2016-03-09 By Kenneth Maxwell
At 6am on Friday morning, March 4, 2016,, Brazilian armed federal police officers arrived at the home in the outskirts of São Paulo, of the former president of Brazil, Luiz Inacio Lula da Silva, better known to Brazilians and internationally simply as “Lula.”
On Tuesday of this week, the president of Oderbrecht, one of Brazil’s largest multinational corporations, Marcelo Oderbrecht, was sentenced to 19 years and four months in prison by federal judge Sergio Moro for his involvement in the vast Petrobras kick back scandal.
Lula had left office with very high levels of public approval, and his period in office was seen as a triumph for a poor working class boy, who had never had a formal education, but who had pioneered a union movement and a worker’s party, and who had been democratically elected twice as president of Brazil.
His term in office had been marked by innovative social programs, which had lifted many millions of Brazilians out of chronic and extreme poverty.
He had been so popular that he had, in effect, placed is chief of staff, Dilma Rousseff, in the presidency as his successor.
The Brazilian federal police took Lula in for questioning at the federal police offices at São Paulo’s international airport on the order of Brazilian Federal Judge Sergio Moro who has been heading the probe into the Petrobras scandal.
Lula was questioned for three hours, apparently about his ownership of a luxurious beachfront penthouse he has been given by several leading construction companies who had dealings with Petrobras, as well as a luxurious rural property.
Also involved in the continuing investigation are 20 other individuals, in addition to Lula, including his sons and his wife, and the head of the Instituto Lula, his post-presidential institute in São Paulo, as well as 32 businesses, including major Brazilian construction companies with dealings with Petrobras.
Judge Moro has been conducting a wide ranging investigation into the massive corruption scandal at Petrobras, the Brazilian state controlled petroleum multinational.
The investigation, which is called “car wash,” and has been in action for two years now, is named after the initial case, which began as an inquiry into small time money laundering of illicit gains through Petrobras’s network of gas stations.
To date many leading politicians and businesspeople have been arrested, including the head Odebrecht, Brazil’s largest multinational construction, insurance, and petrochemical companies, which has been involved in major construction activities in Florida, Cuba, Portugal and Angola, as well as in other counties throughout Latin America and Europe.
The former treasurer of the Lula’s political party, the worker’s party (PT), is also held by the Brazilian federal police.
All are presumed involved in the massive, multifaceted, billion dollar, international money laundering, kick back, and bribery scheme, involving Petrobras, and interconnections between major Brazilian construction companies and corrupt politicians, and political parties, and campaign funds.
So far 127 people have been arrested and 48 have plea bargained.
And the scandal is moving closer every day towards the very heart of the Brazilian government.
The interrogation of Lula followed the arrest and imprisonment of the PT’s leader in the senate, Delcidio Amaral, who has apparently (it is claimed in the media ) implicated Lula, and his chosen protégée and successor, president Dilma Rousseff, of attempting, like Richard Nixon, to thwart the “lavro jato” investigation.
But the leader of the PT in the congress, Jose Guimaraes, has now called his party and their union allies to the streets to protest. “It is war” he said,”not physical war, but a political war.
We are not going to allow a handful of prosecutors to impose a coup.” Lula was, and probably is still, a formidable street fighter. And Lula has returned to the battle lines claiming he is being unjustly persecuted.
He has threatened to call on the “army of Stedile” who is leader of the landless workers movement, the MST, in a throwback to the “Ligas Camponeses”, the leagues of rural peasants, organised by Francisco Juliao in the arid backlands of the North East of Brazil during the 1950s and 1960s, and which were a major perceived threat to the established order in the run up to the military coup of 1964.
But today the real threat of disorder lies on the street of urban Brazil, and already both sides are organising large demonstrations this Sunday.
The Governor of São Paulo, a leader of the major opposition party, the PSDB, Geraldo Alkmin, has banned a large demonstration called the PT and its union allies on the Avenida Paulista, São Paulo’s principal thoroughfare.
But the interrogation of Lula and the sentencing of Marcelo Oderbrecht, who could well implicate Lula and president Rousseff as part of a plea bargain, moves the political crisis in Brazil to a new level, unseen since the mid-1950, when president Getulio Vargas, facing an excruciating complex of political and military opposition, committed suicide, and Brazil moved inexorably towards two decades of military dictatorship. No one is talking today of a new military intervention to be sure.
But Brazil is facing a very dangerous political impass with a dysfunctional administration, a paralysed politics, and no clear or acceptable political solution on the horizon. The talk of the impeachment of Dilma has undoubtedly gained strength.
But the alternatives to Rousseff are mediocre at the best, and down right bad at the worst. The second in line is the Vice President, Michel Temer, a colourless centrist from the PMDB, a long time politician from the main centrist political party, and so far a (very distant and very rarely consulted) ally of president Rousseff.
The president of the lower house of congress, Eduardo Cunha, the third on line of secession, an evangelical, also from the PMDB, if Dilma is forced to step down, is also facing serious corruption accusations, and attempts to remove him from office are underway.
But Eduardo Cunha is a tenacious manipulator of congressional rules in his own interest.
And he will not go easily.
In the face of political deadlock, the Brazilian stock market, nevertheless, soared on the news of Lula’s interrogation.
But it is a false dawn.
The financial markets have never liked Lula and the PT in any case.
Nor has much of the middle and upper classes of the south and centre of the country which has loudly calling for the arrest of Lula and the impeachment of Dilma Rousseff for some time now.
But the truth is that Brazil is facing the most severe economic downturn in over 50 years.
The low price of petroleum only adds to Petrobras’s and Brazil’s problems. The slown down in China, which is now Brazil’s largest trading partner, aggravates Brazil’s dismal international prospects.
And the rapid spread of the Zika virus in Brazil confronts an abysmally inadequate and underfunded system of public health. The chronic pollution of the Guanabara bay in Rio de Janeiro, where many of the Olympic Games sailing events are scheduled to take place this August, has worried potential international competitors for months.
And there are still persistent doubts about the completion in time of all the promised Olympic facilities and transportation links.
It is the perfect storm, and it is not over by any means.
It is often said (by Brazilians) that “God is a Brazilian.”
But if so, God (She or He) has self-evidently, not been paying much attention recently to events in Brazil.