Byline: Alvaro Vargas Llosa, SPECIAL TO THE WASHINGTON TIMES
Brazil's President Lula da Silva is immersed in a seemingly endless corruption scandal; his once larger-than-life reputation has been reduced to tatters. The significance of this is not negligible: Lula has become an emblem of the post-Cold War left with his combination of conservative fiscal and monetary policies and big social programs targeting the poor.
A breathtaking sequence of revelations involving the government and Lula's Workers' Party - beginning with the confession by opposition legislator Roberto Jefferson, that he had received bribes for his vote in Congress - has brought to the surface a vast scheme of bribes to legislators and irregular methods of party financing.
The conventional wisdom was that, despite his radical Marxist roots and occasional concessions to his political base, Lula represented a healthy move away from the old left and toward emergence of a new model for underdeveloped nations similar to Europe's social democracy. Many thought this model would have a moderating effect on the left across the Continent and hold Hugo Chavez in check.
However, Lula's capacity to reinvent the left always hinged on something more than keeping interest rates high to stem inflation, maintaining a strong currency, riding on the high prices of certain commodities, and giving cash to poor families. He could either opt for simply managing the perpetual crisis or could try to overhaul a labyrinthine political system that benefited certain pockets of industrial and agricultural production but keeps millions of people out of opportunity. He chose the former path.
While technocrats talk about 3 percent economic growth for Brazil this year and an export boom that has translated into a trade "surplus" of $40 billion, Lula's voters are indignant at the corruption scandal. But the real point is that corruption has developed naturally in an environment of limited opportunities due to asphyxiating government interference. And the absence of adequate limits on the political bureaucracy's power in turn is an incentive for corruption at the top level.
The corruption of Lula's government, therefore, should be seen more as a symptom than a cause. Ranting about corruption without removing the causes will only generate further frustration. Brazilians impeached President Collor de Mello in the 1990s but failed to change a system that ensured a party like Lula's would fall into the same trap years later.
Brazil has often been a bellwether of Latin American political currents. It exemplified French-style authoritarian positivism in the early 20th century, centrally planned industrialization in the 1960s and 1970s and democracy in the 1980s. …