Brazil in Political Crisis: A New Interim President Comes to Power


2016-05-15 By Kenneth Maxwell

On Thursday May 12, 2016,  the Brazilian senate voted by 55 to 22 to begin an impeachment trail of Dilma Rousseff.

This means she was suspended from office and vice president Michel Temer was installed as interim president of Brazil.

The trial of Rousseff in the senate could last up to 180 days.

This will bring it close to the opening of the Olympic Games.

Dilma is unlikely to step down voluntarily.

Rousseff is well known for her obstinacy.

But she is also known for her courage in adversity.

Brazil's President Dilma Rousseff reacts during a meeting with leaders of the Social Democratic Party (PSD) at the Planalto Palace in Brasilia November 5, 2014. REUTERS/Ueslei Marcelino
Then Brazil’s President Dilma Rousseff reacts during a meeting with leaders of the Social Democratic Party (PSD) at the Planalto Palace in Brasilia November 5, 2014. REUTERS/Ueslei Marcelino

Brazil’s first female president claimes that she has been the “victim of a great injustice.”

She is accused of breaking budget laws to disguise the scale of the fiscal deficit during her re-election campaign in 2014: “I have made mistakes, but I have not committed any crimes.”

She is unlikely to be acquitted.

The balance of the votes are against her. But she is not charged with personal corruption.

The case against her involves her alleged manipulation of the budget. But this been an endemic practice by previous presidents, governors, and municipal leaders for decades.  In fact the accusations against her are political.

The decision to impeach her is a political act, which is the direct result of her abismal ratings of popularity.  The action is conducted within legalistic and constitutional mechanisms.

So it is not a “coup” as she claims.

But it is without question a “constitutional” removal from office of an elected president by a partisan congress, where she has lost support, and where her political enemies, many of them accused of corruption, have been calling the tune.

Acting president Michel Temer has moved quickly to install a new government.

The key figures in Temer’s government are the new finance minister, Henrique Meirelles, and Jose Serra, the new minister of foreign affairs.  Both men have presidential ambitions. Michel Temer, who is 75, will not run for office in the next presidential election which will take place in 2018.

Michel Temer is the interim President of Brazil. Credit Photo: Reuters
Michel Temer is the interim President of Brazil. Credit Photo: Reuters

Jose Serra is a long term leader in the main oppostion party (the PSDB). Serra was twice the presidential candidate of the PSDB in 2002 and 2010, when he was defeated by Luis Inacio Lula da Silva, of the workers party (PT).

Dilma, who was Lula’s handpicked candidate to suceed him, was twice elected president, also in opposition to a PSDB candidate, most recently, when she ran for a second term against Aecio Neves, also a leader of the PSDB, a former governor on Minas Gerais, and now a senator from Minas Gerais, and a leader of the impreachment against Dilma Rousseff.

Serra is a long term political leader in Sao Paulo, Brazil’s industrial, commercial, and financial capital, where he has served a mayor, governor, and was elected as senator. He has a PhD from Cornell university. Serra has quickly asserted his leadership of the foreign ministry by criticising the so-called “Bolivarian” states of Latin America, principally Venezuela and Cuba, for their claims that Dilma was removed by a coup. He will undoubtedly go on to criticise the BRICS, another major component of the PT’s foreign policy agenda. As a senator Serra also introduced legislation (which passed) to privatise Brazil’s offshore petroleum assets.

Henrique Meirelles, the new minister of finance, is a former long term president of Brazil’s central bank. During Lula’s two terms in office, he was an essential figure in establishing and retaining Brazil’s financial credibility for Lula when he first became president. Lula was a left-wing union organiser and PT founder and his election had been opposed by Brazilian business leaders.

But Lula gave Meirelles de facto autonomy at the central bank, and he presided over a time when Brazil experienced great prosperity as a result of high commodity exports, low inflation, the discovery of vast off shore petroleum reserves, and substantial social progress.

Meirelles is a fiscal hawk.

He has a PhD in economics from MIT, and he was for 28 years with BankBoston, where he became president and chief operating officer. He has also said he will appoint Ilan Goldfajn, chief economist at itau Unibanco, as the new head of Brazil’s central bank. Goldfajn is also a PhD in economics from MIT. He also worked as chief economist and risk manager for Gavea Investments in Rio de Janeiro, the company established by Arminio Fraga, who was the Brazilian Central Bank president under Fernando Henrique Cardoso. Arminio Fraga had previously worked with George Soros in New York City. Temer had wanted Fraga to be his finance minister, but he declined.

These appointments in the financial area, however,  will undoubtedly be very well received by the financial establishment in São Paulo, and more generally by the co-called “markets.” The “Financial Times” in fact called them the ideal “wishlist for investors.”

But who is Temer and what are the prospects for his administration?

Temer is a Brazilian career politician from São Paulo. He has twice been speaker of the chamber of deputies.

He is the son of Lebanese Christian immigrants, a lawyer, and constitutional law professor at the pontifical catholic university of São Paulo. He is also the author of a work of fiction “anonymous intimacy” and a collection of poems. But he is not well known by the public, nor is he popular. And there have been accusations against him for electoral improprieties and illicit funding of his campaigns.

He is best known for his marriage to Marcela Temer (32) who is 43 years younger than her husband, and is a statuesque former beauty queen who has “Michel” tattooed on her neck. The Brazilian weekly newsmagazine, Veja, a protagonist in the  impeachment debate, called Marcela Temer (approvingly): “Beautiful, maiden like, and a housewife.”(Bela, recatada, e “do lar”). Which only reinforced the popular reaction to Temer’s new cabinet which is all white and all male.  But then only 53 out of 513 Brazilian congressional representatives are women.

Michel Temer certainly has the insider skills of a long serving politician, but he also has all the faults of a long term “articulator” of the back room deals which characterize the “inside the beltway” mentality of Brazilian politics.

His choice of ministers reflects this pattern.

His first choice as minister of defence, for example, was representative Newton Cardoso Jr, the son of the former vice-governor of Minas Gerais. Newton Cardoso Jr had supported Dilma’s re-election, but he then voted for her impeachment. The army reacted with fury to this nomination. A general was quoted a saying that it was “incredible” that a “boy of 26 years old” would “command men of 60 at a critical moment of crisis on the eve of the Olympic Games.”

Temer retreated. Cardoso Jr was not appointed to be minister of defence.

But other ministers bring heavy baggage.

Temer’s first chose as minister of science was Marcos Pereira, an evangelical pastor, who is a “creationist.” Evangelical  Christians form an important bloc  in the congress. But again he was forced to retreat. But he did secure the agriculture ministry for senator Blairo Maggi of Matto Grosso, known as the “soya-king”. Maggi it is claimed was responsible for deforesting large tracts of the Amazon rain forest.

One thing is certain. Michel Temer’s honeymoon will be very short indeed.

His government faces formidable problems on many fronts:

Not least the worst recession in modern times.

Growing inflation.

Competing would-be presidential hopefuls in key positions in his administration.

Providing security for the rapidly approaching Olympic and para-Olympic games in Rio de Janeiro.

The continuing spread of Zika.

The on-going Petrobras investigations, plea bargaining and convictions (as well as other corruption scandals.)

And against this background the ongoing impeachment trail of Dilma Rousseff in the Brazilian senate, which for all her faults, omissions, misjudgments, and misgovernment, now risks becoming the trail of a wronged woman, pursued by middle aged, corrupt, and vengeful men.

But the new interim president of Brazil is the last man to realize the potency of this image.

Dilma defenestrated is much more powerful than Dilma in office.