Brazil protests show cost of hosting major sports events

The recent protests in Brazil, increasingly referred to in the media as the "soccer riots," highlight the deep social costs of hosting major sporting events such as the World Cup.

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The fiery demonstrations on the streets of Rio de Janeiro and other Brazilian cities began in mid-June after a rise in bus fares, but have expanded to become a broader grievance about poor public services, especially education and health care, as well as government corruption.

'You wont want to wear a FIFA blazer in Brazil. Youll get knocked down.' Andrew Jennings, British journalist

One of the themes emerging in the protests is concern over the costs associated with Rio hosting the 2014 World Cup of soccer, as well as public enmity towards FIFA, the international soccer body.

Many FIFA officials are in Rio for the Confederations Cup, which wraps up on Sunday, with the home country facing off against Spain in the final.

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On Thursday, about 5,000 anti-government protesters clashed with police outside Castelao stadium in Fortaleza, the site of the semifinal game between Italy and Spain.

When protesters see FIFA delegates and the festivities surrounding the Confederations Cup, "and you realize the stadia cost three times as much as you were promised, it was all going to be private sector and no public money, youd get angry," says Andrew Jennings, author of FOUL! The Secret World of FIFA: Bribes, Vote-Rigging and Ticket Scandals.

"You wont want to wear a FIFA blazer in Brazil," says Jennings. "Youll get knocked down."

According to Brazils sports ministry, the initial budget for stadiums and transit infrastructure for the 2014 World Cup was 25.5 billion reals ($11.4 billion US). It has grown to 28 billion reals ($12.7 billion) nearly three times what it cost Germany to host the 2006 World Cup.

Many Brazilians feel that given the profound deficiencies in the countrys education and health-care systems, government spending on projects related to the World Cup in 2014, as well as the Olympics in 2016, is misguided.

On June 20, a million people across 80 Brazilian cities took to the streets to protest. The countrys president, Dilma Rousseff, has acknowledged their concerns but also appealed to citizens to temper their outrage, lest it jeopardize next years World Cup.

Broadening the reach of sports

Sporting bodies such as FIFA and the International Olympic Committee have made it part of their mandate to stage mega-events in developing countries as a way of extending their reach, says Norman OReilly, a professor of sports management at the University of Ottawa.

"You cant just keep going back to the G8 countries, where you know theres a little less risk."

Going into a developing nation, however, can highlight income disparities between the moneyed elites and the rest of the nation.

"I think any country, other than communist countries, that hosts [mega-sporting events] has to expect a group or groups to be offended by the amount of money thats being spent," says Rick Burton, a professor of sports management at Syracuse University.

The economic benefits of hosting a major sporting event such as the World Cup or the Olympics are hotly debated. Those who prepare the bids for these events often tout an influx of tourism and spinoff effects for the local economy, from construction to merchandising.

The accounting firm PriceWaterhouseCoopers has reported that the preparation and staging of the 2010 Winter Olympics in Vancouver, for example, generated about $2.3 billion in real gross domestic product for the province of B.C.

But Stefan Szymanski, a sports economist and co-author of the book Soccernomics, has said there are "only very limited economic benefits" to hosting major sporting events.

"Governments claim that the investments in infrastructure will create construction activity and will boost the economy. But the construction of these structures really just displaces other construction activity, and those other construction activities usually are more productive," Szymanski said in an interview with the public policy site MercatorNet in 2011.

"So youd be better off building roads and flats and new commercial properties than building stadiums, because stadiums just aren't used enough."

Legacy effects

OReilly, who worked on Torontos bid for the 2008 Olympics, says that many of the benefits associated with major sporting events are "legacy effects."

The building of new stadiums for a World Cup, for example, can lead to the establishment of local soccer teams after the event is over, which can have a lasting impact on the citys sports culture, not to mention its economy.

As well, by making a massive investment in infrastructure for one large sporting event, a city or country improves its chances of being chosen to host another, even bigger competition. OReilly points out that prior to being chosen to host the 2014 World Cup, Rio hosted the 2007 Pan Am Games.

But legacy effects are unlikely to be top of mind for protesters in Brazil, says Burton.

"That person in the street, in the moment, who doesnt have a job, or feels displaced or feels overwhelmed by the challenges they face I dont think theyre looking at discussions of return on investment or how this is going to leave this great legacy for Brazil," says Burton. "Theyre wondering where their next meal is coming from."

OReilly says the mere fact of getting a World Cup or Olympics can be a PR coup. As TV audiences become more fragmented, mega-sporting events are among the few properties that still command worldwide interest, he says.

"The attention you get for the Olympics and World Cup is unmatchable anywhere else in the world these days," says OReilly. The event leads to heightened international awareness, which raises a city or countrys brand and can result in greater future tourism and foreign investment.

Although Montreal has become notorious in sports circles for the debts it accrued in hosting the 1976 Olympics, OReilly says hosting the event "put the city on the map."

"Its by far the best-known city in Canada [internationally]. Toronto hasnt had those big events, so people dont know about it," he says.

Theres no denying the increased attention that comes with hosting a sports extravaganza, but Jennings says the locals rarely even get to see the action.

Major sporting events are "a hoax on the people, playing on their natural desire for sport not realizing, they aint going to get a ticket," says Jennings.

"Thats one reason Brazilians are on the street."