Tuesday, 25 June 2013

First World Stadiums, Third World Health and Education

In the latest wave of social discontent around the world, hundreds of thousands of Brazilians have taken to the streets. The immediate cause of the unrest was the decision by  the government to raise fares on public transport. However, beneath this lies a broader frustration that the government has spent billions on building stadiums for next year’s World Cup, instead of funding other essential public services. One slogan raised by the demonstrators has been: ‘First World Stadiums, Third World Health and Education’. 

The similarities between the situations in Brazil and Poland are striking. The decision by the Warsaw government to raise fares has led to a series of protests. These are of course incomparable in size to those occurring in Brazil, yet as part of a wider campaign they could yet result in the removal of Gronkiewicz-Waltz from her position as President of Warsaw. 

The other obvious similarity with Brazil is the economic and social costs of directing large sums of public money into building stadiums for a major football tournament. As it is now over a year since Euro2012, we have some opportunity to assess the usefulness of this investment. 

Euro2012 was itself a huge success for Poland (at least off the football field) and showed that the country could effectively organise an event of this magnitude and that its population is open and welcoming to people from other cultures. Furthermore, the huge investments made before the tournament was a crucial element in helping to maintain economic growth and a reminder of how public investment can help to counter recessionary tendencies in the economy. 

On the other hand it should be remembered that the Polish government was using funds that it had already gained from the EU before it became a host of Euro2012. No new money was gained by the Polish government for cohosting Euro2012 and therefore public money was  being used for the tournament that may otherwise have been spent differently. 

Poland now has three world class stadiums that can host major sporting and cultural events. The problem however is that for the most part these stadiums have remained empty and the costs of maintaining them are crippling local governments. The PGE Arena in Gdańsk costs 750,000 zloty a month to maintain, rising to 2m in Wrocław and 3.5m for the national stadium in Warsaw. The energy costs alone for these stadiums are 750,000 zloty a month. 

Despite the assurances of politicians, the financial difficulties of these stadiums seem set to continue. The recent fiasco of the National Stadium making a loss out of a Madonna concert underlies the problems that are faced. The National Stadium has as yet not even managed to rent out any of its 40,000sqm of office space. 

The conclusion that must be drawn is that Euro2012 was a waste of resources and misdirected essential public investment during a time when Poland was receiving an unprecedented amount of funds from the EU. As in Brazil the new state of the art stadiums now stand in stark contrast to the country’s deteriorating public services. 

However, it would be unfair to state that while Poland now has some first world stadiums that it also has third world education and health. Despite its difficulties, Poland possesses an infrastructure of schools, hospitals, universities and clinics that most third world countries could only dream of. The general state of the populations health and high level of education is reflective of the fact that universal health and education services are provided by the government.

The problem however is that the political elite does not in general view these services as being important elements of the country’s economic and human capital, but rather as a burden on public finances. It is not understood that these public services need to be continually invested in and developed rather than being considered as an asset that at best may be sold off to private investors. Polish capitalism has had the advantage, over its poorer counterparts, of having inherited the infrastructure (yes one that was often insufficient, heavily centralized and bureaucratic) of a well-developed public sector. Yet rather than build on this advantage, successive governments have run these services down. 

If we just take the example of health, we can see how this capital has deteriorated. Between 1995 and 2011 the number of public hospitals reduced from 696 to 501, with the number of available hospital beds per thousand of the population falling from 55.4 to 46.9.  During the same time period the number of doctors declined by almost 8,000; nurses by nearly 3,000 and midwives by over 2,000. Before our eyes we can see the quality of the health service deteriorate, which fuels the calls of those who can already afford to use private health care for it to be privatised. 

The attempts by the government to close down a number of schools and increase the privatisation of hospitals, has met some resistance within society. If the current degradation and commercialization of these services continue then an important element of Poland’s development will have been removed. Health and education will cease to be a right granted to all and rather become a commodity that can only be afforded by a privileged minority. Such a scenario would see Poland move closer to that in countries such as Brazil.


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