The end of the PT´s history

2014 may well enter Brazil´s political memory as the year in which the Workers Party (PT) died. It died as a result of involuntary suicide or it may have inoculated itself with a lingering, progressive and incurable illness called corruption — a disease that degenerated its cells and transformed it into something that no longer had anything to do with what it dreamed of being when it was founded. The PT remains alive, in fact, extremely alive, as a machine occupying the State. However, it is no longer the party of those Brazilians who earn their living from their labor as it once aimed to be. It is even less of a movement that once saw itself as an alternative to capitalism in Brazil. Today, tragically, the real PT is just the party of construction companies that carry out public infrastructure works, those who sell goods and services to the State, and all those whose business activity involves the constant harassment of the Treasury. This is something that goes back a long time, to the days when the PT began to like the taste of the fruits of government. Now, at the end of 2014, it is reduced to a commercial enterprise. This is proven by the undeniable facts revealed in the current legal investigation into corruption in Petrobras — the unlimited, uncontrolled and unprecedented rip-off in Brazil´s history known as the “petrolão” (big oil scandal) that has become the most notable hallmark in the PT´s 34 years of existence.

How can a political party survive if it has lost its honor? Perhaps there could have been some hope if former president Lula, current president Dilma Rousseff and most of the PT leadership had decided to break with the strategy of serial corruption which is currently the main reason for the party´s existence and the vital center of its program as a political organization. However, none of them has shown the slightest sign of wanting to do anything like this. On the contrary, the party remains inherently tied to corruption as is proven, day after day, in its commitment to defend at any cost the central conduct of Petrobras and its senior management. Instead of condemning the crimes that have been committed within the company over the last 12 years, or at least trying to distance itself from them, the PT has dived headlong into collusion with the thieves. It reached the stage of carrying out a congressional investigation committee (known locally as CPI) that issued a 900-page report which concluded that Petrobras had done nothing wrong in the “petrolão” scandal. It then had to backtrack when it saw the extent of this foolish conclusion. The situation of Rousseff, who has been the most influential person in the company since 2003, is no better than that of the party. This can be seen in a very simple question. Could the president go on national television today and swear that during all this time she never knew anything about any serious problem in Petrobras´s most important business deals? No she cannot. Checkmate.

By allowing itself to be contaminated by corruption shortly after winning its first municipal elections around 30 years ago, the PT certainly did not want to kill itself. In fact, it imagined that a little stealing would not harm anybody. (Did former president Lula not admit a short time ago that he thought it was reasonable to rob a bank here or there, as bankers had money to spare? This was the spirit of the thing.) However, these calculations, in the best of assumptions, were pure self-delusion. Everybody knows there is no such thing as a vice that leads to virtue and, in the case of the PT, stealing a little only led it to steal even more. It went from the municipal governments upwards, from the bribe paid by the municipal bus company to the piles of money offered by Brazil´s biggest construction companies, from the small world of school meal contracts to the large world of big business. This is where English is spoken. The bribes range from one Real to millions of dollars deposited in foreign bank accounts. On the other side of the counter are the multinational companies, pension funds, the loan portfolio of Brazil´s national development bank, the BNDES, and, as we see in the petrolão scandal, the endless funding from Petrobras. This is the situation we have reached. When we talk about the PT nowadays, it is unusual to hear anything that is related to the world of the worker. From what we hear, the PT has become a party that is constantly being forced to explain things such as overbilling, works being awarded without public tenders, “topping up contracts” and other similar marvels.

The PT of Lula, the Rousseff´s government and the “allied base” in Congress continues to exist, of course, with all its ability to do bad — and even good, if it wanted to. It continues to be the biggest political party in Brazil and nominate people who give orders. It has almost R$ 1.5 trillion to spend in the 2015 Budget, according to its calculations. However, it has become something else. After three decades of exercising power, mainly over the last 12 years, the PT has lost its faith. During this entire time, it has been unable to bring a single worthwhile idea or anything that could even be called an idea to the national debate. It has been incapable of forming any real leadership in its whole history and continues exactly as it was when it was founded in 1980, with Lula the only outstanding leader and, under him, an abyss. Can anybody mention a name remotely similar to perform his role in the party? The PT had around R$ 350 million to spend in re-electing its candidate for the presidency in the last electoral campaign, more than any other competitor. The Workers Party? Obviously an organization with more than R$ 350 million to burn in a campaign cannot be a party of the workers. It could be anything else, but certainly not that.

It is equally unbelievable that a political group that has destroyed the value of the people´s assets to the extent the PT has would really be on the side of the Brazilian population. No other government has managed to bring about so many losses in Petrobras´s market value, cash situation and reputation since the company was founded in 1953.  Petrobras shares traded at over R$ 50 in 2008, when they reached their highest level, and are trading at less than R$ 10 at the end of this year. The company´s market capitalization, which was more than R$ 730 billion at that time, has crashed to R$ 115 billion today. The shocking case of the Abreu e Lima refinery in Pernambuco state, which has been under construction since 2007 and is at the very center of the current corruption investigations, is one of the biggest disasters in the history of Brazilian industry. The refinery was initially estimated at US$ 2.5 billion but could end up costing up to eight times this amount and still has no scheduled handover date after seven years of work. Petrobras has signed around 800,000 contracts without any public tenders since the PT came into power. Lula and Rousseff both knew this perfectly well but, today, after the roof has fallen in, they say they never noticed any irregularity in the way the company did business. What else were they expecting?

There is a lot more to say and history will certainly say it. By the way, there is no longer any doubt that the overall mess Petrobras is in will be a heavy factor in the final judgment on the periods in which Lula, Rousseff and the PT governed Brazil. The claim that the stealing was limited to the company´s small fry and occurred a long way from the exalted eyes of the politicians has been proven to be false in the face of the facts. It is a “fantasy”, as president Rousseff would say. A single episode that occurred five years ago suffices to make this clear. In 2009, the Federal Accounts Court announced the existence of serious signs of corruption in the Abreu e Lima refinery and Congress, with its “allied base” and all, approved a resolution that suspended the transfer of funds to the project. Lula simply vetoed the decision, claiming it could put “25,000” jobs at risk. This was an exact repetition of the oldest and most efficient excuse the construction companies use when the net starts tightening around them. Rousseff, who was certainly informed of the mistakes committed at that time by Petrobras, could obviously not have ignored this veto. How can she now say the government has “checked” all the allegations?

What the president and Lula did was exactly the opposite and actually sabotaged the investigations as they thought they could cover up the real situation. To complicate things, Rousseff is directly involved in Petrobras´s acquisition of the Pasadena refinery in the United States, perhaps the most inexplicable of all the bad deals done in the company´s existence of more than a half century. Her trusty friend, right-hand woman and soul mate, Graça Foster, the current CEO of Petrobras, lied explicitly when she said she had known nothing about allegations of corruption in the company´s deals with at least one foreign supplier. To her credit she also came up with the idea of presenting amounts related to the bribes paid in the general corruption case being examined by the legal authorities within the Petrobras balance sheet. As a direct result of all the theftthat has already been denounced, Brazil´s biggest company is ending the year in an unprecedented, humiliating position of not having published to date its financial statements for the third quarter of 2014 as no credible auditing firm would be prepared to examine the document. Who would be brave enough to believe in any figure presented by the Petrobras of Rousseff & Foster?

The journalist Fernando Gabeira recently wrote that the PT died when Lula arrived in the Presidency in 2003 and has continued to die since then. That is exactly what has happened. Its leaders gave up trying to build the future and devoted 100% of their time to benefiting from the present-day attractions. That is all it now has and this will only last as long as the boss lasts. The PT´s history has ended because the party is no longer interested in trying to create a country that is different from the way it is today as it has learned during its time in government that it likes things exactly as they are. The party did not resist temptation when the first bag of money was thrown onto one of its tables back then. In fact, to the general surprise, its resistance to the political methods of the “right” proved to be very short-lived. It can no longer go back or squeeze the “toothpaste back into the tube” as president Rousseff put it. Nowadays, the PT and its propaganda machine are reduced to defending construction companies. This means in practice that it is combatting the investigations into the “petrolão” scandal, and organizing escape routes for the prison sentences currently being considered by the legal authorities. A vale of tears lies ahead. Corruption in Petrobras is not confined to the ill-fated Abreu e Lima refinery but extends to the works at the Comperj complex in Rio de Janeiro, the consortia of companies set up to supply drilling rigs and other heavy equipment to the company and God knows what else. Even worse is that corruption in the government is not restricted to Petrobras. It is spread throughout the vast portion of the public machine that the PT and its “allied base” have privatized to their own benefit. There is no point in getting further bogged down in complicity with the gangs of parties in Congress to find a “political shield” or wait for the media to get tired of speaking about the subject. The politicians may give their backing but they are not the people who not sign the prison sentences. The facts may leave the headlines but they will not leave the legal cases.

No organization has been as successful over such a long period or as rapidly as the PT in Brazil´s entire political history. Who could have imagined that when it was founded as a body set up by labor union leaders making speeches in a football stadium that it would become the biggest political party in Brazil? How could anyone foresee that this party, created against the heated backdrop of industrial strikes, without any consultation with the “left” which until then had believed it was the only force authorized to speak on behalf of Brazilian workers, would end up holding the Presidency of the Republic for four successive mandates? This really was an enormous triumph but it was not an enduring one. The PT was losing its soul as it was growing. To gain increasingly more, it had to appear increasingly less what it was or wanted to be. The result is that, today, when it could be basking in its most brilliant moment, it has also reached the end of its history.