Monday, 21 March 2016

Brazilian Government’s Unraveling Accelerates

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Events surrounding Brazilian President Dilma Rousseff (shown) and her alleged links to the “Operation Car Wash” investigation and scandal are moving so quickly that one can scarcely keep up. Just a week ago Sunday, more than three million Brazilians took to the streets demanding her ouster as a result of the scandal. On Tuesday Rousseff sought refuge by inviting her mentor and former President Luiz Inácio Lula da Silva (known as “Lula”) to become her chief of staff. She was banking on his remaining popularity to stuff her impeachment proceedings in the legislature while offering him — in a quid pro quo arrangement — protection from further investigation in the widening scandal because the position comes with virtual immunity from prosecution.

On Wednesday she formally announced his acceptance of the position, claiming that he would bring much-needed expertise to her administration in turning around Brazil’s foundering economy.

Later that same day Federal Judge Sergio Moro released to the media copies and transcripts of that Tuesday conversation (authorities had bugged Lula's phone), which made it clear that the offer to Lula and his acceptance had nothing to do with his economic expertise, but instead was designed to shield both of them from further “Operation Car Wash” troubles. Under Brazil’s rules, ministers have special legal status and can be indicted only by the Supreme Court — eight of the 12 justices were appointed by either Lula or Rousseff.

Another part of those transcripts released on Tuesday revealed a conversation Lula had with Rousseff’s former chief of staff, Jaques Wagner, in which Lula asked Wagner to have Rousseff intervene with one of those Supreme Court justices on his behalf.

That sparked more demonstrations, with protesters surrounding the capitol demanding once again Rousseff’s ouster.

On Thursday, during Lula’s swearing-in ceremony, Rousseff was defiant, declaring,

Current circumstances give me the magnificent chance of bringing to my government the biggest political leader in this country. Coup supporters won’t bring me to my knees.

On Friday a Supreme Court justice, Gilmar Mendes, issued an injunction preventing Lula from taking the post until the full court could make a final ruling on the matter.

In the interim, which could be quite brief, the injunction gives the chief prosecutor in the Operation Car Wash investigation a chance to issue an arrest warrant for Lula on charges of money laundering, influence-peddling, and other criminal behavior.

In his decision to release the damning tapes, which were played on TV stations across the country, Federal Judge Sergio Moro wrote that their release “will allow not just the right to ample defense by those [being] investigated, but also the healthy scrutiny [by] the public regarding the actions of [Rousseff’s] public administration.”

Judge Moro is indefatigable and undaunted in his efforts to push Operation Car Wash as far as it will go. Although he has, at this writing, not issued an arrest warrant for Lula, his past record of going after Brazilian corruption bodes ill for Lula. As this writer noted in a previous article in The New American on Operation Car Wash, “Moro helped prosecute corruption at Brazil’s state bank Banestado in 2001, which led to the sentencing of 97 bankers. He weighed in on Operation Farol Da Colina, where more than 100 players in money laundering, tax evasion, and other schemes were sent up,” adding,

At last count Operation Car Wash has investigated 232 individuals, with 179 of them being indicted and 84 of them being convicted. The scandal is spread like a cancerous network across the country and around the world, with at least four criminal enterprises involved in it [along with] sixteen Brazilian companies.

Adding to Rousseff’s woes came plea-bargain testimony on Tuesday from Senator Delcidio do Amaral, a prominent member of Rousseff’s Workers Party (allied with Brazil’s Communist Party), that accused Rousseff of having knowledge of the bid-rigging and pay-to-play schemes that Moro has uncovered, and claimed that she also “worked with her inner circle” to suppress Moro’s investigation — all of which Rousseff has continually and vehemently denied.

In addition, another high-level official in Rousseff’s administration told prosecutors, in his plea-bargain attempts to receive a lesser sentence, that Rousseff “tried to meddle in the [Operation Car Wash] investigation by naming a superior court judge whom she allegedly deemed to be amenable to releasing two jailed government contractors.”

In what must qualify as one of the understatements of the year, Leonardo Barreto, a political consultant in Brazil's capital of Brasilia, said that all this “news has reinforced the feeling that the end is near” for Rousseff and her far-left mentor, Luiz Inácio Lula da Silva.


A graduate of an Ivy League school and a former investment advisor, Bob is a regular contributor to The New American magazine and blogs frequently at, primarily on economics and politics. He can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it..


Related articles:

Brazil’s “Prince of Contractors” Sentenced to 19 Years for Corruption and Bribery

Investigators Circling Brazil’s President; “Sudden” Regime Change Likely

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