Last year, Congress ousted Dilma Rousseff from the presidency. Though technically her removal was for having doctored the federal budget, the markets and business sector wanted her out because of her disastrous economic policy. Investors saw her vice-president, Michel Temer, as a man capable of conducting a peaceful transition towards the 2018 election – all while pushing for austerity measures that would “fix” Brazil’s economy.
The reality is that Temer’s short reign has been anything but smooth. He has paltry approval ratings (3 percent), has not been able to fully redress the economy, and has had two indictment requests presented against him. To avoid losing his office, Temer decided to spend big money to please congressman and obtain their sympathy, contradicting his discourse for austerity. Meanwhile, the federal public deficit grew 108 billion BRL between January and September – a record.