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Tuesday, November 14. Operation Old Jail, a spillover from Rio de Janeiro’s Car Wash investigation, undercovers bribes paid by bus company owners to state congressmen. The prosecutors request the imprisonment of the speaker of Rio State Legislative Assembly, Jorge Picciani, and two state congressmen, all from Michel Temer’s PMDB (Brazilian Democratic Movement Party) - the party which has maintained power in Rio state for nearly 20 years.
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Two days after, the state legislature, or ALERJ decides to free the legislators. In total, 39 state congressmen vote to release their colleagues. A few hours later, the three suspects leave jail.
ALERJ’s decision to revoke the prison sentences against its congressmen was expected. The three lawmakers relied on a governmental majority in the State Congress. The center of political power has been concentrated in the Rio state legislature for decades. Governors come and go, but the cronyist parliamentary majority remains.
However, for the first time, the old political class in Rio is confronting an unedited judicial attack against corruption. Added to the context is Rio’s financial crisis, with an estimated deficit of R$20.3 Billion for 2018, and the austerity measures imposed. The result is a multitude of public sector workers in revolt, not only about their late salaries, but against the gross corruption schemes.
Carioca Cronyism
Any anti-corruption investigation implemented in Rio de Janeiro has to deal with the reality of historically consolidated power and be willing to challenge the regional political dynamic and the exchange of interests between the legislative assembly and the governor’s palace. The Governor’s pen always ends up subjected to the behavior of the groups represented in the state Congress.
This network of exchanging favors between the legislative and executive branches in Rio constitutes the base of a political phenomenon that historians call chaguism. The expression comes from Governor Chagas Freitas, who ran the state during the end of the Military Dictatorship (1979-1983), and refers to the cronyist and paternalistic practices of that administration. Such cronyist system included PMDB interests.
In practice, the power network inside of the Rio state legislature formed what philosopher Renato Janine Ribeiro ironically nicknamed “PALERJ” or “The ALERJ Party”. Independently of each congressman’s political party, all integrate the same physiological voting block in defense of their colleagues’ interests, without commitment to any regional development project. Its main project is the micro-politics of meeting the pressures of corporate groups such as the business community.
The Imprisonment of Cabral: The first blow against the PMDB
One of the main architects of this cronyist model left the ranks of parliament to occupy the head of the executive branch. From PMDB party, arose the ex-governor Sergio Cabral (2006-2014), who governed the state of Rio during the economic boom in Brazil of the last decade and helped bring the 2016 Olympics to the state capital. During his government, billion-dollar projects were launched like a new metro line and reformation of Maracana stadium for the 2014 World Cup.
As the Car Wash investigations uncovered years later, these projects involved charging bribes on the part of the governor and his cronies. Cabral led a criminal organization that embezzled R$224 million in infrastructure and building contracts with the State Government. In November 2016, the ex-governor was arrested and accused of passive corruption and money laundering.
Despite this, ex-governor’s principal allies in the executive and legislative branch tried to maintain the party’s political hegemony. In this context, the current president of ALERJ, Jorge Picciani, became one of the main political representatives of the PMDB in Brazil. Picciani is one of the bosses of the alliance between the public sector and businessmen who make a fortune from State contracts. The most symbolic example of this relationship is the Federation of Passenger Transport Businesses of the State of Rio (Fetranspor), made up of 10 private bus companies contracted to provide public transportation that are known for giving terrible service to the population. Their expensive fares caused the wave of protests for lower fares and better service which had repercussions across Brazil in June 2013.
It is a notorious fact that Fentranspor, run by the businessman Jacob Barata Filho - known as the “King of the Bus” - has always maintained a promiscuous relationship with authorities. The notorious Fentranspor slush fund, made from bribes paid to politicians in exchange for things like unjustifiable fare hikes, was finally revealed in the Operation Final Stop investigation, which showed that the transport companies paid more than R$260 Million in bribes. The Federal Police action against the “transport mafia” led to the hard blow against the PMDB’s tentacles of power: Old Jail.
The imprisoned (and released) PMDB leadership
The PMDB’s political hegemony sees itself under threat for the first time in decades. Governor Luiz Fernando Pezão - Sergio Cabral’s ex-vice governor who was elected as his successor in 2014 - faced the fall in the price of petroleum on the international market, leading to a situation in which the state revenue was not in line with expenditures.
Massive public worker protests from areas like the education, health and the justice department were met with tear gas bombs and pepper spray. In order to balance the budget, Governor Pezão proposed a package of radical austerity measures, including an increase in payroll pension deductions, cuts in social programs, freezing salaries until 2020 and the privatization of the state water and sewage company, CEDAE.
This chaotic context has made the PMDB lose the little political legitimacy it had left with the population. In the state capital, Pezão has a miserable 3 percent approval rating. This change in the power relationship explains the deepening of State’s Attorney and Federal Police investigations into corruption. The investment against Rio’s political class and its corrupt relationship with the private sector will have a “hygienic effect”.
The Federal Police started Operation Old Jail, which revealed the use of the presidency of the legislative assembly for practicing criminal associations, money laundering and tax evasion. The investigators requested the imprisonment of the leader of the government coalition, state congressman Edson Albertassi, the ex-president of ALERJ, Paulo Melo and the all-powerful current ALERJ president, Jorge Picciani, along with another 10 people. They are accused of receiving monthly bribes from Fentranspor to approve projects favorable to the bus company owners.
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Two days later, federal judges from the second regional court, unanimously requested the preventative imprisonment of Jorge Picciani, Paulo Melo and Albertassi. The court, however, had to issue its judgment over a territory in which the accused have total domination, ALERJ, which has to authorize their imprisonment. In a special closed door session, the state congressmen freed Picciani, Paulo Melo and Albertassi, alleging that the Constitution only allows the imprisonment of congressmen in cases which they are caught in the act of non-bailable offenses. The opposition, made up of left parties such as PT and PSOL, was defeated by a wide margin of 39-18 votes.
One more time it became clear that the Rio de Janeiro legislative assembly continues to operate according to a dynamic corporatism, based on the political phenomenon of chaguism. The logic of the ALERJ Party maintains its deep roots in the political culture of Rio de Janeiro.
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