Brazil already resembled a sinking ship, and now with impeachment proceedings against President Dilma Rousseff, the crew has declared a mutiny against its captain.
A triple-decked storm of deep recession, a gargantuan corruption scandal and the launch of a formal effort to push Rousseff from office has left Brazil asking how low it can go.
"The image of Brazil could not be worse," said independent political analyst Andre Cesar. "A country with no direction, drifting, with no one in command, and where the captain has disappeared."
Just a few years ago, Brazil was hailed as an investor's paradise and model of social justice, with some 40 million poor being raised into the middle class. The country of 204 million people hosted the World Cup in 2014 and Rio was named host of next year's Olympic Games.
Today, nothing is going right for the Latin American giant.
The world's seventh biggest economy is in deep recession, with third quarter GDP down 4.5 percent year-on-year, and warnings that the slump will turn into outright depression -- the worst since the Great Depression of the 1930s.
A bribes and kickbacks scandal centered on state oil major Petrobras expands relentlessly, sucking in politicians and top executives, with the latest to face charges being a leading senator and a billionaire banker.
Now the battle to oust Rousseff is transforming what had been merely months of political paralysis into what a senior member of the president's leftist Workers' Party, Siba Machado, calls "war."
Rousseff "is at her lowest point in five years of the presidency and she has few political weapons to defend herself with," Cesar said.
- Splintered nation -
This vast country, often called a continent within a continent, always struggled to unify. Racism, shocking disparities in wealth, and simply the challenging geography feed divisions among Brazilians.
The start of impeachment proceedings against Rousseff, whose leftist party has been in the ruling coalition since 2003, is dramatically laying bare those dividing lines.
The last time a president was impeached -- Fernando Collor de Mello in 1992 -- there was "consensus among the political elite on the need for this," said Rubens Figueiredo, at the University of Sao Paulo. "That doesn't exist today."
Collor de Mello was accused of serious corruption and resigned even before the impeachment trial finished.
Rousseff, however, is accused of illegal accounting practices to mask budget holes -- not actually stealing.
Further muddying the waters, her principal antagonist, lower house Speaker Eduardo Cunha, is himself facing criminal charges of taking bribes and stashing money in secret Swiss accounts.
"What's the point of getting rid of Dilma if the others remain there?" asked O Globo newspaper columnist Cora Ronai. "What's the point of a supposedly moralizing process when it's born in the most disgusting mud possible?"
Both the Workers' Party and the main opposition PSDB party promise street demonstrations to claim that moral high ground.
"The streets will naturally mobilize now," said Aecio Neves, the center-right senator whom Rousseff narrowly beat in 2014 to win her second term -- a bitter election that set the groundwork for the current impasse.
- Economic tears and cheers -
Analysts say an impeachment struggle could go on as long as six or seven months, potentially close to the eve of the August Olympics in Rio.
That bodes ill for an economy already hamstrung by Rousseff's inability to persuade Congress to cooperate on spending cuts and tax raises aimed at stabilizing the budget and luring back investors.
The decision by Standard and Poor's ratings agency in September to cut Brazil's credit rating to junk status was not enough to shock legislators into action.
Now gridlock is expected to strengthen, while Rousseff's already weak grip on power is expected to slip further.
"Paralysis will continue and get worse. She can't approve anything in Congress. She has zero governability," said David Fleischer, a political science professor at Brasilia University.
Despite that scenario, stocks on the Sao Paulo index shot up four percent on opening Thursday. The reason? Any change is better at this point.
"These are very painful processes in the short term, they cause a lot of paralysis, many uncertainties for the economy, but we think they will be very positive in the medium and long term," said Andre Leite from TAG Investimentos.
"Brazil has been paralyzed these last 12 months. 2015 was a lost year, a year when Brazil did absolutely nothing and anything which can get us out of that paralysis is very positive."
Brazil already resembled a sinking ship, and now with impeachment proceedings against President Dilma Rousseff, the crew has declared a mutiny against its captain.
A triple-decked storm of deep recession, a gargantuan corruption scandal and the launch of a formal effort to push Rousseff from office has left Brazil asking how low it can go.
“The image of Brazil could not be worse,” said independent political analyst Andre Cesar. “A country with no direction, drifting, with no one in command, and where the captain has disappeared.”
Just a few years ago, Brazil was hailed as an investor’s paradise and model of social justice, with some 40 million poor being raised into the middle class. The country of 204 million people hosted the World Cup in 2014 and Rio was named host of next year’s Olympic Games.
Today, nothing is going right for the Latin American giant.
The world’s seventh biggest economy is in deep recession, with third quarter GDP down 4.5 percent year-on-year, and warnings that the slump will turn into outright depression — the worst since the Great Depression of the 1930s.
A bribes and kickbacks scandal centered on state oil major Petrobras expands relentlessly, sucking in politicians and top executives, with the latest to face charges being a leading senator and a billionaire banker.
Now the battle to oust Rousseff is transforming what had been merely months of political paralysis into what a senior member of the president’s leftist Workers’ Party, Siba Machado, calls “war.”
Rousseff “is at her lowest point in five years of the presidency and she has few political weapons to defend herself with,” Cesar said.
– Splintered nation –
This vast country, often called a continent within a continent, always struggled to unify. Racism, shocking disparities in wealth, and simply the challenging geography feed divisions among Brazilians.
The start of impeachment proceedings against Rousseff, whose leftist party has been in the ruling coalition since 2003, is dramatically laying bare those dividing lines.
The last time a president was impeached — Fernando Collor de Mello in 1992 — there was “consensus among the political elite on the need for this,” said Rubens Figueiredo, at the University of Sao Paulo. “That doesn’t exist today.”
Collor de Mello was accused of serious corruption and resigned even before the impeachment trial finished.
Rousseff, however, is accused of illegal accounting practices to mask budget holes — not actually stealing.
Further muddying the waters, her principal antagonist, lower house Speaker Eduardo Cunha, is himself facing criminal charges of taking bribes and stashing money in secret Swiss accounts.
“What’s the point of getting rid of Dilma if the others remain there?” asked O Globo newspaper columnist Cora Ronai. “What’s the point of a supposedly moralizing process when it’s born in the most disgusting mud possible?”
Both the Workers’ Party and the main opposition PSDB party promise street demonstrations to claim that moral high ground.
“The streets will naturally mobilize now,” said Aecio Neves, the center-right senator whom Rousseff narrowly beat in 2014 to win her second term — a bitter election that set the groundwork for the current impasse.
– Economic tears and cheers –
Analysts say an impeachment struggle could go on as long as six or seven months, potentially close to the eve of the August Olympics in Rio.
That bodes ill for an economy already hamstrung by Rousseff’s inability to persuade Congress to cooperate on spending cuts and tax raises aimed at stabilizing the budget and luring back investors.
The decision by Standard and Poor’s ratings agency in September to cut Brazil’s credit rating to junk status was not enough to shock legislators into action.
Now gridlock is expected to strengthen, while Rousseff’s already weak grip on power is expected to slip further.
“Paralysis will continue and get worse. She can’t approve anything in Congress. She has zero governability,” said David Fleischer, a political science professor at Brasilia University.
Despite that scenario, stocks on the Sao Paulo index shot up four percent on opening Thursday. The reason? Any change is better at this point.
“These are very painful processes in the short term, they cause a lot of paralysis, many uncertainties for the economy, but we think they will be very positive in the medium and long term,” said Andre Leite from TAG Investimentos.
“Brazil has been paralyzed these last 12 months. 2015 was a lost year, a year when Brazil did absolutely nothing and anything which can get us out of that paralysis is very positive.”
