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Brazil's government in crisis – the Guardian briefing Why is Brazil's government in crisis? – the Guardian briefing
(35 minutes later)
What’s the story?What’s the story?
Tens of thousands of Brazilians took to the streets on Wednesday to protest against the government, as a gathering corruption scandal threatened to engulf the president and her predecessor.Tens of thousands of Brazilians took to the streets on Wednesday to protest against the government, as a gathering corruption scandal threatened to engulf the president and her predecessor.
Earlier Dilma Rousseff appointed Luiz Inácio “Lula” da Silva as her chief of staff, in what was widely seen by her critics as an attempt to shield him from prosecution over alleged corruption and money-laundering. Under Brazilian law, only the supreme court can authorise the investigation, imprisonment and trial of cabinet members.Earlier Dilma Rousseff appointed Luiz Inácio “Lula” da Silva as her chief of staff, in what was widely seen by her critics as an attempt to shield him from prosecution over alleged corruption and money-laundering. Under Brazilian law, only the supreme court can authorise the investigation, imprisonment and trial of cabinet members.
Hours after Lula’s appointment, a judge investigating a corruption scandal at the state-run oil company Petrobras released a number of secretly taped phone calls between Lula and Rousseff, which appeared to suggest that the job offer had indeed been made to protect the former president.Hours after Lula’s appointment, a judge investigating a corruption scandal at the state-run oil company Petrobras released a number of secretly taped phone calls between Lula and Rousseff, which appeared to suggest that the job offer had indeed been made to protect the former president.
The demonstrations are only the latest in a swelling tide of unrest. On Sunday an estimated three million people joined rallies across the country in protest at Rousseff’s beleaguered government, which is also grappling with Brazil’s worst recession in a century. The demonstrations are only the latest in a swelling tide of unrest. On Sunday an estimated 3 million people joined rallies across the country in protest at Rousseff’s beleaguered government, which is also grappling with Brazil’s worst recession in a century.
Who are the key players?Who are the key players?
Rousseff, an economist and former socialist activist who was imprisoned during Brazil’s military dictatorship, was elected as president in 2011. She had previously acted as chief of staff to Lula for part of his eight-year presidency, and the two have remained close political allies.Rousseff, an economist and former socialist activist who was imprisoned during Brazil’s military dictatorship, was elected as president in 2011. She had previously acted as chief of staff to Lula for part of his eight-year presidency, and the two have remained close political allies.
Rousseff has never attained the huge popularity that her predecessor commanded, and has been fighting off potential impeachment proceedings over alleged fiscal mismanagement in office. The supreme electoral court has been looking into possible campaign funding irregularities that could end up annulling her 2014 re-election.Rousseff has never attained the huge popularity that her predecessor commanded, and has been fighting off potential impeachment proceedings over alleged fiscal mismanagement in office. The supreme electoral court has been looking into possible campaign funding irregularities that could end up annulling her 2014 re-election.
Lula, as he is universally known in Brazil, is a former union leader who was named the world’s most popular politician when he left office in 2011. But the sprawling Petrobras scandal, in which dozens of prominent politicians have been caught up, threatened to engulf him, too, and this month his home was raided after allegations that he received political favours from companies now under investigation. The former president accuses prosecutors of launching a politically motivated campaign against him.Lula, as he is universally known in Brazil, is a former union leader who was named the world’s most popular politician when he left office in 2011. But the sprawling Petrobras scandal, in which dozens of prominent politicians have been caught up, threatened to engulf him, too, and this month his home was raided after allegations that he received political favours from companies now under investigation. The former president accuses prosecutors of launching a politically motivated campaign against him.
What is the Petrobras scandal?What is the Petrobras scandal?
In a two-year investigation known as Operation Carwash, prosecutors have uncovered what they say is a huge kickback and bribery scheme at the oil giant, which has become the biggest corruption scandal in Brazil’s history.In a two-year investigation known as Operation Carwash, prosecutors have uncovered what they say is a huge kickback and bribery scheme at the oil giant, which has become the biggest corruption scandal in Brazil’s history.
They allege that senior figures at Petrobras conspired with construction companies to inflate the value of contracts. Much of the extra revenue was allegedly funnelled to political parties, including Lula and Rousseff’s leftwing Workers’ party, to fund election campaigns.They allege that senior figures at Petrobras conspired with construction companies to inflate the value of contracts. Much of the extra revenue was allegedly funnelled to political parties, including Lula and Rousseff’s leftwing Workers’ party, to fund election campaigns.
Dozens of politicians and executives have been caught up in the scandal, including Marcelo Odebrecht, a former head of South America’s largest construction firm, who this month was jailed for 19 years for bribery and money-laundering in relation to a system of kickbacks that his company allegedly paid to senior Petrobras executives.Dozens of politicians and executives have been caught up in the scandal, including Marcelo Odebrecht, a former head of South America’s largest construction firm, who this month was jailed for 19 years for bribery and money-laundering in relation to a system of kickbacks that his company allegedly paid to senior Petrobras executives.
Why is it so important?Why is it so important?
Brazil’s economy shrank by 3.7% last year, and forecasts for 2016 are similarly gloomy. The uncertain state of its largest oil company and the construction companies caught up in the scandal will not help.Brazil’s economy shrank by 3.7% last year, and forecasts for 2016 are similarly gloomy. The uncertain state of its largest oil company and the construction companies caught up in the scandal will not help.
The scandal also offers a further threat to the presidency of Rousseff, who initially avoided being personally touched by the Petrobras allegations despite having been chair of Petrobras from 2003-10, when much of the corruption is alleged to have taken place.The scandal also offers a further threat to the presidency of Rousseff, who initially avoided being personally touched by the Petrobras allegations despite having been chair of Petrobras from 2003-10, when much of the corruption is alleged to have taken place.
It threatens to shake much of Brazil’s political class; as well as Rousseff and Lula, Brazil’s vice-president, the speaker of the house, the president of the senate and the main opposition leader have all been accused of involvement.It threatens to shake much of Brazil’s political class; as well as Rousseff and Lula, Brazil’s vice-president, the speaker of the house, the president of the senate and the main opposition leader have all been accused of involvement.