Rousseff's Impeachment Advances in Congress

The debilitating crisis that engulfed Brazil this year is bound to deepen in 2016 regardless of the outcome of the fight to impeach President Dilma Rousseff, which started in earnest in early December and could drag on for months. The political battle has overtaken the congressional agenda, derailing any efforts to address in the foreseeable future the underlying problems that turned the country from a once promising emerging economy into a train wreck in the first year of Rousseff’s second term. Two thirds of voters favor ousting the discredited president, according to two opinion surveys released in the past week. Confirming findings of a survey conducted earlier this month   by Idea Inteligência, a São Paulo polling firm, a total of less than one hundred thousand people joined the protests in various state capitals and other cities, in the first street demonstrations called after the president of the House of Representatives, Eduardo Cunha, accepted a citizens ‘motion to start the impeachment procedures on December 4th, for violation of the country’s Law of Fiscal Responsibility.

This is a fraction of the millions that participated in three waves of anti-government street protests since 2013.   Brazilians low appetite for demonstrations against their discredited president is due to a combination of factors.  Organizers say they were surprised by Cunha’s action and did not have time to prepare. The Christimas holiday season is certainly not ideal for social activism in a heavily catholic/evangelical Brazil. There may also be at play a general disappointment with the country’s political class. Low attendance to protests is also indicative of people’s discomfort with the fact that the impeachment process was initiated by Cunha, a highly suspicious politician who is himself accused of crimes of corruption and will likely be expelled from Congress before it decides on Rousseff’s fate.

Impeachment campaign likely to gain momentum

It would be a mistake, however, to interpret the apparent popular apathy regarding impeachment as hopeful news for the embattled president. Or to assume that a failure of the impeachment effort will strengthen Rousseff politically and allow her to govern effectively, which she has not been able to do since her narrow reelection victory in October 2014. More likely, she will face growing political isolation and diminishing options in the weeks and months ahead, with or without impeachment.

Rousseff saw her popular support vanish as the country’s economy collapsed into an estimated 3.5 percent GDP contraction this year. The recession is expected to continue in 2016, and could deepen, depending on the country’s capacity to resolve the political crisis. It is the first time in more than eighty years that Brazil faces the prospect of two consecutive years of recession. In people’s minds, Rousseff has already lost effective power and political viability, and will remain in office only as an increasingly irrelevant figurehead, incapable of dealing with the consequences of the mess she helped create, if she manages to survive the impeachment process.

The odds against the president increased dramatically on December 8th when the parties of the coalition that grudgingly support her in Congress lost control of a Special Committee  formed by  the lower house  to  examine the impeachment petition presented by  respected constitutional law experts, including  Helio Bicudo, a founding member of Rousseff’s Workers’ Party. More ominously, only 199 of the 513 deputies supported the government’s position in a vote about the Committee’s composition. It was a stunning defeat for Rousseff. If upheld by the Supreme Court, it means that  deliberations on the impeachment will start – after clearing procedural hurdles at the country’s highest court  ‑ with those who favor ending the president’s tenure having to turn only 28 votes to deny her the minimum of 171 necessary to block the approval of the impeachment by the mandated two thirds majority. Assuming the process moves forward, the Senate will make the final decision. 

Vice-President maneuvers to take over

A second blow was a declaration of war against the president by a dissident group of congressmen from the PMDB, the main partner of her Workers Party (PT) in the government coalition, after she attempted to interfere in an internal party leadership dispute, in an effort to derail the impeachment process. Influential congressman Geddel Vieira Lima, a former ally who served in the cabinet of former president Luiz Inácio Lula da Silva, said Rousseff’s interference was “unacceptable” and described it as a sign of “desperation.” The congressman vowed to call a special party convention to formally break ties with the government and join the opposition. On December 13th, another prominent PMDB leader, Eliseu Padilha, who just last month resigned from Rousseff’s cabinet, said that “the majority of the party favors leaving the government coalition.”

To complicate matters, a decision by imprisoned Workers’ Party senator Delcídio Amaral to cooperate with federal prosecutors after his arrest last month on obstruction of justice charges looms large as a potential threat for Rousseff. Amaral, the former Senate leader of the government, was arrested last month after being caught on tape planning to obstruct a criminal investigation against a key defendant of the Petrobras scandal. On December 10, a lawyer to the once influential politician denied media reports that he would sign a plea bargain agreement in exchange for a reduced jail sentence. According to the reports, the disgraced politician felt abandoned by Rousseff, Lula and the Workers Party after his arrest and was urged by his family to tell all he knows in exchange for being placed under house arrest while the case moves forward in the courts. That would supposedly include allegations of Lula’s knowledge of the assault on Petrobras and of Rousseff’s direct involvement in some disastrous investment decisions made by the state owned company in the decade she chaired its board of directors. The former president has been traveling abroad and stayed mostly silent, including about the November arrest of a close friend, José Carlos Bumlai. On December 14th, Bumlai, members of his immediate family and others already cited in the Petrobras case, were indicted on various corruption charges. 

Amaral’s cooperation will not necessarily add to the impeachable offense that Rousseff is charged with – the violation of the country’s fiscal responsibility law in 2014 and this year, by increasing public expenditures without congressional authorization, borrowing from federally-owned banks and postponing mandated transfers of funds to states and municipalities to artificially boost government accounts.

In Brazil’s increasingly toxic political environment, exacerbated by the economic downturn and expected new revelations and charges in the ongoing Petrobras investigations, the efforts to get rid of Rousseff will continue to undermine what is left of her authority. With that in mind, on December 9th, Vice-president Michel Temer distanced himself from the president in a letter that strongly suggested he is positioning himself to succeed her sometime in the new year. An urgently arranged meeting of the two did not dispel the perception that they are now on divergent paths. Last month, Temer leaked a road map of his presidential plan in the form of a lengthy document titled “Bridge to the Future”. If taken, the bridge would supposedly help to reinstate a sense of direction and governability, paving the way for a smoother transition to the 2018 elections.  

Cardoso join the impeachment campaign

Popular opposition senator Aloysio Nunes, from São Paulo, who in 2010 received the largest number of votes on record in a senate race, predicts that public pressure to impeach Rousseff will gain momentum after the end of congressional recess, in late January or early February. “The economy continues to deteriorate, inflation is now above 10 percent and unemployment is growing, with 100,000 jobs being lost every month. Unemployment benefits will start to dry up around February for many of the 1 million Brazilians who lost their jobs this year. With the expected downgrading of Brazil’s sovereign credit risk by Moody’s and Fitch, following last September S&P decision to lower the country’s debt to junk status, Nunes’ calculation is that if indignation does not fuel protests, hardship will, putting pressure on Congress to remove the president in the first quarter of the 2016. In a significant move, former president Fernando Henrique Cardoso, who had been reluctant to support his PSDB party campaign to oust Rousseff, saying the process could damaging for the country’s democratic institutions  joined the impeachment cause on December 11th. “Repeatedly disrespecting the Law of Fiscal Responsibility, for electoral gains, is a consistent reason [for impeachment]’” he said. Mass protests are scheduled for March, when the opposition expected the lower house to vote.

If impeached, Rousseff will have to step down and wait for the Senate final decision If history serves as a guide, under these circumstance she would probably resign. Obviously aware of this scenario, investors and companies alike have started working on strategies for a “post-Dilma” Brazil. The risk, however, is that if the political battle is unresolved and the crisis drags on for too long, local investors will give up and flee from the country, sparking the type of old-fashioned external crisis many thought had been left to Brazil’s history books.

Paulo Sotero is the Director of the Brazil Institute at the Woodrow Wilson International Center for Scholars.

Photos courtesy of Flickr users Senado Federal and Michel Temer.