Corruption and Democracy in Latin America

Chapter8: Corruption, Accountability Reforms, and Democracy in Brazil

Over the past decade, the developmental effects of corruption have assumed a central role for academics and policy practitioners at both the local and national level, as well as within multinational institutions such as regional development banks and the World Bank. Corruption is no longer seen as a potentially beneficial instrument of economic and political development: an ample consensus exists that corruption does not grease the wheels of developing economies but rather creates distortions in policy choices, worsens the investment climate, and reduces overall societal well-being (e.g., Kaufmann , Kraay, and Zoido-Lobaton 1999; Lederman, Loayza, and Soares 2005; Mauro 1995; Rose-Ackerman 1999). Social scientists have also noted the pernicious effects of corruption on government and especially its deleterious effects in undermining the basic trust at the core of most conceptions of democracy (e.g., Bailey and Paras 2006; Gambetta 1988; Levi 1998; Warren 2004; see also the discussion by Bailey in chapter 3). Corruption, as Klitgaard (1988) noted, is the outcome of monopoly plus discretion minus accountability (C=M+D-A). The preva150    Matthew M . Tay lor 8 Corruption, Accountability Reforms, and Democracy in Brazil I am grateful for constructive feedback received from John Bailey, Chris Blake, David Fleischer, Marcus André Melo, Steve Morris, Tony Pereira, Sérgio Praça, Bruno Speck, Jorge Zaverucha, and the participants in roundtables sponsored by the Goethe Institut, LASA, and the UFPE-Woodrow Wilson Center. cor rup tion, accountabilit y reforms, and democracy in brazil   151 lence of corruption, in other words, is an outcome of the amount of power concentrated in any given political post, plus the discretion given to the postholder, minus the degree of accountability to which a corrupt postholder can expect to respond if corruption is detected. This chapter focuses on the accountability variable and the salience for democracy of the process by which responsibility for allegedly corrupt acts is allocated and accountability is enforced by public institutions, the private sector, and society as a whole. Brazil offers an important case study of the disconnect between perceptions of corruption and perceptions of accountability: although by most measures it is far from the most corrupt country in Latin America, perceptions of the widespread absence of accountability have contributed to a marked frustration with the broader political system (for a comparison within the region, see the data presented in chapter 2). Most recently, three major scandals have rocked the nation during the Lula government: (1) the mensalão scandal, in which the government allegedly held together its legislative alliance by buying off congressmen with monthly payments; (2) the so-called sanguessuga (leech) scandal, a scheme—in which one in every eight members of Congress have been implicated—by which ambulances were included in the budget, at inflated prices, in return for kickbacks ; and (3) a scandal in the state of Rondônia that has led to the arrests of the head of the state court, several prosecutors, and all but one state assembly member on charges of looting the state treasury.1 But Lula’s government is not an exception to the rule; in fact, every one of his predecessors during the democratic regime has faced some sort of corruption scandal. Not surprisingly, corruption was one of the biggest themes of the 2006 electoral campaign, and there is no shortage of proposals for reform. Yet despite the growing consensus that something— anything—must be done, past experience suggests that overoptimism about the democracy-enhancing reforms that will emerge from scandals is all too common. One leading scholar, for example, wrote almost a decade and a half ago, referring to yet another congressional budget scandal : “I interpret the recent scandals and the accompanying uproar as the final gasps of traditional politics. First, the elites have been exposed in their perversion of the political process; second, the public is no longer willing to tolerate a state more satisfied with passing laws than with enforcing them honestly” (Da Matta 1993). Sadly, this appears not to have been the case: despite the continued exposure of high-level corruption of the political process and growing lev- 152   matthew m. taylor els of public dissatisfaction with the political system, little has been done to directly confront the problem.2 A series of highly publicized corruption scandals in the government, and even the impeachment of President Collor in 1992, have generated little response: only a handful of nationally elected officials implicated in the country...