Thursday, May 26, 2016

José L. Flores — Wall Street’s New Man in Brazil: The Forces Behind Dilma Rousseff’s Impeachment

This fight is not about Dilma Rousseff or corruption; the government would not impeach a corrupt president only to install a more corrupt president. This drama isn’t even about the political parties, all of them are corrupt. The problem is for the last thirteen years the Workers’ Party, with all its faults, has been implementing social welfare and safety net programs for the poor and was paying for it on the dime of Petrobras.
Brazil is the richest and most influential country in South America and for that reason is a primary target for U.S. economic control. If neoliberalism is not implemented in Latin America, what Washington considers its backyard, countries like Brazil will seek independent paths, regardless of U.S. capital and investments. This is always unacceptable to the United States’ imperialist policies and to the proxy leaders it uses for self-aggrandizement and profit.
A worse sin was BRICS, RC in particular.

Counterpunch
Wall Street’s New Man in Brazil: The Forces Behind Dilma Rousseff’s Impeachment
José L. Flores

9 comments:

Ryan Harris said...

Before the Chinese post-industrialization credit collapse brought about the end of the commodity cycle, the politicians were claiming all the economic development and success was a result of their leadership and progressive programs. Then when the collapse came, it was blamed on a US coup.

Imports of Mfr goods from China plummetted 60% by this year from their peak only a couple years before while export volumes of commodities dropped along with a complete massacre in value. A more protectionist industrial policy in Brazil might benefit their industries which are not productive enough to compete against government subsidized Asian industry or European mercantilism policy. The problem for Brazil is that China is their biggest resource export destination and China expects Brazil to buy their Mfr goods in exchange. If Brazil doesn't keep their markets open, the Chinese threaten to buy from Australia and elsewhere. This particular cycle is harder to blame on US economic and political policy than previous cases. The economic numbers that changed and squeezed Brazil were squarely down to China's shift toward consumerism from industrialism. China warned the world for many years that their model of growth was going to shift, they published their 5 year plans...

Matt Franko said...

Well Ryan at least this lefty admits this part here:

"The problem is for the last thirteen years the Workers’ Party, with all its faults, has been implementing social welfare and safety net programs for the poor and was paying for it on the dime of Petrobras."

a baby step but at least some progress from the idiot left with this admission here...

Simsalablunder said...

Yes, an admission which you will never see from any idiot right winger. No baby steps forward from the idiot right wingers, only giant steps backwards.

André said...

This sort of US lead conspiracy theory is not good for left-wing credibility. But instead of repeating this, I will try to add something to the discussion.

I cannot annex images here, but here is an importante image URL: http://www.ibopeinteligencia.com/imgs/uploads/images/aprovacao_dilma_mar16(1).png

It's a poll about government approval conducted by Ibope. Green are the % of people that approves the government, and Red disapproves. The sample is suppose to represent Brazil's population.

The presidential elections, when Dilma was reelected, were in october/2014. Her approval was in the range 52%-44%, in line with the results of the elections (she had 51% of the votes).

Suddenly, in jan/2015, her approval fell to 19%, and disapproval rose to 78%.

There are a lot of explanations to that, but for me it's clear that the change in opinion happened because of one event: the media coverage of the Petrobras corruption scandal, the biggest in Brazil and maybe the biggest in the world.

With disapproval in the 80%-90% range, it is impossible for Federal Deputies and Senators to vote against impeachment.

The impopularity, allied with the PMDB and PSDB parties' interests (that wanted to take power and also to stop the corruption cases investigations, because they are as dirty as Worker Party's politicians) made impeachment unavoidable.

It's all about usual brazilian politics, and NOT about some US led conspiracy.

Jose Guilherme said...

the change in opinion happened because of one event: the media coverage of the Petrobras corruption scandal

In fact, it started before that - right when Dilma Rousseff, the day after the election victory of October 2014, betrayed all her electoral promises and simply adopted the economic platform of the opposition by implementing austerity and choosing a Chicago school banker as head of the Brazilian equivalent of the Treasury department.

All that for fear that Brazil - a currency issuer (and also a net creditor in dollars, to boot) - might be running out of reais!

There's even a current in the Partido dos Trabalhadores (PT) that wants to sell the dollars held in the central bank vaults in order to get reais to pay for urgently needed public works. This is stated with a straight face, even if the central bank (that is not even nominally independent in Brazil, being subject to direct executive power control) could issue all the necessary reais by a stroke of the pen, or computer keyboard.

The question seems clear: either the Brazilian left (and other Latin American cousins - see the Venezuelan case) gets a grip on the fact that the gold standard is over and that the issuer of a non convertible, floating regime currency cannot run out of money or it is doomed to suffer well deserved and ignominious failure.

Tom Hickey said...

"The problem is for the last thirteen years the Workers’ Party, with all its faults, has been implementing social welfare and safety net programs for the poor and was paying for it on the dime of Petrobras."

Way out of paradigm. "Pay for it" with exports. They have to get their own currency?

The problem is neoliberal budget madness that the left succumbs to. IF they listened to MMT, they would be fine.

André said...

"In fact, it started before that - right when Dilma Rousseff, the day after the election victory of October 2014, betrayed all her electoral promises and simply adopted the economic platform of the opposition by implementing austerity and choosing a Chicago school banker as head of the Brazilian equivalent of the Treasury department."

Almost 40% of the population don't know how to read and write. They certainly don't know what "Chicago School" is. They also don't understand what is the Central Bank Interest Rate. So it's very hard to say that the "betrayal" was the explanation for the suddenly change in opinions.

People know and feel what are unemployment and inflation. But there were no radical changes in both in such a short period of time, so it's hard to say that unenployment and inflation were that reason for a radical change in opinions.

Agreed that both right and left don't understand how government finance works. That's a big problem. But that's another issue. It was not a lack of MMT that caused Dilma impeachment.

Jose Guilherme said...

it's hard to say that unenployment and inflation were that reason for a radical change in opinions

That's not correct. While in October of 2014 the situation was near full employment, the economy went on a nosedive right after the election due to 2 main factors: the Petrobrás scandal (the company represents some 10% of total investment in the Brazilian economy and it simply froze due to the scandal) and the Dilma-Levy austerity policies that aggravated the recession. Unemployment exploded, real incomes dropped, the fall in economic activity will be likely close to the double digit mark by the end of 2016, etc.

High employment, rising real incomes and well designed social programs explain the electoral victories of Lula and Dilma - the opposite results natural translate into apathy if not downright hostility among millions of voters let down by the U-turn in policy and ideology ("we cannot spend, we must cut expenditures, we don't have the money, the European troikas are our model") that occurred after October 2014.

André said...

The economy went on a nosedive in three months? In dez/14 the approval rate was about 52% (and disapproval 41%) and then suddenly in mar/15 it was 19% (and disapproval 78%)?

Was this the fastest unemployment growth in the history of mankind? Or was it some other factors that had influence over the government opinion?