By: KENNETH MAXWELL

Folha de São Paulo - Op-ed section - page A2  

I attended a small private lunch in the City of London coincident with the beginning of the mensalao scandal. Five or six of the largest private hedge funds in the world where represented around the table and a collective decision to scramble out of Brazilian assets by these men and women would have been a disaster for Brazil then, and even now. They were all very well informed about what was going on in Brasilia. As we left one commented to me "So what's new." It was in other words business as usual. Corruption as usual. The old Brazil as usual. No doubt last week they shrugged their collective shoulders about the shenanigans in the Brazilian Senate. It was Brazilian politicians doing what they do best so to speak: A sort of collective Marco Aurelio Garcia hand sign to the public. And it all had no impact at all on the Brazilian economy, on the "fundamentals" as economists like to say.

Yet it does matter. Why? The means for the corruption are familiar enough; private clandestine and indirect payoffs for collateral deals by entrepreneurs that feed at the public trough. This is the core of the case against Senator Renan Calheiros. But the objective of the Lula government in all this is political: As in the case of the mensalao the passage of fiscal and economic legislation in Congess. But these are Faustian bargains. Why? Because these old and well tried methodologies preempt real political reform. This is also a very old Brazilian story; a sort of perverse Brazilan genius that anticipates change and in the process prevents change; so that Brazil's history lacks real ruptures and is marked by multiple successful counterrevolutions. It makes for a sort of morose stability and continuity to be sure.

But it serves to perpetuate archaic structures and holds back the emergence of a collective sense of responsible citizenship, especially among politicians devoid of shame.

Fernando Henrique Cardoso fell into the trap when he bargained for his second term. The emasculation, corruption and co-optation of the PT in government is the latest chapter. Sadly, the hedge fund manager was right as she hurried back after lunch in London that afternoon to tend to her billions "under management." What's new?

KENNETH MAXWELL is a weekly op-ed columnist (every Thursday) for Folha de São Paulo, Brazil's leading newspaper.