It's been a rough week for President Dilma. First, her embattled chief of staff quit in the midst of a corruption scandal, after she'd failed to take action and called in Lula to try to contain the political crisis. Palocci was one of Dilma's most trusted advisors, although it wasn't the first time he was accused of illicit activities; in 2006, he resigned as Lula's finance minister after being involved in the massive Mensalão corruption scandal, and he was also accused of corruption while he was mayor of Riberão Preto. Dilma's response was seen by some as slow and ineffective, and Lula's involvement was seen as a last-ditch attempt due to her own inability to handle the problem. Upon Palocci's departure, Dilma praised her outgoing chief of staff and confessed she was sad he was leaving.
Dilma chose a relatively unknown newcomer, Gleisi Hoffman, a senator from Paraná, to replace Palocci. Palocci was critical to Dilma's success since he was her power broker in the Lula style, while she could attend to the nitty gritty details of her government, as her style is much more bureaucratic and detail-oriented than Lula's. Now, it's up to Hoffman to prove she can take on the same role and effectively manage the complex array of relationships from the Palácio do Planalto. The media was quick to jump on the new advisor; she supports the Forest Code as it was passed by the House of Representatives, whereas Dilma wants to veto amnesty for illegal loggers. Political analysts say Dilma has to get it right quickly to reestablish order and legitimacy, and she will have to prove that she can step outside her comfort zone to deal with future conflicts more aggressively.
Meanwhile, the Supreme Court finally granted amnesty to accused Italian murder suspect and fugitive Cesare Battisti, and freed him after he spent nearly five years in Brazilian jail. The decision came after the STF had initally voted to extradite him, and then Lula granted him amnesty right before leaving office. This week's decision was to determine if Lula's decision was legitimate and if Battisti's extradition was legal. The 6-3 decision, filled with highly-charged nationalistic sentiment, the court changed its previous decision and even let him go. The trial itself seemed to be a bit surreal; one of the attorney general's arguments against extradition was that to judge extradition or amnesty is "judgement of supposition or hypothetical judgement, which does not need to be based on concrete facts." (I swear, really) The Italian government is up in arms, and judging by previous tensions with the case, it's likely to cause problems if Dilma or her government fail to find a way to smooth things over.
Plus, the decision was highly controversial amongst Brazilians, and some are angry that while a alleged murder was set free, hundreds of Rio firefighters remain in prison. The crisis has the potential to go national, and the Minister of Justice will meet with Rio officials to try to bring an end to the situation.
And finally, there's the economy. The real is still considered by some as the world's most overvalued currency, and inflation is still rising. (In this recent Bloomberg article, the owner of the Fogo de Chão churrascaria chain explained it's now cheaper to eat Brazilian barbecue in the US than in Brazil) The Central Bank raised interest rates again this week, the fourth time in an effort to reign in inflation, and more increases are expected. Dilma's government is under pressure to keep inflation in check in the midst of nationwide demands for higher salaries and an increased minimum wage.
Now is Dilma's chance to tackle these issues and get her administration back on track, and to prove that she can be both an effective administrator and power broker.
It's sad to see how biased you became since you returned to the US...
Inflation is not rising, it's declining:
http://exame.abril.com.br/economia/noticias/inflacao-semanal-diminui-nas-sete-capitais-pesquisadas-pela-fgv
Actually, Brazil has by far the highest real inteest rate in the world (interest rate - inflation); compare that to the *negative* real interest rate in the US and EU and how sustainable that is.
The firemen have been freed by now; see this poll also:
http://oglobo.globo.com/participe/vote/resultado.asp?pergunta=6392&javotou=False&editoria=4&resultado=1&exibir_resultado=S
Again, sad to see how your once balanced reporting is turning so sour since you're return to problem-ridden United States of America.
Note: I'm not Brazilian; I'm a citizen of problem-ridden Europe.
Posted by: Jake B | June 11, 2011 at 01:46 PM
PS cause and effect, start looking for causes of worldwide problems back home:
http://emsnews.wordpress.com/2011/06/08/opec-chaos-world-oil-inflation-due-to-us-money-printing/
Posted by: Jake B | June 11, 2011 at 01:53 PM
Hi Jake,
This post was written earlier in the week, before the firemen were freed. I'm not sure what the poll has to do with anything.
Inflation in Brazil is on the rise, it's a known fact. That article you posted is specifically about this past week, saying weekly inflation is down in 7 cities. Not at all the same thing.
I'm sorry to say you're quite mistaken.
Posted by: Rio Gringa | June 11, 2011 at 02:05 PM
1. Inflation *expectations are lowered for a *fourth* straight week:
http://www.sfgate.com/cgi-bin/article.cgi?f=/g/a/2011/05/30/bloomberg1376-LLVBWP0D9L3501-6LMA11Q88N8FVSB6QURPBFLO4I.DTL
"Brazilian economists lowered their 2011 inflation forecast for a fourth straight week as the cost of raw materials eased."
You claim "Brazil inflation is on the rise". So that means you are as sure as can be that 2011 inflation of Brazil will top 7% (it is now 6,23%)? Or what?
Inflation in Belgium is now 3,2%; that is a delta of 3% compared to Brazil, a historic low. Yet, GDP growth in Belgium is anemic compared to growth in Brazil.
You could do the same exercise for the US: take the historic delta between US inflation versus BR inflation and compare that with the delta between US GDP growth and Brazil GDP growth: put that in a graph and then tell your readers where things are worsening: Brazil, Belgium, the US,...
Tá claro?
2. The poll simply outlines that your sensational lines are hollow:
"The crisis has the potential to go national, and the Minister of Justice will meet with Rio officials to try to bring an end to the situation."
Besides, I wished firemen in Belgian would go on the streets to demand a wage raise from 413 € (950 R$) to 890 €. Quite not possible, they already earn +1.800 €. If they go on the streets in Europe it's to protest against the extention of the pension age from 55 to 62 and beyond. Choose yourself which side you prefer to be on.
Paz e Amor.
Posted by: Jake B | June 11, 2011 at 04:48 PM
Gringa, your May 13 biased post also needs an update.
"Every so often, a story will come out in the American or European media about the World Cup and Olympics preparations in Rio. Sometimes, it's about how things aren't going quickly enough ...".
Nono, this time it's actually about the IOC officials being happy with the preparations of the 2016 games":
Today in Sports Illustrated
http://sportsillustrated.cnn.com/2011/more/06/10/ioc.happy.rio.games.2016.ap/index.html#ixzz1P0En45ZS
"IOC officials left Rio de Janeiro impressed by preparations for the 2016 Olympics, saying the city had made great strides on its infrastructure projects."
Understand why I point to that irritating one-sided tone; why not compare the US where you life in and Brazil you visited in a such more objectivated way instead of critizing so unidimensional from the other side?
Posted by: Jake B | June 11, 2011 at 04:54 PM
I glossed over that Al Jazeera post on the decision regarding Battisti. And it doesn't seem the author believes nationalism had anything to do with the court's attitude. In fact, he adduces realist calculations - the opposite of nationalism - as one of the factors behind the decision. And why should nationalism be involved in the court's decision regarding a man who's not even Brazilian and whom the overwhelming majority of Brazilians don't care about either way? It should be reminded that, when Salvatore Cacciola - a banker charged with fraud - fled Brazil for Italy, the Italians also refused to send him back (he was a dual Brazilian and Italian citizen). He was only sent for trial in Brazil after he briefly left Italy for Monaco. Thanks Princess Caroline and Interpol!
As for inflation, it should be noted that this is not a Brazilian problem only. Many countries around the world, even the slow growing ones such as the UK and Japan, have experienced it. This has much to do with financial manipulations in the capital markets. Be that as it may, Brazilian inflation remains high only on an annual base. Monthly inflation, however, has been falling since February. See the IPCA index on the IBGE website.
Posted by: RFS | June 11, 2011 at 07:47 PM
You are actually not letting through my previous 2 comments; censorship? Why?
Posted by: Jake B | June 12, 2011 at 10:07 AM
Jake, honestly I'm not sure how to respond. Please be patient with comments as I do not check them more than once a day. What I do is take the news and comment on it. Sometimes I compare things to the US, sometimes I don't, but lately I haven't been. I think that's an important distinction to make because I DO want to focus on Brazil and what's going on there, rather than constantly compare it to the US or Europe. Things in the US are a hot mess, but there are plenty of talented bloggers already writing about it. I leave that to them. This has nothing to do with "taking sides" at all. I take real stories and comment on them -- I'm not into romanticizing, I'm into reality.
@RFS thanks for the tip about IBGE, I'll check it out for my update this week.
Posted by: Rio Gringa | June 12, 2011 at 12:16 PM