Lula and Brazil’s Progress – WSJ

The forever-developing nation of Brazil has been putting its legal system to an extreme stress test, impeaching one former president, indicting the current one, and late last week convicting former President

Lula da Silva

of corruption even as he plans to run for the office again.

So far the rule of law is winning, but Lula may be its sternest test. The champion of Brazil’s left who served two terms as president from 2003-2011 was convicted for money laundering and corruption and sentenced to nearly 10 years in prison. Judge

Sergio Moro

ruled that Lula had steered government contracts to the Brazilian construction firm OAS in exchange for roughly $1.2 million in bribes in the form of a refurbished beach-front apartment.

Lula’s Workers Party allies are howling that he was framed by his political enemies, but everything about the decision suggests the opposite. Mr. Moro’s prosecutors have spent three years in a painstaking investigation that has uncovered a vast network of government graft emanating from the giant government-owned oil company

Petrobras
,

whose contracts were steered by Lula.

Scores of Brazilian businessmen and politicians have been caught in the net. And it is Mr. Moro’s willingness to follow the case where it led, including to a popular former head of state, that breaks new ground for the young democracy. “It’s lamentable that a president of the republic is criminally convicted,” Mr. Moro said. “No matter how important you are, no one is above the law.” Investors voted on the Lula verdict by bidding up stocks and Brazil’s currency on the news.

This is real progress for South America’s largest economy and a cause for optimism despite the immediate turmoil. The great flaw most developing countries share is a weak rule of law. Brazil has…

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