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Brazil sinks deeper into crisis as its unelected President faces corruption charges

The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of this site. This site does not give financial, investment or medical advice.

Back on 29th August 2016 I wrote an article for The Duran in which I said that the pending impeachment of Brazilian President Dilma Rousseff was a disaster for Brazil, removing from office a President who for all her mistakes had been democratically elected and was not corrupt, and replacing her with Michel Temer, an appointed President who would inevitably be compromised by the grossly partisan method of his appointment through a flawed impeachment process orchestrated by a corrupt and self-seeking elite.

I also pointed out that the ostensible reason for impeaching Rousseff – that her government had engaged in an illegal budget manoeuvre during Brazil’s recession – would convince no one since it was all too obviously not the real reason for Rousseff’s impeachment but rather an excuse for it, the true reason being the wish of a corrupt right wing elite to remove form office a President who was both left wing and not corrupt.

This is how I summarised the situation in my article

This is very bad for Brazil.  The country has had a difficult history of political instability and violence.  Within living memory Brazil has experienced two long periods of dictatorship (under Getulio Vargas from 1930 to 1945, and under the military from 1964 to 1985), military coups in 1930 and 1964, an attempted military coup in 1954 (aborted by the suicide of the then President, the former dictator Getulio Vargas), and extreme political violence during the period of military rule from 1964 to 1985, in which Dilma Rousseff herself became involved as an urban guerrilla before being captured and tortured by the military.   As is true in most of Latin America class and political conflict in Brazil is intense.

Brazil also suffers from deep seated problems of violent crime and corruption.  The recent holding of the Olympic Games in Rio de Janeiro highlighted the degree to which the slum areas of the city – the favelas – are to a great extent controlled by heavily armed criminal gangs and have become no-go areas for the police.   Meanwhile the irony that one of Brazil’s few genuinely non-corrupt politicians – Dilma Rousseff – is being impeached in the middle of a corruption scandal by a political system rife with corruption is lost on no-one. 

In such a fragile system removing a democratically elected leader through a grossly partial impeachment process is not only profoundly undemocratic.  It is also fraught with risk, and can only add to the already dangerously high levels of cynicism and alienation which exist in the country…..

It is Brazil’s deeply corrupt, dysfunctional and highly polarised political system which is holding the country back.  By removing its democratically elected leader Brazil’s political class has just ensured that it remains corrupt, dysfunctional and highly polarised still.

Since I wrote those words the political and economic crisis in Brazil has deepened, exactly as I – and many others – predicted.

Lacking an electoral mandate Brazil’s new President Michel Temer predictably sought to consolidate his authority by doing what the elite and the international investment community wanted from him: imposing austerity measures to “cure” Brazil’s economic crisis.

These austerity measures in turn threatened the economic and social benefits Brazil’s lower classes had won during the decade of leftist rule under President Dilma Rousseff and her charismatic predecessor President Luiz Inácio Lula da Silva.

That in turn provoked a storm of protests culminating in a general strike in April, during which Temer’s poll ratings crashed to single figures.

Temer now faces mounting calls to resign as claims about his previous corrupt practices have become widespread, with Temer now under investigation for corruption by the country’s prosecutor general.

Meanwhile revelations about the corruption of the country’s political elite have exploded, with the speaker of the parliament who presided over Rousseff’s impeachment now in prison on corruption charges, and his successor as parliament’s speaker, 9 ministers of Temer’s government, and scores of other politicians, officials and business leaders under investigation also.

Temer meanwhile is resisting calls ti resign despite reports of a revolt against him from within his own party, and despite talk of a possible petition to the Brazilian courts to set aside the result of Brazil’s last Presidential election, which put Temer in the position to succeed Rousseff as President by electing him alongside her as her Vice-President.

The trouble is that even if Temer is removed from an office for which on any objective assessment he seems completely unsuited, there is no one who obviously commands the respect or authority to replace him.  Interestingly no one so far seems to be calling for Rousseff to be brought back, possibly because following her impeachment that is either politically or legally impossible.

The result is that Brazil – Latin America’s largest country and a founder member of the BRICS group – seems destined to descend into even deeper crisis whether Temer stays or goes, with no end to the crisis in sight.

This is a tragedy.  This is what I wrote about Brazil’s potential last August

Brazil is a country with enormous potential.  Possessing huge natural resources, a large, young and dynamic population, a by no means insignificant industrial base, a potentially strong commercial and financial hub in Sao Paulo, no external enemies to speak of, secure borders, and with large areas of the south of the country as developed and as wealthy as many places in Europe and north America, Brazil should be a world leader.

People have been saying thing like this about Brazil’s potential for as long as I can remember.  Yet Brazil’s seeming inability to resolve the problems of its dysfunctional political system always seem to prevent this potential from realised.  It seems that after brief hopes in the 2000s that this barrier had at last been broken, the country once more is falling back into the corrupt and dysfunctional mire from which it has never managed to escape.

The contrast with Russia is instructive.  During the economic and political crisis of 1998-1999 Russia experienced a financial crisis far worse than the one Brazil experienced under Rousseff, whilst in Boris Yeltsin it had a leader whose failings were many orders of magnitude greater than Rousseff’s.  However despite extraordinary provocations Russia remained politically stable, largely because the leaders of the country’s opposition – fully conscious of the fragile of the state of the country – were determined to keep it so.  I remember at the time being impressed by how violent and extreme responses were consistently rejected, as the country sought to resolve its problems peacefully and constitutionally.

The result was that when the transfer of power from Yeltsin to Putin finally took place it was carried out smoothly with all the constitutional formalities observed, and was immediately put to the people for their consent in a Presidential election.

The consequence is that the legitimacy and authority of Russia’s government is today never seriously questioned, whilst the general standard of Russia’s governance is of a quality of which Brazil can only dream.

The truth – of which Rousseff’s impeachment serves as just one example – is that cutting corners in a country which aspires to be a democracy in order to remove from office the country’s constitutional leader is not the right way to secure democracy or end a political crisis however flawed that leader may be.  On the contrary doing that undermines democracy, and exacerbates the crisis.

That has been true in recent years in both Ukraine and Brazil.  If the attempts to impeach Donald Trump on manifestly bogus charges ever succeed it will also be true of the United States.


The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of this site. This site does not give financial, investment or medical advice.

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