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Corruption and capitalism: a marriage of convenience

Luciana Genro – HuffPost Brasil

The enormous wealth accumulated by at least part of the large companies is the result of their corrupting action with public and political agencies.

Corruption is a mark of societies governed by the logic of the commodity and in which the distribution of income is unequal and unfair. In capitalism, corruption is a recurring feature, but free-market ideologues insist on arguing that less state and more capitalism could reduce corruption.

Measures that further deepen the subordination of the public interest to large corporations and monopolies would in theory be the solution to corruption, always identified with the state and politicians, and never with business and large corporations.

Supposedly, reducing the size of the state, that is, privatization, would be the way to reduce corruption. The current scandal involving Petrobras has served the purpose of totally handing over the company to private capital. This identification of the corruption with the State is a maneuver, because the big companies are fundamental protagonists of the corruption.

Brazil provides a very concrete example of the relationship between the power of large corporations, corruption and capitalism.

Many politicians are being arrested and even Michel Temer can go to jail if he loses his term because the system is handing out the rings, even the most valuable ones, to keep fingers. But politicians and rings can be replaced and, therefore, it is necessary to break the system that allows the capitalists to continue plundering the country.

It is not recent that these capitalists gain and command the country through political puppets. Regardless of government and even regime changes, large corporations have always taken advantage.

Protagonists of recent corruption scandals, for example, contractors began to nationalize and gained political and economic strength during the military dictatorship. They, who were regional, arrived in Brasilia in Juscelino Kubitschek’s government and began to organize themselves politically. They helped planning the military’s seizure of power and guided Brazil’s public policies, according to the historian Pedro Campos.

He states that “every sign indicates that corruption hasn’t rised. What we have today is a series of inspection mechanisms that expose much more than before. In the dictatorship, there weren’t many inpection mechanisms, and the ones avaliable were limited”.

The thesis became the book Strange cathedrals: Brazilian contractors and the civil-military dictatorship, 1964-1988, in which Pedro Campos stripped the relations of Andrade Gutierrez, Camargo Corrêa and Odebrecht with power since the dictatorship.

Already in the FHC government we lived the process that became known as the “privataria tucana”, a great scheme to benefit large companies. The “gang” moved about $ 2.5 billion. There are proven tips of 20 million dollars, all abundantly demonstrated in the book of Amaury Ribeiro Júnior.

Also in the FHC government, Vale do Rio Doce, big banks and telephone companies have made a lot of money, as Aloysio Biondi has shown in his book Privatized Brazil.

Then, in PT governments, contractors such as Odebrecht continued to pocket billions, while other companies were chosen to be “national champions” at the expense of subsidized loans from public banks and contributions from BNDESPar, the BNDES shareholding arm.

It was the cases of JBS and the businessman Eike Batista’s EBX group, whom was arrested for money laundering and kickback payments to Rio de Janeiro’s former governor, Sérgio Cabral (PMDB), also imprisoned.

Of all this, what remains is the rule of the big corporations over politics. They are the corruptors who irrigate the accounts of all the dominant parties, responsible for the perpetuation of regimes and governments in the service of capital.

The relationship of former president Lula with Odebrecht is revealing of this promiscuous relationship. According to testimony from former executives of the group, in exchange for generous financial contributions since the 2002 campaign, the Lula government guaranteed the privatization of the Brazilian petrochemical industry and consolidated almost the entire sector in the hands of Braskem, an Odebrecht-controlled company.

Even Petrobras became a minority partner of Braskem to stop being a competitor and facilitate the supply of raw materials to the Odebrecht group company. Thanks to Lula’s help, Braskem has also bought over the last few years private competitors such as Ipiranga Petroquímica, Copesul and Quattor.

The help was valuable. In 2002, prior to Lula’s inauguration, Braskem had grossed R $ 8.9 billion. At the end of 2015, according to the company’s latest audited annual balance sheet, revenues reached R $ 54.1 billion. A 508% growth, against a 120% inflation in the same period.

In 2002, Braskem also had a loss of R $ 794 million. In 2015, it celebrated a profit of R $ 2.9 billion.

The payments to politicians during all those years had a good return for the company, which also received a lot of money from BNDES. In 2002, the loans granted by the federal bank to Braskem amounted to R $ 304 million. In 2015, the value was R $ 3.4 billion, a growth of more than 1,000%.

JBS increased its revenues 44 times from 2014 to 2016. During this period, the gross revenue of the Batista brothers’ company increased from R $ 4 billion to R $ 176.9 billion. Joesley Batista’s talk with Ricardo Saud, recently released by Attorney General, shows how this empire was built.

It is increasingly evident that the enormous wealth accumulated by at least part of the large companies is not the result of work and competence, as the liberals like to say, but of their corrupting action with public and political bodies.

Brazil is not an isolated case of the globalized world economy. The figures are overwhelming and show how corporations co-opted the rulers converted into political agents of the great capitalists.

It takes a profound change program that deconstructs this power and begins to build a people’s and workers’ power. This goes to the end of the fiscal benefits to the millionaires and big companies, with the hard collection of all the great evaders.

Large corporations involved in corruption must operate under the control of their workers, not their corrupt owners anymore. And that the financial system is under public control and its profits are reverted to the interest of the majority, and not pocketed by a handful of millionaires.

In addition, a profound tax change is required, which imposes heavily on capital and property, alleviating the burden on wages and popular consumption.

A serious anti-corruption system is also essential. The white-collar criminal’s sense of impunity is gigantic. We have seen that even with Operation Lava Jato in progress, which has arrested several politicians and businessmen, former minister Geddel Vieira Lima kept an apartment stuffed with money and Joesley planned to buy agents from the Attorney General and the Supreme Court.

Effective anti-corruption efforts are not enough for police or legal operations. It is through politics that we need to build an alternative that enables more direct participation of the people in politics and a permanent and effective oversight over politicians.

If we fail in this construction, the only balance of the fight against corruption can be a total discredit of the policy, and this is the shortest way for the emergence of “saviors of the motherland”, wanting only to save the system.

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