Published On: June 22, 2016

A Time for Optimism?

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Neymar, Brazil’s star footballer, is enjoying the Copa América tournament at the Rose Bowl stadium in California from the box seats. He’s not playing, but instead is on vacation and renting a mansion in Beverly Hills to hang out with friends like Justin Bieber.

Is anyone in Brazil talking about its national team playing the national sport without its best player, who some consider to be the finest scorer in the world today? Is anyone in Brazil talking about the upcoming Summer Olympic Games in Rio that will be played for the first time in the winter?

The answer to both these questions is – no. Perhaps for the first time ever, Brazilians are not thinking about their football team. The fact is, Brazilians have far more important issues on their minds.

Things are not good in Brazil. Unemployment and inflation have both risen into the double digits. For the second year in a row, the economy is exhibiting negative GDP growth. The combination of high unemployment with “stagflation” is a crippling blow to a once booming economy. The IMF, which had listed Brazil as the seventh largest economy in the world, says it has now slipped to ninth, behind India and Italy.

Neymar's rented home in Beverly Hills, Calif.

Neymar’s rented home in Beverly Hills, Calif.

Thanks in large part to this economic downturn, the ruling political party, PT, has been dethroned. PT has held the presidency for the past 13 years, riding atop a multi-party coalition. However, today, the suspended president of Brazil, Dilma Rousseff, the first woman president in its history, finds herself in a political coma. She resides in the presidential palace but is powerless, by decree of the Brazilian constitution, as she faces an impeachment trial in the senate. A two-thirds vote by Brazil’s senators against her will force her back into the general population as a private citizen.

Meanwhile, Dilma has declared her impeachment a nonviolent coup d’etat (golpe) led by the opposition party (PMDB) of her vice president, Michel Temer. Some thought Dilma would resign rather than face the humiliation of an impeachment trial. This is what happened the last time a president was impeached in 1992. Dilma under the watchful eye of her PT mentor, former president Lula, shows no signs of resigning.

Not surprisingly, no one has any idea what lies ahead. Does PT still control enough of the senate to withstand a two-thirds removal vote? The voice of the populace is in support of her removal, but PT continues to have significant influence among the labor unions and working class. While running the country, PT’s social/economic policies led to a huge improvement in the everyday lives of the poor and working class.

Suspended President Dilma Rousseff with Lula speaking out against the coup d'etat (golpe)

Suspended President Dilma Rousseff with Lula speaking out against the coup d’etat (golpe)

The young, who are often the greatest force behind social democracy in any political movement, are today as confused as everyone else. PT poured millions into expanding education programs and had uncontested support among the young until recently. However, with the bribery scandal known as Car Wash (Lava Jato) getting headlines every night, many of PT’s youth base have crossed over to the other side, voicing their distrust in PT, the party that supported education but did it with the help of bribery and kickback schemes that gutted the coffers of Brazil’s national oil company, Petrobras, the largest company in the country.

While Brazil’s suspended president is by law powerless, an interim president has stepped in, Michel Temer (PMBD), who was Dilma’s vice president. Upon taking his position, he immediately reorganized and replaced the entire Cabinet Ministry, excluding PT from the inner circle positions of power.

Many in Brazil heaved a sigh of relief when Temer was elevated to the position of interim president. The financial markets rallied, Brazil’s currency strengthened, and investors saw in Temer a man ready to put the country’s economic health and stability as his number one priority.

Interim President Temer

Interim President Michel Temer

Temer’s “honeymoon” lasted less than a week. Immediately, women’s groups were protesting that Temer hadn’t included any women or people of color as Cabinet Ministers. Artists protested when Temer eliminated the position of Minister of Culture, and Temer relented. In his second week as interim president, Temer demanded the resignation of one of his Ministers, and a second Minister’s resignation followed. The resignations occurred because wiretaps were presented in a plea bargain that implicated the two ministers in the Car Wash scandal.

There’s reason to believe that more Ministers and other PMDB elite will fall from grace. Rodrigo Janot, the Prosecutor-General of Brazil since 2013, wants to prosecute the president of the Senate, Calheiros, along with one of the resigned Ministers, Jucá, based on conversations recorded on secret tapes made by Sérgio Machado, an ex-senator, during a plea bargain arrangement. Janot is also asking permission from the Supreme Court to arrest José Sarney, a retired senator, whose son, Sarney Jr., is the current Minister of Agriculture under Temer. José Sarney is a former president of Brazil and former president of the senate. Sarney, Calheiros, and Jucá are all from the same party as Temer, PMDB.

Prosecutor-General Rodrigo Janot

Prosecutor-General Rodrigo Janot

Amid this changing of the guard, no one can predict what’s next. Some predicted that mass street demonstrations during the impeachment would end in violence, with pro and anti-PT forces coming to blows. Thus far, the streets have been relatively calm. It would seem many people are staying home, hoping Temer will succeed in righting the economy, which would improve everyone’s lives.

Many also predicted that Temer and PMDB would squash the intense criminal probes of Lava Jato that have seen some of Brazil’s richest and most powerful businessmen land in jail, such as Marcelo Odebrecht. Here again, the predictions have been wrong. Mr. Odebrecht has remained in jail for months in Curitiba. This month Folha de S. Paulo reported that Odebrecht had signed a plea arrangement with Judge Sérgio Moro, and in revenge against his former colleagues who have abandoned him to prison, Odebrecht plans to “sing like a canary” and implicate as many as 50 politicians. This following on the footsteps of the jailing of billionaire banker André Esteves, thanks to a plea bargain with Senator Delcídio do Amaral (PT), who was subsequently kicked out of the senate by his peers.

Dilma at the Palácio da Alvorada, official residence of the President

Dilma at the Palácio da Alvorada, the official residence of the President

What lies ahead is anyone’s guess, and that’s the most troubling aspect of the current situation. As long as the criminal investigations continue from Janot and Moro, Brazil’s most powerful politicians will be under constant scrutiny. If Temer is unable to rally support for his government or federal prosecutors pursue Temer, there is no telling how long his government mandate can sustain itself. Already some of the most powerful members of Temer’s party, such as Eduardo Cunha, the Speaker of the House, have been stripped of their positions. Meanwhile, prosecutors are pursuing allegations that Temer violated election laws six years ago. A court last week found him guilty and banned him from running for office for eight years.

Temer faces an uphill battle as he tries desperately to instill life into the lackluster economy. If stagflation were the only obstacle, there might be some optimism. However, Temer must first battle women’s groups, and he has conceded by appointing a woman as head of the BNDES bank, the government’s lending agency. (This week women’s groups littered Copacabana Beach with red panties in a protest against the unsolved gang rape of a teenage girl in Rio.)

Additionally, the powerful landless workers’ organization (MST) continues to organize against Temer’s government, and unions hold rallies in support of PT. The labor union movement is so influential in Brazil there’s an organization to represent and organize the unions (CUT).

Women's underwear protest on Copacabana Beach, June 2016. (Photo by Mario Tama/Getty Images)

Women’s protest on Copacabana Beach, June 2016.
(Photo by Mario Tama/Getty Images)

In a country known for its optimism, there is little to be found in Brazil these days. While the unemployed and the wealthy may be cheering for Temer, others are skeptical. Can Temer’s team survive the Lava Jato scandal that seems to ensnare another politician every week? On Wednesday, June 8, an officer with the Federal Police was arrested. Newton Ishii was known throughout the country for his diligence in arresting corrupt top government officials, like José Dirceu.

The bottom line is everyone, not just Brazilians, wants to see Brazil return to a state of productive calm. Everyone benefits from a strong economy with an effective criminal justice system. The problem is Lava Jato isn’t going away, and it’s nearly suspended the power of politicians. Congress is too worried about staying out of jail to spend time fixing the country’s enormous problems. Nobody knows who’s next to be implicated in Lava Jato. Could it be the previously impossible to believe – the arrest of Lula or one of his sons?

On the one hand, many Brazilians want Temer’s administration to succeed, if for no other reason than to return the country to its normal state of calm optimism. On the other hand, the majority of the population supports the downfall of PT and the impeachment of Dilma because of the connection between PT, Petrobras, and Lava Jato. Therefore, if a clean government free of corruption is at the emotional center of today’s controversy, it will be impossible for the populace or the Prosecutor-General to overlook any apparent crimes among Temer’s team and the PMDB elite.

Newton Ishii arrests José Dirceu in Curitiba, August 2015. (Photo: Reuters/Rodolfo Buhrer

Newton Ishii arrests José Dirceu in Curitiba, August 2015     (Photo: Reuters/Rodolfo Buhrer)

Before long, with more arrests resulting from more plea bargains, and little improvement in unemployment figures or inflation, Brazilians will face another test of their optimism. They may begin to question their hopes for Temer. Just before the impeachment proceedings began, Dilma’s approval rating was less than ten percent. Today, she’s looking a little better compared to what’s replaced her – Temer, Calheiros, and Cunha. According to a poll taken last week in Brazil, only 62.4 percent of Brazilians now believe the impeachment of Dilma was the right decision.

Meanwhile, in the same poll, 50.3 percent favor holding new presidential elections this year, and 11.3 percent believe nothing has changed since Dilma was suspended. Clearly, there are no firm solutions to Brazil’s political predicament – stability or honesty? Watching Michel Temer lead Brazil out of this impasse is like watching an athlete racing with a bad leg. We all want the athlete to succeed because we respect his efforts. However, we know his chances of winning the race are slim.

On Friday, June 10, pro-PT organizations like MST and the Brazil Communist Party are planning a rally in São Paulo to press for the resignation of Temer. Their reasoning is that Dilma has not been convicted of any crimes, and that whatever PT has done that’s corrupt is no worse than what Temer’s party, PMDB, has done, too.

Believing there are no good solutions, a growing group of congressmen is working to draft legislation to call for new elections. For that to happen, both Rousseff and Temer would have to resign or be removed from office. “New elections would be difficult but not impossible,” says Francisco Fonseca, a political science professor at Fundação Getulio Vargas in São Paulo.

Speaker of the House Eduardo Cunha questioned by colleagues in congress

Speaker of the House Eduardo Cunha questioned by colleagues

Brazil’s political future remains an enigma. The truth that remains unspoken, hidden beneath the secrets and lies, is that if Michel Temer, or anyone else, can save Brazil’s economy before the next presidential election in 2018, no one is going to worry about their past criminal indiscretions.

If only there were some way to wipe the slate clean and start over. Hold new elections and dump all the dirty politicians. Anyone who has been convicted of a crime like money laundering or taking bribes would be prohibited from seeking elected office. How’s that for Brazilian optimism.



B. Michael Rubin is an American living in Curitiba.



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