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Why we need a British Europe, not a European Britain

The critical thing for eurozoners to understand is that the United Kingdom is an exceptional power, not prepared to sacrifice its sovereignty.

In September 1946 Winston Churchill announced that it would require an “act of faith” to save Europe from “infinite misery and indeed from final doom”. Only the creation of a “kind of United States of Europe”, he argued, would rescue the continent from further chaos. He was speaking, of course, in the immediate aftermath of the Second World War. The European situation today is less dramatic, but still highly alarming. We face a series of interlocking challenges that are individually and cumulatively bringing the continent to its knees. It has experienced the unchecked resurgence of an authoritarian Russia since 2007, the emergence of Islamic State in the Middle East and its Islamist affiliates on the European home front, a financial and economic crisis since 2008, the return of the “German problem” with the imposition of EU-wide austerity policies primarily at Berlin’s behest from 2010 or thereabouts, the prospect of secessionist movements in Catalonia and elsewhere since about 2012, as well as the rise of Eurosceptic feeling across the EU in countries as diverse as the United Kingdom, Germany, France, Hungary and Greece.

As if all this were not bad enough, the long-running British Question has re-emerged with a vengeance. This goes back to the original ambivalence at the time of the UK’s accession in 1973, as to whether it was merely joining a free-trading association, or signing up to a programme of ever closer political and economic union. When the euro crisis prompted a fresh surge of fiscal and political integration, matters came to a head at the infamous December 2011 summit. There, in order to protect the interests of the City of London, Prime Minister David Cameron vetoed the EU treaty designed to save the euro, and immediately found himself not merely isolated, but circumvented by the rest of Europe. Since then the EU’s principle of free movement has reignited the immigration issue in the UK, as the relative dynamism of its economy sucks in labour from across the Union. The Conservative right, after a long period of relative quiescence, has been cranking up the pressure for withdrawal, or at least an early referendum on membership of the EU. Moreover, while the formerly fringe UK Independence Party failed to win more than one seat at the general election, it had millions of voters, all of them presumably hostile to the EU. The Prime Minister has sought to head off these challenges by pledging a referendum on EU membership in 2017. His stated hope is that he will be able to renegotiate Britain’s position in the EU, or even “reform” the EU as a whole, in such a way that he can recommend a Yes vote.

At the same time, the British Question is being posed in a different way by the campaign for Scottish independence. Were Britain to leave the EU on the basis of English votes alone, Scotland would certainly demand a fresh ballot on independence. Conversely, if Britain voted to remain, with Scottish votes making the difference, that could boost English nationalism and Ukip, and even demands to dump Scotland from the UK so as to preserve the sovereignty of the kingdom, or at least of England. In these circumstances, a “central secession” through a unilateral English declaration of independence from Europe and the UK would become a possibility.

Beyond its implications for the Anglo-Scottish relationship, a hostile and uncoordinated exit from the EU would have profound economic consequences for Great Britain which have been rehearsed many times before. The greatest damage to British interests through a shambolic “Brexit”, however, would be its impact on the rest of the continent. A legislative Dunkirk, in which Britain repatriated her sovereignty as the eurozone slipped further into crisis, would have a shattering psychological impact on her European partners. It might well accelerate the break-up of the currency union if the Germans, too, wished to regain their national freedom of action. Conversely, if Germany stayed, it would dominate the rump even more than it already does, without wishing to. The result would most likely be a fragmented, fearful and vulnerable Europe, less likely to caucus against Britain, perhaps, but also much less capable of delivering the economic and political stability of the continent on which not only Britain’s prosperity but her security has always depended.




The key to understanding, and solving, the present predicament of the UK and the eurozone lies in how and why both unions were established in the first place. For hundreds of years England and Scotland were rivals. The Anglo-Scottish Act of Union of 1707, which ended hundreds of years of open or latent warfare between the two neighbours, was driven primarily by the demands of the European state system. Elites on both sides of the border contemplated the strategic and ideological threat of Louis XIV’s Catholic, absolutist and territorially expansionist France with dread. To this end, England and Scotland embarked on a parliamentary, debt and foreign-policy partnership that enabled both countries not only to end their long hostility but to “punch above their weight” on the European stage. This was an event, not a process.

The Anglo-Scottish Union was so successful that it served as the model for the American patriots after the 13 colonies broke away from Britain in the late 18th century. They were acutely aware of their precarious geopolitical situation with predatory great powers on all sides, conscious of the danger of falling out among themselves, and concerned to settle the divisive question of how the debts incurred during the revolutionary war were to be repaid. The solution agreed at the Philadelphia Constitutional Convention of 1787 contained distinctive features, including a directly elected presidency and a senate to represent state interests, but it was, in its essence, and was understood by contemporaries to be, an improved variant of the Anglo-Scottish Union. Americans soon pooled their debts, created a treasury bond, a national bank and, in due course, a strong military. Once again, union was an event, not a process.

Likewise, the project of European inte­gration is a product of the rivalries that culminated in the Second World War. It sought to make war between western and central European countries impossible, and in particular to solve the German problem, by embedding Germany in broader European institutions. It also sought to mobilise the energies of democratic Europe, especially the Federal Republic of Germany, against the threat of Soviet communism. This endeavour originally had the potential to develop into something akin to the United Kingdom or the United States. Instead, the idea of rapid political union, completed against the background of a traumatic war, was superseded by the notion of gradual unity through many small economic, social and fiscal steps. What should have been an event became an interminable process.

As a result, the eurozone is a currency without a state and a joint political project without joint military instruments or a common sense of its mission on its own continent, let alone in the world. Because of the lack of a common parliamentary representation transcending the sovereignty of the national assemblies, Europe is unable to issue the eurobonds that would stabilise the markets and the currency. Because of the absence of a common army and a truly common foreign and security policy, Europe can only mount a feeble response to the ideological and military challenge of Vladimir Putin’s Russia on its eastern borders, or to any of the other threats such as Islamist terrorism or state failure on its Mediterranean periphery. Southern European countries, such as Italy and Spain, do not feel the pain of Russian ambitions in the same way as Poland, Finland and the Baltic states – as southern opposition to sanctions on Moscow has shown. The states of northern and eastern Europe, for their part, are unworried about the Mediterranean, as Polish hostility to the Libyan intervention in 2011 demonstrated. Germany, nestling snugly in a ring of friendly democracies, is largely disengaged from both threats. All this results from mounting confederal responses to European problems that require federal solutions.

Against this background, both the German and the British government solutions to the European problem make no sense. Berlin and Brussels believe that “Europe” will cohere through a series of fiscal and economic measures. They have pushed through European rescue funds for the common currency, and they want a Euro­pean commissioner with the power to veto member-state budgets that violate the commonly agreed guidelines; they privilege “rules” rather than democratic participation. Political union, they say, will not accompany currency and fiscal union, but complete it. It is to be the crowning moment, not the point of departure, the process seemingly a goal in itself rather than a means to an end. There has been some progress with this vision, in the establishment of a “banking union”, for instance, but it is doomed to failure. The resulting austerity policies will crush the periphery before they produce significant economic benefits, or lead to the return of suspended participatory rights through the establishment of full political union. Moreover, given the confederal nature of Europe’s democratic legitimation and the federal nature of its fiscal-economic governance, control of the whole has devolved largely to its largest and most powerful part, namely Germany. This is the very outcome that the eurozone project was originally designed to prevent.

Above all, eurozone leaders do not seem to have grasped that, contrary to EU lore and culture, successful unions have historically resulted not from gradual processes of convergence in relatively benign circumstances, but through sharp ruptures in periods of extreme crisis. As we have seen from the Anglo-American examples, they come about not through evolution, but with a “big bang”. They are events rather than processes. The present political integration strategy, therefore, is a long-term, permanent engagement that will end not in marriage, but in tears.




David Cameron’s vision of a looser European Union is equally unhelpful. In his much-discussed Bloomberg speech of January 2013, the Prime Minister set out a more “British” and “flexible” Europe that would restore its global competitiveness by allowing powers to “flow back” from the centre. He called for “a structure that can accommodate the diversity of its members”, some of whom, “including Britain . . . would never embrace” closer economic and political integration.

Yet the Prime Minister’s presuppositions have already been invalidated by events. He was assuming that the “twin marauders of war and tyranny have been almost entirely banished from our continent”. As the recent Russian annexation of Crimea, its state of undeclared war with Ukraine in Donetsk and Luhansk, and Vladimir Putin’s steady reduction in domestic liberties suggest, however, the “twin marauders” have returned. No design for a future Europe can ignore this. The looser the bonds, the weaker its response to outside threats will be.

In fact, the “British” solution for Europe is based on the exact opposite of the principles on which the UK was created. It was established as a strong state with clarity on debt, parliamentary sovereignty and the common defence; this is why the Scottish demands for greater devolution have, rightly, produced such consternation. To insist that Europe retreat from closer union in order to solve her crisis, and make it possible for Britain to remain, is to fly in the face of Britain’s own historical experience, and that of her US cognate. Here the Prime Minister is being not so much hypocritical as uncomprehending. The loosening of federal bonds may be conceived by London as pores through which peoples can breathe, but they will in practice prove to be cuts, out of which the lifeblood of the European Union will flow.

The eurozone must recognise that its predicament – an interlocking series of political, fiscal and strategic challenges – closely resembles those that led the British and the Americans to take the plunge for union in 1707 and 1787. This United States of Europe would take from the Anglo-Scottish Union the principle that national identities and histories can be transcended through full political union without loss of cultural heritage. It would take from the United States the model of how to reconcile the needs of the centre and the regions in a union of numerous states of vastly differing size, economic strength and strategic interests. It would take from both the lesson that only a consolidated debt for which common parliamentary representation takes responsibility can put the state on a sound financial footing and ultimately enable it to defend its position in the world. All this requires Europeans to abandon the cherished nostrum that the process will lead to the event, and to embrace a strategy beginning with an event, with an open-ended process to follow.

The construction of a single eurozone state on Anglo-American constitutional principles must begin with the simultaneous consolidation of debt into a “Union Bond”, for which the parliamentary representation of the entire Union would be responsible. Foreign policy and border security must be the exclusive preserve of the EU. There should be a single army within Nato. These arrangements would mobilise the entire resources of the eurozone, especially those of Germany, for common projects. The Union Bond will end the euro crisis by creating a sustainable aggregate debt backed by the productive power of the whole Union; the end of national sovereignty will remove (or at least severely curtail) the capacity of the individual member states to incur fresh obligations. A single foreign policy and military force would contain Russia. The end of the national state would solve problems such as Catalonia and other areas where there are demands to separate from the local metropolis, but not for full independence outside the EU.




A full federal union of the eurozone would be very much in Britain’s interest. It would save the euro, rescuing the British from the danger of economic contagion after a blowout of the common currency, or interminable deflation through austerity. By stabilising the continent militarily and containing Putin, the new state would reduce the strain on the two countries bearing the largest burden of deterrence in the Baltic and elsewhere – the United States and the United Kingdom. This benefit should outweigh and transcend the old British thinking about the balance of power, which might otherwise tempt London to oppose the creation of a single, potentially dominant continental European state. After all, the establishment of the United States of America eventually relieved Britain of responsibility for the western hemisphere, and supplied a vital ally against the terrible challenges of the 20th century. Likewise, the creation of a cognate eurozone union within Nato would secure the UK’s eastern flank for generations, and free up British ­capacity for involvement in other parts of the world.

Winston Churchill pointed the way to such a solution nearly 70 years ago, just after the Second World War. In his celebrated Zurich speech of September 1946, the former British prime minister urged the full political union of the continent in “a kind of United States of Europe” under the “principles embodied in the Atlantic Charter”. Strikingly, however, Churchill conceived of this United States of Europe alongside but not including the United Kingdom and the British “Commonwealth of Nations”: that is, the empire. This Churchillian model of a single eurozone state without Britain but associated with her is the only solution possible today, in my view. It demands federation within the eurozone and confederation between the new state and the UK.

There would be political rewards for the Prime Minister. Britain’s negotiated exit from the inner EU would make Ukip largely redundant, though it might maintain a fringe presence by appealing across a range of social issues. An amicable Brexit would heal the rifts in the Tory party, as most of its Europhiles do not wish to sacrifice British sovereignty by joining a single European state; indeed, their whole rhetoric over the past three decades has hinged on arguing that this prospect is a mere chimera.

It would, however, pose considerable difficulties for large parts of the Liberal Democrat and Labour parties, whose enthusiasm for Europe is fuelled by a sense that there is something wrong with Britain.

Full federal union would also solve the Scottish problem, provided a referendum on Europe can be delayed until eurozone union is in train. Full federal union on the Continent would force Scots to choose between remaining in the UK, joining the new European state (replacing London with another, much more remote capital), and full independence outside both the eurozone union and the UK. There is no polling data on this scenario as yet, but it seems likely that the status quo would prevail. Even if Scotland decided to go for independence from both the UK and the eurozone, it would be corseted by two strong unions to the south and north. Finally, London could view the (unlikely) prospect of Scotland joining the eurozone state with equanimity, as it would secure England’s northern flank for the foreseeable future, mobilise Scots to defend the security of the continent far more comprehensively than they are doing at the moment and thus fulfil the aims of the 1707 Anglo-Scottish Union by other means. The old United Kingdom could then be safely wound up: its work would have been done.




At first sight, this final British “opt-out” will perplex and irritate other Europeans. There will be many details to be sorted. The critical thing for eurozoners to understand, though, is that the United Kingdom is an exceptional power. The British are not prepared to sacrifice their sovereignty through membership of a full federal Europe, and are willing to pay a high economic price for that stance. Virtually all other peoples in Europe, by contrast, are ultimately either willing to sacrifice that sovereignty or have already lost it, for one reason or another, most notably by surrendering national control over their currencies. Almost uniquely among European states, Britain is strong enough to survive on her own. This partly reflects a constitutional tradition unbroken by dictatorship or defeat in the 20th century, and partly her enduring economic and military potential.

Nearly all the other European states, by contrast, are too weak to prosper as independent actors – survival being the limit of their ambitions – and Germany is too large to be permitted to do so. In other words, “Europe” was designed to fix something that was never broken in Britain. The central point is that if the eurozone is not to collapse, “Europe” will become something quite different from the Community Britain joined 40 years ago. It is, therefore, a case not of Britain leaving the EU, but of the eurozone leaving the original EU: a “Euroexit”, so to speak. This would then necessitate a revised European confederation between the UK and the new eurozone state.

However, as Clausewitz says, although everything in war may be very simple, the simplest things are very difficult. How can a eurozone union be given the constitutional structure it needs, without marginalising Britain? The proposition that London would just have to accept EU single-market regulation without having had a say in drafting it, as is now the case with Norway and Switzerland, is flawed. Britain cannot be compared with the other non-eurozone members, or non-EU states. Her economic strength, her permanent seat on the UN Security Council, her credible currency, her independent nuclear deterrent, and what the Prime Minister calls her “military prowess”, combine to make her one of the top three or four powers in the world. All this makes Britain so resilient that she cannot be dictated to by the eurozone and remain a huge net contributor to European security.

It follows that a grand bargain between London and a putative eurozone state is necessary and possible. Here is what such an arrangement might look like. Britain would continue to contribute to Europe over the odds militarily (through Nato) and take out over the odds economically (through the single market). Immigration and travel could be resolved amicably on the basis of reciprocity, whether in a restrictive or a permissive sense. Justice and the budget would be repatriated. Most importantly, there would have to be a confederal management of the single market and the City of London.

A single European federal state including Britain is not compatible with British sovereignty. A fragmenting Europe with an unstable currency, a Heath-Robinson constitutional structure, and without any serious capacity to deter threats, whether conventional or terrorist, is not in Britain’s interests. A united eurozone, constructed along Anglo-American constitutional lines, in confederation with Great Britain, and in security partnership with Canada and the US through Nato, is not only compatible with British sovereignty but very much in Britain’s interests. What is urgently needed on both sides of the Channel, therefore, is not a European Britain, but a British Europe.

As matters stand, however, the very thing the Prime Minister, the Eurosceptics and many soft Europhiles profess to want the EU most to be – a more flexible, British-type arrangement, reversing the trend towards “ever closer union” – is least compatible with the outcomes Britain desires, which are the effective management of the common currency and a concerted response to the enormous security challenges we face, especially in the east. Thus – given that the UK was created as a tight parliamentary union to defend Britain’s corner in the world – David Cameron’s vision for Europe is very unBritish.

The United States originated as a break­away state from the United Kingdom, based on the principles of the Anglo-Scottish Union. By the same token, Europe can only become more British by separating from Britain. If it does so, and thereby realises its potential, the resulting polity will eventually be more powerful than these two previous mighty unions put together. In this way, the Europeans would become more “British” than the Americans and, indeed, the British themselves.

Brendan Simms is Professor in the History of International Relations at the University of Cambridge and the president of the Project for Democratic Union ( His books include “Unfinest Hour” and “Europe: the Struggle for Supremacy” (both Penguin)

This article first appeared in the 01 July 2015 issue of the New Statesman, Crisis Europe

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Enough to educate 17 million children: the true cost of Brazil’s Car Wash scandal

As a new Netflix series dramatises one of the world’s largest corruption cases, Global Witness puts a figure on the cost of the scandal.

In the 1980s, Alberto Youssef was, alongside an older sister, smuggling whisky and electronic products from Paraguay to Brazil. Once, while being chased at a high-speed by police, VCRs kept falling out of the pick-up truck he was driving. Few would have guessed that this almost comical character would, one day, become a key player in what has been called the biggest corruption scandal in history. But then, the Car Wash, or as it’s known in Portuguese, Lava Jato, stretched far and wide across Brazil at a huge cost.

New research by Global Witness shows the damage caused by the Car Wash scandal far exceeds the sums stolen. The cost to the Brazilian treasury may be nearly eight times higher than the £1.4bn actually taken, enough to cover the salaries of more than a million nurses or provide a year’s education for over 17 million children.

Police only began to uncover the extent of the Car Wash scandal in 2013, when they became suspicious about the sheer quantity of cash churning through a bureau de change in a humble petrol station in the country's capital Brasilia. That led to the arrest of Youssef, which in turn led to further arrests. It soon became clear that this was no ordinary money laundering operation. Police had stumbled upon a racket that would involve at least 28 major corporations and 20 political parties, resulting in over 100 convictions. The list of those implicated reads like a Who’s Who of the Brazilian political elite, including two of the country's presidents.

Former Brazilian president Luiz Inacio Lula da Silva has been sentenced to more than 12 years, after it emerged he took bribes for helping a construction company win contracts with Petrobras. Lula says the case is politically motivated and remains free while appealing it. A ruling in a federal court on Monday, however, could send him behind bars, even as he takes the case to the Supreme Court.

Current president Michel Temer has also been at the centre of corruption investigations, most recently over allegations of bribery concerning a deal for operating services at the Port of Santos, Latin America’s largest container port. Congress has twice blocked Temer from standing trial on corruption charges while in office, and he denies the allegations.

The scandal has also inspired The Mechanism, a new Netflix drama from the director behind the biopic of Pablo Escobar, Narcos. The sums of money involved in Car Wash were almost at Escobar levels, but the billions lost to Brazil’s hard-pressed public services mean the scam might also have caused harm on a scale comparable to the druglord’s activities.

The fraud revolved around Petrobras, Brazil’s state-owned oil company. Instead of awarding huge contracts for construction projects, oil rigs, shipping and so on in the normal manner, the work was rotated around a cartel of companies in orderly fashion. Petrobras would over-pay the companies by at least 3 per cent, with the extra money forming a kickback to the directors responsible for awarding them the contracts. These directors would pocket some of the money, and hand the rest to the politicians who had appointed them to their lucrative posts. The money then went to the campaigns of Brazil’s political parties and provided backdoor funds that kept otherwise unstable governing coalitions together.

The result was a Byzantine racket of astonishing intricacy and scale in which everyone took a cut. Bribes came in the form of bricks of cash, expensive art works, aircraft and yachts; anonymously-owned companies in tax havens and foreign bank accounts helped launder the loot. One Petrobras director alone channelled €20m to banks in Monaco from accounts in the Bahamas, Panama and elsewhere.

“Once the mechanism is established, only the corrupt can take part,” says José Padilha, the Brazilian writer and director of The Mechanism. “If you’re an honest politician you’re doomed. The honest businessman will not get any contracts. There are only crooks.”

This “mechanism” had been running uninterrupted for at least 12 years.

Was this really the biggest corruption scandal of all time? Virtually every Car Wash explainer in the UK press poses the question – but none provides an answer. That’s probably because it’s notoriously hard to quantify value throughout history. In 193 AD, the Roman Praetorian Guard assassinated their emperor and held a fraudulent auction to appoint his successor, striking a deal worth 250 pieces of gold for each soldier in the army. (The empire was not theirs to sell). If not the earliest documented fraud, it was surely the most audacious – but trying to convert the ransom into modern currency is a fool’s errand.

But Padhila has no doubt. “It’s the biggest corruption scandal in the history of mankind,” he says. “It involves a mechanism which has been operating in Brazil in one form or another since at least the Eighties. Too many Brazilians fall into the trap of ideology, but the mechanism has no ideology. It is left wing and right wing. The whole political system is corrupted. Democracy has failed.”

Regardless of whether Car Wash is the biggest bribery case of all time, it certainly features in the ranks of the world’s corruption mega-scandals, sitting alongside mammoth state-thieving operations such as Malaysia’s recent “1MDB scandal” – US lawsuits claim an estimated $4.5bn has gone missing from a state development fund – and France’s Elf scandal, which shook the body politic and in which at least $400m was creamed off international oil contracts. All these scandals were linked to illicit political funding.

Taking a look at the cost of Car Wash to Brazil, first off there is the amount filched from the state oil company in improper payments. A Federal Police report seen by Global Witness conservatively estimates this at £1.4bn – all of which had to be laundered, sometimes moved physically. To put this logistical feat in context, if withdrawn in £10 notes the sum would make a stack eight miles high equivalent to almost 16 Burj Khalifas, the tallest building in the world (or, if you like, 343 Christ the Redeemers). The 119 tonnes of cash would take a fleet of 97 Ford Transit vans to deliver.

Then there is the £2.1bn fine Petrobras has agreed to settle a US investors’ class action, already bigger than the amount actually stolen. But both the theft and the losses are dwarfed by (and reflected in) the collapse in Petrobras’s share price. Before the scandal broke in September 2014, shares were at $19.33 but as of March 2018 they had dropped to $14.07. The government suffered a paper loss of £14.1bn for its 29 per cent stake in the company.

September 2014 was also the moment that global oil prices began a long decline, but the damage was too great for Petrobras to hide. “I would say 90 per cent of the fall in share price is due to Car Wash,” says Tiago Cavalcanti, a Brazilian economist at the University of Cambridge.

Petrobras’s 3.7 billion shares are supposed to furnish Brazil with a healthy income, and in the three years before Car Wash exploded, they provided Brazil with an average annual dividend of £360m. No dividend was paid in 2015, 2016 or 2017, costing the country £1.1bn.

Then comes the kicker. So vast was the upheaval  with billions slashed in investment   that some believe it helped bring about the worst recession in Brazil since records began. In March 2014, when the first Car Wash arrests were made, the Brazilian unemployment rate was 7.1 per cent. By last summer it was at 13 per cent. São Paulo consultancy GO Associados, headed by economist Gesner Oliveira, calculated that the fallout from Car Wash hit GDP by 2.5 per cent in each year the investigation was going on, from 2015 to 2017. The consultancy has now told Global Witness it has revised those figures up to an extraordinary 3.6 per cent — which would mean almost the entire drop in output during 2015 and 2016 was accounted for by Car Wash.

GO Associados said that would imply an annual $4.6bn (£3.3bn) in lost tax for each of the three years the fallout from Car Wash was at its most extreme £9.9bn. This figure would appear to be on the conservative side: it is based on the hit to the economy from Petrobras’s reduction in spending plans  but does not take into account the wider impact on Brazil’s giant construction companies, many of which lost contracts elsewhere in Latin America as a result of the scandal. Such firms were also banned from any public contracts in Brazil. The figure also fails to include the reduction in foreign investment in Brazil as a result of the political turmoil.

So even setting aside Brazil’s paper loss – Petrobras shares may well continue to rise  Lava Jato could have cost the government at least £11bn in revenue in lost tax and lost dividends from its stake in the company. That’s almost eight times the amount stolen from Petrobras in the first place.

“That number sounds very plausible and the calculation is logical,” says Cavalcanti, who has himself calculated that without Car Wash and other governmental policies Brazilian GDP would have grown by 1.2 per cent in 2015 and 2016 (as opposed to an actual fall of 3.8 per cent and 3.6 per cent). “Another reason for the recession was the falling price of commodities, but Peru and Chile did not have the fall Brazil had. Certainly Car Wash was a very big factor in the recession.”

Who knows the real difference that £11bn could have made in a country where universal healthcare is still some way off and about 7 per cent remain illiterate. The real price of Car Wash is incalculable.

“I feel disgust and exasperation,” says Padilha.

You might think that at such terrible cost, the Brazilian public would rather the fraud had never been exposed. But a recent poll suggests 94 per cent of Brazilians think the investigations should continue despite the current turmoil. For many, this is a golden opportunity to tackle the corruption that has afflicted the Brazilian body politic for decades before the mechanism started turning.

Because according to the filmmaker, Petrobras is the tip of the iceberg.

“There is no public contract in any village, town, city or state that is not affected, from the tiniest new road to the biggest government project,” he says. “All are corrupted - and none of this is exposed yet. In my country you can turn any stone and there will be cockroaches underneath.”

Ed Davey is an investigative journalist for Global Witness.

This article first appeared in the 01 July 2015 issue of the New Statesman, Crisis Europe