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Clouds Over Brazil

It is the best of times and the worst of times in Brazil.  The country has so far survived the global economic upheaval in good shape; but Brazil is haunted by 200 years of promise that never quite panned out. Brazil’s disappointments are usually related to the interplay of two problems: the booms and busts of world commodity markets and questions of domestic governance.

What makes for some nervous moments in Brazil right now is that both world markets and domestic politics are acting up.  The risk of more recession in the US, Europe and even bubbling China threatens Brazil with the possibility of a commodity price plunge; at home, President Dilma Rousseff has watched four of her cabinet ministers resign, her governing coalition strain, and whiffs of scandal spread.

The FT reports that a recent poll in Brazil

found that the most-remembered aspect of her government to date was a corruption row that claimed the scalp of the minister of transport last month as well an ethics scandal that felled her most senior minister, Antonio Palocci, in June.

Those scandals have since been followed by the loss of her third cabinet member, defence minister Nelson Jobim, for publicly criticising fellow cabinet members, including saying that he was surrounded by “idiots”. Ms Rousseff was then forced to stand by her agriculture minister, Wagner Rossi, after a police investigation of alleged kickbacks by his ministry. And last week, her government was shaken again when the federal police arrested 33 tourism ministry officials and associated businessmen, including the deputy tourism minister.

The police suspect that millions of dollars intended to provide professional training for workers in advance of the World Cup and Olympics was embezzled.

(Rossi has since resigned.)  For Dilma (as everyone in Brazil calls her), the problem is that she can’t live with corruption and you can’t live without it.  To have a reliable majority in Congress you need the support of regional coalitions who want perks and pork; this inevitably leads to bad publicity and newspaper scandals.  Dilma is not a career politician; she is a technocrat who got her current job because her popular predecessor anointed her.  It looks as if her skills are going to be tested.

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  • Andrew

    It’s worse than you think. Corruption in Brazil, as in India, is endemic. I must confess that this observation is based on a single visit, but I saw enough low-level dishonesty to persuade me never to return.

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