Abstract
Operation Car Wash is based on the memoirs of two Brazilian Federal Police officers who participated in the country’s most notorious and controversial corruption investigation. Originally published in Portuguese in 2020 and translated into English in 2022, it is authored by Jorge Pontes, a veteran officer, and Márcio Anselmo, a junior agent. Robert Rothberg, a Harvard university professor and expert on political corruption, has praised it as a revelatory inside job by two highly informed officers on systematic corruption and efforts to cope with this deep-rooted phenomenon in developing countries.
Operation Car Wash dates to March 2014, when the Federal Police uncovered a money-laundering scheme at a Brasilia gas station owned by a conservative supporter of the Lula government. From a routine police operation it evolved into a mega-investigation of corruption at Petrobras. By 2018, it had provoked a watershed in Brazilian politics with the impeachment of president Dilma Rousseff and the imprisonment of ex-President Lula along with scores of PT militants, businessmen, governors, and influential politicians from the entire ideological spectrum. During the 2018 general elections, the investigation unleashed an anti-PT electoral backlash that swept the far-right into power under the leadership of the retired army captain Jair Bolsonaro. Many of the themes of Bolsonaro’s campaign are found in this book, among them the notion that the inner circle of the PT administration built an institutional network of corruption infiltrating the three powers—state-owned companies, the civil service, and private contractors, the equivalent of a deep state—that used embezzled public funds to co-opt conservative parties. For Pontes and Anselmo, institutionalized corruption was not an isolated criminal act but a centralized planning system for attaining political hegemony.
From the outset, they explain that their purpose is to go beyond the description of the Car Wash events to reveal its institutional causes. This ambitious objective promises to be the book’s strength, but it has its shortcomings and vulnerabilities. There is indeed a wealth of data and observations on embezzlement schemes, key businessmen negotiating kickbacks, invoices fraud, overpricing, revolving-door tactics between corrupt managers in state and private companies, and other forms of illicit behavior, but the assertion that the system of centralized corruption was the work of a conniving Lula and his inner circle lacks clear evidence. Throughout the book, these accusations seem to reinforce the political narrative of Bolsonaro and his justice minister Sérgio Moro. Reading between the lines of 11 disconnected chapters, the reader is led to deduce two causes of political corruption in Brazil: (1) the diversion of the Federal Police from investigating politicians’ shady deals and (2) the instrumental construction of a PT-planned embezzlement scheme to control the state. For the most part, the veteran Jorge Pontes tackles the organizational culture of the Federal Police, while Márcio Anselmo details the investigative side of Car Wash (wiretapping, search warrants, and plea bargains).
Pontes describes the constant uneasiness among Federal Police freshmen officers assigned to the Amazon region, many of whom believed that they were being deliberately sidetracked to the endless pursuit of petty marijuana dealers instead of investigating corrupt politicians’ complicity in environmental crimes. That changed under Tomaz Bastos, Lula’s first minister of justice. After nominating a highly respected director for the Federal Police, he introduced new technologies, sent officers overseas on training missions, and signed cooperation agreements with first-class law enforcement agencies in the United States and Europe. Although Pontes lauds Bastos for his support, he attributes the modernization of the Federal Police to international agreements that the first Lula administration had signed on environmental protection, greenhouse gas emissions, money laundering, and international terrorism. For Pontes, international pressure was the true catalyst for the conversion of the Federal Police into an effective internal security agency, especially after September 11.
In a matter of few years, the Federal Police assumed many new roles beyond antidrug enforcement: a Secret Service to protect national authorities, pursuit of smuggling and counterfeiting, homeland security, regulation of migration, investigation of environmental crimes, issuance of passports, inspection of private security firms, financial crimes, and the protection of the indigenous population. It covered more areas than all the internal security agencies of the U.S. government put together. This expansion, however, was not accompanied by budget increases and the hiring of new agents. Subtle harassment and intimidation added further hurdles to investigations of corruption: threatening agents with transfer to inhospitable regions, using leaks to the press to abort anticorruption operations, fake news, and external oversight. This was a repetition of a Brasilia tradition of going the extra mile to reduce transparency. In these chapters Pontes pictures incorruptible agents willing to sacrifice their personal interests to deal with Brazil’s gravest problem, the systematic embezzlement of public funds. However, many questions arise. Was the financial pressure on the Federal Police a political ploy to limit its capacity or part of a trend that affected federal government institutions as a whole? Did all administrations hamper Federal Police anticorruption operations? How was the Federal Police able to track and arrest numerous high-profile notables while being intimidated by influential politicians and their collaborators in all three branches of the state?
The second thesis on the origins of institutionalized crime is tackled in Chapters 5 (“From Organized to Institutionalized Crime”) and 7 (“Capitalism the Brazilian Way”). Riddled with antileft narrative reminiscent of the Cold War, the book argues that, prior to the PT, corruption had been limited in scope and scale. At most it was similar to organized crime: spontaneous and fragmented, easy to detect and control. However, under the command of Lula’s inner cabinet, corruption became an institutionalized crime. It originated in the presidential staff but soon crept into ministries, the judiciary, the legislative branch, state-owned companies, political parties, infrastructure private contractors, and subnational governments. Rationalized corruption served a dual purpose: enriching the PT’s top brass and controlling the state by bribing congressional leaders.
The embezzlement was based on institutionalized delinquency, illicit acts committed in state-owned companies in an alliance with the country’s largest infrastructure contractors. In several chapters Pontes and Anselmo detail the system of bribery and the trail of illicit funds. The process begins when political appointees to state-owned companies negotiate kickbacks with private contractors. Contractors overprice construction jobs to include bribery. Once payments by the state-owned companies reach the contractors, cash is stashed in suitcases and delivered to political appointees, and bribes are distributed by party leaders to the rank and file in the Congress to maintain their political allegiance. Corruption became so routine that contractors established special accounting divisions to keep records of falsified invoices, overpricing, and bribes. The most notorious was Odebrecht’s Department of Structured Operations, tied directly to the company’s president, Marcelo Odebrecht. During elections, kickbacks became more voluminous because of the galloping costs of political campaigns.
Pontes and Anselmo still argue that institutionalized corruption was behind some key industrial policies and foreign economic relations during the PT administrations. For them, the national champions policy existed only because of embezzlement. PT-promoted infrastructure projects in Latin America and Africa made institutionalized corruption a global business, linking Brazilian politicians, contractors, and foreign governments in schemes of fraud.
The book certainly offers a detailed analysis of the way corruption operates in Brazil and the difficulty of reversing this entrenched practice. However, the question is whether corruption was PT’s instrumental policy to dominate the Brazilian state or a modus operandi that outlasted presidencies. Two facts mentioned in the book support the second interpretation. First, during interrogation Emilio Odebrecht (Marcelo’s father) declared, "Everything that is happening is an institutionalized business. It’s just how it’s always been.” This blunt statement by a business insider means that the same corruption schemes were carried over from the dictatorship to Sarney, Collor, Cardoso, and Lula. Hence, PT was hardly a founder of institutionalized corruption. Rather, it was a left party seduced by the ease with which bribery reins in conservative politicians and guarantees large congressional majorities. PT’s misfortune was that it backfired and caused a reversal of democratic governance and a pretext for an autocratic reawakening in Brazil. Secondly, Alberto Youssef, the money launderer involved in both Banestado (the Paraná-state-owned bank) and Car Wash, declared during his plea bargain that the same methods were adopted by various governments and that "everybody knew what was going on,” implying that the Federal Police had knowledge of institutionalized corruption.
I conclude this review with a few questions about corruption, the political system, and capitalism. Isn’t corruption an outcome of the “coalition presidency,” a system of government that demands large party coalitions to secure governability? Under this political arrangement, no matter what party is in power the glue that sustains majorities is thousands of managerial positions allocated to party coalitions. Isn’t such a clientelistic exchange of offices for loyalty a legalized corruption? Shouldn’t a political reform that regulates the allocation of authority positions in the Brazilian state be on the agenda?
Although Brazilian democracy ended two decades of authoritarian rule, many of the mechanisms of the old regime continue to regulate relations between the executive and the legislative branch. On one hand, the presidency is endowed with extraordinary powers to set political agendas. On the other, party leadership in the Congress secures the loyalty of the rank and file through the distribution of offices and cash payments. Wouldn’t the concentration of political power in the presidency and party leaders lead to ever more sophisticated methods of usurpation of public goods by the political elite?
Finally, Brazilian capitalism is still commanded by dynasties that owe their fortunes to political patronage, especially among contractors of public works. Odebrecht, Andrade Guiterrez, OAS, and Mendes Junior—the so-called four sisters—have been involved in every corruption scheme since military rule. They have expanded and thrived under authoritarianism and democracy; they have supported the right and the left and paid allegiance to both the free market and state planning. Those capitalist enterprises are commanded by families that know the value of bribery as the key to their fortunes. Why wouldn’t regulators ignore overpricing when public works costs consistently surpass original estimates by severalfold?
This could have been an eye-opening book on corruption in a capitalist society had the authors avoided political scapegoating. Certainly, PT fell into the trap of oligarchic politics, but it was far from being an all-powerful organization that built a deep state. In this book, the authors fall into the same dilemma as Judge Sérgio Moro, the main protagonist of Operation Car Wash. Moro promised society to conduct an exemplary investigation that would reaffirm the rule of law. But Moro eventually tossed the entire probe onto the shady grounds of political manipulation.
Pontes and Anselmo criticize Bolsonaro and level accusations of corruption at his government, but their thesis that PT was the true founder of a deep state legitimizes the far-right narrative. Nowadays a generalized doubt troubles Brazilian public opinion—whether Operation Car Wash was a sincere effort to rid Brazil of malignant corruption or a far-right pretext to delegitimize the PT as a political force.
Footnotes
Jawdat Abu-El-Haj is a professor of political science at the Universidade Federal do Ceará.