What does the Brazilian crisis teach us?

brasilecoThe author is a Panamanian sociologist and political activist.  

A huge political crisis is looming over the giant Brazil. A judicial investigation called “Lava Jato” has exposed a pattern of corruption involving senior officials from Petrobras, a semi-public Brazilian multinational corporation in the petroleum industry, large construction companies and Brazilian politicians.

Allegations of corruption involve not only the Workers Party (PT), as the media would like to present it, but the Progressive Party (PP) and the Brazilian Democratic Movement (PMDB), both right-wing parties.

But the right wing is maneuvering with the collaboration of the bourgeois media, led by the Globo network, and the complicity of the U.S. embassy, ​​to only target charges against President Dilma Rousseff, former President Ignacio Lula Da Silva and the PT.

Rightist coup maneuver

The right wing aims to impose a parliamentary coup d’état, forcing the impeachment of the president by Congress, which is headed by rightist Eduardo Cunha, who is accused of receiving more than $5 million in “tips” from Petrobras.

The coup maneuver would be to get Rousseff out through a rigged trial held by the corrupt Congress and to seize power by promoting Vice President Michel Temer, of the right-wing PMDB, currently allied with the PT government, without holding new elections or any kind of referendum.

How did the corruption operate?

The central actors in the crisis are Petrobras executives appointed by the PT government, Renato Duque and Pedro Barusco, and a former senator of that party, Delcidio Amaral.

The scheme was that Petrobras sold mainly gasoline at prices below the international market prices to Braskem, the largest petrochemical company in Latin America, which is a subsidiary of the multinational Odebrecht Group. The millions in profits to Braskem (and theft of Petrobras) is estimated at $1.6 billion between 2009 and 2014.

Then Odebrecht, through its offices and phantom companies in such tax havens as Switzerland and Panama, paid “tips” to the staff who had expedited this lucrative business.

Research estimates that the “tip” for Duque and Barusco was approximately 2 percent of the value of each contract. As Duque was treasurer of the PT, it is estimated that some of the money was used to finance the party. But the corruption also stains the head of the right-wing opposition in the Senate, Eduardo Cunha, accused by the Supreme Court of receiving payments of $5 million.

The charges include the directors of Odebrecht and the “operator” of the PMDB, as well as a manager of Petrobras, who is related to the Progressive Party. As is already known, Marcelo Odebrecht, head of the company, has been sentenced to 20 years in prison for these crimes.

Political system is mother of corruption

What the media don’t report is that the supposedly “democratic” political systems require additional packets of millions of dollars to participate in the electoral process for a chance of “being elected.”

Where it is most clear that the injection of economic power determines election results is in the U.S., where politicians are funded directly by powerful corporations and billionaires. Once politicians are elected, they receive additional funding from lobbyists.

The media also hide the fact that they and their owners, having an absolute monopoly on the means of communication and imposing prices on all advertising, are the main beneficiaries of the millions spent on election campaigns.

Lula and Odebrecht

It has recently come out that there is a close relationship between former President Lula Da Silva and the Brazilian Odebrecht construction company. Research has brought to light that between 2011 and 2013, Lula received “sponsorship” from these companies and grants up to about $5 million U.S. to the “Lula Institute,” and $3 million U.S. was paid to him in royalties for his lectures abroad.

Lula argues that these payments are legal and that other former presidents who also travel the world promoting their countries and companies charge a hefty sum for lecturing.

Not only Lula’s version of the legality of such payments is credible, but also it is public knowledge that he has never refused to testify before the judges on the subject. However, from the working-class point of view, which Lula has represented for decades, the close relationship with a transnational company like Odebrecht presents ethical-political dilemmas that can be and are widely and publicly discussed in Brazil.

Rousseff’s economic policy alienates working-class social base

Crushed between a growing capitalist crisis, falling prices of raw materials, increasing social struggles, as well as the media campaign against her, President Rousseff and the PT, instead of going to the left, are giving in to neoliberal policies. That the PT is looking to the right in search of support is shown by its alliance with the PMDB.

Although the PT government inaugurated in Latin America the so-called social policies involved in Lula’s “Zero Hunger Plan,” the truth is there have been no fundamental changes in the basic aspects of life expected from a government that said it would work on behalf of the workers. On the contrary, the Rousseff government leans increasingly toward neoliberal measures.

The social situation is deteriorating: 1.5 million jobs were lost in 2015. In 2016, the unemployment rate is 7.6 percent. Youth unemployment in the metropolitan area of ​​Sao Paulo exceeds 28 percent. Inflation last year edged close to 11 percent.

This year, President Rousseff adopted two agreements that aroused union opposition: the PT, PMDB and Social Democracy Party (PSDB) decided together to give the private sector oil reserves belonging to Petrobras and to freeze the minimum wage and salaries of public employees, while giving priority to debt payments to the banks.

For a democratic and popular way out of the crisis

Faced with the political crisis looming over Brazil and facing the right-wing’s maneuver to attempt a parliamentary coup to remove Rousseff and replace her with the vice president, important sectors of the leftist opposition have denounced the move against democracy and against the people, proposing that there can be no way out that does not include popular participation.

The Latin American experience in general and the Brazilian in particular show that the only way to save progressive political processes from the attacks of the right wing and imperialism is not by trying to negotiate and give in to their demands, but by convening popular mobilization and taking more radical socialist measures.

Translation and minor editing by WW/MO staff.