The permanent settlement of Brazil was begun by deserters and mutineers set on shore from ships on their way to India or to cut brazil-wood. In 1509 a certain Diego Alvarez, nicknamed by the Indians "Caramuru," or "man of lightning," landed at Bahia and escaped being eaten by frightening the Indians with his musket. He married a chief's daughter, and when a real colony was established years later he and his numerous half-breed descendants proved of great use to his compatriots. Two years later John Ramalho did much the same near Santos, hundreds of miles to the south. The story of the last of the three authentic degradados is even more romantic. His name was Aleixo Garcia, and with three companions he landed about 1526 in the present state of Santa Catharina. Collecting an army of Indians he led them on a conquering and gold-hunting expedition over the coast-range, across the great plateau, into the valley of the Paraguay, and even penetrated ten years before Pizarro into territory tributary to the Incas of Peru. He finally perished in the centre of the continent, but when, years afterwards, the Spaniards penetrated the valley of the ParanÁ they found that the Indians already knew of white men and firearms.

As early as 1516 the Portuguese government offered to give farming utensils free to settlers in Brazil, and it is probable that shortly afterwards some sugar was planted. The first serious and official effort to cultivate sugar was made in 1526. ChristovÃo Jaques founded a factory on the island of Itamarica, a few miles north of Pernambuco. It was shortly destroyed by the French brazil-wood hunters, and the settlers fled to the site of Pernambuco and renewed the effort pending the arrival of re-enforcements. Seekers of brazil-wood hailing from Honfleur and Dieppe were swarming along the coast. The value of the region for sugar raising began to be appreciated. When the news came of the failure of the Spanish expedition which Cabot had led to the Plate, the Portuguese government determined to fit out a considerable expedition, composed of colonists and families as well as soldiers and adventurers. Seduced by the cry, "We are going to the Silver River," four hundred persons enlisted. The five vessels were commanded by Martim Affonso da Souza, a great general and navigator, who had already proved his capacity and who later went to the very top in the East Indian wars. He was instructed to expel all intruders and establish a permanent fortified colony. Early in 1531 he reached the coast near Pernambuco, captured three French ships laden with brazil-wood, and sent two caravels north to explore the coast beyond Cape St. Roque, while he himself sailed south with the idea of founding a colony on the Plate. But after passing Santa Catharina he was unfortunate in losing his largest ship with most of his provisions, and deemed it safer to return toward the north. At SÃo Vicente, now a little town near the great coffee port of Santos, he dropped anchor, and there, January, 1532, founded the first Portuguese colony in Brazil. Near this point lived the solitary Portuguese, John Ramalho, surrounded by his half-breed descendants, and he gave his countrymen a glad reception. He soon showed them the way up the mountains to the high plateau which begins only a few miles from the sea. Another settlement was founded on these fertile plains near the site of the present city of SÃo Paulo.

In the west of Brazil the settlements were established at a striking distance from the coast, but in SÃo Paulo the colonists could more easily spread over the open plains of the interior than along the mountainous coast. On top of their plateau they were cut off from ready communication with the mother country; they struck out for themselves, and their development was something like that of the British in North America. They were the pioneers of Brazil, corresponding closely in character and habits, in the virtues of daring, hospitality, and self-confidence, and in the vices of cruelty, rudeness, and ignorance, with the pioneers of the Mississippi valley.

The Paulistas were all profoundly influenced by their intimate association with the Indian tribes. In the early days intermarriages were frequent, but the continual re-enforcement of the European element, and the inferiority in capacity of reproduction which the Indian has shown in Brazil, make the traces of that intermixture hard to discover at the present time. The Paulistas and their descendants in the interior states are taller, slenderer, darker, and more active and graceful than the modern Portuguese. Their hands and feet are smaller, their movements more nervous, their manners more self-confident.

The successful founding of a considerable colony in Brazil aroused interest at home, and many courtiers solicited the Crown for grants. It was decided to partition the whole coast into feudal fiefs, each proprietor undertaking the expenses of colonisation and being given virtually sovereign powers in return for a tax on the expected production. Each of these "captaincies" measured fifty leagues along the coast, and extended indefinitely into the interior. In 1534 twelve such fiefs were created, covering the whole coast from the mouth of the Amazon to the island of Santa Catharina—these being the points where the Tordesillas line met the seaboard.

Six of these proprietors succeeded in establishing permanent colonies. Martim Affonso's settlement has already been described. In 1536 his brother, Pero Lopes, established Santo Amaro within a few miles of SÃo Vicente. Naturally its history soon became confounded with that of the larger settlement. Duarte Coelho founded Pernambuco in 1535, and in it was soon absorbed Itamarica, the second of the two colonies founded by Pero Lopes in 1536. The other three permanent settlements were Victoria, the nucleus of the present state of Espirito Santo, Porto Seguro, and Ilheos. No one of them prospered, and their territories are still among the most backward parts of the Brazilian coast. The donatory of the territory which included the bay of Bahia, started a town, but it was destroyed by Indians. The other five captaincies were not taken hold of seriously by their proprietors. The four nuclei for the settlement of Brazil were SÃo Paulo, Pernambuco, and the later colonies of Bahia and Rio de Janeiro.

Martim Affonso recked little of his fief or its revenues and left his Paulistas to work out their own destiny. Pernambuco was on the track of every ship which came to South America, the neighbouring interior was level and easily accessible from the coast, the soil and climate were suitable for sugar, and from the beginning relations with the mother country were intimate and continuous. Its proprietor, Duarte Coelho, determined to devote himself to his colony, and he personally headed a numerous and carefully selected colonising expedition. He spent the rest of his life there, and died twenty years later, surrounded by a large and prosperous colony, which was already a self-supporting state with all the elements of permanence. A good business man and liberal for that age, he granted land on easy terms; its possession was secure; contributions were moderate; and he resolutely defended himself and his grantees from the exactions of the Crown.

The Portuguese occupation of Brazil was induced solely by commercial considerations. Explorers and emigrants went out to make their fortunes, not to escape religious or political tyranny. When the first voyagers were disappointed in not finding gold mines, they turned their attention to brazil-wood. Soon the suitability of the territory for sugar was discovered. The European demand for this luxury was increasing, and the Portuguese had become familiar with its culture in Africa. Cane was taken from Madeira and the Cape Verdes to Brazil before 1525, and there is a record of exportation at least as early as 1526. Here was found the basis for the real colonisation. From the very start the industry prospered in Pernambuco, and Brazil became the main source of the world's supply.

Near Pernambuco little trouble was experienced with the Indians. Many of the tribes were allies of the Portuguese, though the fierce AymorÉs fought the settlers and once reduced the infant colony to the verge of destruction. Although the law of Portugal forbade the enslavement of Indians except as a punishment for crime, they were reduced to bondage on a large scale in Pernambuco, and the Paulistas never paid any attention to this prohibition.

By the middle of the sixteenth century Brazil contained one rapidly expanding colony of sugar-planters, Pernambuco, which gave sure promise of wealth if not attacked from without,—a half dozen moribund settlements on the thousand miles of coast to the south, and an isolated but vigorous and self-sufficing group in SÃo Paulo, whose inhabitants produced little for export, but who were reducing the aborigines to slavery in an expanding circle. In the last there was a considerable proportion of Indian blood and in the first a large number of negroes. The smaller captaincies were little more than resorts for pirates and contraband traders in brazil-wood. The settlers were powerless to prevent the French expeditions which yearly became more numerous. Serious apprehensions were felt that the French would occupy the coast and make Brazil a basis for attacks on Portugal's African and Indian empires.

The best blood of the Portuguese nation was being drained away in exhausting wars and expeditions to India and Africa; absolute government was sapping civic vitality; the extravagances of Court and nobles were impoverishing the country. However, enough vitality remained, before the terrific destruction of Portuguese power and pride at Alcacer-Kibir in 1580, to secure such a firm establishment of the Portuguese race on the whole coast of Brazil that it never has been dislodged, and only once seriously threatened. This result was largely due to the founding of a strong military and naval post at Bahia, around which grew up a prosperous colony, and under whose protection Pernambuco spread out over the north-east coast, SÃo Paulo developed uninterruptedly, and Rio Bay was saved from the French.

The first proprietary settlement in Bahia Bay had been destroyed by the Indians, but this magnificent and central harbour was manifestly the most convenient point whence to send assistance to the other settlements and guard the whole coast. In 1549 the king determined to build a fortress and city there. Thomas de Souza, the illegitimate scion of a great house, was chosen the first governor-general. He sailed in April, 1549, with six vessels, and accompanied by three hundred and twenty officials and a number of colonists. The new capital commanded the entrance to a magnificent inland sea which offered splendid facilities for the establishment of a flourishing state. Bahia Bay is nearly a hundred miles in circumference; its shores are fertile and penetrated by rivers; each plantation has its own wharves. Within a few months a town of a hundred houses had been built, surrounded by a wall and defended by batteries; a cathedral, a custom house, a Jesuit college, and a governor's residence were under way.

Thomas de Souza was instructed to strike at the root of the difficulties that were supposed to have prevented the success of the proprietary captaincies. He was the direct representative of the king and had supreme supervisory power. Other officers, however, were associated with him who were independently responsible in judicial, financial, and naval matters. He was closely bound by instructions covering every detail that could be foreseen, and these instructions clearly show the centralising and jealous spirit of Portuguese institutions and ideas.

Few Portuguese of that age were capable of rising to an appreciation of the economical advantages of freedom. The liberal concessions to the original proprietors—free trade with the mother country, the right of communication with foreign countries, and judicial and administrative independence—availed nothing. Neither colonists, proprietors, nor the central government could understand or apply them. Brazil was subjected to a systematic and continually more rigorous exploitation by the home government, and to the irresponsible and uncontrolled military despotism of little satraps.

In Bahia, as in Pernambuco, the sugar industry prospered from the beginning. Bahia is close to Africa and navigation across is safe and easy. The importation of blacks began immediately, and the port continued to be the greatest entrepÔt and distributing point for the trade during three centuries. Bahia's population is more largely black than that of any other city in Brazil, and the pure African type is frequently seen on its streets. The local cuisine includes many dishes of African origin, and the local dialect many African words. Certain African dialects are spoken to this day, and a few Mohammedan negroes there still perform the rites of the Koran in the most absolute secrecy.

The municipal government of the town, though under the overshadowing power of the governor, showed some vitality and independence. The fertile island of Itaparica, just opposite the city, had been granted to the mother of a minister. Though the donation was repeatedly confirmed by the king himself, she and her heirs were never able to put their agents in possession. The municipal council successfully insisted that the original royal instructions to the governor required all grantees to occupy their estates in person.