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Brazil's Rousseff Faces Growing Impeachment Threat

  • Reuters

FILE - Demonstrators attend a protest against Brazil's President Dilma Rousseff, part of nationwide protests calling for her impeachment, at Paulista Avenue in Sao Paulo's financial center, Brazil, Aug. 16, 2015.

FILE - Demonstrators attend a protest against Brazil's President Dilma Rousseff, part of nationwide protests calling for her impeachment, at Paulista Avenue in Sao Paulo's financial center, Brazil, Aug. 16, 2015.

If the worst economic crisis in a decade, a massive corruption scandal centered on her ruling party and approval ratings in the single digits weren't rough enough for Brazilian President Dilma Rousseff, she's now faced with an angry rival who controls the possibility of impeachment proceedings against her.

Eduardo Cunha, the powerful speaker of Brazil's lower house of Congress, is Rousseff's sworn enemy and has been charged by her attorney general with taking millions in bribes in connection with a sprawling corruption scandal at state-run oil company Petrobras.

He's also the man who can call for an impeachment vote in the Chamber of Deputies against the president, an action that two-thirds of Brazilians say they want to see happen, according to polls.

‘On the high wire’

“Dilma is walking on the high wire without a net,” said Eliane Cantanhede, one of Brazil's best-known political commentators for the Estado de S. Paulo newspaper and Globo television. “Nobody knows what Cunha is going to do, and this situation is a double-edged sword for Dilma.”

Cunha, who has openly said he'll block important economic and political reform measures Rousseff wants to push through Congress, was weakened after federal prosecutors charged him last week with corruption, which “may be good for Dilma, because he's losing the political backing to push through impeachment,” Cantanhede said.

“But as a weakened figure, he also becomes a political suicide bomber, because nobody knows what he'll tell prosecutors,” she added. “Nobody knows what he knows.”

A few months ago, most analysts said the threat of impeachment against Rousseff was only a distant possibility.

She's not been accused of wrongdoing in the Petrobras case, in which dozens of federal deputies, senators and other top political figures are under investigation, along with some CEOs of Brazil's top construction and engineering firms who are already jailed. Prosecutors allege the kickback scheme involved roughly $2 billion in bribes paid by companies in return for grossly inflated building contracts over more than a decade.

But with an economy in recession, along with growing inflation and unemployment, Rousseff has the worst approval rating for any president since Brazil's return to democracy in 1985. Additionally, the top federal audit court is looking into whether she illegally used money from state banks to fill budget holes in 2014, and Brazil's top electoral court is investigating if any of the Petrobras kickback money was used to fund her re-election campaign last year, in which she won a narrow victory.

‘50-50’

If wrongdoing is found in either instance, that immediately opens a strong legal avenue for her opponents to begin impeachment proceedings against her in Congress.

“Right now, I'd say the chance of seeing impeachment proceedings is about 50-50,” said Marcos Troyjo, a professor of international affairs at Columbia University who runs its BRICS lab in Rio and is a former Brazilian diplomat. “And if you ask me tomorrow, those chances for impeachment may have grown.”

The “single most important element to determining whether impeachment goes forward” is what happens to Cunha, Troyjo said.

Cunha has two weeks to present his rebuttal to Brazil's Supreme Court, which alone can decide whether or not he will stand trial on the charges brought by the Attorney General Rodrigo Janot. Even so, he could remain in office until and if he's found guilty, a ruling that could take many years.

If he remains as speaker, yet faces trial, he's so politically damaged that it's unlikely he could muster the support for an impeachment vote, analysts said - meaning Rousseff may want him to twist in the wind for as long as possible. However, if he steps down under pressure from his Democratic Movement Party, known as the PMDB, it could be worse for Rousseff.

That's because Rousseff's vice president, Michel Temer, is the leader of the PMDB, a powerful party that has been the glue that's bound the Workers' Party ruling coalition since 2003, but now has many members calling for the party to leave it. The PMDB sees a real opportunity for the party to take the presidency in 2018, or, even more dangerously for Rousseff, now, as her impeachment would put Temer in the highest office.

‘Alignment of forces’

Political columns have been abuzz with speculation that Temer covets the presidency despite his public denials - and a decision he announced this week to stop acting as Rousseff's chief interlocutor with Congress further fueled close readings of the political tea leaves.

“If Cunha is driven away, that could bring about another speaker of the house who may be even more of an opposition figure to Dilma, and in that case you could see an alignment of forces,” Troyjo said. “You'd have a speaker who is both willing and able to put an impeachment process in motion, and a vice president who has decided himself that he wants to govern the country for the next three years.”

Running in Rousseff's favor is that many powerful sectors of society are beginning to see that any impeachment would make an already bruising economic environment downright poisonous - doubly so given the external shocks of China's stumbles, along with the bottoming out of the price of oil and other commodities that are important to Brazil's economy.

Two of Brazil's biggest newspapers - the Folha de S.Paulo and O Globo - have run editorials against impeachment unless Rousseff is found guilty of some crime, citing the economic, political and social destruction her downfall would unleash.

An impeachment based on “banal reasons would create internal instability and tarnish the nation's image in the eyes of the international community, that Brazil, in theory, overcame its banana republic phase,” the Folha de S.Paulo wrote in an editorial this week.

One of Brazil's most influential businessmen, Roberto Setubal, the head of the nation's largest private bank, Itau Unibanco, gave an interview to Folha in recent days in which he said removing Rousseff from office “would be terrible for the country.”

“From what I've seen until now, there is no rhyme or reason for impeachment,” he added.

“To the contrary, what we see is Dilma allowing a total investigation into the topic” of corruption at Petrobras, Setubal said. “Not long ago it would have been difficult to imagine such an independent investigation in Brazil. Dilma deserves credit for this.”

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