Scandal Frazzles Brazil’s Congress : Corruption: Public is outraged at allegations. Lawmakers are in a panic.
BRASILIA, Brazil — Aloizio Mercadante was walking into the Chamber of Deputies’ dining room for lunch when a fellow congressman, visibly worried, waylaid him for urgent, hushed consultations. The man was afraid of being implicated in Brazil’s “Budget Mafia” scandal, Mercadante explained.
“All day I have that problem here,” he said later. “They come in, wanting to know if they are involved or if they aren’t.”
Mercadante is the chairman of an important subcommittee of a special congressional commission investigating the Budget Mafia. The commission, formed in October, has turned up evidence that a secret network of Congress members and other officials made allocations for public works and phony charities, in exchange for big campaign contributions and kickbacks.
Published lists of officials allegedly involved in the corruption have sparked public outrage and sowed “panic and tension” among many lawmakers, Mercadante said. “They are in a French Revolution whose guillotine is public opinion.”
Earlier this month, the panic and tension pulsated through congressional halls as the investigative commission prepared to hear testimony from Paulo Cesar Farias, a round-faced, balding businessman known as “P.C.”
Farias was former President Fernando Collor de Mello’s campaign treasurer. A congressional investigation last year of P.C.’s activities turned up evidence of massive corruption--influence-peddling, bid-rigging, kickbacks, bribes--and led to Collor’s impeachment and resignation.
After fleeing the country and getting expelled from Thailand, Farias is now under arrest here. His wife has warned that he could incriminate 160 people in corrupt activities. But when P.C. was brought in to testify to the investigative commission Friday, he gave no names or evidence linked to the Budget Mafia.
Even without a new list of tarnished names from him, Brazil is being forced as never before to openly face the deep, dirty truth about a rotten political system.
Mercadante said the Congress is under strong pressure not only to expel corrupt members but to promote a “deep reform of the Brazilian state. We have to reformulate the budget laws, electoral and party legislation. . . . It doesn’t do any good to simply hunt down the flies and leave the filth.”
With a population of 160 million, Brazil has the world’s 10th- or 11th-largest economy--right up there with China. But official control over corruption, fiscal order and the monetary system is so lax that rampant inflation of 30% a month and more has become the norm, severely limiting development.
Some analysts estimate that corruption costs Brazil billions of dollars a year, making it a huge drain on resources and an important cause of inflation. “It is a monstrous thing,” Mercadante said.
Many Brazilians see a link between corruption and inflation, and this is not the first time politicians have felt the heat. In the 1989 presidential campaign, well-known candidates tasted rejection as fed-up voters put dark-horse candidate Collor and leftist Luis Inacio Lula da Silva into a runoff.
Collor beat the bearded star of the Workers’ Party amid fears of Marxist influence. Then, less than three years later, Collor dashed the nation’s hopes for clean, efficient government.
Now, Lula is way ahead in opinion polls taken to test the waters for next October’s first round of presidential elections. If the economic crisis and the corruption scandal are not resolved to the masses’ satisfaction, Lula is likely to harvest a bumper crop of protest votes.
Most analysts agree that today, nearly nine years after the armed forces gave up power in Brazil, democracy faces much more than another mega-scandal, another economic crisis and another election campaign. The current confluence of events highlights the need for changes in the deeply flawed political system that averts reform, keeping the country in perpetual frustration, unable to fulfill its potential as a prosperous and powerful democracy.
Opportunities for change arise on three main fronts:
* Besides pursuing an investigation that could lead to exemplary purges and punishments, the Congress is due to write a package of constitutional amendments, which many hope will strengthen administrative, financial and political components of the ailing body politic.
* Early in December, the government announced an innovative economic stabilization plan that could, many economists say, tame the inflation that is bleeding Brazil.
* The 1994 elections for president, Congress and state governorships give voters a chance to choose more responsible, capable leadership in a climate that favors throwing rascals out.
The Budget Mafia scandal started after police arrested Jose Carlos dos Santos, a former budget official, on suspicion of killing his wife and hiding her body. He denied killing his wife but began talking freely in October about corruption in the congressional budget committee.
Since then, the 44-member congressional investigative commission has been interrogating witnesses and going through financial records to pin down corruption charges, making things hot for dozens of congressmen and other officials.
Things also have got gotten hotter for Dos Santos. Two men confessed to killing his wife, Ana, on his orders. The confessed killers led police to her hidden grave. According to an initial confession by one, they dug the grave, hit her with a pickax and began burying her before she was dead.
Police detectives have said they believe Dos Santos had his wife killed after she threatened to tell authorities about his involvement in the Budget Mafia, unless he broke off an affair with another woman.
Dos Santos claims the killing was ordered by corrupt Congress members.
Many people suspected the budget corruption Dos Santos revealed, but his statements offered the first known verifiable evidence.
“If he didn’t talk, things would go on as usual--business as usual,” said Luiz Pedone, a professor of political science at the National University of Brasilia.
“I don’t think Congress can avoid taking the political mandates of at least 15 or 20, maybe 30” of its members, he said, adding, however, that he thinks the Congress will protect members who were only marginally involved in the corruption.
As if to show that the Congress means business, the Chamber of Deputies expelled three of its members for seeking bribes to switch political parties.
Pedone said it is too early to tell who might benefit most from the scandal in next year’s elections. But he noted that Lula of the Workers’ Party is a strong contender.
Lula never finished high school. But he is known as a consummate politician with a gift for negotiating and a record of picking able advisers. His main economics adviser is Mercadante, a former university professor.
Both Lula and Mercadante belong to their party’s moderate wing, which advocates policies similar to those of European Social Democrats. Another wing, however, is staunchly Marxist-Leninist “with a Stalinist vision of society,” according to Pedone.
While Lula courts centrist voters, the party’s radicals will be kept in the background, Pedone said. “They will stay quiet in Lula’s campaign, but they are not dead.”
One politician seen as a potentially successful rival to Lula is Finance Minister Fernando Henrique Cardoso, who introduced the government’s new economic stabilization plan.
“If this plan is successful, he is a strong candidate,” said Congressman Jose Anibal, a member of Cardoso’s Brazilian Social Democratic Party. But if the austerity measures announced by Cardoso bring new pain to Brazil’s already suffering majority without curbing inflation, he will be an unattractive alternative to Lula.
Many Brazilians recall that the country’s 1964 coup, which started 21 years of military rule, was against a less-leftist president than Lula. Some foresee problems with conservative officers if Lula wins.
But Pedone argued that many of his party’s official views are shared by army commanders. For example, the party platform recognizes free enterprise as the main motor of economic development and welcomes foreign capital, while it says government should retain ownership of strategic industries such as petroleum, electricity and telecommunications.
“That’s why I don’t think the military would make a coup,” Pedone said.
More immediate are reports of army unrest over the political crisis caused by the current corruption scandal. Generals are said to worry that scandal has preoccupied the administration of President Itamar Franco and the Congress at a time when economic problems require full and urgent attention.
But Gen. Benedito Bezerra, the army chief of staff, said recently, “Our option is for democracy.” He said the scandal is temporary and “represents the purification of institutions.”
That clean sweep, however, is not assured in Brazil’s legal system. Collor, who faced corruption allegations when impeached last December and barred from political office for eight years, has yet to stand trial on any criminal charges.
This month, the Supreme Court split 4-4 on his appeal against the congressional action barring him from office. But a Superior Court panel decided the issue Thursday against Collor, reaffirming the ban. Criminal charges against Collor are pending.
Whether Brazil’s mega-scandals end up putting any politicians in jail, Mercadante said the congressional campaign against corruption is worth the crisis it has caused.
“I believe we are living a moment of risks to the democracy and institutions, and also a moment of great opportunity for rechanneling democracy and the citizenry and for promoting changes that have been awaited for a long time in Brazilian history,” he said. “It is a moment for renovation.”
Long was recently on assignment in Brazil.
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