Tag Archives: Brazil

The Lula Opinions (Trial Court Verdict and Summary of Appeals Court Affirmance), Now Available in English Translation

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The conviction and imprisonment of former Brazilian President (and current would-be presidential candidate) Luiz Inácio Lula da Silva (known as Lula) is among of the most consequential and polarizing outcomes of a corruption investigation in recent memory. The case that led to Lula’s conviction (one of several that were pending against him) did not necessarily involve the biggest or most important allegations, but it was the one that was brought first, presumably because this was the case where the prosecutors felt they had all the evidence they needed to proceed, though critics insist that the case was rushed through on skimpy evidence in order to disable Lula from seeking the presidency in this month’s election.

I only know a bit about the specifics of the case, which involved a beachfront apartment than a construction company had allegedly promised to Lula in return for helping the company secure contracts with Brazil’s state-owned oil company. (Lula, for his part, claims that he was never promised the apartment and the only evidence otherwise is unreliable testimony from one of the company’s executives, who offered the testimony in exchange for a reduced sentence as part of a plea bargain.) But I’ve been repeatedly told by passionate, seemingly well-informed Brazilians on both sides of this debate that the judicial opinions in this case—the original trial court verdict and the appellate court affirmance—demonstrate that their side of the argument is clearly correct:

  • On the one hand, I’ve been told by several of Lula’s strong supporters that the charges against him are bogus and the conviction is improper. “Just read the judicial opinions from the trial court and the appeals court,” one of them told me last spring, “and it will be obvious that they make no sense, and that there was no real legal or factual basis for the conviction.” (I’m paraphrasing, but only slightly.)
  • On the other hand, I’ve been told by supporters of the prosecution in this case that Lula’s conviction was the right legal result, and that the attacks on the verdict (and the associated attacks on the prosecutors and judges) are politically-motivated obfuscation. “Just read the judicial opinions from the trial court and the appeals court,” several people with this view have emphasized, “and it will be obvious that the law and the evidence amply supported the verdict.”

Since smart, well-informed advocates on both sides have told me I should read the opinions, that seemed like a sensible thing to do. Until recently, though, this would not have been possible, as the opinions were (to my knowledge) only available in Portuguese, which I do not read. But I was recently informed that the trial court opinion, as well as an official summary of the appeals court opinion, are now available online in English translation! I haven’t had a chance to read them yet (the trial court opinion is 185 pages long; the summary of the appellate court ruling is a more succinct six pages); I may post again after I’ve done so if I feel like I’ve got anything useful to say. For now, it occurs to me that there might be other non-Portuguese speakers out there who are following developments in Brazil and would like to read these opinions for themselves, so I’m posting the links:

  • The trial court verdict is here.
  • A summary of the appellate court ruling is here. (I’m still hoping to find and post an English translation of the full appeals court ruling.)

Hopefully this will be helpful to others who are trying to work through what they think about the accusations and counter-accusations swirling around this high-profile case. Again, there’s only so much an outsider can learn from the text of court opinions, especially without knowing more about the surrounding context and the details of Brazilian law, but I figure this will at least be helpful.

[NOTE: The original version of this post erroneously characterized the appeals court document linked to above as the full appeals court ruling. That was incorrect; the online document is an English translation of the summary of the appeals court ruling. The text of the post–as well as its title–have been changed to correct this mistake.]

Guest Post: What To Make of Latin America’s Wave of Anticorruption Prosecutions?

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Today’s guest post is from Professor Manuel Balan of the McGill University Political Science Department:

There seems to be a surge in corruption prosecutions of current or former presidents throughout in Latin America (see, for example, here, here, and here). In the last year we have seen sitting or former presidents prosecuted for corruption in Brazil, Guatemala, El Salvador, Honduras, Colombia, Costa Rica, Ecuador, and Panama. In Peru, Pedro Pablo Kuczynski resigned from the presidency amid corruption probes, and the last three former presidents are either facing trial or serving time for corruption. Argentina may soon join this list as a result of the so-called “Notebook Scandal,” which has triggered a fast-moving investigation that has already snared 11 businessmen and one public official, and is getting closer to former President, Cristina Fernández de Kirchner. (Argentina’s former vice-president Amado Boudou was also sentenced to almost six years in prison for corruption in a separate case.) Indeed, it now seems that Latin American presidents are almost certain to be prosecuted for corruption at some point after leaving office, if not before. My colleagues and I have documented the growing trend of prosecution of former chief executives in the region since democratization in the 1980s: Out of all presidents who started their terms in the 1980s, 30% were prosecuted for corruption. Of those that entered office in the 1990s, 52% were or are being currently prosecuted for corruption. In the group of presidents that began their terms in the 2000s, 61% underwent prosecution for corruption. And, remarkably, 10 out of the 11 presidents elected since 2010 who have finished their mandates either have been or are currently being prosecuted for corruption.

The explanation for this trend is not entirely clear. It’s probably not that Latin American presidents have become more corrupt. Some have suggested that the uptick in corruption prosecutions is a reaction, by the more conservative legal establishment, against Latin America’s “Left Turn.” But the trend towards increased prosecution is hardly limited to the region’s self-identified leftist leaders; in fact, left and non-left leaders are nearly equally likely to be prosecuted for corruption. Part of the explanation might have something to do with changes in prosecutorial and judicial institutions, media, or public expectations—the reasons are still unclear, and likely vary from country to country. Whatever the explanation, is this trend something to celebrate? Some observers say yes, arguing that the anticorruption wave sweeping Latin America is the result of Latin American citizens, fed up with corruption and taking to the streets in protest, putting pressure on institutions to investigate and punish corrupt politicians.

While I wish I could share this optimism, I think it’s likely misplaced. Continue reading →

Brazil’s “Clean Slate” Law Keeps Lula Off Ballot — Now Let’s Smear His Prosecutors

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Brazil’s top electoral court ruled Friday, August 5 (here), that former President Luiz Inacio Lula da Silva, now serving a 12-year sentence for accepting a bribe, cannot stand as a candidate in Brazil’s upcoming presidential elections.  “Lula,” as he is universally known, was to be the candidate of one of Brazil’s major parties, and if pre-election polls are to be believed, he stood a very good chance of winning, setting up the unusual (to say the least) situation of a head of state governing from a jail cell.  Absent a last-minute reversal by Brazil’s Supreme Court, Lula will now sit out the election in jail and the threat Brazil’s government will be run by a convict is over.

Lula’s supporters claim he is a political prisoner and is being unfairly denied the right to run for president.   In doing so, they have glossed over the extraordinary protections the Brazilian legal system has afforded him, both in his effort to overturn his conviction and to run for office.  Having failed in the courts of law, they are now trying to smear the prosecution in the court of public opinion.  A report from a well-placed source in Brazil — Continue reading →

Will Brazilians Elect Their Own Donald Trump?

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Will Brazil get its own Donald Trump? Brazil’s next election is right around the corner (the campaign starts August 16, and first round elections are October 2) but currently Jair Bolsonaro—a right wing, pro-gun rights, anti-gay firebrand who has proudly branded himself the “next Donald Trump”—is polling first among eligible candidates, trailing only former president Lula Inácio de Silva—who as of now is not actually allowed to run due to his conviction on corruption charges—and the “null option” (that is, none-of-the-above). What explains Bolsonaro’s appeal? In large part, the issue of corruption. Revelations of graft and bribery have continued to pile up in Brazil over the last few years—most notably (though not exclusively) in connection with the so-called Car Wash investigation of corruption in Brazil’s state-owned oil company, which may have involved upwards of $5 billion in stolen public funds. These corruption scandals have already led to the impeachment and removal of former President Dilma Rousseff, criminal charges against the current President Michel Temer, and the conviction and imprisonment of former President Lula. Given all this, it’s little wonder that in a recent poll, corruption was ranked as the most important issue for 62% of Brazilian citizens.

Much as Donald Trump pledged to “drain the swamp,” Bolsonaro has centered his campaign on the issue of corruption. He asserts that he is the only candidate in the election who has not engaged in some form of corruption or white collar crime. Of the five major presidential candidates, he’s the only one who is not either from a major party that has been mired in a recent corruption scandal, or been part of a coalition with one of those tainted parties. (Bolsonaro’s party, the PSL (Social Liberal Party) is small, barely present at the national level, and he is advertising his status as a political outsider as one of his appeals.) Thus Bolsonaro has presented himself as the only candidate who will usher in a new, less corrupt era for Brazil.

This places some Brazilian voters who care deeply about corruption in a difficult situation. Many Brazilians may feel like their only alternative to perpetuating a corrupt system is to take a gamble on a disruptive figure like Bolsonaro. Indeed, at a recent campaign event, supporters cited his aggressive anticorruption and anti-crime stances as the principal reasons why they were planning to vote for him. Diehard supporters aside, it’s possible that some Brazilian voters who are not totally comfortable with Bolsonaro might nevertheless be swayed by his outsider persona and his aggressive attacks on Brazil’s current political class. For those who have followed U.S. politics over the past few years, this probably sounds disturbingly familiar—and indeed seems to fit into a now-recognizable pattern, also manifested in the Philippines’ 2016 election of populist, zero-tolerance Duterte. It’s precisely that similarity that should, and I hope will, give these on-the-fence Brazilian voters pause. Continue reading →

Guest Post–Assessing Corruption with Big Data

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Today’s guest post is from Enestor Dos Santos, principal economist at BBVA Research.

Ascertaining the actual level of corruption is not easy, given that it is usually a clandestine activity, and much of the available data is not comparable across countries or across time. Survey data on corruption experience can be helpful, but it is often limited to very specific kinds of corruption (such as petty bribery). Researchers and analysts have therefore, quite reasonably, tended to rely on subjective corruption perception data, such as Transparency International’s well-known Corruption Perceptions Index (CPI). (The CPI aggregates corruption perception data from a variety of other sources, mostly expert assessments.) But conventional corruption perception measures (including those use to construct the CPI) have well-known problems, including limited coverage (with respect to both years and countries) and relatively low frequency (usually annual). And they rely on the perceptions of a handful of experts, which may not necessarily be representative. These limitations mean that while traditional perception measures like the CPI may be useful for some purposes, they are not as helpful for others, such as measuring the impact of individual events or news reports on corruption perceptions, or how changes in corruption perceptions affect government approval ratings.

To address these concerns, a recent study by BBVA Research, entitled Assessing Corruption with Big Data, offered an alternative, complementary type of corruption perceptions measure, based on Google web searches about corruption. To construct this index, we examined all web searches classified by Google Trends in the “Law and Government” category for individual countries, and calculated the proportion of those searches that contain the word “corruption” (in any language and including its misspellings and synonyms). Our index, which begins in 2004, covers more than 190 countries and, unlike traditional corruption indicators, is available in real-time and with high-frequency (monthly). Moreover, it can be reproduced very easily and at very low cost.

Here are some of our main findings: Continue reading →

How “Scandalizing” Corruption Can Backfire

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High profile corruption scandals are making headlines almost every day: Israeli Prime Minister Benjamin Netanyahu is embroiled in multiple bribery allegations; Brazilian President Luiz Inácio Lula da Silva (known as Lula) was convicted for his involvement in corruption; Peruvian President Pedro Pablo Kuczynski was forced to resign after his allies were caught on tape buying political support to defeat his impeachment vote. The list could go on and on. And one cannot help noticing that the media coverage of these high-profile corruption cases often focuses on the most lurid, sensational aspects of individual politicians’ corrupt behavior. For example, as the Netanyahu probes unfolded, the Israeli media emphasized the juicy details: how Netanyahu and his wife were bribed with Cuban cigars and Dom Pérignon worth up to $130,000, the state’s annual allocation of approximately $3,000 for the PM’s pistachio ice cream supply, and his son’s bragging of how his father pushed through a gas deal caught on tape in a strip club. And this is but one example. It seems that corruption cases are often covered as if they were TV dramas, with entertaining plot twists and voyeuristic appeal. To put this in the terminology developed by Shanto Iyengar in his book on how TV news frames political issues, much of the contemporary media coverage of corruption tends to be “episodic” (focusing on individual stories or specific events, putting the issues in a more subjective light, and including sensational or provocative content) as opposed to “thematic” (more systematic, abstract, and in-depth, and providing a wider context for a more nuanced understanding of the causes and trends).

Such salacious coverage of corruption is perhaps unavoidable; these tawdry details attract more readers and viewers than dry reporting on financial misdeeds and back-room negotiations. And one might think that such coverage would be more effective in motivating citizens to take action against corruption—whether through votes, protests, organizing, or other means. After all, as Jimmy Chalk argued last year on this blog, anticorruption narratives can be more effective when they include dramatic stories with virtuous heroes and sinister villains. That may well be true for narratives fashioned by activists in the context of a campaign, but for news reporting, the episodic/scandal-centric approach may be counterproductive, for three main reasons:

Continue reading →

Is the West Being Too Critical of Corruption in Ukraine? The Debate Continues

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A couple weeks back I posted a commentary on an interesting debate over the West’s approach to promoting anticorruption in Ukraine. On the one side, Adrian Karatnycky (the Managing Partner of a consulting firm that assists international clients with government relations in Ukraine) and Alexander Motyl (Professor of Political Science at Rutgers) published a piece arguing that the West’s approach to promoting anticorruption was misguided, for two reasons: First, because (according to the authors) there was too much focus on punishing individual wrongdoers rather than on institutional reform, and second because the emphasis on the failings of the Ukrainian government (and the wrongdoing of individual Ukrainian officials) was undermining a reformist government, and would likely lead Ukrainian voters to embrace populist demagogues. On the other side, Daria Kaleniuk (the executive director of a Ukrainian civil society organization called the Anti-Corruption Action Center) countered that the only reason the Ukrainian government has made any progress on anticorruption reforms is because of pressure from the West, and that holding individual wrongdoers accountable is essential to making progress on this issue and restoring the faith of the Ukrainian people in the institutions of government.

My own take was that Ms. Kaleniuk is likely correct that individual accountability, though not sufficient, is a necessary component of an effective anticorruption strategy; Karatnycky and Motyl’s implicit argument that Ukraine could make headway on the corruption problem without an effective system for holding individual wrongdoers accountable, as long as the country pursues “institutional reforms” (like privatization and de-monopolization), struck me as both facially implausible and inconsistent with what we know about successful anticorruption reforms elsewhere. Karatnycky and Motyl’s second point, about “messaging,” struck me as harder. On the one hand, it’s true that emphasizing only problems and failures and shortcomings might breed cynicism, frustration, and possibly political instability. But on the other hand, exposing corruption may be the only way (or at least the most effective way) to mobilize public opinion to address some very real problems.

I probably wouldn’t have returned to this topic (about which, I can’t repeat enough, I lack genuine expertise), but Mr. Karatnycky and Professor Motyl published a rejoinder to Ms. Kaleniuk last week that I think merits further commentary. The new piece makes a number of separate points, and I won’t touch on all of them. But if I had to sum up their central argument, it would go like this:

Don’t be too critical of the ruling elites—even if those elites are pretty corrupt, and even if the only reason they’ve done much of anything about corruption in the past is because they’ve been pressured or shamed or coerced into doing so. If you’re too mean to them, they might lose the support of the people—and what comes next might be much worse.

That summary, which I admit is a bit of a caricature, might seem unfair. But I don’t think it is. Indeed, I not only think it’s an accurate distillation of Karatnycky and Motyl’s main argument, but I actually think that it’s an argument worth taking seriously, and in some circumstances might even be right. But I’m skeptical it’s right in most cases, and I remain to be convinced that it’s right about Ukraine. Under most conditions, I think it’s probably wrongheaded and dangerous to say that we shouldn’t criticize a government for failing to tackle corruption or try to expose the corruption of individual politicians out of a concern that doing so might undermine the legitimacy of the government.

So, before I proceed, let me make clear that my caricature—“Don’t say mean things about the kinda-corrupt-but-kinda-reformist incumbents”—really is a fair distillation of the argument. Here the key passages from Karatnycky and Motyl’s most recent piece: Continue reading →

Brazil: A Model for International Cooperation in Foreign Bribery Prosecutions

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Much ink has been spilled celebrating the extraordinary crackdown on corruption in Brazil over the past few years (including on this blog). Headlined by the massive Operation Car Wash (Portuguese: Lava Jato)—in which officials received nearly $3 billion in bribes to overcharge Petrobras, Brazil’s state-controlled oil company, for construction and service work—high-profile corruption investigations have swept through Brazil, threatening to upend its reputation as a bastion for unchecked graft. Although corruption in Brazil remains a serious problem, the extensive investigations have worked to elevate the nation as an inspiration for countries looking to address their own corrupt political systems and hoping to become “the next Brazil.”

In addition to the headline-grabbing investigations targeting the upper echelons of the Brazilian government, Brazilian authorities have also worked closely with U.S. authorities investigating bribery activity in Brazil, leading to significant penalties both under Brazilian law and under the U.S. Foreign Corrupt Practices Act (FCPA). This is a significant development, because it demonstrates the possibility for close collaboration on cross-border bribery cases between a developed country (usually on the “supply side” of transnational bribery cases) and a developing country (on the “demand side”). Commentators have complained that too often supply-side enforcers like the United States take an outsized role in transnational bribery cases, with the countries where the bribery takes place doing too little. Other commentators have cautioned that an increase in prosecutions by other countries, in the absence of some sort of global coordination mechanism, may lead to races to prosecution or to over-enforcement. China’s nearly $500 million fine of British pharmaceutical giant GlaxoSmithKline in 2014 for bribing Chinese doctors and hospitals was emblematic of these fears, providing an example of an aggressive, unilateral approach to demand-side enforcement – while putting DOJ in the unfamiliar position of pursuing FCPA violations as a cop late to the scene.

Through its recent enforcement actions, Brazil has provided a different model. While there have been successful joint enforcement actions in the past—such as the Siemens case—the recent series of coordinated U.S.-Brazil actions exhibit how developed and developing countries can work together in anti-bribery enforcement, sharing in the investigative responsibilities, negotiations with companies, and even the financial returns.

Continue reading →

More on the 2017 Corruption Perceptions Index, and the Relationship Between Media/Civil Society Freedom and Corruption

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The rest of the anticorruption commentariat (and the mainstream media) may have already moved on from the publication of Transparency International’s 2017 Corruption Perception Index (CPI), but I wanted to follow up on my other posts from earlier this month (here and here) to discuss one other aspect of the new CPI. The general overview, press release, and other supporting materials that accompanied the latest CPI stress as their main theme the importance of a free press and a robust, independent civil society in the fight against corruption. As TI states succinctly in the overview page for the 2017 CPI, “[A]nalysis of the [CPI] results indicates that countries with the least protection for press and non-governmental organisations (NGOs) also tend to have the worst rates of corruption.” And from this observation, TI argues that in order to make progress in the fight against corruption, governments should “do more to encourage free speech, independent media, political dissent and an open an engaged civil society,” and should “minimize regulations on media … and ensure that journalists can work without fear of repression or violence.” (TI also suggests that international donors should consider press freedom relevant to development aid or access to international organizations, a provocative suggestion that deserves fuller exploration elsewhere.)

Speaking in broad terms, I agree with TI’s position, and I’m heartened to see TI making an effort to use the publicity associated with the release of the CPI to push for concrete improvements on a particular area of importance, rather than simply stressing the bad effects of corruption (such as the alleged adverse impacts on inequality and poverty), or devoting undue attention to (statistically meaningless) movements in country scores from previous years. Whether TI succeeded in leveraging the CPI’s publicity into more attention to the freedom of the media and civil society is another story, but the effort is commendable.

That said, I spent a bit of time digging into the supporting research documents that TI provided on this issue, and I find myself in the uncomfortable position of finding the proffered evidentiary basis for the link between a free press/civil society and progress in the fight against corruption problematic, to put it mildly—even though my own reading of the larger academic literature on the topic makes me think the ultimate conclusion is likely correct, at least in broad terms. That latter fact, coupled with my recognition that the materials I’m evaluating are advocacy documents rather than academic research papers, makes me reluctant to criticize too harshly. Nonetheless, on the logic that it’s important to hold even our friends and allies accountable, and that in the long term promoting more careful and rigorous analysis will produce both more suitable policy prescriptions and better advocacy, I’m going to lay out my main difficulties with TI’s data analysis on the press freedom-corruption connection: Continue reading →

Adjusting Corruption Perception Index Scores for National Wealth

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My post two weeks ago discussed Transparency International’s newly-released 2017 Corruption Perceptions Index (CPI), focusing in particular on an old hobby-horse of mine: the hazards of trying to draw substantive conclusions from year-to-year changes in any individual country’s CPI score. Today I want to continue to discuss the 2017 CPI, with attention to a different issue: the relationship between a country’s wealth and its CPI score. It’s no secret that these variables are highly correlated. Indeed, per capita GDP remains the single strongest predictor of a country’s perceived corruption level, leading some critics to suggest that the CPI doesn’t really measure perceived corruption so much as it measures wealth—penalizing poor countries by portraying them as more corrupt, when in fact their corruption may be due more to their poverty than to deficiencies in their cultures, policies, and institutions.

This criticism isn’t entirely fair. Per capita income is a strong predictor of CPI scores, but they’re far from perfectly correlated. Furthermore, even if it’s true that worse (perceived) corruption is in large measure a product of worse economic conditions, that doesn’t mean there’s a problem with the CPI as such, any more than a measure of infant mortality is flawed because it is highly correlated with per capita income. (And of course because corruption may worsen economic outcomes, the correlation between wealth and CPI scores may be a partial reflection of corruption’s impact, though I doubt there are many who think that this relationship is so strong that the causal arrow runs predominantly from corruption to national wealth rather than from national wealth to perceived corruption.)

Yet the critics do have a point: When we look at the CPI results table, we see a lot of very rich countries clustered at the top, and a lot of very poor countries clustered at the bottom. That’s fine for some purposes, but we might also be interested in seeing which countries have notably higher or lower levels of perceived corruption than we would expect, given their per capita incomes. As a crude first cut at looking into this, I merged the 2017 CPI data table with data from the World Bank on 2016 purchasing-power-adjusted per capita GDP. After dropping the countries that appeared in one dataset but not the other, I had a 167 countries. I then ran a simple regression using CPI as the outcome variable and the natural log of per capita GDP as the sole explanatory variable. (I used the natural log partly to reduce the influence of extreme income outliers, and partly on the logic that the impact of GDP on perceived corruption likely declines at very high levels of income. But I admit it’s something of an arbitrary choice and I encourage others who are interested to play around with the data using alternative functional forms and specifications.)

This single variable, ln per capita GDP, explained about half of the total variance in the data (for stats nerds, the R2 value was about 0.51), meaning that while ln per capita GDP is a very powerful explanatory variable, there’s a lot of variation in the CPI that it doesn’t explain. The more interesting question, to my mind, concerns the countries that notably outperform or underperform the CPI score that one would predict given national wealth. To look into this, I simply ranked the 167 countries in my data by the size of the residuals from the simple regression described above. Here are some of the things that I found: Continue reading →