According to a Financial Times August 28 post, Brazil’s economy slid into recession in the second quarter. Inflation is running dangerously high and consumer confidence continues to fall. Compared to the second quarter of last year, the economy has shrunk 2.6%. The rate of unemployment continues to climb. The country’s currency, the Real, has fallen to one of its lowest points as against the dollar. This year the country is on pace to record its first budget deficit since 1997.
The people in Brazil are not so naïve to believe that President Rousseff is in no way responsible for the mess that the country is in. The question of what to do with her socialist agenda will be decided at the polls.
It seemed inevitable that impeachment proceeding would be instituted against President Rousseff. On December 2 the impeachment process formally began. Eduardo Cunha, Speaker of the lower house, filed the necessary papers to begin formal proceedings. After months of back-room negotiations, it had become clear that a number of old political allegiances had come undone. President Rousseff has struggled to keep her Workers Party (PT) governing coalition together. Her ability to govern solely based upon her charisma has lost its magic.
The impeachment proceeding is based upon the allegation that the President manipulated government accounts to help her reelection bid. In response to the filing, President Rousseff appeared on national TV to label the charges as being politically motivated. Opinion polls show that her televised denial was not well received by the public.
Reed Johnson and Paulo Trevisani, writing in the Wall Street Journal’s World-Latin section on December 2 questioned Cunha’s standing for initiating impeachment proceedings. He too is facing very serious charges of corruption. Prosecutors believe that he accepted thousands of dollars in bribes and secretly stash the illegal gains in Swiss bank accounts. It is possible that he might not be speaker when the impeachment proceedings formally begin. The lower house’s ethics committee is considering the charges against Cunha and may remove him from the speaker’s office. Because of Cunha’s own corruption charges and the technical nature of the charges of impeachment, the authors believe that President Rousseff might be able to weather the political storm. I disagree with the authors’ conclusion. Like other intellectuals, Mr. Johnson and Mr. Trevisani tend to over analysis at the cost of not understanding basic human nature to blame someone for their problems.
Also, I think that Mr. Johnson and Mr. Trevisai failed to give enough credence to the recent ruling of the Federal Audit Court. In a unanimous ruling, the 10 judges of the court found that President Rousseff’s administration manipulated the government’s accounts in 2014. According to the judges, this was done to disguise a widening fiscal deficit as President Rousseff was campaigning for reelection. This was the first time in nearly 80 years that the court has ruled against a sitting president. Leaders of the PSDB opposition party rejoiced over the ruling. Attorney General Luis Inacio Adams said the government would appeal again to the top court to overthrow the audit ruling.
President’s Rousseff’s staunchest supporters have failed to appreciate her precarious predicament. When the Federal Audit Court issued its preliminary finding in April 2015, Vice President Michel dismissed the idea that the president would be impeached. He did not believe “that the president was in any danger.” It is inconceivable that the Vice President could give his unqualified support to President Rousseff when just a month earlier thousands of protesters were in the streets demanding that she be impeached. In fairness to the Vice President’s position, the demonstrators demanded impeachment on the grounds of the worsening economy and growing Petrobras scandal. The fact remained that the Federal Audit Court preliminary ruling only served to further fuel the outrage towards President Rousseff.
“The Case Against Rousseff’s Impeachment” was written by Shannon K. O’Neil, a member the Council of Foreign Relations and a Nelson and David Rockefeller Senor Fellow, and posted on Latin America’s Moment on July 30, 2015. I believe that the essay rests upon solid legal analysis. In her work Ms. O’Neil acknowledges that Speaker Cunha had terminated his allegiance with Rousseff. As a testament to her fair analysis, Ms. O’Neil understood the significance of hundreds of thousands of protesters demanding the President’s resignation. I agree with Ms. O’Neil that illegal acts committed while Rousseff was chairman of Petrobras would not sustain an impeachment finding. From a legal standpoint, Rousseff has little to fear from the Petrobras scandal. While Rousseff’s poll numbers remained high, politics would prevent the mounting of a serious legal case against her. Ms. O’Neil conceded Rousseff had something to fear if the opposition tried to impeach her on manipulating the reporting of economic data or violating campaign finance laws. President Rousseff now faces these exact charges in her impeachment proceeding.
I think that President Rousseff miscalculated her ability to weather the political storm as it gathered about her administration. A long time ago, this astute politician needed to carefully consider her possible responses to the worsening economy and Petrobras SA scandal. If she wanted to remain an effective head of state, President Rousseff had to have accepted some responsibility for the problems facing her country. Brazilians do not want to hear her respond to legitimate criticism by dismissing it as an attack on her efforts to help poor people. The downturn in the economy and the Petrobras SA scandal hit the poor hardier than other segments of Brazilian society. I am sure that the poor do not appreciate President Rousseff’s now leaving them to fend for themselves while she fends for herself.