Brazil's Temer Escapes Corruption Trial in House Vote, Again

Updated on
  • Lower house voted 251 to 233 to block corruption charges
  • Delay to start voting indicates discontent among allies

Brazil's president Michel Temer.

Photographer: Andre Coelho/Bloomberg

Brazil President Michel Temer survived a second attempt to try him for corruption with a victory in the lower house that allows him to cling to power until his term ends in December 2018.

On Wednesday evening Temer allies defeated a motion with 251 against 233 votes that would have put him on the Supreme Court bench. There were 25 absentees and two abstentions. The margin was smaller than in an August vote on similar charges, when 263 lawmakers voted to shelve the charges against him. A result of 257 or more would have been considered positive by analysts at JP Morgan.

The victory allows Temer to draw a line under a five-month long corruption scandal that has drained part of his political capital and pushed his approval ratings into the low single digits. While the sizeable show of support suggests the government may still have the strength to deliver at least some of its plans for economic reform, Wednesday’s proceedings revealed further signs of growing discontent within the ruling coalition.

"There’s friction in the house and with every one of the deputies. This is going to cause a certain amount of discomfort with his supporters," House Speaker Rodrigo Maia said after the vote.

A shake-up of the pension system, a simplification of the tax code and a downsizing in the size of the state are among some of Temer’s ambitions for his last 14 months in office, but all of these measures will face some resistance.

"The government will continue with the same public opinion ratings and support in Congress but will face problems because it built a relationship out of money rather than love with its allies and cabinet members," said Miro Teixeira, an 11-term legislator from the Rede party.

Temer supporters may vote against the pension reform as much as some members of the opposition will support the tax reform, said Renata Abreu, a legislator with the Podemos party.

The government may also be running out of time soon. The closer to next year’s
election campaigns, the more legislators are likely to distance themselves from Temer’s
proposed austerity measures.

"The government must define an agenda with its allies and the time to vote it
is very short," said Aguinaldo Ribeiro, a government whip in the House.

Easing Expectations

After rallying to record highs earlier in the month, the Sao Paulo stock exchange has leveled off in recent weeks, while the currency has eased in line with other major currencies against the U.S. dollar. Many investors have down-scaled their expectations of an aggressive reform agenda going forward.

Earlier on Wednesday opposition legislators protested outside the plenary while defense lawyers, prosecutors and legislators debated the charges. Many members of the ruling coalition were hesitant to show open support for Temer, meaning that it took the government around seven hours to reach a quorum.

"This is what happens when the government doesn’t do what it promised," said Paulo Pereira da Silva, a lawmaker from the Solidariedade party, before the vote. "Many deputies were left waiting for budgetary resources for their cities and this wasn’t done."

President Hospitalized

Adding to the drama ahead of the vote, the 77-year-old president was hospitalized over a urological blockage, prompting the Bovespa stock exchange to plummet briefly. It quickly recovered and Temer was discharged a few hours later. 

Earlier in October Temer was diagnosed with a slight obstruction in one of his coronary vessels, according to an official at the presidential palace who also requested not to be identified.

Darcisio Perondi, the deputy leader of the government in the lower house, told Bloomberg that the president had been sedated due to the painful nature of the procedure. Still, the outcome of the vote was "a victory for Brazil".

— With assistance by Rachel Gamarski, and Samy Adghirni

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