WORLD

A man on the run

Collor faces calls for his impeachment

SCOTT STEELE August 17 1992
WORLD

A man on the run

Collor faces calls for his impeachment

SCOTT STEELE August 17 1992

A man on the run

BRAZIL

Collor faces calls for his impeachment

Until recently, Fernando Collor de Mello, the athletic young president of Brazil, wore different T-shirts on his regular Sunday jogs through the capital, Brasilia, each printed with a political or moral “thought for the day.” But now, as a growing corruption scandal engulfs the handsome 43-year-old leader, slogans of a different kind are springing up throughout Latin America’s largest country. Street vendors are doing a brisk business in Tshirts emblazoned with such messages as “Don’t steal. Fernando hates competition” and “Warning: ‘Collora’ can kill you.”

The president has vehemently denied any wrongdoing and vows to remain in office until his five-year term ends in 1995. But damaging evidence linking him to illegal profiteering continues to emerge, threatening his 29-month-old presidency. Said political columnist Carlos Castello Branco: “Congress is beginning to prepare for the worst: for impeachment.”

The “Collorgate” affair, as many Brazilians call the widening scandal, has badly shaken the fledgling democracy. Some analysts say that they now doubt that the president, who in 1989 won election on an anti-corruption, reformist platform in Brazil’s first fully democratic vote in nearly 30 years, can withstand the accusations against him. They include charges that he secretly profited from an illegal kickback operation arranged by his former campaign treasurer, businessman Paulo César Farias. A congressional committee investigating Farias since June for alleged improprieties, including influence peddling and tax evasion, is uncovering purported links to the president’s office. And leaders of Brazil’s three main opposition parties have agreed to press for impeachment if Collor does not resign.

Still, even in a nation accustomed to decades of military rule, it appears that democracy will survive in the country of 153 million citizens. Said Paulo Cardinal Evaristo Ams, the Roman Catholic archbishop of Sào Paulo: “Our institutions are strong.” Added the prelate of South America’s largest city: “The people don’t want a coup. Brazil is much greater than the crisis.” Declared political scientist Zairo Cheibub: “The question on the agenda is not a coup. The question on the agenda is impeachment.”

Collor’s problems began in May, when his younger brother, Pedro, 39, told Veja, Brazil’s leading newsmagazine, that the president had profited from questionable business deals with Farias. At the time, Pedro Mello, who unlike Collor uses his father’s surname, claimed that, after taking office, the president had used Farias as a “front man” in illicit kickback deals involving government contracts worth millions of dollars. Both Collor and Farias denied the charges.

Mello later acknowledged that he had no

direct evidence that his brother, who launched a lawsuit against him, was receiving illegal funds from companies doing business with the government. But he continued to contend that he had proof of “illicit activities” and tax evasion on the part of Farias, leading to a congressional investigation. That inquest, coupled with extensive media inquiries, soon drew the president into the scandal.

A former federal deputy, Renan Calheiros, who was Collor’s government leader in the lower house of congress, accused Farias of running a “network of parallel power” that enabled him to obtain lucrative government

contracts. Some local journalists also charge that Farias funnelled illegal profits to Collor by depositing money into the bank account of the president’s personal secretary. Collor, they say, used the funds to pay personal expenses, ranging from a $ 1-million home gardening bill to his wife’s beauty appointments.

Collor has denied having any connection with Farias since the election. But journalists contend that Collor’s family received $2.8 million from Farias-owned businesses over a 30month period, including weekly cheques of $5,700 made out to first lady Rosane Collor that were signed by Farias himself. Copies of the cheques, they add, are locked in an underground safe in the federal senate and will be attached to the investigating committee’s final report, which is expected to be released at the end of August.

Late last month, a key witness delivered the most damaging blow to Collor so far, claiming that the president’s associates fabricated a coverup to account for the money. Earlier, to help establish Collor’s innocence, a former aide had testified that the funds used by the president came not from Farias, but from a $5.8-million loan by a Uruguayan trading company to finance the 1989 presidential campaign. But Sandra Fernandes de Oliveira, secretary to Alcides Diniz, a prominent Sao Paulo businessman who is a close friend of the president, testified that she overheard her boss and company lawyers planning to fabricate a document to strengthen the loan defence. Since then, cabinet ministers have indicated that they consider a proposal to impeach Collor to be inevitable.

If the president has to leave office, his likely successor would be Vice-President Itamar Franco, who opposes the radical privatization and public spending reduction programs that Collor has initiated. But last week, in an effort to attract the support of rightwing congressional allies and to avoid impeachment—which requires a two-thirds majority in the 503-member lower house—Collor announced that he was prepared to release about $1 billion

to fund deputies’ development programs. That apparent departure from the government’s austerity program fuelled speculation that hyperinflation, which has been reduced to 22 per cent a month from about 50 per cent a month when Collor took office, might again plague the Brazilian economy. Meanwhile, the only winners in the current crisis appear to be the street vendors now peddling T-shirts and bumper stickers that read, “Collor for Expresident.”

SCOTT STEELE

DEAN GRABER

Rio de janiero