Brazil’s Congress launches bid to impeach President Rousseff

Already struggling with weak popularity over Brazil’s economic ills and a political corruption scandal, President Dilma Rousseff now must fight an impeachment effort launched by a political foe who heads Congress’ lower house.

Such was the squeeze on the president that markets in Latin America’s largest economy jumped on Thursday as investors hoped that a harsh political reckoning for Rousseff, known for interventionist policies that economists say worsened the economic downturn, could be forced to adopt more market-friendly measures. The financial accusations reflect a court decision that the Rousseff administration’s accounting practices in 2014 violated the law. These include so-called “backpedaling” whereby funds are taken from public banks to cover budgetary shortfalls but their repayment is deliberately delayed.

“I don’t have any foreign bank accounts; I have not has not concealed from public knowledge the existence of personal property”, she said alluding to accusations that Cunha received millions in bribes from the Petrobras scandal and hid the money in Swiss bank accounts which were opened by family members. Whether the practice constitutes an impeachable crime is at the center of the impeachment debate.

Rousseff, who won re-election in a tight runoff previous year, now has an approval rating of less than 10%.

The bickering on Thursday began when House Speaker Eduardo Cunha, an avowed enemy of Rousseff despite being from a party that is part of her governing coalition, said Rousseff tried through an intermediary to allegedly help improve the outcome of an ethics probe against him just hours before he approved the impeachment proceedings on Wednesday.

Brazil’s political institution is already near paralysis as a result of an investigation into an enormous graft scandal at state-run oil firm Petrobras that has heightened political tensions and created gridlock in Brasilia. She denied responsibility for any “illicit acts” and claimed not to have supported the attempt to reach a deal with Cunha based on killing the ethics charges against him.

Shearing says that although political turbulence is the last thing the Brazilian economy needs now, impeachment proceedings are also not likely to significantly affect the market.

As such, he told reporters, Rousseff lied in a televised address on Wednesday night when she said she would not seek to negotiate with Cunha. “It is a watershed”, stated David Fleischer, a political science professor at the College of Brasília.

However, the political scientist added that Cunha was also a “very pragmatic politician” who probably had a strategy planned out. If two-thirds of the chamber, or 342 deputies, vote in favor of impeachment, Rousseff is temporarily suspended awaiting a final vote by the Senate. “There is a big difference between opening impeachment proceedings and actually removing the president from office”.

“It’s an interconnected game of individual political survival, and there are only two scenarios: either they both survive, or they both die”, he said of Cunha and Rousseff. The special commission will have lawmakers from all the parties represented in the lower house. The PMDB is a member of the governing coalition formed by the president, though it has distanced itself from the government in recent months.

If a two-thirds majority approves, it then goes to the upper house for an impeachment trial, where another two-thirds majority would force Rousseff from office.