Brazil’s big-bucks brouhaha

For people watching the scene at the Sao Paulo airport, it must have been amusing to see Brazilian cops searching the luggage of Jose Vieira da Silva and taking $100,000 out of his neatly packed underpants. Minutes before they had found an additional $85,000 elsewhere in the bag.

Then came the serious questions: How could a low-level political aide to the Workers’ Party chairman carry so much money? Whose money was it? What was it meant for?

This bit of seeming corruption in the ranks of President Luiz Inacio Lula da Silva’s Workers’ Party comes on the heels of a bigger scandal, the accusations by a Brazilian legislator that operatives of Lula’s ruling party were bribing politicians from opposition parties to switch votes and affiliations.

Internationally, this comes at a bad time for Lula, who was trying to enhance Brazil’s global stature.

Apart from staining a political party that has historically considered itself holier than the rest, the charges have thrown Lula’s Cabinet and party hierarchy into disarray. His powerful chief of staff, Jose Dirceu, has resigned, and the Workers’ Party chairman, treasurer and secretary have been pushed from their posts.

So far, Lula seems to have survived the crisis, in part by employing what sounds like a Richard Scrushy- or Ken Lay-style defense: I knew nothing, and my trusted underlings betrayed me. Most Brazilians seem to have bought it, putting the blame on Congress and the political parties.

Even granting Lula the benefit of the doubt, the magnitude of the scandal ought to make people wonder how he could have ignored a number of warning signs.

As far back as June 2004, a widely circulated videotape showed Waldomiro Dinz, an advisor to Lula’s chief of staff, apparently demanding campaign contributions and bribes from major industrialists. Health ministry officials and businessmen were also exposed in a plot to inflate the government’s purchase price for blood and blood derivatives.

Brazil is also plagued by pervasive and growing money-laundering operations run by organized crime groups. Some analysts have suggested organized crime connections to political corruption and campaign financing.

Lula needs to do more than plead ignorance if he wants to keep Brazil’s international star rising, no matter how willing Brazilians may be to forgive him.