How a Scandal in Petrobras Threatens to Bring Down Brazil’s President

Last month’s protests in the main cities of Brazil brought 2 million opponents of Dilma Rousseff’s administration to the streets. The profile of the demonstrators ranged from former constituencies of the ruling party, proponents of President Rousseff’s impeachment and even a few radicals that demanded military intervention. They combined an anti-corruption mood with broader discontent over the deterioration of the political situation and economy of the country.

Mrs. Rousseff (Worker’s Party) was reelected last year with 51.6% of the votes in the second round against Aécio Neves (Social Democratic Party) in the tightest election in Brazilian history. The fierce contest, marked by Rousseff’s strategy of “deconstructing” the reputation of oppositional candidates, reinforced the hostile polarization between government and opposition. The president’s notorious lack of inclination to deal with day-to-day politics (she had never taken part in any election before 2010) shrunk the support for her in parliament.

Parliamentary support has been further deteriorated by an unprecedented corruption scandal in Petrobras. It is alleged that a bribe collection system at the state-controlled oil company has financed coalition parties since 2004. The ruling party’s treasurer and more than 30 politicians from Mrs. Rousseff’s political alliance are formally implicated, including the current speakers of both Houses of Parliament, who have since turned their ire at the government. To make a bad situation worse, Mrs. Rousseff herself chaired Petrobras’ board of directors from 2003 to 2010. A Recent poll from the firm MDA, commissioned by the national transport group, shows that around 60% of Brazilians are in favor of the impeachment.

As the Constitution of Brazil forbids the president to be held responsible for acts unrelated to their time in Office, the impeachment crucially depends on the connection between the wrongdoings and Mrs. Rousseff’s Presidency. There is a consensus in Brazil that the impeachment is also conditioned by political factors. President Fernando Collor, who resigned in 1992 just before the Parliament was expected to approve his impeachment, was later personally acquitted by the Supreme Court over corruption charges. Yet to this day his impeachment is considered to have been inevitable since Mr. Collor would have lost the most basic conditions to remain in office after systemic corruption in the government was brought to light.

For the first time since 1945, Brazil was expected to undergo two consecutive years of decreasing GDP) (a last minute methodological change resulted in a 0.1 growth rate for 2014.) Inflation is already estimated at 8% in 2015, much higher than the target of 4.5%. In 2014, Brazil’s trade deficit was the highest since 1948 and the government incurred its first budget deficit since 1997. The toughness of Minister Joaquim Levy’s fiscal adjustment, whose measures barely passed through Parliament, has alienated the Worker Party’s constituencies. Unemployment is on the rise and the dollar hit a 12-year record of 3.3 reals.

On March 8th, the president refrained from acknowledging mistakes and blamed economic hardship on the international financial crisis in a long television address to the nation. The divorce between discourse and reality, which replicated the tone of the electoral campaign, gave rise to an unexpected reaction from Brazilians. They started the panelaço, a mass pot-banging protest initiated in key cities such as São Paulo, Rio de Janeiro and Brasília. One week later, the panelaço was repeated after demonstrations in protest against a press conference held by two ministers from Rouseff’s administration.

As the great politician Ulysses Guimarães once remarked, “the only thing that makes a politician scared is the people on the streets”. The turbulent environment imposes on the President the need to improve her dialogue with civil society, as well as political allies and adversaries. If she fails to acknowledge mistakes and insists on a discourse that splits the population between the rich and the poor, there might be long-run damage to Brazilian democracy, which celebrated its 30th anniversary precisely last March 15th.

 

The views expressed in this oped are those of the author and do not reflect those of any institution he is affiliated with. 



Igor Medina de Souza, Brazil

About

Igor Abdalla Medina de Souza is a career diplomat since 2006. He is currently working at the Department of Europe at the Brazilian Ministry of External Relations. Igor is also Assistant Professor of International Relations at the Catholic University of Rio de Janeiro. He holds a PhD in Political and Social Sciences from the European University Institute (Florence, Italy) and Bachelor's Degrees in Law and Economics.


  • Thank you for the OPED, Igor.

    Although true that Brazil is living a political turmoil, my political assessment is that if President Dilma was to be brought down for any reason, the facts so far show that the Petrobrás scandal would only be the cover for other reasons, of political and economic nature. At the moment, there is little ground for an institutional justification for impeachment, e.g.

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