- - Monday, June 26, 2017

BELO HORIZONTE, Brazil — The headlines here still scream of scandal and malaise, drift and decline, but for the first time in years, at least some Brazilians are feeling a tiny sliver of optimism as they look ahead to next year’s presidential elections.

Once touted as one of the developing world’s emerging powers, South America’s most populous nation has long been in a political and economic free fall, a crisis of national confidence that culminated in last year’s impeachment and removal of President Dilma Rousseff. And amid ever-widening corruption probes and the bitter economic hangover from last year’s Olympic Games, her successor, Michel Temer, may get ousted himself on corruption charges.

But talk to residents of this heartland state capital strolling around Belo Horizonte’s traditional Central Market on Friday, and you get the sense that the slight economic uptick gives them hope that the worst might be over.

“In 2014, at the height of the country’s political and economic crisis, many stores had to close,” said 29-year-old Rafael Igino, who owns a codfish stand in the market. “Between 2014 and now, there has been a reaction, albeit a small one. Things are better; the clientele has a little more confidence.”

If they hope to consolidate that trend, then citizens at the ballot box must remember the lessons of Brazil’s spectacular corruption inquiries, said Francisley Martins, one of Mr. Igino’s employees.

“Brazilians have a short memory. There are many people who did bad things and can run — and be elected — once again,” said Mr. Martins, 45. “We have to be very responsible when we vote for a candidate, look at his background [to find out] if he did something bad.”

He made the comments as judges were considering the fate of Belo Horizonte native Aecio Neves, a former Minas Gerais governor and runner-up in the last presidential election, now caught up in the latest of countless cases that have tainted much of Brasilia’s political class.

Painful as that constant dribble of scandal may be, it speaks to the strength of Brazilian institutions taking on the country’s most powerful figures, said political scientist Marcus Melo, co-author of the Princeton University Press book “Brazil in Transition.” As painful as it has been to the national psyche, Brazil is proving able to deal with its own failings.

“In the short term, we are experiencing turbulence, but with a silver lining: Authorities in Brazil have shown themselves to be effective in the fight against corruption,” Mr. Melo said.

Efforts such as the anti-corruption Operation Car Wash, which has yielded some 1,400 years of combined prison terms and more than $3 billion in seized funds, have few, if any, equals in history, he said. The reach of the scandal has shaken governments across Central and South America.

“It’s a level of punishment of the political elite you don’t find in any other country,” Mr. Melo said, “other than Italy’s Mani pulite,” a 1990s probe that led to 1,300 plea bargains and convictions. “In the case of Brazil, we can say the glass is half-full,” he said.

Growth, finally

While not good, the economic picture is no longer one of unrelieved gloom.

Inflation has fallen below government targets, and a grinding two-year recession came to an end when the Brazilian economy eked out a small gain in the first quarter of 2017. Despite his political troubles, Mr. Temer this month said he is committed to pushing through labor and pension reform bills designed to give greater flexibility to business owners.

While the national jobless rate hit a record 13.6 percent this spring and economists are not ruling out a double-dip recession if world food and commodity prices turn south again, the government last week reported an addition of 34,253 payroll jobs in May, the second straight month of positive employment momentum and well above economists’ expectations. Brazil’s economy is projected to register a 0.4 percent growth rate for all of 2017 — after contracting 3 percent in 2015 and 2016.

Such cautious optimism, however, often ends at the political divide. Supporters of the leftist Ms. Rousseff, the country’s first female president, are reeling from her removal, which they dub a “coup.” Her popular mentor and predecessor, Luiz Inacio Lula da Silva, also is accused of corruption.

“I don’t view this fight against corruption in Brazil as legitimate. I don’t think the problem was corruption,” said Jorge Neves, a sociologist at Belo Horizonte’s Federal University of Minas Gerais. “Today, the [accusations] against Mr. Temer are much worse than any trouble Dilma had, [but those] who were yelling ‘Dilma, go home’ in the streets now aren’t there yelling ‘Temer, go home.’”

But one person who counts a great deal — Brazil’s attorney general — did the constitutional equivalent of yell “Temer, go home” on Monday.

Attorney General Rodrigo Janot filed a formal criminal accusation on Monday, making Mr. Temer the first sitting president here to face criminal charges. The Chamber of Deputies decides whether the charge has merit. If a two-thirds vote agrees, Mr. Temer will be suspended for up to six months until a trial can be held.

According to Mr. Janot, Mr. Temer took a $150,000 bribe this spring from Joesly Batista, former chairman of meat-packing giant JBS.

But the investigations Mr. Neves views as politically motivated may well backfire in the economic realm, he said.

“This corruption hunt will create great difficulties for the future,” he said. “Before Mani pulite, Italy had above-average economic growth in Europe; after Mani pulite, Italy had below-average growth.”

To Mr. Neves, Mr. Lula is the only leader who, amid all the chaos, “preserved political patrimony,” and many like-minded supporters of the Workers’ Party hope the former two-term president will make a comeback in the race next year.

But if last year’s municipal elections are any indication, voters seem to have little appetite for establishment candidates. In Sao Paulo, entrepreneur Joao Doria beat Workers’ Party incumbent Fernando Haddad by a whopping 36 percentage points.

“The country’s largest city rejected all traditional politicians and picked a manager, an executive,” said Paulo Roberto de Almeida, director of the Ministry of Foreign Affairs-linked IPRI think tank in Brasilia.

Mr. Doria’s name is now frequently mentioned among the top contenders to move into the Planalto Palace, Brazil’s version of the White House, come 2019, with Mr. de Almeida comparing his movement with that of new French President Emmanuel Macron, a centrist whose year-old political movement swept aside France’s traditional ruling parties of both the left and right.

“If the opinion polls indicate high popularity for Joao Doria, it will be difficult for [his party] not to nominate him as a candidate for president,” he said. “And he could win given the people’s dismissal of all traditional politicians as corrupt and profiteering.”

Mr. Temer said in Brasilia that the country had to move forward with reforms because it has exhausted all the alternatives.

“There is no Plan B. We have to move forward,” he told reporters, according to The Associated Press.

But whether it’s Mr. Lula, Mr. Doria or any other contender, Norma da Silva, shopping for cheese and herbs at the Central Market, said she would will think much harder than in the past before marking her ballot.

“We will look long and hard at the person’s history,” the 60-year-old retiree said.

Even so, Mr. de Almeida said, she and her fellow Brazilians will need not just optimism, but mostly patience.

“Total recovery will take time,” he said. “[But] there’s hope that Brazil has stopped falling into the pit, into the hole.”

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