Is there any sense to be made, in Rio?

Or anywhere at all?

SONY DSC

Alleged kickbacks on construction contracts: part of a mega-event package that destroyed the homes of thousands of Rio’s poor. This was Vila Autódromo, next to the Olympic Park

Vem, meteoro!”

Rio Facebook users spent a day last week invoking a meteor: not clear if they wanted it to fall on the Marvelous City or its successor as capital, Brasília. Of course there are space objects big enough to hit both cities, all of Brazil or even wipe out the entire planet.

Perhaps it’s easier to contemplate the end of days than to sort through all that’s taking place in government and in the streets, interconnected at local, state and federal levels. Along with, no less, the news from Syria, the United States, UK, Italy, France and the Philippines…

If 1968 was the year of “Power to the People”, 2016 may be seen later as the year of “Tough Digestion”. It took about twenty years for youth almost everywhere to challenge social institutions that WW II had already begun to shake up. And it’s taken about twenty years for people of all ages to rise up over the hardships of life in a globalized world of technology-based communication and connection.

Though 1968 represented, in hindsight, progress, for many of us 2016 seems to have brought a reversal of values and priorities.

One hopes not for a meteor, but some sort of hiccup that will get us back on track. Or that 2016 is a hiccup; human history is, after all, a story of ever greater exchange. Digestion must occur, however fibrous and gassy the contents of the Internet.

In Brazil, the year 2013 must also go down in what could be called the Gregorian Calendar Hall of Fame, along with 1968 and 2016. Perhaps its meaning is only now, amid recession, political mayhem and corruption investigations, becoming clear. That year was when Brazilians, near the end of an unprecedented phase of socioeconomic inclusion, began to demand that government think about the greater good.

It turns out that, as so many investigations and plea-bargained testimony now reveal, that hundreds of government officials have long been thinking about their own good(s).

Rio’s flashy governor, among them, is now in jail; Mayor Eduardo Paes and other local officials stand accused and are likely to follow in his footsteps.

Meanwhile, the state is broke and may, along with Minas Gerais and Rio Grande do Sul, be the first to enter a new federal receivership program, called recuperação judicial. This involves the suspension of Rio’s debt payments to Brasília for 36 months, renewable for another three years. The savings to public coffers here would total R$ 14.1 billion, O Globo reports, citing state Finance Secretariat data. To qualify, Rio must increase state public servants’ pension contributions.

This year’s budget deficit has been calculated at R$17.5 billion. According to Valor newspaper, Rio’s 2018 deficit would total R$ 52 billion if no action were taken.

Oddly, as part of the deal Rio would also reportedly have to hand over Cedae, the state water and sewage company, to the federal government, for privatization.

Although Cedae is said to have modernized its management and finances in the last decade or so, Rio’s sewage is still mostly untreated, water loss is enormous and its pipes are in dire need of an overhaul. The state has been working, together with the national development bank, BNDES, and the newly created Metropolitan Integration Chamber to redesign pieces of Cedae’s sewage business in a public-private partnership format. Most of metropolitan Rio’s favelas aren’t included in formal sewage collection, much less treatment, heavily contributing to the pollution of Guanabara Bay and other water bodies.

Whoever takes over all or part of the company would have to deal with the social aspect of providing service, as Light has tried to do — with partial success.

Rio’s state legislature, Alerj, has spent the last week or so under siege by protesters, protected by police, as they debated and voted a package proposing to restore financial health. Of 22 measures, only six have passed into law — keeping state finances at risk. An Itaú Bank study shows that Rio is likely to experience supplier, employee and pension payment delays for some time to come.

Tuesday, Alerj passed a sales tax increase on cigarettes, beer, gasoline, electricity and telecommunication services. Lawmakers managed to take a vote by show of hands, such that the Rio electorate will never know who was in favor and who was against the bill. Friday, a Rio judge suspended the passage of this bill; the legislature will appeal. Thus Rio mirrors Brasília’s ongoing battles among government branches.

Just how long will police be willing to protect those lawmakers? Apparently with this question in mind, state legislature president Jorge Picciani (also the target of corruption investigations) decided Friday to return to Governor Pezão an extremely unpopular bill to put off raises for public safety workers (police and penitentiary guards) for three years. Another, to raise public servants’ pension contributions by three percentage points, will be put off until February 2017. The state owes police overtime pay for the last four or five months; during the Olympics these workers were obliged to work extra hours.

Rio’s Civil Police force plans a demonstration and a partial strike on Tuesday.

Certainly, with 23 million un- and under-employed nationally (21% of the labor force), slashed budgets and increasingly deficient social services  (plus a gratifying rise in the white-collar prisoner population) — paying cops and prison guards a sufficient wage in a timely fashion should be a priority. Should this not be so in Rio de Janeiro– well, stay tuned.

Wednesday, the state legislature passed a bill ending a tax break for the oil industry, dating to 2007. That was the first year of former governor Sérgio Cabral’s time in office. His administration has now been accused of giving tax breaks in return for kickbacks and favors such as money laundering by way of off-the-books jewelry sales. Officials are now debating the bottom line of tax breaks allegedly meant to attract business to the state. Only now, with empty coffers, has the policy come under scrutiny.

This blogger hasn’t been writing much here lately, as the book-in-progress on how Rio works (in Portuguese) enters its final phase (one hopes). So this post is a chance to stop and just say: if the corruption allegations are proved correct and top Rio officials end up in jail, wouldn’t it be nice to see the metropolis go back in time? Rethink mega-events, avid real estate development, low-income housing and, last but not least, public safety? If only judges could penalize the guilty by having them undo public policies undertaken for personal gain instead of the public good.

One can argue, as former public safety Secretary José Mariano Beltrame recently did in an interview for the book, that pacification put Rio on the right track towards mitigating violence. That, tragically, is so much less than what he set out to do.

And in some cases, that track isn’t looking so good: for the first time, a São Paulo gang now runs at least part of a Rio favela (Rocinha), and is said to be bringing in weapons galore. Crime is up within this particular favela and in surrounding neighborhoods. In the pre-pacification era, when one chefe ran the drug business, he customarily kept a crime-free cordon around the hill. Misha Glenny, author of Nemesis: One Man and the Battle for Rio (about former Rocinha don, Nem) recently called for a new public safety policy, drawing on the public and private sectors, in a Globo op-ed piece.

The year 2016 as the year of Tough Digestion is certainly part of the political equation in Brazil, as elsewhere. Here, our insides roil over the expectations raised in the Lula-Dilma era. These will never go away.

Newly elected Rio mayor, Marcelo Crivella  seems to be struggling already with that equation. Though he promises to curb spending, he’s also talking about taking over and expanding the state subway concession, Metro Rio. While the newly elected São Paulo mayor João Doria has already named his entire staff, Crivella has only come up with two municipal secretaries, two weeks from his inauguration. One is his vice-mayor Fernando MacDowell, age 71, a former Metro Rio executive who’ll double as transportation secretary.

Crivella is expected to name additional secretaries, today.

And what will 2017 bring, for Rio and the rest of the country? A key element of the answer will be Brazil’s ability to come up with sure-footed new politicians and policies to replace those who need to go. A new national nonpartisan group, Agora (Now), is working to do just this. In conversation this week with journalists, ITS founder-director Ronaldo Lemos and Instituto Igarapé founder-director Ilona Szabo said that Agora is focusing on what is simple, human and sustainable.

Heartened, journalists said the lack of viable politics in Brazil is largely due to a 21-year democracy blackout, 1964-1985, during the military dictatorship — and that it’s past time for young people to roll up their sleeves. One suggested that Agora map new political ventures across the country, bringing good news into the spotlight.

The political vacuum resulting from LavaJato is a hot topic of conversation in Rio these days.

This blogger hopes that Now really means now; the risk is that, after several years of upheaval, 2018 in Brazil could make conservative calls for law and order look dangerously appealing. Now let’s do our best to get to that year in one planetary piece.

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About Rio real

American journalist, writer, editor who's lived in Rio de Janeiro for 20 years.
This entry was posted in Brazil, Transformation of Rio de Janeiro / Transformação do Rio de Janeiro and tagged , , , , , , , , , , , , , , , , , , . Bookmark the permalink.

13 Responses to Is there any sense to be made, in Rio?

  1. curmudgeon says:

    Julia, having clicked on your link to Agora! and read their article, I fear that while you can certainly support their optimism and their verve, and indeed their ideals–a Brazil that is more “accessible” “humane” and “sustainable”–all they are expressing is what the 1988 Constitution expressed: a desire to do a makeover of Brazil and turn it from Belindia into Scandinavia.
    The 1988 Constitution is full of lofty ideals, injunctions and ideology. It is a “prescriptive” Constitution, not a “proscriptive” one, as is the US Constitution. Its basic tenor is “thou shalt” rather than “thou shalt not”.
    Sadly, it hasn’t worked. Brazilians are not Scandinavians, who have thousands of years of history of conquest of other people, and one monolithic culture, and the advantage of living in a climate where, if you don’t work hard during the 4-6 months when you’re not snowed in, you will starve during the winter.
    There has never been a work ethic in Brazil, save in Baltic pockets in the South and the “time is money” financiers on Sampa’s Av. Paulista; there never will be. Brazil is, save for an accident of plate tectonics, a Mediterranean country–think “Mani Puliti” when you think “Lava-Jato”, then ask yourself who the next Brazilian Berlusconi will be. Or, closer to home, the next Perón or Kirchner…after all, the definition of an Argentine is an Italian speaking bad Spanish who thinks he’s British.
    The most prominent candidate is Ciro Gomes, a wannabe “caudilho” who went to Harvard and (shudder) claims to understand Roberto Mangabeira Unger’s blatherings, something none of his fellow academics has ever been able to do. That’s frightening.
    Marina, the seringueira siren, has proven herself unable to administer her way out of a paper bag, Consider her as President–that’s frightening.
    So, back to the original word–Agora! The curmudgeon penning this simple desultory philippic (pace Paul Simon) well remembers “Agora é Lula!” back in 2002. Heaven forfend Brazil should be so forgetful of history as to repeat that mistake.
    PS Julia, apologies for the length and lack of brevity or levity. After 40 years in Brazil, I too am depressed by these last days of 2016, with the sombre shade of a Trump darkening 2017.

    • Rio real says:

      I know how you feel. At least there are some good young people around! The world will be theirs (if it lasts), after all. They better do something about it.

    • shotw2arrows says:

      Mr. curmudgeon — almost everything that happens has many “causes”. It is usually impossible to scientifically determine the weight of each cause. So we will never be able to say, for instance, why Trump was elected. There is no use arguing about politics. But it is useful to bat ideas around as some of them may likely be true. You seem to be a person of good will and I like to think I am. Here are some of my thought on your post.

      You say Brazilians don’t have a work ethic. I don’t know if you are referring to hordes of workers who take trains, buses, and subways from the outlying districts, where rent is cheap, to the inner and “noble” areas, where the money is and the pay is enough to live on. I think an army of about 1,000,000 come in every morning, on trips that can take two hours one way, and ride back the same route, at least 5 days a week.

      I don’t know if they have a work ethic.I would not like to do the jobs they do. But they do work. It’s likely they do it because they have to.

      I don’t think they participate in politics. Why is that?

      I think it is likely that the elite in Rio would not want them to. A lawyer can make in two hours what the workers make in a week. A good lawyer makes that much because his work is valuable to whomever employees him. The lawyer can help a businessman pay less taxes. This gives the businessman more money to try to influence Congress. Congressmen need more money to get elected. The hordes of workers provide votes.

      It is very true that any one of those workers could become a lawyer. A tiny fraction of them do. I did not grow up in a favela, but I imagine that the world they is so different, only a very exceptional individual could picture becoming a lawyer. I can’t imagine me taking tea with Queen Elizabeth in Buckingham Palace.

      I think the Constitution of 1988 was a sham, as was that of 1824. The elite doesn’t want to give up what they have. In the present economic crisis, I have heard almost nothing about a hike in taxes for the rich. When 2,000,000 people are living on less then $2/day and 10,000 are living on $1000/day, who can more easily bear a tax increase?

      There is much to be said against my thesis. We must have highly trained, educated, intelligent people, and they naturally should earn more. One can think easily of a dozen more reasonable counter-proposals.

      If we can think together, with good will, and then act together, we can attain — utopia?

      No. But the present situation in Brazil won’t do. It just won’t do.

      Thank you for reading this, and for your interest, Mr. curmudgeon.

      • curmudgeon says:

        We still live in Belindia, a term coined more than 40 years ago during the military dictatorship and still valid. “Belgium” is the developed part, “India” the underdeveloped. The working poor work extremely hard, but as you point out, they are part of the “work force” but not of the “work ethic”. This phrase refers to the belief that if you work very hard, you can progress in life, and become rich. The US has had this ethic for centuries, and Trump has played on it. Sadly, it hasn’t been true for the past half century there. In Brazil, where income inequality is still far worse than in the US, the ruling class really does not believe they will progress through hard work–rather, they will progress through their connections, their “jeito”, their financial acumen, and the “Lei do Gerson”–i.e. always take advantage of others’ weakness.
        I’ll not comment extensively on lawyers, because in the real world I am one. Not all of them are rich, and in fact, there are far too many of them chasing too few clients.

  2. Rio real says:

    Very well put. I agree that people here do work hard. They sometimes have to work harder, in tough jobs, because the educational system is so bad. They have long commutes because they can’t pay to live close to work and/or drive a car. Then they get sick and the health system allows them to die earlier than they would if they could pay for private care. Gotta change this, yup.

    • shotw2arrows says:

      Thanks Julia, I am glad we agree on these points. I think we would also agree that the problems you mentioned are not entirely due to the laziness, immorality, or lack on innate intelligence of the people. What then is the greater factor? Poor governance, it seems clear. We all seek the remedy to poor governance. For that, we must learn how and how it came to be. I hope your book can be part of the answer.
      I am extremely concerned with something that just occurred, the passage of PEC 55, also called the New Fiscal Regime. As soon as I can I will send a post about it. I am sure you are aware of the event and I hope you are already studying it. O Globo doesn’t see to be worried about PEC 55, but an agency of the UN is.

  3. Rio real says:

    I’ll be interested to see what you come up with. I cannot make head nor tails of what the PEC will actually accomplish. So many different takes on it.

    • shotw2arrows says:

      I truly wish I could give you a fact-based appraisal of the PEC, Julia. I will work on it. One of the troubling things about this amendment to the Constitution, due to last 20 years barring another amendment, is that I don’t think many other Brazilians know much about it. From the links I will post, we learn that 43% of Brazilians have even heard of it; and of those who have heard of it, the majority disapprove. I find it strange, and even marvelous, that the Temer administration was able to pass it on short notice, just before Congress went off to Christmas vacation until February. Consider:

      1) Temer himself has been cited in Lava Jato plea bargaining testimony, for criminal actions.
      2) The Speaker of the Senate is actually a defendant facing criminal charges.
      3) A vast number of congressmen are in various stages of investigation of criminal charges — I believe 40% — some of them are also defendants facing criminal charges.
      4) A vast number of congressmen have been cited in Lava Jato plea bargaining testimony.
      5) The majority of Brazilians would like Temer to step down so that new elections can be held.
      6) Temer is not an elected President. He came to his position as the result of the impeachment of Dilma. The LEGAL basis for that impeachment is certainly questionable. It turns on whether you can broaden the definition of a loan from a bank to the Treasury; there were no explicit loans. I am not a lawyer; I won’t revive that debate here.
      7) Even if you dismiss (6), the election of both Dilma and Temer may be annulled as the result of irregularities in their campaign.

      All in all, it seems unlikely that a President and a Congress under such a cloud of illegitimacy could enact an amendment to the Constitution so fundamental and far-reaching. But that’s what they did. The question is why they we able to do it.

      As to the actual PEC, here is a link to an article that appear before the bill was passed:

      http://www.ohchr.org/EN/NewsEvents/Pages/DisplayNews.aspx?NewsID=21006&LangID=E

      It is from the High Commissioner of Human Rights of the United Nations. Excerpts:

      Government plans to freeze social spending in Brazil for 20 years are entirely incompatible with the country’s human rights obligations, according to the United Nations Special Rapporteur on extreme poverty and human rights, Philip Alston.

      The independent expert appointed by the UN Human Rights Council called on the Brazilian Government to ensure a proper public debate on PEC 55, to estimate its impact on the poorest segments of society, and to identify alternative measures to achieve the goals of austerity. –

      “This is a radical measure, lacking in all nuance and compassion,” he said.
      “It will hit the poorest and most vulnerable Brazilians the hardest, will increase inequality levels in an already very unequal society, and definitively signals that social rights are a very low priority for Brazil for the next 20 years.”

      He added: “It clearly violates Brazil’s obligations under the International Covenant on Economic, Social and Cultural Rights, which it ratified in 1992, not to take ‘deliberately retrogressive measures’ unless there are no alternative options and full consideration has been given to ensure that the measures are necessary and proportionate.”

      The debate on PEC 55 has been rushed through the National Congress by the new Government with limited participation by the groups affected, and without studying its impact on human rights. A recent survey suggested that that 43% of Brazilians are not aware of the plan, and among those who are aware, a majority oppose it.

      The following appeared after the bill was passed:

      http://www.aljazeera.com/news/2016/12/brazil-austerity-move-slammed-disaster-poor-161217185527208.html

      Sorry, I am short of time and probably you and your readers are short of patience. I hope you will have time to read the articles and comment on them. I am particularly interested in ideas about how the Temer administration was able to get these bills through. There is no doubt the reforms needed to be made. Dilma could not have made them, even though she surely realized something had to be done.

      Well, I’ll shut up. Thank you for giving me this voice, Julia. Otherwise I might go nuts, what with the situation in the US, and indeed it seems, throughout the world!

      • Rio real says:

        HI! Sorry for the slow reply, this has been a busy period for me. Thanks for your work on the PEC. I see from Merval Pereira’s recent columns that he too asks how Temer and Congress did this. The answer seems to be the very fact that they’re in the same leaky boat! Not so much attention to what the electorate thinks. And we shall see what comes of that… Happy New Year to you and to all our readers!

      • curmudgeon says:

        It appears that Temer has the support of upwards of 75% of both houses of Congress. This is not surprising, given the composition of Congress–rich white men (plus a few women). It is arguable that the reason Lula created and masterminded the Mensalão and the Petrolão is that he knew, for sure, that Congress would never vote in any of his social programs designed to benefit the poor, unless they were personally enriched in return.
        Now the official corruption programs are over, the rich white men are free to vote their conscience–if they have one. Most of them don’t.

  4. shotw2arrows says:

    Thank you for your clarifications, Mr. C. (I hope you don’t mind if I call you that — call me Shot if you wish.) I thought Belindia was a little town in in the South. “Work ethic” can have many meanings and thank you for making clear yours. You certainly understand the realities of Brazil, better than I do. I have heard anecdotal reports consistent with yours about the lack of work ethic in certain circles. Certainly these things are not true about every Brazilian of the class. But I believe many Brazilians would agree about the lack of professional conduct of some of their colleagues.

    We can never say for certain why this behavior exists, we can only speculate. Do you have a theory or theories?

    I believe in a “trickle down effect”. Throughout Congress, the Executive, and the Judiciary, from high to low and low to high, from 1824 though 2016, we see unethical behavior. Given this, it would be surprising if the professional and business classes were squeaky clean. And the vendor in the street, the cop on the beat, the repair man, the mechanic, all know what is going on and follow suit.

    But why the illicit behavior of the highest classes? Of course it starts with the Conquest, the theft by force of the land from the Indians, the exploitation of Brazilians by the mother country, and the importation of slaves. But in all this there was little hypocrisy. It was frank and open.

    I think the hypocrisy started with the 1824 Constitution. Decade followed decade following in which the Law SAID one thing, Practice and Custom DID something else. After nearly 200 years this disconnect between law and deed has settled in the bowels and soul of the culture. Politicians seem to be genuinely affronted when they are caught in the act and have to go to jail: they go with their fists raised in defiance, rather than shame.

    I hope to start with the Constitution of 1824 and work this into a sketch of the conditions that lead to the present. I envy you your knowledge of law and your years of interaction with Brazilian culture. I’m a retired mathematician from the Midwest US who worked 21 years with engineers in Virginia.

    In the above, I wrote about illegal behavior. Re-reading you post, I perceive you wrote also about another behavior, not explicitly illegal: “the ruling class really does not believe they will progress through hard work–rather, they will progress through their connections, their ‘jeito’, their financial acumen, and the ‘Lei do Gerson’–i.e. always take advantage of others’ weakness.”

    I agree. I wish someone would promote the notion that you can do good, honest work because you love it; that after a time, you can build a reputation that will end in your having money sufficient for your happiness and well-being. Also, building of the skills of the less fortunate is good for EVERYBODY in the long run. Reinstating slavery would lower the prices of goods and attract investors to Brazil in the short run. But it is not the way to happiness, even for the upper classes.

    Have you heard about PEC 55, the New Fiscal Regime, a constitutional amendment just passed into law? I would like to know your thoughts about it.

    Thank you very much for reading this Mr C. I welcome your comments and have a good day — “Shot”

  5. shotw2arrows says:

    I would like to reply to Julia and Curmudgeon individually, but am not sure where to click so please consider this my reply to both of you. You both make good points. I understand why it takes awhile to get back; I don’t have time to read 5% of what I would like to read.

    Why has Temer been able to get so much through Congress? The “everybody on board a leaky boat wants to save it” argument makes sense to me. When most of the world was floundering in the Great Depression, Nazi German was doing well financially. A strong man had taken the helm; all would be well if decent Germans trusted him and stood behind him. The rights of the powerless might be trampled on — well — let’s don’t think about that. If crimes are committed, so long as Germany is prosperous and strong. those crimes will go unpunished.

    We know now that the early prosperity of Nazi Germany was only temporary. It seems clear that Hitler knew it couldn’t last and that’s why he provoked WWII when his nation was not ready for war. The bills that Temer rushed through will give an immediate boost to business confidence. The inimical effects of these laws will be felt a few years down the road.

    (I must admit here that some of these bills may actually have been necessary and salutary. If we examined them, we probably we finds some of Hitler’s measures beneficial.)

    The crimes of Hitler’s henchmen were monstrous. By comparison, Lava Jato-type corruption seems like playful schoolyard pranks. You have to be a son whose mother has died because she can’t get adequate health care to be enraged. You have to be a mother whose son has died because the state can’t adequately police a favela. The simple truth is that these things cost money. Money comes from the sweat and labor of taxpayers and buys, not health care or security, but the luxurious life-style of politicians and the elite that serves them.

    It is easy to believe that those members of the Congress who are guilty of crimes may feel that President Temer will not be convicted of anything if Brazil seems on the way to financial salvation. If Temer is spared, an erring congressman might well believe that Temer and his powerful friends would go out of the way to get him off the hook. Surely Temer has the skills to intimate to all: “I will back anyone who backs me.” It’s the oldest political rule in the book.

    Curmudgeon suggests that Lula knew Congress would not pass any of his social measures unless Congressmen received bribes. I believe that. I think the same is true of Henrique Cardoso and Dilma. All three came upon a political matrix that was corrupt through and through. All three were likely people of good will who felt they could do nothing for Brazil if they didn’t play the game.

    This is, of course, only a conjecture. I don’t have hard evidence. But I wish the supporters of Lula/Dilma would at least consider it.

    (/Almost) “Everybody is guilty!” We need to find out how this happened to be. But right now we have to ask what to do about it.

    I think that in determining penalties, there should be a big distinction between two cases. In one case, people like Cardoso, Lula, and Dilma allowed bribes to be passed to obtain actions from Congress. Further, these actions of Congress didn’t benefit ,financially at least, Cardoso, Lula, Dilma, etc.

    The other class of miscreants simply used their office to enrich themselves.

    I am very passionate that this historical corruption probe not cease until everyone is fairly tried. If it were to coast to a halt before all those who may be be guilty were brought before the bar of justice, maybe it would have been better to not start the judicial probes!

    Because isn’t it clear to all that impunity has been a curse to Brazil and will continue to be a curse until it is surgically removed from the body politic?

    As to how this all came to be, I think we must go way back to he moment Brazil obtained its Independence from Portugal. I hope to post here a mini-theory — based entirely on suppositions, guesses, intuitions — of value only that it might arouse the curiosity of more knowledgeable readers.

    That you Curmudgeon for your thoughts and attention. I hope to hear your ideas. Same to Julia, with additional thanks for starting this blog. Thanks to all readers. Let’s tried our damnedest to make 2017 better than 2016.

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