At about this same time the Jesuits began to arrive, soon becoming the strongest arm of the church, as opposed to in Spanish America, where they arrived long after the other orders. They were prominent in the attempt to deal with the indigenous population, founding villages (aldeias) on new sites much in the manner of the missions on the Spanish-American fringe. Thus the main forms of European-Indian contact in Brazil—war, trade, slavery, and missions—were the same as on the periphery of Spanish America.

The Portuguese population in 16th-century Brazil remained sparse. Moreover, by all indications, including the Portuguese practice of exiling convicts to Brazil, one can imagine that it was as acutely marginal socially as were the settlers of Spanish-American fringe areas. The sugar age

Starting in the last decades of the 16th century, the Brazilian sugar industry began an upswing that led to its being in the 17th century the world’s largest producer of sugar for the ever-growing European market. The main structural changes had occurred by 1600, though the strongest growth came thereafter.

The more the industry prospered, the more it attracted Portuguese immigration, and the more it could afford African slaves as workers. Both movements resulted in the diminution of the indigenous role; by the third decade of the 17th century, through death and flight to the interior, Indians had become a negligible factor on the northeastern coast, where sugar growing concentrated. The Portuguese coming into the area were not only more numerous but represented a much broader cross section of society, including enough women for prominent men to marry. The northeastern cities were beginning to look more like their Spanish-American counterparts. In a word, the northeast was becoming a new central area, with some noticeable differences from those of Spanish America: it was built on bulk export rather than precious metals, with an Afro-European base rather than Indo-European, oriented to the sea rather than to an indigenous hinterland.

Sugar production was almost as industrial an enterprise as silver mining. The dominant feature was the engenho, the mill. So expensive were the mill, technicians’ salaries, and the force of African slaves to work there that mill owners normally depended on cane growers called lavradores to produce cane for the mill. Under various kinds of leasing arrangements, the lavradores used their own African slave crews to cultivate the land, grow the cane, and transport it to the mill. Some of the cane growers were from mill-owning families, while others were more humble, and some even were racially mixed.

The sugar industry required a large number of Portuguese. Although Africans came to constitute the majority of the local population, the Portuguese sector was also large. Instead of a sprinkling of masters among great masses of slaves, the predominant pattern was the use of slaves in relatively small units, each in contact with some Portuguese. The mill owners had rural residences, but, as with the Spaniards, their main seats were in the nearest city, where their group tended to dominate the senado da câmara, the equivalent of the Spanish cabildo. Portuguese with less capital went into growing tobacco for export or roças for provisioning the cities and mills, and they employed relatively fewer slaves. In the backland (sertão), ranches grew up to supply the coast with meat and work animals. Society was varied and complex.

The rural-urban continuum was strong, and the Africans took part in it as well as the Portuguese, so that the most skilled and acculturated of them tended to end up in the cities, where there came to be an African population, increasingly racially mixed and in part free, much as in Spanish America. With so many more Africans present than in the Spanish central areas, groups based on African ethnicity could retain their language and cohesiveness longer. Christian lay organizations with an African ethnic base were very strong, and many African cultural elements were preserved, especially in the areas of music, dance, and popular religion. The same sort of strength allowed for the flourishing of independent communities of runaway slaves to an extent not known in Spanish America, though the phenomenon occurred there too in some forested areas.

An elaborate scaled status system recognizing racial and cultural mixture and legal status, comparable to the Spanish-American ethnic hierarchy, grew up in the Brazilian northeast, but it was different in being overwhelmingly bipolar—European and African—with the indigenous factor hardly counting. It is not by chance that in Mexico and Peru the top category remained Spaniard, while in Brazil it came to be white as well as Portuguese. If in the Spanish central areas the Africans were intermediaries, here they had a more complex function, replacing the Indians at the bottom of the functional ladder as well as filling many intermediate niches.

The northeast now assumed many of the other characteristics of a central area. The mercantile interest grew strong, localizing the form of men of business (homens de negócios) who both invested in merchandise and owned sugar mills. They intermarried with the planters and served on the town councils. Not only did a governor-general, later a viceroy, reside in Bahia, but there was (most of the time) a high court of appeal, or relação, like the Spanish-American audiencia, with the associated network of lawyers and notaries. Monasteries and convents became part of the picture, and authors writing on local topics appeared, some of the most prominent of them Jesuits.

Institutionalization stopped short of what was seen in the Spanish-American central areas, however. Transatlantic contact remained more essential to local society than in Spanish America. Universities and printing presses were not established; students went to Portugal for advanced education, and books were printed there. Transatlantic careers spanning not only Portugal and Brazil but also including Africa were common. So much a part of the Atlantic world was the northeast of Brazil that Europe continued to make itself felt strongly. It was perhaps a somewhat secondary phenomenon that the king of Spain was also the king of Portugal from 1580 to 1640, but the impact of the Netherlands was more directly felt, for the Dutch seized Bahia in 1624, holding it to 1625, and controlled the important captaincy of Pernambuco from 1630 to 1654. The south

Only the northeast of Brazil was thoroughly transformed by the sugar industry. The remainder long stayed much as it had been before, a sparsely inhabited fringe with a weak economy, more indigenous and European in composition than African. São Paulo, the dominant centre of the south, had a small Portuguese population, and much if not most of it was racially mixed. Not unlike the Paraguayan Spaniards, the Paulistas (citizens of São Paulo) lived in large households and estates among numbers of Indian slaves, freedmen, and dependents, strongly affected by indigenous language, customs, diet, and family structure.