What Exactly Is Going On in Brazil? Take Your Choice

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Brazil's besieged president, Dilma Rousseff, at a meeting with educators at the Planalto Palace in Brasilia, Brazil, on April 12. Her ruling party is finding it hard to portray itself as the underdog. It’s not easy to sell an anti-elite narrative when you’ve been in government for 13 years. Ueslei Marcelino/reuters

An unpopular government fighting for survival against impeachment. The worst recession in a century. And the largest corruption scandal in its modern democracy.

Brazil is going through a crucial moment in its history, and two grand narratives are competing to make sense of it all.

The first account goes as follows: Brazil is a country plagued by corruption through all of its republican history. Bribes and kickbacks are but the usual cost of doing business in Brasilia. Ever more confident in their impunity, politicians became even more audacious in their schemes and designs.

An escalating degree of corruption reached billionaire levels under the government of the Workers' Party (PT). Under president Dilma Rousseff and her predecessor, Luiz Inacio Lula da Silva, PT used Petrobras as a cash cow to finance the party’s project of power. They brought the economy to a halt and are now trying to get away with murder.

This time, however, society is fighting back. Independent judges and courageous investigators are finally going after politicians and businessmen, arresting the wealthy and bringing overdue justice to the powerful.

This is the narrative of "The Cleansing", if you will. The narrative that is bringing out to the streets a record-breaking number of Brazilians. This is the narrative pushing for the dismissal of PT's government.

The competing narrative may be called "The Persecution."

Brazil is a country ruled by elites since its foundation. It took Brazilian society 500 years after the arrival of the Portuguese to allow a popular lower-class politician to hold Brazil's highest office. Lula was the first true president of the people.

During PT's government, millions have been lifted out of poverty via social programs such as Bolsa Familia. These achievements are now threatened by that very elite that was displaced out of power.

A highly concentrated mainstream media has manipulated facts in order to taint Rousseff's government with corruption charges that are in no way exclusive to her administration and her party. An abusive judiciary has teamed up with an opportunistic congress. Together, they have collaborated to push the country to the brink of a coup d'état disguised as an impeachment process.

The dismantling of the current government would bring other corrupt politicians to power. Hit by an economic crisis beyond their control, Rousseff, Lula and the rest of PT must resist for the sake of the people, for the sake of the poor, for democracy.

This is the official government narrative, the narrative Lula tells supporters around the country, the narrative Rousseff has told the international press.

The Persecution framework has helped PT win decisive battles in the past. This time, however, the party is finding it more challenging to characterize itself as the democratic underdog. It is hard to sell an anti-elite discourse when you’ve been in government for 13 years.

When in opposition, PT was the leader of anti-corruption campaigns; now, it resorts to sharing the blame with old enemies and recent allies (often the same people). And although corruption is widespread within the country’s political establishment, as PT supporters claim, to equate the corruption scandal of a government controlled oil company under a PT controlled government with everyday bribery is to lose sense of proportions.

Estimated at $5.3 billion, the Petrobras scandal is the largest corruption scheme of modern democracy. Rousseff herself chaired Petrobras from 2003 to 2010, a period during which most of the company’s graft scheme took place. Her campaign manager is in jail for accepting illegal donations from construction companies.

There are also increasing evidences that, as the Public Prosecution Office has stated, Lula “was the final responsible party for the decision of Petrobras's directors and one of the main beneficiaries of its felonies." Rousseff's failed attempt at appointing Lula chief of staff, a move that would shield the former president from public persecution, did not help their case.

It is also hard to accept PT's comparison of an impeachment process with 1964’s military coup d’état. In 1992, PT led a successful campaign for President Collor’s impeachment, which was lauded as a victory for democracy.

As Supreme Court judges have recently assured the population, the impeachment process is constitutionally provisioned and, therefore, legal. "It is not a coup", said Supreme Dias Toffoli. "All democracies have processes of control, and the impeachment is a process of control."

One can hardly accuse Brazil's highest court of anti-government bias. Lula and Rousseff nominated 8 out of 11 judges currently sitting in the Supreme Court, including Mr Toffoli—who served as Lula da Silva’s attorney general before being appointed to the country’s highest court.

If impeachment was antithetical to democracy, PT would have lost their democratic credentials long ago. Prominent party members filed impeachment processes against every elected president in democratic Brazil, with only two exceptions: Lula da Silva and Dilma Rousseff.

In the battle of narratives so far, The Cleansing seems to have the upper-hand. A recent Datafolha poll shows 61 percent of Brazilians want Rousseff impeached, while 33 per cent are against it. Only 13 percent of Brazilians approve of her government. The intensity of discontent must also be taken into consideration. According to official sources, demonstrators in anti-impeachment marches across Brazilian cities accounted for only 7 percent of the number of participants in anti-government demonstrations.

Nevertheless, The Cleansing has its own set of problems. It amalgamates the legislature and the judiciary as the narrative's heroic protagonists, often forgetting they are separate powers with separate missions.

While the judiciary leads a crusade against corruption with the so-called Lava Jato operation, the impeachment process underway in Congress argues on other grounds of fiscal fraud. The people's blood might be boiling because of the Petrobras scandal, but the impeachment process against President Rousseff is based on accusations of budget tricks.

Besides, the cleansers have their fair share of dirt, which will not disappear if Rousseff shifts power to her vice-president, Michel Temer. His party, PMDB, is still embedded in corruption. Eduardo Cunha, a PMDB leader who sits as the House’s speaker and is second in the presidential succession line, may soon be judged by the Supreme Court for money laundering.

Even if the judiciary follows through with its takedown of corrupt politicians from all parties, it is not their role to govern the country. Judges will not propose budgets, prosecutors will not enact policies. Brazil will still need politicians to reform its bankrupt welfare state.

While Rousseff is spending her efforts building a self-serving narrative, the country is in the second year of what is arguably the worst recession in over a century. In 2015, 1.5 million Brazilians became unemployed, and over 3.7 million have impoverished. For this year, the government has already defunded eight out of the nine social programs introduced by Lula and Rousseff.

Narratives simplify reality in order to win hearts and minds, but the fix for Brazil's political and economic problems cannot overlook the complexity of policy reform. Whoever wins over the Executive must be able (and willing) to deliver the reforms that will unleash sustainable growth and cut the roots of corruption in Brazil.

In order to decrease reliance on political barter, the national government must reduce the supply for political handouts, by handing state owned companies over to independent entrepreneurs, as well as its demand, by introducing an entry clause that reduces the number of parties in parliament.

The country also needs to unlock barriers to its stagnated productivity with fiscal and labour reforms that will allow it to sustain measures of poverty alleviation. A good start for one of the most closed economies in the world would be for Brazil to open its market up to foreign investment, especially when it comes to infrastructure, a precarious and protected sector dominated by a handful of well-connected companies, now exposed by Lava Jato.

In the end, narratives must give way to real reforms. By preaching The Persecution narrative, PT is clinging onto power at the expense of the rule of law and the welfare of the people.

On the other hand, the anti-corruption rhetoric of The Cleansing narrative will not on its own solve the conundrum of achieving robust economic growth while sustaining social expenditures.

Corruption and fiscal irresponsibility will remain part of the government’s toolkit for as long as there is no clear path for structural changes and improvement of accountability mechanisms. Brazil has to move beyond narratives and treat corruption as a consequence and not only a cause of defective institutions.

Diogo Costa is a Ph.D. candidate in political economy at King's College London. Magno Karl is a Ph.D. candidate in political science at University of Erfurt.