Brazil's Dilma Rousseff, still indignant? 

Malice in Brazil's Palace

Mac Margolis writes about Latin America for Bloomberg View. He was a reporter for Newsweek and is the author of “The Last New World: The Conquest of the Amazon Frontier.”
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This time last year, Brazilian President Dilma Rousseff was in a huff. Former National Security Administration analyst-gone-rogue Edward Snowden had just unloaded his findings on how U.S. spymasters were snooping even on allied heads of state, and Rousseff was caught in the widening gyre.

The Brazilian leader immediately canceled a state visit to Washington and demanded a formal apology, slamming the Obama administration for the "affront" of "tampering in such a manner in the lives and affairs of other countries." Brazil went on to lead a campaign for new rules to govern the Internet and safeguard democracy.

Now Rousseff has her very own affront to manage. This one wasn't just about eavesdropping on unwitting citizens, but a cybersmear campaign against journalists. And while no one from government has been directly implicated, the scandal has Brasilia's footprints all over it.

The immediate targets were Miriam Leitao and Carlos Alberto Sardenberg, both marquee journalists specializing in business and economics, with vast followings. Both have a reputation for the sort of independent and fearless criticism that delights audiences as much as it rankles rainmakers and politicians. Not surprisingly, they have feasted on the Rousseff administration, which lately has served up a banquet of embarrassments, from the soccer pitch to overpriced oil refineries.

Loyalists to the ruling Workers Party have pushed back, accusing their news media critics of fueling partisan rancor with factoids. With presidential elections looming in October, the battle has become predictably fierce. And dirty.

A couple of weeks ago, Leitao got a tip from a reporter to check her profile on Wikipedia, the online encyclopedia. Instead of a bio, she found a hatchet job. The tampered page fingered Leitão for "disastrous" reporting on the economy and blamed her for driving the big Rio de Janeiro daily, O Globo, into "bankruptcy" and a costly bailout by the state-owned development bank. Another item had her singing the praises of a crooked Brazilian banker.

Because the attacks weren't just false but grotesquely amateurish, Leitão at first dismissed them as the work of some freelancer with a grudge and "nothing better to do." After all, Wikipedia is an open source page that invites collaborative editing. But the next day, when a reporter traced the Wikipedia edits to a computer address inside the Planalto presidential palace, the storyline changed. "Aggressive attacks are part of the electoral game, but this was someone using a public institution for political ends," Leitao said.

The same server had been used to smear Leitao's colleague, columnist Sardenburg, said to be in the pocket of the financial sector. The smoking gun? One of Sardenberg's siblings -- he has seven -- worked for the Brazilian Banking Federation.

That was bad enough. Then Brasilia made things worse, glossing over the incident with disclaimers and bureaucratic bromides. The Planalto's first response was to deplore the incident and then play victim, claiming that it was "technically impossible" to trace the cyber-attack, because "anyone" could have logged on to the palace Wi-Fi network.

When reporters countered that the presidential network required a password, Brasilia deflected, saying now it was "very difficult" to identify the invader. An official probe was announced with answers promised within 60 days, reduced to 30 days as the news cycle intensified. "The person who did this committed two wrongs: against those affected [by the attacks] and against the government," said Rousseff's chief of staff, Gilberto Carvalho.

The problem was more than anger management. The official defensiveness speaks volumes about power under pressure. The Brazilian economy is slowing and Congress is investigating the state's flagship company, Petrobras, for corruption. With Rousseff's job on the line, the steady drip of bad news has unnerved Brasilia.

To her credit, Rousseff has resisted calls within her party to curb the free press --- "social control of media," her loyalists call it. But last month, she flew into a snit when a private bank warned clients that their investments could fall if she won re-election. Now overanxious government boosters are at it again, at their peril.

This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.

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