Brazil’s largest political party, the
Brazilian Democratic Movement Party (PMDB), has said that it will leave its coalition with the ruling Workers Party (PT), Reuters reports.
That means we’re one step closer to seeing the impeachment of Brazilian President Dilma Rousseff, and the end of her party’s decade-plus rule over the world’s 7th largest economy.
Once PMDB members leave Rousseff’s camp, and any posts in her administration, they can vote for her impeachment. The resignations have already started rolling in. According to Reuters, that could get her out of office by May.
She would be replaced by her Vice President, a PMDB member.
At the car wash
Rousseff’s regime has been under siege since the spring of 2014, when an anti-corruption sting operation called ‘Operation Car Wash’ revealed that her party had used the country’s quasi-state oil company, Petrobras, as its personal slush fund. With Petrobras cash, the PT paid kickbacks and bribes — think suitcases of cash and private jets. This scandal reached the highest levels of Brazilian society in a way no scandal ever has in the country’s modern history.
Rousseff won reelection by only a hair in the fall of 2014.
The scandal also almost broke Petrobras. The company’s stock collapsed as it revealed that corruption had sucked over $2 billion from its balance sheet. That was last year. Over the last few weeks, hundreds of thousands of Brazilians have taken to the streets to make Rousseff, and even her predecessor, the beloved Luiz Inacio Lula Da Silva, answer for the PT’s transgressions.
The market likes the idea of Rousseff out of the picture. The Ibovespa, Brazil’s stock market, is up 18% year to date. Petrobras is up 36% over the same period. Still, it’s unclear who will really run Brazil once Rousseff and the PT are out. The PMDB is known for its lack of consensus, and the leader of the PT’s rival party, Eduardo Cunha, is also being investigated for issues related to Operation Car Wash.
There aren’t a lot of good options here, people.