Los Angeles Times e Lula

August 30, 2005 - latimes.com

Scandalous Brazil

Revelations of government corruption could turn a Latin American success story on its head -- and take U.S. interests with it.

By Peter Hakim, PETER HAKIM is the president of the Washington based think tank Inter-American Dialogue.

One bright spot has been Brazil's economically viable center-left government led by President Luiz Inacio Lula da Silva. But through the summer, a spreading corruption scandal has threatened the country's financial stability, and that is bad news for him and U.S. interests in the region.

Lula's Workers' Party stands accused of illegally financing political campaigns and bribing congressional allies for votes on key issues. Several of the president's closest advisors have been forced to resign, the party's leadership has been humiliated and replaced, and impeachment proceedings threaten a raft of its congressional members.

Lula's role in the debacle remains unclear — he has not been tied directly to wrongdoing — but his poll numbers are dropping and so are his reelection chances. It is no longer unthinkable that the scandal could bring down Finance Minister Antonio Palocci, the country's second most powerful official who is widely regarded as the linchpin of its economy.

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