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An anti-government demonstrator holding a Brazilian flag kneels as he takes part in a protest over the appointment of Luiz Inacio Lula da Silva as chief of staff, in front of the Planalto palace in Brasilia, Brazil, March 17, 2016. (RICARDO MORAES/REUTERS)
An anti-government demonstrator holding a Brazilian flag kneels as he takes part in a protest over the appointment of Luiz Inacio Lula da Silva as chief of staff, in front of the Planalto palace in Brasilia, Brazil, March 17, 2016. (RICARDO MORAES/REUTERS)

Rousseff backed into corner as new revelations stir turmoil in Brazil Add to ...

Follow Stephanie Nolen on Twitter and Facebook for updates on the evolving turmoil in Brazil.

With both the judicial and legislative branch lining up against her, Brazilian President Dilma Rousseff stands on a political precipice.

A defiant Ms. Rousseff swore in former president Luiz Inacio Lula da Silva as her presidential chief of staff and a member of her cabinet on Thursday morning in Brasilia, warning darkly of an attempted “coup” and naming powerful political figures who had gathered to support her.

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But, in the recurring pattern of recent days, Ms. Rousseff had no sooner spoken than dramatic events shifted the political ground yet again.

First, a judge issued a temporary injunction against Mr. da Silva taking office – creating a legal uproar over whether that was even possible, given that he was now sworn in. Within hours there were at least 16 judicial applications to block Mr. da Silva, in what was apparently an opposition strategy to tie the process up in Brazil’s Byzantine legal system.

In the late afternoon, Congress elected a commission to hear an impeachment process against Ms. Rousseff: Split between supporters and opponents of government, it includes an array of politicians who are themselves already convicted or under investigation for grand corruption.

Brazil woke up Thursday still reeling from revelations the night before, when Judge Sergio Moro, who oversees the vast corruption investigation known as Lava Jato, released transcripts and audio from Mr. da Silva’s tapped phone, including an incendiary call between the current and former president.

Ms. Rousseff reiterated at the swearing-in that she was bringing her predecessor back into government in order to capitalize on his connections and political skills to help resolve the crisis gripping the country. “The circumstances give me the prerogative of bringing into government the biggest political leader in the country,” Ms. Rousseff said.

But government critics believe the move was a clear attempt to shield him and obstruct the Lava Jato investigation. And the audio released by Judge Moro includes Ms. Rousseff offering to send Mr. da Silva the official appointment notice “in case its needed.”

Mr. da Silva, who served two terms as president ending in 2010 and was one of the country’s most popular leaders, has recently come under investigation for money laundering and misrepresentation of assets in the Lava Jato case. By bringing him into cabinet, Ms. Rousseff affords him some degree of protection from prosecution – under Brazilian law only the Supreme Court can prosecute someone who hold this position.

But Ms. Rousseff says she was making the offer to send the document not as a potential shield if police came calling, but only because she did not know if Mr. da Silva would be able to attend the ceremony – and nothing in the audio released to date disproves this version. At the ceremony, she brandished what she said was the piece of paper under discussion in their call, saying, “You see, it has only his signature, not mine,” and would have needed hers in order to protect him.

At the ceremony, she denounced the release of the audio by Judge Moro as both a violation of her office and a clear attempt to undermine government. “Creating havoc in society based on false facts sets very serious precedents: That’s how coups start,” she said. “There is a clear intention to abrogate the limits of a democratic state, to move to a state with rights suspended. … If they violate the prerogatives of the presidency, what will they do with those of an ordinary citizen?”

Almost all of her cabinet was in attendance at the brief ceremony in the Palacio do Planalto, the presidential headquarters, but Vice-President Michel Temer, who is from her main coalition ally, was conspicuously absent. Mr. da Silva, looking haggard, was by her side but did not speak.

As President Rousseff began her remarks, a congressman screamed from the audience, “Shame!” And outside the headquarters, thousands of protesters gathered – supporters of the government in red, and yellow-clad critics of the government scuffled briefly before being divided to opposite sides of the road by police on horseback.

But the audio is damaging, and the new threat to Ms. Rousseff is likely what has pushed Bovespa, the Sao Paulo stock market, to close up nearly 7 per cent on Thursday, its biggest one-day gain in seven years. It is clear that most of the country’s institutions are lined up against the President. “Days after a protest of dimensions that had never been seen in the country’s history, Dilma and Lula teamed up to ignite, in a way that is likely irreversible, even more intense indignation in the people,” the national newspaper Folha de Sao Paulo said in an editorial titled “It’s the End.”

In any case, Mr. da Silva’s place in government is far from certain. The first temporary injunction to block it was granted by a Brasilia federal court judge less than an hour after the swearing-in. In the order, Judge Itagiba Catta Preta Neto said that Mr. da Silva’s appointment threatened the ability of police, prosecutors and the judiciary to freely exercise their powers. Then it was revealed that the judge’s personal Facebook page featured an array of pictures of himself at anti-government protests.

(Another such legal attempt was rejected by a different federal court judge, in Porto Allegre in the south – she is Graziela Bundchen, sister of supermodel Gisele.)

The government immediately appealed his injunction to the Supreme Court.

One of the three Supreme Court justices who will hear the first attempt by government to end the injunction against Mr. da Silva is Gilmar Mendes. He is well known as a critic of the Rousseff administration who had already said in interviews, in the days before Mr. da Silva’s appointment, that the former president should not return to government – suggesting Judge Mendes is unlikely to lift the ban. A welter of other similar applications was filed across the country.

Then came the opening of impeachment proceedings: These have been in the works for months, and relate not to the corruption scandal but to separate allegations that Ms. Rousseff’s government illegally borrowed funds from federal banks in order to cover budget shortfalls.

The drive is spearheaded by her political archenemy, Eduardo Cunha, the speaker of the lower house of Congress, who is under investigation in the Lava Jato case for allegedly accepting millions of dollars in bribes, money he salted away in Swiss bank accounts.

The impeachment commission elected in the lower house has 65 members, from all parties, and they are roughly split between those who support Ms. Rousseff and those who oppose her, but there are expected to be defectors from her camp in the coming days, as she is increasingly besieged. Mr. Cunha said he expects the proceedings to take 45 days, with a first vote in late April or early May.

The Congress session was heated, and the final makeup of the panel to decide Ms. Rousseff’s fate was emblematic of the dark moment in which the country finds itself – a great many of the members have either been convicted of, or are under investigation for, corruption or other crimes. Paulo Maluf, for example, is on the panel; he is the subject of an Interpol warrant after he was convicted of money laundering in France and under prosecution in the United States. The particular nature of Brazil’s legislative protocol nevertheless does not require him to leave his elected office. Mr. Maluf supports the government. At present, anyway.

Meanwhile Brazilians are furiously debating the motives of Judge Moro, who spearheads the Lava Jato case, following his decision to release the recordings of the presidential phone calls – just hours after they were made.

Justice Minister Eugenio Aragao suggested on Thursday that Judge Moro had broken the law by releasing the tapes, and that a phone call of the President that requires “judicial attention” could not be handled by a court at Mr. Moro’s level, and should have been sent directly to the Supreme Court, and certainly should not have been made public. “This is going to have consequences,” he said. “It doesn’t matter who that hurts. … There is no one in this country with a monopoly on morality, with a monopoly on saving the nation.”

Judge Moro is now the subject of two complaints with the body overseeing Brazilian judges, while the association of federal judges issued a statement supporting him.

It became clear in the course of Thursday that the audio tapes have dramatically complicated Mr. da Silva’s situation. In one call with Ms. Rousseff, he is heard saying that Lava Jato is driven by the media and has left all political and judicial bodies cowed.

“We have a totally intimidated Supreme Court, we have a totally intimidated [lower] Supreme Court of Justice, a totally intimidated parliament. … We have a lower house speaker who is fucked, a president of the senate who is fucked, I don’t know how many parliament members threatened, everyone waiting for a miracle to happen, for everyone to be saved,” he says.

Those individuals and bodies lined up to rebut that characterization. “This court is not intimidated – on the contrary, it is brave, for keeping big figures in jail,” said Joao de Noronha, a justice on the lower bench of the Supreme Court. “[We’re] fighting so that a rich criminal doesn’t become a minister of this republic,” he went on, in a reference to a line Mr. da Silva himself used decades ago on the campaign trail.

The critical piece of audio released by Judge Moro – involving the letter of appointment – turned out to have been recorded after the wire-tap order on Mr. da Silva was no longer in effect.

But on Thursday, Judge Moro defended the decision to release it anyway. “It would not be suitable to exclude the dialogue [between Mr. da Silva and Ms. Rousseff about the appointment order] considering the relevant content in the context of the investigations,” he wrote in a decision related to the case.

“The communication was intercepted fortuitously,” he wrote. “Moreover not even the supreme leader of the republic has the absolute privilege of safe-guarding their communications.” He went on to cite the Watergate case in 1974, and the taping of President Richard Nixon’s phone calls, which was upheld by the U.S. Supreme Court.

Protests in support of the government are planned for cities across Brazil on Friday. As anti-government protesters went to the streets in several cities on Thursday, the Federation of Industry in Sao Paulo offered those in attendance at the demonstration there a free lunch – of filet mignon.

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