Bolsonaro Gets Harsh Reality Check as Brazil Lawmakers Rebel

(Bloomberg) -- Brazil President Jair Bolsonaro’s honeymoon appears to be coming to an abrupt end as his approval ratings plummet and lawmakers rebel against his legislative agenda just a few months into his government.

Lower house president, Rodrigo Maia, will no longer negotiate on behalf of the government’s pension reform in Congress, according to the leader of his political party, potentially dealing a major blow to Bolsonaro’s legislative agenda.

DEM leader Elmar Nascimento said in an interview that lawmakers’ patience was wearing thin with the government and that Maia would step back from his role as a liaison between the executive and the legislature.“The atmosphere in the lower house is terrible,” he said. Maia did not immediately respond to a request for comment.

President Jair Bolsonaro’s administration relies heavily on Maia, Brazil’s most powerful lawmaker, to push its agenda through Congress. Without him, key legislation, such as a major overhaul of the country’s social security system, may struggle to make much headway in a fragmented legislature of more than 20 parties.

Maia’s irritation stems from attacks on social media by Justice Minister Sergio Moro and one of the president’s sons, who implied he is stalling on the delivery of anti-corruption laws. Even before the latest incident, progress of the government’s pension reform bill had stalled, amid widespread anger from lawmakers at the generous treatment offered to military personnel.

A powerful cross-party bloc has also signaled it may reject a plan touted by the president to exempt U.S. citizens and some others from visa requirements, a move announced with great fanfare during Bolsonaro’s recent trip to Washington D.C. The president is currently in Chile and has not commented on the latest developments.

Bolsonaro won the presidency with pledges to combat crime and revive the economy while doing away with "old style" closed-doors political decisions. Since then, he’s shown little sign of building the support needed to pass key legislation. Complicating matters further is a potential fallout with Maia, Brazil’s most powerful lawmaker and a fervent defender of a pension reform that’s deemed essential by investors to narrow a gaping budget deficit.

"The strategy of harassing Maia used by the president’s supporters is not intelligent," federal deputy Domingos Neto said in reference to social media remarks against Maia. "Everyone knows that he’s the biggest supporter of pension reform, and he’s being attacked. It’s unbelievable."

It is not the first time infighting within the Bolsonaro administration has gone public. This time, the war of words fueled a new round of Brazilian market angst, with the benchmark stock exchange tumbling 2 percent and the real plunging the most among all major currencies on Friday, even after Maia said he will never stop defending pension reform.

A poll published on Wednesday also showed Bolsonaro’s personal approval rating had dropped by 16 percentage points since January.

Maia’s Support

According to local media, Maia became incensed by remarks from Carlos Bolsonaro, who posted "Why is the lower house president so on edge?" via social media on Thursday. Earlier that day, former President Michel Temer and ex-minister Wellington Moreira Franco, Maia’s father-in-law, had both been detained on corruption charges.

Markets fell as investors perceived Temer’s arrest as a distraction from efforts to push the pension overhaul, which needs backing from three-fifths of both the lower house and Senate to pass. By Friday, it seemed increasingly likely that the government will have trouble approving even less contentious legislation.

The opposition PSOL party introduced a proposal to overturn Bolsonaro’s plans to remove tourist visa requirements for citizens from several countries. Calls to maintain those requirements grew amid backlash to Carlos Bolsonaro’s comments, and the PSOL proposal now has the backing of government allies such as the PP, according to the party’s lower house leader, Arthur Lira.

Throughout Thursday, representatives of some of the country’s biggest political parties advised Maia to no longer act as chief negotiator on the proposal.

"We asked Rodrigo to retain his institutional role," said Lira. "It’s the government that’s responsible for facilitating pension reform and getting the needed votes."

--With assistance from Rachel Gamarski.

To contact the reporters on this story: Simone Iglesias in Brasília at spiglesias@bloomberg.net;Samy Adghirni in Brasilia Newsroom at sadghirni@bloomberg.net

To contact the editors responsible for this story: Raymond Colitt at rcolitt@bloomberg.net, Matthew Malinowski, Bruce Douglas

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