Home Article A Car Wash retrospective: Brazil, a never-ending political crisis

A Car Wash retrospective: Brazil, a never-ending political crisis


Way back in 2014 Brazilian prosecutors were investigating a money laundering scheme based out of a car wash in Brasilia, the country’s capital. Feeling creative, the investigators called it Operation Car Wash.

The scheme revolved around the state-run oil company Petrobras, which Brazil’s largest construction companies systematically defrauded by agreeing to overcharge for projects. The construction companies then used that money to finance election campaigns and bribe politicians, and also kept some for themselves.

Operation Car Wash uncovered insane amounts of money smuggled across borders by dudes who taped stacks of cash to their bodies before wrapping themselves in saran wrap and wearing baggy clothes like it was 1997 all over again.

The cash was just the tip of the iceberg. The investigation revealed an elaborate scheme of bribes that were wired to bank accounts set up in international tax havens. The largest company involved, Odebrecht, even created an entire department — politely named the Department of Structured Operations — to manage the scheme.

It’s hard to fully account for the amount of money involved in Operation Car Wash, but three years on, it looks like oil company Petrobras lost about 6.6 billion reais, or roughly $2 billion. This is both an extremely large amount of money and really pretty small if you think about what it means to take down the entire government of a country.

When the scandal first became public knowledge, painful austerity measures were in place in Brazil and government services had been cut back to get the budget under control. For those who already felt the government was against them, Operation Car Wash later confirmed their worst nightmares.

Then-president Dilma Rousseff’s favorability sunk to around 10% in polls and the value of the reais plummeted. But not everyone was mad at Rousseff. Brazil’s political parties are extremely polarized. Supporters of Rousseff’s party — the Worker’s Party, or PT — saw the investigation as a power play by the opposition at best, and an attempt to undermine Brazil’s storied social programs at worst, leading to ginormous counterprotests.

Eventually Rousseff was impeached, and if this were a normal story that would be the end of it, but there are many more seasons of this soap opera.

So far the scandal has engulfed the PT, which was in power from 2003 until 2016, when VP Michel Temer took over from Rousseff. Opposition parties have been implicated too. Aécio Neves, who ran against Rousseff in 2014, is being investigated for multiple cases related to Operation Car Wash. And Eduardo Cunha, who was speaker of the House under Rousseff and led the charge for her impeachment, had to step down shortly afterward because it turns out he took $40 million in bribes, which he hid in a shell company called — and this is true — JESUS.COM.

For comparison: Imagine if Barack Obama and half the Democrats had been accused of a giant corruption scandal, but then you found out that Paul Ryan and Mitch McConnell were involved too! (Pause for a moment to appreciate the fact that the US Congress is so polarized and dysfunctional that it’s actually laughable for opposing parties be involved in a corruption scandal together.)

As the investigation continues to spiral outward like a galaxy unfurling as the universe approaches heat death, more companies and more people are shown to be part of the constellation of corruption. The latest and greatest is JBS, the world’s largest meatpacking company. Rather than do jail time, JBS executives opted for a plea bargain in which they agreed to provide evidence showing that they had bribed Brazil’s current and previous two presidents to the tune of about $85 million in exchange for loans from Brazil’s development bank.

In March, the CEO of JBS visited President Temer at his residence and made a secret recording in which Temer appears to encourage him to continue the bribes. A week later, federal police recorded video of another politician from Temer’s party meeting up with JBS executives at a pizzeria and then walking away with a wheeled suitcase full of cash for himself and Temer, according to prosecutors. Temer has said that the recording was doctored and denies that the cash was for him.

The Order of Attorneys of Brazil, Brazil’s bar association, has filed a petition with Congress to impeach Temer. Temer says that the recording was doctored to make him look bad and has promised that he’s not going anywhere, but when more than 100 — ONE HUNDRED — politicians, not to mention CEOs and other business executives, are being investigated, it’s a little hard to believe that anyone’s telling the truth.

You thought this was House of Cards but it’s actually Game of Thrones because, guys, there is magic involved! A warlock from São Paulo posted photos back in March saying that he had been inspired by his “American sisters” (you may recall some witches here in the US said they were putting a curse on Trump) and was going to put a curse on Temer. According to his post, which was made on March 6, the curse would come true within 70 and 72 days. Lo and behold, on May 17, exactly 72 days later, the recordings of Temer talking to the JBS CEO were leaked to the press.

With Temer added to the list, every single one of Brazil’s former and current living presidents has been implicated in the corruption scandal.

Three years into Operation Car Wash, protesters are back in the streets and Temer’s popularity has sunk. The question on everyone’s minds now is, where does this all end? Multiple motions to impeach Temer have been filed, and Brazil’s biggest newspaper O Globo published an editorial calling for him to step down. But, the move to impeach must get past the speaker of the Lower House of Congress, who is a close ally of Temer and seems unlikely to allow the motion.

On Friday, a court, tasked with determining whether the 2014 election (which elected Rousseff for a second term and brought Temer to the vice presidency) should be invalidated due to corruption, voted to uphold the results. They surprised many by refusing to admit evidence gathered by prosecutors in the Car Wash probe.

But fear not: The chaos is still going.

Beyond fingering Temer, the JBS executives testified that they paid a mind-blowing 1,829 politicians from 28 different parties. Prosecutors have enough material to keep investigating for years, if not decades, and the consequences of the scandal are starting to extend beyond Brazil to neighboring countries and to the US. There have been a million and one thinkpieces about the ~culture of corruption~ in Brazil, and they’re all kind of like, “We need massive political reform to change incentives, but people aren’t really motivated to make that happen.

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