Thursday, 12 June 2014

The FIFA World Cup and the Poverty of Many Brazilians

Today is the start of the FIFA World Cup, held in Brazil. I will likely watch a game or two, but I don't know that much about the subject. Many economists have offered their predictions (e.g., here and here). NYT's 'The Upshot' has an extensive poll about people's attitudes towards the "beautiful game", which shows sympathies across nations (unsurprisingly, Argentinians want England to do poorly). Me, I won't offer any predictions at all. I do note, however, that Ladbrokes have Brazil as their favourite to win the lot, likely beating Argentina in the final. For higher odds, "dark-horse" teams with plenty of youth like Belgium and England might be worth betting on.

But the main point of this blog post is the discussion about Brazil hosting a costly event while many Brazilians live under highly unenviable material circumstances. Recent protestors have campaigned against spending money on building stadia rather than on housing. I don't know who's spending the money, which I would argue is extremely relevant to the issue. If it is private individuals, then I do not see any problem with building stadia rather than handing out alms; although the latter would of course be a very nice thing to do, the moral principle that one should not spend money on one's self because others can be helped cannot be maintained in a world of insatiable wants. Individuals can help others if they want to, but forcing them to do so is a breach of their sovereignty, their dignity, and their sense of being in control of themselves.

However, from the fact that the President of Brazil, Dilma Rousseff, has defended the World Cup, I surmise that it is really the Brazilian government which are constructing stadia. If there is to be a government, it should arguably spend tax-payers' money on socially useful projects. So then maybe the protestors have a point. By the argument made above, maybe the government should not have any money to begin with, but once the "damage has been made" the money might as well be spent wisely.

In this case, I do not see how the protestors' point is any less valid when applied to welfare payments to citizens of rich countries. After all, assuming away concerns about disincentive effects to work from transfer payments, those recipients are relatively well-off and not kept from abject squalor by hand-outs from the state. If this money were instead directed to the poor folks of the favelas (and again, if the disincentive effects to work are assumed away), a far greater success of poverty alleviation would have been achieved.

It may be objected that transfer payments going abroad only drain the nation's economy, but why should the calculus of altruism be restricted to nations? The loss to one "nation" is outweighed by the benefits to another. As long as the greatest wants are satisfied first, this means global gains of vast proportions, indeed. The fact that governments palpably do not work along these lines suggest to me some deep underlying problems in the mechanics of politics.

Of course, rather than sending money to Brazilians (and before them Haitians, Malawians and many, many poor people of other nations), rich countries could do something for which there is precedent, namely open their borders to these poor individuals. Food for thought while watching the games.

No comments:

Post a Comment