Elec­tions, econ­omy give glim­mer of hope

Af­ter years of crises, Brazil­ian con­fi­dence starts to rise again

The Washington Times Daily - - FRONT PAGE - BY FRED­ERIC PUGLIE

BELO HOR­I­ZONTE, BRAZIL | The head­lines here still scream of scan­dal and malaise, drift and de­cline, but for the first time in years, at least some Brazil­ians are feel­ing a tiny sliver of op­ti­mism as they look ahead to next year’s pres­i­den­tial elec­tions.

Once touted as one of the de­vel­op­ing world’s emerg­ing pow­ers, South Amer­ica’s most pop­u­lous na­tion has long been in a po­lit­i­cal and eco­nomic free fall, a cri­sis of na­tional con­fi­dence that cul­mi­nated in last year’s im­peach­ment and re­moval of Pres­i­dent Dilma Rouss­eff. And amid ever-widen­ing cor­rup­tion probes and the bit­ter eco­nomic hang­over from last year’s Olympic Games, her suc­ces­sor, Michel Te­mer, may get ousted him­self on cor­rup­tion charges.

But talk to res­i­dents of this heart­land state cap­i­tal strolling around Belo Hor­i­zonte’s tra­di­tional Cen­tral Mar­ket on Fri­day, and you get the sense that the slight eco­nomic uptick gives them hope that the worst might be over.

“In 2014, at the height of the coun­try’s po­lit­i­cal and eco­nomic cri­sis, many stores had to close,” said 29-year-old Rafael Igino, who owns a cod­fish stand in the mar­ket. “Be­tween 2014 and now, there has been a re­ac­tion, al­beit a small one. Things are bet­ter; the clien­tele has a lit­tle more con­fi­dence.”

If they hope to con­sol­i­date that trend, then cit­i­zens at the bal­lot box must re­mem­ber the lessons of Brazil’s spec­tac­u­lar cor­rup­tion in­quiries, said Fran­cis­ley Martins, one of Mr. Igino’s em­ploy­ees.

“Brazil­ians have a short mem­ory. There are many peo­ple who did bad things and can run — and be elected — once again,” said Mr.

Martins, 45. “We have to be very re­spon­si­ble when we vote for a can­di­date, look at his back­ground [to find out] if he did some­thing bad.”

He made the com­ments as judges were con­sid­er­ing the fate of Belo Hor­i­zonte na­tive Ae­cio Neves, a former Mi­nas Gerais gov­er­nor and run­ner-up in the last pres­i­den­tial elec­tion, now caught up in the lat­est of count­less cases that have tainted much of Brasilia’s po­lit­i­cal class.

Painful as that con­stant drib­ble of scan­dal may be, it speaks to the strength of Brazil­ian in­sti­tu­tions tak­ing on the coun­try’s most pow­er­ful fig­ures, said po­lit­i­cal sci­en­tist Marcus Melo, co-au­thor of the Prince­ton Univer­sity Press book “Brazil in Tran­si­tion.” As painful as it has been to the na­tional psy­che, Brazil is prov­ing able to deal with its own fail­ings.

“In the short term, we are ex­pe­ri­enc­ing tur­bu­lence, but with a sil­ver lin­ing: Au­thor­i­ties in Brazil have shown them­selves to be ef­fec­tive in the fight against cor­rup­tion,” Mr. Melo said.

Ef­forts such as the anti-cor­rup­tion Oper­a­tion Car Wash, which has yielded some 1,400 years of com­bined prison terms and more than $3 bil­lion in seized funds, have few, if any, equals in his­tory, he said. The reach of the scan­dal has shaken gov­ern­ments across Cen­tral and South Amer­ica.

“It’s a level of pun­ish­ment of the po­lit­i­cal elite you don’t find in any other coun­try,” Mr. Melo said, “other than Italy’s Mani pulite,” a 1990s probe that led to 1,300 plea bar­gains and con­vic­tions. “In the case of Brazil, we can say the glass is half-full,” he said.

Growth, fi­nally

While not good, the eco­nomic pic­ture is no longer one of un­re­lieved gloom.

In­fla­tion has fallen be­low gov­ern­ment tar­gets, and a grind­ing two-year re­ces­sion came to an end when the Brazil­ian econ­omy eked out a small gain in the first quar­ter of 2017. De­spite his po­lit­i­cal trou­bles, Mr. Te­mer this month said he is com­mit­ted to push­ing through la­bor and pen­sion re­form bills de­signed to give greater flex­i­bil­ity to busi­ness own­ers.

While the na­tional job­less rate hit a record 13.6 per­cent this spring and econ­o­mists are not rul­ing out a dou­ble-dip re­ces­sion if world food and com­mod­ity prices turn south again, the gov­ern­ment last week re­ported an ad­di­tion of 34,253 pay­roll jobs in May, the sec­ond straight month of pos­i­tive em­ploy­ment mo­men­tum and well above econ­o­mists’ ex­pec­ta­tions. Brazil’s econ­omy is pro­jected to reg­is­ter a 0.4 per­cent growth rate for all of 2017 — af­ter con­tract­ing 3 per­cent in 2015 and 2016.

Such cau­tious op­ti­mism, how­ever, of­ten ends at the po­lit­i­cal di­vide. Sup­port­ers of the left­ist Ms. Rouss­eff, the coun­try’s first fe­male pres­i­dent, are reel­ing from her re­moval, which they dub a “coup.” Her pop­u­lar men­tor and pre­de­ces­sor, Luiz Ina­cio Lula da Silva, also is ac­cused of cor­rup­tion.

“I don’t view this fight against cor­rup­tion in Brazil as le­git­i­mate. I don’t think the prob­lem was cor­rup­tion,” said Jorge Neves, a so­ci­ol­o­gist at Belo Hor­i­zonte’s Fed­eral Univer­sity of Mi­nas Gerais. “Today, the [ac­cu­sa­tions] against Mr. Te­mer are much worse than any trou­ble Dilma had, [but those] who were yelling ‘Dilma, go home’ in the streets now aren’t there yelling ‘Te­mer, go home.’”

But one per­son who counts a great deal — Brazil’s at­tor­ney gen­eral — did the con­sti­tu­tional equiv­a­lent of yell “Te­mer, go home” on Mon­day.

At­tor­ney Gen­eral Ro­drigo Janot filed a for­mal crim­i­nal ac­cu­sa­tion on Mon­day, mak­ing Mr. Te­mer the first sit­ting pres­i­dent here to face crim­i­nal charges. The Cham­ber of Deputies de­cides whether the charge has merit. If a two-thirds vote agrees, Mr. Te­mer will be sus­pended for up to six months un­til a trial can be held.

Ac­cord­ing to Mr. Janot, Mr. Te­mer took a $150,000 bribe this spring from Joesly Batista, former chair­man of meat-pack­ing giant JBS.

But the in­ves­ti­ga­tions Mr. Neves views as po­lit­i­cally mo­ti­vated may well back­fire in the eco­nomic realm, he said.

“This cor­rup­tion hunt will cre­ate great dif­fi­cul­ties for the fu­ture,” he said. “Be­fore Mani pulite, Italy had above-av­er­age eco­nomic growth in Europe; af­ter Mani pulite, Italy had be­low-av­er­age growth.”

To Mr. Neves, Mr. Lula is the only leader who, amid all the chaos, “preserved po­lit­i­cal pat­ri­mony,” and many like-minded sup­port­ers of the Work­ers’ Party hope the former two-term pres­i­dent will make a come­back in the race next year.

But if last year’s mu­nic­i­pal elec­tions are any in­di­ca­tion, vot­ers seem to have lit­tle ap­petite for es­tab­lish­ment can­di­dates. In Sao Paulo, en­tre­pre­neur Joao Do­ria beat Work­ers’ Party in­cum­bent Fer­nando Had­dad by a whop­ping 36 per­cent­age points.

“The coun­try’s largest city re­jected all tra­di­tional politi­cians and picked a man­ager, an ex­ec­u­tive,” said Paulo Roberto de Almeida, di­rec­tor of the Min­istry of For­eign Af­fairs-linked IPRI think tank in Brasilia.

Mr. Do­ria’s name is now fre­quently men­tioned among the top con­tenders to move into the Planalto Palace, Brazil’s ver­sion of the White House, come 2019, with Mr. de Almeida com­par­ing his move­ment with that of new French Pres­i­dent Em­manuel Macron, a cen­trist whose year-old po­lit­i­cal move­ment swept aside France’s tra­di­tional rul­ing par­ties of both the left and right.

“If the opin­ion polls in­di­cate high pop­u­lar­ity for Joao Do­ria, it will be dif­fi­cult for [his party] not to nom­i­nate him as a can­di­date for pres­i­dent,” he said. “And he could win given the peo­ple’s dis­missal of all tra­di­tional politi­cians as cor­rupt and prof­i­teer­ing.”

Mr. Te­mer said in Brasilia that the coun­try had to move for­ward with re­forms be­cause it has ex­hausted all the al­ter­na­tives.

“There is no Plan B. We have to move for­ward,” he told re­porters, ac­cord­ing to The As­so­ci­ated Press.

But whether it’s Mr. Lula, Mr. Do­ria or any other con­tender, Norma da Silva, shop­ping for cheese and herbs at the Cen­tral Mar­ket, said she would will think much harder than in the past be­fore mark­ing her bal­lot.

“We will look long and hard at the per­son’s his­tory,” the 60-year-old re­tiree said.

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