In the previous article, we talked about similarities between the impeachments of Fernando Collor and Dilma Rousseff. During their respective tenures as President of Brazil, both ended up enacting schemes which they had expressly stood against prior to taking office.
In his election campaign, Collor had argued that if his rival Luiz Inácio Lula da Silva won the election, he would freeze bank accounts. However, after his election, Collor himself went about freezing bank accounts, thus irking the voting populace. Though he did so to loosening the vice-grip of inflation on the economy, people felt betrayed by this action.
In her case, Rousseff had cautioned voters during her campaign speeches about her opponents intending to push through hurtful fiscal adjustments, promising that she’d not take Brazil down that road. However, given the poor state of the economy, she herself put into effect similar fiscal adjustments. Again, though the move was not wrong, it flew in the face of her campaign promises, thus angering the public.
The Rousseff era ends: Enter Michel Temer
The process of Brazil’s political impasse was completed on August 31, when Rousseff was found guilty of mishandling government spending and impeached with a 61-20 vote. This paved way for Michel Temer – Rousseff’s second-in-command – to take over and complete the remaining term until the end of 2018.
Even with the economy being in shambles, Brazilian equities (EWZ). Brazil’s stock market has had an excellent run in 2016. Bank stocks like Itaú Unibanco Holding S.A. (ITUB) and Banco Bradesco S.A. (BBD) and oil producer Petrobras (PBR) have seen sharp rises in the year.
Brazilians had another reason to rejoice: the summer Olympics which were held in August. After all the political wrangling, the games brought some relief and a much needed break. Coupled with hope for Rousseff’s impeachment and a better future, Brazil hosted a successful Olympics after an iffy start.
There were mixed feelings about Michel Temer with some polls showing that he was as unpopular as Rousseff. However, hope had preceded worry then. Recent announcements from his government have been quite unpalatable to the Brazilian people. Let’s look at this closely in the next article.