Shannon K. O'Neil

Latin America's Moment

O'Neil analyzes developments in Latin America and U.S. relations in the region.

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Showing posts for "Brazil"

The Even Scarier Thing About Brazil’s Prison Violence

by Matthew Taylor
Relatives of inmates react in front of Desembargador Raimundo Vidal Pessoa jail in the center of the Amazonian city of Manaus, Brazil, January 8, 2017 (Reuters/Michael Dantas). Relatives of inmates react in front of Desembargador Raimundo Vidal Pessoa jail in the center of the Amazonian city of Manaus, Brazil, January 8, 2017 (Reuters/Michael Dantas).

Prison violence has taken the lives of more than one hundred Brazilian prisoners since the beginning of the year. While the recent killings have been gruesome and especially numerous, they are a continuation of a long-standing pattern of savage prison violence that has developed its own macabre logic of control. Scarier still than the calculated horror of the past week’s violence, though, is the possibility that this prison violence may contribute to the consolidation of a particularly virulent form of criminal organization that threatens the rule of law in Brazil and its neighbors. Read more »

The Odebrecht Settlement and the Costs of Corruption

by Matthew Taylor
A sign of the Odebrecht SA construction conglomerate is pictured in Rio de Janeiro, Brazil, February 26, 2016 (Reuters/Ricardo Moraes). A sign of the Odebrecht SA construction conglomerate is pictured in Rio de Janeiro, Brazil, February 26, 2016 (Reuters/Ricardo Moraes).

It is hard to overstate the meaning of the settlement announced by U.S. authorities on December 21 with Odebrecht. Under this “largest-ever global foreign bribery resolution,”[1] the construction giant and its petrochemical subsidiary Braskem have agreed to pay at least $3.5 billion to Brazil, U.S. authorities, and the Swiss Office of the Attorney General. Of the total criminal fines, 80 percent of Odebrecht’s payments and 70 percent of Braskem’s payments will go to Brazil, a victory for both Brazilian prosecutors and for the cash-strapped Brazilian government. Read more »

Latin America’s Wide-Open Electoral Season

by Matthew Taylor
July 28, 2016 (Reuters/Guadalupe Pardo). July 28, 2016 (Reuters/Guadalupe Pardo).

Half of the eighteen nations of Central and South America will hold presidential elections over the next two years.[1] The number of elections is not unprecedented, but the degree of uncertainty is, given the economic doldrums and political crises that have afflicted the region in recent years. As a consequence of the electoral outlook’s uncertainty, many of the coming year’s events in Latin America will need to be interpreted through the peculiar lens of candidates’ strategic calculations and parties’ maneuvering for advantage at the polls. Read more »

Michel Temer’s Shrinking Presidency

by Matthew Taylor
Brazil, president, Lava Jato, PMDB, Michel Temer, corruption, anticorruption reforms, Geddel Vieira Lima Brazil's President Michel Temer looks on during a news conference at the Planalto Palace in Brasilia, Brazil, November 27, 2016 (Reuters/Ueslei Marcelino).

When he officially became president three months ago, Michel Temer’s game plan was simple and bold: in the roughly eighteen months before the 2018 presidential campaign ramped up, he would undertake a variety of legislative reforms that would put the government’s accounts back on track, enhance investor confidence, stimulate an economic recovery, and possibly set the stage for a center-right presidential bid (if not by Temer himself, at least by a close ally). Temer’s band of advisors—Brazilian Democratic Movement Party (PMDB) stalwarts and long-time Brasília hands Romero Jucá, Geddel Vieira Lima, Eliseu Padilha, and Moreira Franco—would ensure that he had the backing of Congress to push through reforms that might not bring immediate returns, but nonetheless might improve investor confidence, prompting new investments in the short term. Sotto voce, many politicians also assumed that the PMDB—which has been an integral player in every government since the return to democracy in 1985—would be well placed to slow the pace of the bloodletting occasioned by the massive Lava Jato investigation and stabilize the political system. Read more »

The Hidden Refugee Crisis in the Western Hemisphere

by Shannon K. O'Neil
Haitians migrants wait to make their way to the U.S. and seek asylum at the San Ysidro Port of Entry in Tijuana, Mexico, July 15, 2016 (Reuters/Jorge Duenes). Haitians migrants wait to make their way to the U.S. and seek asylum at the San Ysidro Port of Entry in Tijuana, Mexico, July 15, 2016 (Reuters/Jorge Duenes).

While much attention is rightly focused on Syria and the Middle East, there are a growing number of refugees in the Western Hemisphere.

The largest group comes from Central America’s Northern Triangle—Guatemala, El Salvador, and Honduras. For each of the past three years between 300,000 and 450,000 Central Americans have fled north. Of these, between 45,000 and 75,000 are unaccompanied children; another 120,000 to 180,000 families (usually a mother with children); and between 130,000 to 200,000 single adults. These numbers peaked in May and June 2014 when more than 8,000 unaccompanied minors crossed the U.S. border each month. 2016 numbers are again rising, with August inflows higher than ever before. Read more »

Bringing International Pressure To Bear on Nicolás Maduro

by Matthew Taylor
Venezuela's President Nicolas Maduro (2nd L) and former Spanish prime minister Jose Luis Rodriguez Zapatero (2nd R) speak next to Secretary General of the Union of South American Nations (UNASUR) Ernesto Samper (L) and former president of Dominican Republic Leonel Fernandez, during their meeting at Miraflores Palace in Caracas, Venezuela July 21, 2016 (Reuters/Carlos Garcia Rawlins). Venezuela's President Nicolas Maduro (2nd L) and former Spanish prime minister Jose Luis Rodriguez Zapatero (2nd R) speak next to Secretary General of the Union of South American Nations (UNASUR) Ernesto Samper (L) and former president of Dominican Republic Leonel Fernandez, during their meeting at Miraflores Palace in Caracas, Venezuela July 21, 2016 (Reuters/Carlos Garcia Rawlins).

[This post was co-authored with John Polga-Hecimovich*. It is the third of a series that begins with this post.]

The collapse in Venezuela has many potential costs: democratic regression in Latin America; destabilization of neighboring countries, including, potentially, the fragile peace process in Colombia; the possibility of a significant migrant crisis; rising violence, corruption, and criminality; and threats to hemispheric energy security. A mix of frustration with President Nicolás Maduro’s recent moves and apprehension about the potential outcomes of the crisis has led to a frantic search for alternatives, none of which seems particularly likely to be effective on its own. The paucity of alternatives suggests that the best the international community may be able to hope for is to isolate the regime, demonstrate to moderates within the regime that there are costs to sticking with Maduro, and make efforts to ameliorate the worst humanitarian consequences of the crisis. Read more »

Corruption, FATCA, and the Tightening Dragnet Around Brazilian Offshore Accounts

by Matthew Taylor
Brazilian Federal Revenue Secretariat, SRF, corruption, FATCA, brazilian offshore accounts, Swiss bank accounts, Car Wash, Panama Papers, Foreign Account Tax Compliance Act, Repatriation Law, illicit money Replicas of R$100,00 banknotes are hung on a clothesline during a protest of the national union of prosecutors against money laundering in Brazil, at the Esplanade of Ministries in Brasilia March 18, 2015 (Reuters/Ueslei Marcelino).

The Brazilian Federal Revenue Secretariat (SRF) has some good news to cheer: a big haul of fines and taxes from assets held offshore by Brazilians. The deadline for filing under Brazil’s equivalent of the Offshore Voluntary Disclosure Program ends October 31, but news reports suggest that more than US$12.6 billion in foreign bank accounts held by more than 25,000 Brazilians have already been disclosed, leading to fines and taxes of nearly US$4 billion on money ferreted away in accounts that had previously been inaccessible to tax officials. More than a third of that money has been declared in the last week alone, suggesting that by the end of the month, the absolute volume of fines and taxes may be near the amounts collected under a sister program in the United States, whereby 45,000 taxpayers contributed US$6.5 billion to the U.S. Treasury. Read more »

A Brief Note on Eduardo Cunha’s Arrest

by Matthew Taylor
Brazil, Eduardo Cunha, Car Wash, Lava Jato, corruption, President Michel Temer, Lula, Dilma Rousseff Former speaker of Brazil's Lower House of Congress, Eduardo Cunha (C), is escorted by federal police officers as he leaves the Institute of Forensic Science in Curitiba, Brazil, October 20, 2016 (Reuters/Rodolfo Buhrer).

This week’s arrest of Eduardo Cunha—the former president of Brazil’s Chamber of Deputies, a leading member of President Michel Temer’s PMDB party, and a principal architect of Dilma Rousseff’s impeachment—is a major turning point for the massive Car Wash corruption investigation that has mesmerized Brazil for much of the past two years. Read more »

Latin America’s Populist Hangover

by Shannon K. O'Neil
Alberto Fujimori, Andres Manuel Lopez Obrador, Argentina, Bolivia, Brazil, Carlos Menem, corruption, Cristina Fernandez de Kirchner, Ecuador, Evo Morales, Getulio Vargas, Guatemala, Honduras, Hugo Chavez, Jimmy Morales, Juan Orlando Hernandez, Juan Peron, Latin America, Luiz Inacio Lula da Silva, Mexico, Nestor Kirchner, Nicolas Maduro, Otto Perez-Molina, Pedro Pablo Kuczynski, Peru, populism, Rafael Correa, Venezuela Argentina's President Cristina Fernandez de Kirchner waves to supporters from a balcony after a ceremony at the Casa Rosada Presidential Palace in Buenos Aires on May 4, 2015 (Reuters/Argentine Presidency).

In my piece published in the November/December 2016 issue of Foreign Affairs, I lay out the economic and political characteristics of populism, analyze why it is receding in Latin America today, and describe what a next wave might look like. I also argue that Latin America’s historical experience with populism provides some bracing warnings to other countries now flirting with such politics. You can read the first three paragraphs of the article below: Read more »