World Cup Preparations Sucking the Life from Brazil

We’re less than 3 months away from the beginning of the 2014 FIFA World Cup in Brazil, and the excitement in the soccer world is beginning to materialize. The major European leagues are winding down to a close for the summer break, and although the Serie A and Bundesliga champions have all but been crowned (Juventus and Bayern Munich, respectively), the Premier League and La Liga are wide open for the taking. In mid-May, once the dust of this season’s club competitions begins to settle, all eyes will be fixed firmly on Brazil. Will Latin America’s largest economy be ready to host the largest international sporting event in the world? Truthfully, that’s a difficult question to answer; is any country ever ready to host an event of that scope?

In total, Brazil commissioned the construction of 12 massive stadiums all across the country. As of writing, 9 are completed, which leaves 3 stadiums to be completed by June. The most recent stadium to be officially inaugurated, Arena da Amazonia, was built in the city of Manaus, the most populous city in the sate of Amazonas, which is also home to the amazon rainforest.  The game that the Arena da Amazonia hosted was between Nacional and Remo in front of a crowd of 20,000 people (the stadium’s capacity is 44,000). Construction of the Arena da Amazonia was marked by 3 deaths and $290 million in costs, roughly $70 million more than what was budgeted. Massive overspending and human death aside, construction of the stadium was a success…right?

Not so much. Fans who attended the Nacional vs. Remo game took to social media to vent their frustrations at the shoddy craftsmanship and organization that went into the stadium. Allegedly, tickets were sold for seats that didn’t exist, some of the stadium’s bathrooms remained closed and incomplete, and sections of the roof were leaking. These are not encouraging signs for a stadium that’s going to play host to games such Italy vs. England and Portugal vs. United States in a few weeks.

Men work at the Itaquerao, the stadium that will host the World Cup opener in less than three months in Sao Paulo, Brazil, Saturday, March 15, 2014. The Itaquerao was one of the six stadiums that were supposed to be finished by the end of 2013, but a crane collapse that killed two workers in November caused significant delays to the venue.

The situation in Manaus is a microcosm of the larger difficulties Brazil has had preparing the nation for the influx of international tourists and the attention of the entire world. The main stadium in the capital, São Paolo, has yet to be finished, and will be hosting the finals of the entire tournament. Furthermore, each of the 12 cities who received a new stadium to host some of the games are reportedly still in need of repairs – some minor, some dire - to their general infrastructure. Death and massive overspending are not symptomatic of just the Arena da Amazonia; they’ve become par for the course in the construction for most of the stadiums.

Still, there’s no need to be alarmed! Brazil is one of the world’s fastest growing economies and the Brazilian people are ready to foot the inflated bill this World Cup is going to produce for the sake of national pride! Pay no mind to the protests that nearly toppled the government in mid-2013, everything is going according to plan! What’s that you say? The Brazilian economy is slowing down because – among other things – lack of investment in infrastructure? Huge swaths of the population don’t event want to host the event?

Yes, in early June to July of 2013, over 2 million protests across the country organized and shut down portions of Rio de Janeiro, São Paolo, Manaus, and 13 other major cities. Sparked by – of all things – an increase in public transit rates, their collective anger against perceived government corruption and lack of investment in infrastructure, health, and education spilled over into the streets. Despite the emotional nature of the protests, the demonstrations remained largely peaceful. Interestingly, one subject that came again and again was the 2014 FIFA World Cup. The Brazilian people were baffled as to why the government was funneling billions of taxpayer dollars towards hosting an international sports tournament when citizens were spending hours stuck in traffic because there just aren’t enough roads built.

President Dilma Rousseff reacted by moving quickly to cancel the public transit hikes and enact legislation that dealt with the concerns of the protesters, including increased scrutiny and harsher penalties towards corruption, the end of all government taxes for public transport, and the redirection of all government petroleum royalties towards health (25%) and education (75%). Her swift action stopped the protests from spilling over into a more violent quasi-revolution, the kind the global community has grown accustomed to since the Arab Spring, but the cat was out of the bag. The global community was made aware that, for the most part, the Brazilian people really didn’t have any interest in hosting a World Cup while they were still trying to improve aspects of their day-to-day lives.

FIFA president Sepp Blatter recently announced that the usual speeches from the organization that marked the beginning of the World Cup would be scrapped this time around. The stated reason was to avoid any ‘social unrest’ that his presence may cause, as he had become somewhat of a target during last summer’s protests as the face of FIFA. It’s unclear what influence the Brazilian government had over his decision, but what remains painfully obvious is that Brazil may have bitten off a little more than it can chew.

Dilma Rousseff (president of Brazil) and Sepp Blatter (president of FIFA)

The narrative that’s usually played out to the public is that hosting events of this caliber always create more positives than negatives. The mayor of Montreal, Jean Drapeau, famously said of their decision to host the 1976 Olympic games, that “The Olympics can no more have a deficit than a man can have a baby.” In the end, the 1976 Olympic games generated a net loss of nearly $1 billion for the city of Montreal, a debt that was only fully paid 30 years later in 2006. The moral of the story is that countries shouldn’t even consider playing host to things such as the World Cup or the Olympics unless they already have their affairs in order. Trying to pretend otherwise is setting yourself up for real trouble in the future, as Dilma Rousseff and her government might soon realize, since 2014 is more than just the year the World Cup comes to Brazil.

Later this year, sometime in October, Brazil will take to the ballot box for its scheduled election. The Brazilian people will get to voice their displeasure on all of the subjects that have been accentuated by the preparation for the World Cup; the corruption, the need for infrastructure development, and the financing of health and education in the nation of 200 million people. Whoever inherits the government will be in the difficult position of handling the aftermath of the World Cup and preparing for the 2016 summer Olympics. The monumental, back-to-back challenge of hosting both will only be exacerbated by the fact that the general consensus among international economists seems to be that Brazil risks sliding into a recession unless it takes drastic action. The country is in need of deep budget cuts and steep tax hikes to finance the development of roads, hospitals, and schools for its middle class, all while chipping away at its deficit. It’s a challenging balance act for any nation, particularly an emerging economy like Brazil.

Only time will tell if Brazil’s decision to host the World Cup will be one that comes back to haunt them. There’s always the chance that they’ll finish all of the stadiums on time, execute the tournament without any difficulty, and go through the entire month without any social unrest. It isn’t likely, but it’s possible. If anything is going to hold Brazil together during this period, it’s going to be the fact that even though they may be frustrated with the decisions of their government, the Brazilian people really, truly do love soccer.

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