"How Brazil May Be ‘Sacrificing Its Future’ To Host The World Cup"
Sunday’s friendly match between Brazil and England’s international soccer squads was supposed to be a grand opening of sorts, a celebration of Rio de Janiero’s Estádio do Maracanã, a 70,000-seat behemoth that will play host to the opening match of the 2014 World Cup next June. The match itself was a fine display of soccer prowess. It was the week ahead of it that elicited concerns that Brazil’s World Cup bid may have been built on false promises, made particularly to the Brazilian people.
The World Cup was supposed to come with major infrastructure projects meant not just to showcase Brazil to the world but to continue its emergence as a new world economic power. The government projects that the tournament will flush $70 billion into the Brazilian economy, while vast investments into road and transit systems, airports, and its crumbling soccer stadiums would position it to ensure that those gains translate into long-term economic growth.
Instead, World Cup preparations are raising concerns about whether Brazil is ready to play host — and whether it will achieve the benefits it has promised its people.
Construction at Maracanã was so far behind schedule that the England friendly is the only tune-up match that will occur there before the Confederations Cup, a pre-World Cup tournament, begins this summer. The match was nearly canceled by a judicial injunction the week before that because misplaced paperwork kept the stadium from being certified as safe. Other World Cup venues are behind schedule as well, and a roof collapsed at one just weeks ago. The ambitious infrastructure projects that were supposed to accompany the Cup — newly built roads and bus lines, airport improvements and railways linking them to major cities, and public transportation projects — have been delayed or canceled.
The projects are also over-budget. Brazil originally planned to spend less than $1 billion, mostly from private financing, to renovate seven stadiums and build five more. It is now projected to spend more than $3 billion in public dollars, three times more than South Africa spent on facilities in 2010. Delays and corruption have driven up costs on other infrastructure projects as well.
The reality is that those problems are emblematic of a larger issue: the promises of economic boosts were never likely to come to fruition, particularly for Brazilians as a whole. When sports economists Robert Baade and Victor Matheson studied the 1994 World Cup hosted by the United States, they found that it had no substantial effect on the nation’s economy or the economies of host cities. In fact, hosting the Cup may have come at a cost to the country and the cities that played host. That may not correlate perfectly to Brazil, which needs major public investments into infrastructure and even needs improvements to its soccer infrastructure. Still, even accounting for “rosy projections,” the country is most likely “sacrificing a little bit of its future to host the World Cup,” as author Simon Kuper and economist Stefan Szymanski wrote in their book, Soccernomics, in 2012:
If our rosy predictions for Brazilian soccer come true, then that won’t make Brazil as a whole richer. Rather, the Brazilian World Cup is best understood as a series of financial transfers: from women to men (who will have more fun), from Brazilian taxpayers to FIFA and the world’s soccer fans, and from taxpayers to Brazilian soccer clubs and construction companies. Possibly Brazilian society deserves these transfers. Still, we have to be clear that this is what’s going on: a transfer of wealth from Brazil as a whole to various interest groups inside and outside the country. This is not an economic bonanza. Brazil is sacrificing a little bit of its future to host the World Cup.
More than a year before the tournament begins, Kuper and Szymanski’s projections are already coming true, according to a recent report from Bloomberg. Foreign investors are profiting off of publicly-traded companies that are in charge of building stadiums and managing infrastructure projects, and one Brazilian construction company that is supplying concrete and scaffolding has seen its stock price triple since 2010. Meanwhile, in cities across the country, public resources are crumbling: 80 percent of Brasilia’s schools are inadequate, government watchdogs say, and 70 percent of Cuiaba’s water goes untreated. Indigenous populations are being evicted from the shantytowns in which they live; other poor Brazilians have faced similar fates, much as the poor were uprooted in South African cities ahead of the 2010 World Cup there.
The problems almost surely won’t reach the level of South Africa, where state-of-the-art stadiums now sit largely empty in a country where professional soccer has nowhere near the breadth it achieves in Brazil. There can be, according to Kuper and Szymanski, positive social effects that come from hosting an event like the World Cup, especially if the tournament itself goes off without major hitches. And at least some Brazilian cities need updated stadiums that are safe and comfortable for players and fans alike. But while the country builds a $600 million stadium in Brasilia — a city without a top-tier professional team capable of filling its 73,000 seats — it isn’t making similar investments into its overcrowded, understaffed hospitals, its unmanned and incapable ports, and its tattered schools.
“It’s a perfect storm being created for success,” Bob Newman, the chief operating officer of AEG Facilities, a stadium contractor managing much of Brazil’s construction, told Bloomberg News in May. The question is, success for whom? That the answer is the Brazilian people is becoming increasingly hard to believe.