Dilma's Disastrous Legacy, Destroyer Of Brazilian Wealth
Regardless of when or how she exits the political stage, the Brazilian president will leave chaos in her wake.
SAO PAULO — Members of Dilma Rousseff's government are trying their best to convince members of Brazil's Chamber of Deputies to vote against her impeachment. But except for promises of quid pro quo, it's hard to see what could convince them to support the current occupier of the Palácio do Planalto.
Her main showpiece is Petrobras, the state oil company at the center of the anti-corruption operation Lava Jato ("Car Wash"). It's Brazil's biggest company. And yet, it's crumbling under debt, its activity is contracting as it's being dismantled. It is losing money on a monstrous scale.
As if the debts caused by price-fixing, bad investments and corruption weren't enough, Petrobras has had to shoulder the costs of an industrialization program that forced it to buy national products at much higher prices than imports. Put together, these factors amount to billions in losses.
The spectacular scale of Petrobras' collapse diverts attention from other, similar cases in many sectors of our economy, which have also suffered greatly from this government's heavy-handed meddling, incompetence and attachment to outdated economic ideas.
The government's attempt to force down energy prices in 2012 contributed to the losses registered that year by Eletrobras, Brazil's second largest state-owned company and Latin America's largest power utility provider. The manipulation of fuel and electricity prices ruined Petrobras and the entire oil industry and shrank the biofuel sector, while dragging the electrical sector into chaos and debt.
Meanwhile, the politicized management of state-owned companies' pension funds has provoked unprecedented deficits. Beyond revealing sheer governmental incompetence, these funds were routinely used to finance projects of the Workers' Party "Big Brazil" plan, among them the rig leaser Sete Brasil, almost certain to face bankruptcy, and the Belo Monte dam, costly and still under construction.
Nobody knows when or how Dilma Rousseff's tenure will come to an end. But we do know that the president will leave behind a legacy of incomparable destruction.