Brazilian Anticorruption and the World Cup

The FIFA World Cup is more than “a mere sporting event. It’s a tool to promote social transformation.”  So said Ricardo Teixeira, the President of the Brazilian Football Confederation, after Brazil won the bid to host the 2014 games. Despite initial optimism, however, the buildup to the Cup in Brazil has been marred by widespread protests and accusations of corruption. If there is a basis to these accusations, the World Cup provides an early — and high-profile — opportunity to test Brazil’s new anticorruption law. Maryum’s post earlier this week might be right that the national government has a political incentive to prove that it’s serious about anticorruption, but the World Cup contradicts that narrative. The Cup’s high profile might skew the national government’s incentives: identifying corruption in Brazil’s World Cup could be a national embarrassment.  If the federal government’s incentives are misaligned, the decentralized enforcement powers in the CCA – which Maryum’s post criticizes – offer hope that corruption will be punished.

When Brazil bid for the World Cup, it promised Brazilians that the Cup would come with much-needed infrastructural developments. It is now clear that promised infrastructural developments will not be made.  The costs of the Cup have exceeded all estimates and, despite former-President Luiz Inácio Lula da Silva’s promise that no public money would be used for the World Cup, 80 percent of the $3.5 billion earmarked for stadium construction is coming from the public coffers. Despite large expenses and ample time, construction is lagging far behind. Corruption might well be to blame for the cost and the delay, and the Brazilian Sports Minister tasked with overseeing Brazil’s preparations for the World Cup and the 2016 Rio Olympics resigned amid allegations of corruption. Broken promises, staggering costs, inefficiency, and corruption have sparked large protests against poor public services and the high costs of hosting the World Cup.

Responding to public protests, Brazil passed the Clean Companies Act, which came into effect earlier this year. We do not yet know whether or when Brazil will use the new law to prosecute corruption. Though the World Cup might provide a high profile opportunity to enforce the law, it might be so high profile that the federal government prefers to sweep corruption connected to the Cup under the rug. The 2014 World Cup is Brazil’s chance to show what it is capable of doing, and some commentators have pointed out that corruption undermines the country’s show of force.

If the national government’s incentives are misaligned, local discretion to implement the law creates room for enforcement that might not otherwise exist.  Local discretion, not without its problems, better guarantees that some entity will enforce Brazil’s anticorruption law. Though the national government has not initiated its own enforcement actions, state and local officials are already investigating overcharges in the construction of stadiums in Cuiabá and Rio de Janeiro. Maryum suggests that political pressure to fight corruption is stronger for the national government than for local governments. But that overlooks the fact that local officials have at least one strong incentive to fight corruption: they directly feel its effects, and care less about whether exposing corruption might be embarrassing to the nation on the world stage.

2 thoughts on “Brazilian Anticorruption and the World Cup

  1. Last week was a big week for anti-Cup protests.

    An interesting piece of the story that neither Maryum nor I talked about is that local organizations are leveraging the World Cup’s visibility to demand government action in other spheres. Teachers in Rio halted classes for several days to demand better pay; Military Police in Recife went on strike (to deadly effect – over two dozen people were killed in a single day of the strike).

    I don’t know how this affects my argument. I think it strengthens my case, though. If Brazilians are leveraging the visibility of the Cup to bring about changes in compensation, they will likely leverage the visibility of the Cup to highlight corruption, especially when that corruption is related to World Cup projects.

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