Over the weekend, massive anti-government protests swept across the South American country of Brazil. Its citizens were calling for the impeachment of President Dilma Rousseff of the Socialist Workers Party (Partido dos Trabalhadores, PT). Less than a year into her second term, Rousseff’s support is down to single digits. Hundreds of thousands of Brazilians took to the streets throughout the country in response to a massive corruption scandal plaguing the state-run energy firm, Petrobras, and a drastic economic downturn after a decade of growth.
On June 29 and 30, Rousseff was in Washington to meet with President Obama. This came on the heels of a cancelled state visit to the U.S. in response to allegations of spying by the National Security Agency (NSA). The visit, originally intended to take place on October 23, 2013, was heralded as an opportunity to improve faltering relations between the two countries by bolstering economic ties. The leaders were set to discuss a host of issues, including energy opportunities for American companies and Brazil’s potential $4 billion purchase of Boeing fighter jets. The rescheduled visit was a downscaled affair and the leaders stuck to softer topics like “climate change, energy, educational exchanges, and science and technology.” Despite a successful visit, calls for Rousseff’s impeachment have only increased as the Petrobras investigation has continued.
What started off as an investigation into money laundering has turned into the largest corruption scandal in Brazil’s history. High-ranking executives from Petrobras are accused of accepting bribes in exchange for rigging contracts. Senior government officials, politicians, leading members of the national assembly, CEOs, and other lead executives have been arrested for their role in the scandal. Many have confessed to either accepting or giving bribes and engineering preferential contracts. Continued investigations are unearthing evidence against Rousseff’s predecessor, Lula da Silva, and he could face criminal action as well. According to prosecutors, the former president improperly used his influence to help the construction company at the center of the scandal, Odebrecht, secure contracts in Latin America and Africa. Silva’s close friend and Odebrecht CEO, Marcelo Odebrecht, was recently arrested.
Rousseff may manage to stay in office, but the prognosis does not appear to be good. She was re-elected last October in a hotly contested election by a slim margin; in less than a year, her approval ratings have slipped to the single digits, the lowest of any president since the early 1990s. This past weekend’s protest marked the third time large-scale demonstrations occurred against her administration. Brazil’s economic recession adds to her troubles. For the first time since the Great Depression, Brazil is facing two years of negative growth, 2015 and 2016. The scandal embroiling Petrobras, which is the country’s largest investor, is expected to withhold investments equaling 1 percent of gross domestic product. Support for Rousseff and her socialist party are largely based on massive government spending on social welfare programs. Necessary austerity measures will cut into these programs and Rousseff’s dwindling support base.
