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Brazil In Trouble
Brazil’s Lower House Votes to Impeach Dilma

Brazil’s President Dilma Rousseff suffered a big loss last night, when the Lower House voted to impeach her by a wide margin. Bloomberg:

The opposition garnered 367 votes, 25 more than the two-thirds majority it needed to send the impeachment motion to the Senate.

“The commencement of the impeachment process is authorized,” lower house speaker Eduardo Cunha said at the end of the session that was broadcast live on public screens across the nation.

Most analysts agree it will be difficult for Rousseff to muster the votes needed in the Senate to stave off her ouster. A simple majority in the upper chamber is enough to force her to step down temporarily to make way for Vice President Michel Temer and surveys released Monday by three major newspapers in Brazil show the president’s opponents have the votes. That next step could happen within 15 days, said Senator Romero Juca, the head of Temer’s PMDB party, the largest in the country.

It’s not clear what the consequences of impeachment will actually be for Brazil (assuming, of course, the Senate follows suit, as appears likely). Brazil is trying to turn the page on an administration marred by corruption, but as awful as corruption may be, it’s only the start of Brazil’s problems. From a unwieldy bureaucracy to underfunded personnel-related liabilities, there’s a lot that a government not paralyzed by scandal could be discussing. But even if Brazil enacted necessary reforms, it would still be facing the headwinds with which all commodities exporters have had to manage.

Brazil makes up half of Latin America’s GDP, so this is a big story for the region. Brazil saw a decade-and-a-half-long boom that was the envy of the developing world, but the whole house has come crashing down in the past few years as slowing growth in China and elsewhere means less demand for the raw materials which made Brazil rich. The impeachment of President Rousseff is actually a pretty minor story compared to the greater drama and uncertainty besetting Brazil.

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  • Kevin

    The should talk to the Australians perhaps about rebalancing a commodity export oriented economy. Or Texas.

    • JR

      Too many people are employed by the government and getting rid of them will create massive instability. That’s about it.

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