Allegations against aide test Rousseff By Joe Leahy in São Paulo For observers of Brazilian politics, the past week has looked like history repeating itself.
Antonio Palocci, a former finance minister who fell from office after a corruption scandal five years ago, was once again under fire in his latest role as the chief of staff to Dilma Rousseff, Brazil’s new president.
Accused of amassing wealth during his time as a congressman, Mr Palocci’s troubles mark the first political test for a technocratic president who prefers to shun the limelight, leaving the messy business of running her coalition to others. “So far, Dilma has been praised for being lower profile than Lula,” said Joao Augusto de Castro Neves, a Washington-based analyst at Brazil’s CAC Political Consultancy, referring to Brazil’s popular previous president Luiz Inácio Lula da Silva. “Everyone was interpreting that as her being more pragmatic, more efficient, more businesslike, but as president you need to show political leadership.
The president needs to be a political animal.” The affair comes at an inopportune time for Ms Rousseff, who has been ill with pneumonia.
On the political stage, she is struggling with rising inflation, delays in infrastructure projects ahead of the 2014 football World Cup and a battle over a controversial forestry law.
What is perhaps most surprising, however, is that the honeymoon since she took office in January lasted so long in a country where scandals are part of the political landscape.
The claims against Mr Palocci, her most important behind-the-scenes powerbroker, emerged in the Folha de S.Paulo newspaper, which reported he had increased his wealth twentyfold between 2007 and 2010 through property dealings at his consultancy.
Mr Palocci denied any wrongdoing, saying politicians regularly run consultancies.
People close to Ms Rousseff say his job is safe unless there are more allegations. “Dilma’s cabinet counts five other ministers who had similar ‘consulting firms’ before 2011,” wrote David Fleischer, a politics professor at the University of Brasília.
Opposition politicians are seeking a parliamentary inquiry into the Palocci affair but the public prosecutor has stopped short of launching a probe.
Any loss of the market-friendly Mr Palocci would hurt the economic credentials of Ms Rousseff`s government in the eyes of investors.
But of most concern to Ms Rousseff is that the affair will weaken her ability to control her unruly coalition.
In fact, some speculate the source of the allegations against Mr Palocci came not from the opposition but from within the ruling coalition in retaliation for holding back on second-tier government jobs or reducing budgetary spending on congressmen`s pet projects.
The loss of Mr Palocci would also come at a time when doubts have resurfaced about Ms Rousseff`s health.
A former cancer patient, she failed to turn up to the World Economic Forum in Rio de Janeiro late last month after a bout of pneumonia forced her to lay low for several weeks.
A test will be a forestry bill.
An odd alliance of the communist party and landowners has sought to water down forest protection provisions of the bill.
Ms Rousseff is said to oppose the changes.
Bending lawmakers to her will would normally be the job of Mr Palocci.
But if he is weakened by the row, the time may be coming when the president will have to step out of the shadows and play politics herself. ●Standard & Poor’s has raised its outlook on Brazil’s credit rating to positive from stable.
The agency praised the country for diversifying its economy, increasing exports and fostering the growth of the middle classes.