I supported Brazil's World Cup bid, but the expense is now crippling us

This mega event can only deepen Brazil's problems. The only beneficiary will be Fifa

• 
• • Romário
  • The Guardian, Monday 24 June 2013

People gather for an anti-government protest in Rio. ‘The people on the street are crying out for an end to corruption and against the waste of public money, both of which are so common in our Brazil.’ Photograph: Silvia Izquierdo/AP

Over the last week, the Confederations Cup, which is taking place in Brazil, has been sharing space in the news with frequent and timely protests on the streets, most of them with the intention of forcing the Brazilian government into a new economic direction.

As five times world champion, Brazil's love of football has long been blamed for distracting the population from its social problems. It is ironic, therefore, that it was the country's preparation to host the World Cup that has mobilised Brazilians. Raising flags with no party colour, the people on the street are crying out for an end to corruption and against the waste of public money, both of which are sadly so common in our Brazil.

These protests will strengthen our democratic culture. It is the voice from the streets, for one, that will lead to the strengthening of our judiciary. And it couldn't come at a more timely moment: with the legislation currently weak, corruption is rife – and those who steal from the public are let off the hook. As a congressman for the Brazilian Socialist party (PSB), I am comfortable being so critical of the state of the law in my country, because for a long time I have not shied away from pointing out the abuses that take place around here.

When Brazil won the bid to host the World Cup, other politicians were in charge of the country, and our political reality was different. I supported the bid because it promised to generate employment and income, promote tourism and strengthen the country's image.

Since then, Brazil has been affected by the turbulence in the world economy just like any other country. Government plans were redrafted, public investment was cut – yet the commitments signed with all-powerful Fifa stayed the same. Investment in cities hosting World Cup matches were prioritised over the people's needs. Money was channelled predominantly towards sport projects, at the expense of health, education and safety. The lack of investment in education, for example, contributed to an increase in people with no occupation, leading to more unemployment and lack of security in the big cities.

In many cities, conditions in schools are deplorable. Teachers are poorly paid and demoralised, and Brazil is now ranked second last on Pearson's education quality index, out of 40 countries. Worse: one in four students who start out in basic education leave school before they complete the last grade, according to the UN Development Programme's 2012 development report.

Brazil's public health situation is worrying, too. Those who have to rely on public hospitals often end up with their sickness aggravated by the lack of professional treatment. There have been press reports about people dying while on hospital waiting lists, without receiving even basic treatment. Who is responsible for this criminal irresponsibility?

Problems with education, health and safety were inherited by previous governments, making the country socially vulnerable, in spite of what the economy index may tell you. Brazil is now one of the 10 major world powers, but how does that matter to the people if the social loss is so evident?

Under the government of former president Luiz Inácio Lula da Silva, the World Cup proposal was to have an event in which there was transparency on public spending. The opposite has occurred. An initial budget of R$25.5bn ($11.4bn) for stadiums, urban transportation, improvements in ports and airports, has risen to R$28bn, according to the sports ministry's executive secretary, Luiz Fernandes – almost three times the cost of Germany's World Cup in 2006. Why are we organising the most expensive World Cup in history, without any of the benefits to the community we were promised?

Plans to improve traffic around host cities have turned out to be chaotic, too; only three have stuck to their budgets and deadlines. Numbers like these have made the public angry and fuelled popular protests, in a bid to reverse the logic of a system that privileges money over social matters.

Meanwhile, Fifa has announced that it will make a R$4bn profit from Brazil's World Cup, tax-free. Its easy profit contrasts with the total lack of an effective legacy. President Dilma Rousseff repeats what former president Lula said, reassuring us that we'll "host the best World Cup of all time". I don't agree, because we have failed on what matters most: a legacy to make us proud. Only Fifa is profiting, and this is one more good reason to go to the streets and protest.

I never thought the World Cup would solve all of our problems, but now my fear is that this mega event will only deepen the problems we already have.

Civil Aviation in India

India mulls over 49% overseas share in airlinesBy Raja Murthy

MUMBAI - The Indian government on April 12 postponed to this week an eagerly awaited decision to allow foreign airlines own up to 49% stake in Indian carriers. But overseas funding alone is unlikely to rescue India’s struggling US$12 billion civil aviation industry.

It's more a case of mismanaged potential that has caused five out of the six Indian carriers, except Indigo, to have accumulated losses of nearly $2 billion in the past two years. India, the world's ninth largest civil aviation market, had passenger traffic doubling  to over 150 million in 2011, from about 73 million in 2005-06.

India aims to be among the world's top three aviation markets within a decade. In between are mountains to climb and some strange oddities to correct - such as building multi-billion dollar luxury airports in an industry dominated by low-cost airlines.

The foreign direct investment (FDI) move, if it materializes as part of the mountain climbing process, could give desperately needed survival cash and breathing time to nearly dead flying companies like Kingfisher Airlines. The Vijay Mallya-promoted carrier is drowning in a debt of $1.3 billion, with no new loans forthcoming, with over 60% of its aircraft fleet grounded and its employees receiving salaries for December 2011 only on April 9.

The state-owned carrier Air India has similar mismanagement woes, but continues to receive public money to bankroll it. On April 12, the government approved 300 billion rupees (US$5.7 billion) as bailout and part of a revival plan for Air India across the next eight years. This after Civil Aviation minister Ajit Singh informed parliament that Air India incurs losses of $1.9 million every day, or over $700 million annually.

Whether Air India would fare better without government ownership is as moot a question as whether more funding, including FDI, could only be more investment down the drain. Waiting to be surgically treated are roots of the problem such as unviable operating costs for airlines.

Unfairly high taxes on aviation fuel have long been a major complaint for India's airline industry. Aviation Turbine Fuel (ATF) continues to be over 50% costlier in India than in Singapore and Malaysia. Fuel costs contribute about 45% of the operational costs of India's airlines.

Yet India's state-owned oil companies sell jet fuel cheaper to international airlines than for domestic flights in Indian airports. Indian Oil, for instance, sells jet fuel at $1,010 per kilo liter for international airlines in Mumbai (March 1, 2012 prices), while domestic airlines pay a pre-tax cost of $1,316.77. International airlines are free from sales tax on aviation fuel, while domestic airlines pay an additional 26% sales tax that local state governments levy.

Instead of the obvious step of reducing aviation fuel taxes to reasonable levels - or to only at least 25% above international levels - the Indian government earlier this year allowed domestic airlines to directly import aviation fuel. That seems as bizarre as asking an impoverished dying patient to go overseas to buy medicine available down the street.

Even more peculiar is that India exports nearly half its production of aviation fuel. According to Ministry of Petroleum data, India exported 4.478 million tonnes of aviation fuel in 2010-2011, out of total aviation fuel production of 9.570 million tonnes,

Fuel costs are only part of the problem. Aviation infrastructure growth appears heading in a direction different from requirements for industry growth. Privatization of metropolitan airports, for instance, resulted in multi-billion dollar upgrades for the Mumbai and Delhi airports, and new airports for Bangalore and Hyderabad. The impressive new airports though are driving up operational costs for a budget airline industry that critically needs low-cost infrastructure.

The spectacular new Terminal 3 of New Delhi's is itself both solution and problem. Built and operated by the Delhi International Airport (P) Ltd (DIAL) - a joint venture consortium of global infrastructure company GMR Group, Airports Authority of India, Fraport and Malaysia Airports Holdings Berhad - Terminal 3 makes Indira Gandhi International Airport (IGI) one of Asia's largest public buildings and the world's second-largest integrated airport, after Beijing Capital International Airport.

The $6 billion Terminal 3, spread along 4 kilometers and with a roof area of 45 acres (18.2 hectares), serves as future investment for Delhi having the world's fastest growing airport passenger traffic. According to the Montreal-based Airport Councils International, Delhi registered passenger traffic growth of 21.77%, faster than Jakarta's 19.2% and Bangkok's 12% growth. This compares impressively to the 1.8% air passenger traffic growth in North America.

But India's airlines and passengers are being asked to pay more airport fees and taxes to recover the multi-billion dollar costs for the new airports. Both Air India and Kingfisher Airlines alone owe the Delhi airport $100.4 million in airport fees. So airport employees are also suffering salary delays.

International carriers are too feeling the pinch. Malaysia's Air Asia, the continent's leading budget airline, announced termination of its flights out of the Delhi and Mumbai airports from March 24 this year, citing excessively high airport and handling fees and aviation fuel costs at these airports. Air Asia continues to fly from five other cities in South India.

The Airports Economic Regulatory Authority has proposed a 280% increase in landing and parking charges at Delhi airport, while the airport operator DIAL wants a 700% increase. Not just low-cost airlines, but Lufthansa, Air France, KLM and British Airways have announced putting on hold expansion plans in India due to the huge hike in operational fees at IGI Terminal 3.

Such headaches were not quite anticipated when an Air Deccan 48-seater ATR turbo-prop aircraft took off from Hyderabad to Vijayawada on September 26, 2003, to unofficially launch low-cost airlines in India. Since then, a heavily loss-making Air Deccan was bought by Kingfisher in 2007, and now a heavily loss-making Kingfisher is looking to sell itself to a foreign carrier.

The pending 49% FDI decision on the governmental anvil is actually a throwback to over six decades ago. In 1951, the government bought a 49% stake in Air India, founded and owned by the Tata Group. The government retained an option to buy another 2% stake and became owner. It did so under the Air Corporations Act of 25 August 1953 that nationalized all private airlines.

Air travel was booming in India in the 1950s, with cheaply available World War II surplus aircraft and India having bountiful skilled air pilots and maintenance crews after the war. The 26-page "Official Airline Guide" of July 1952, published by the Air Transport Association of India, lists schedules for about nine domestic airlines: Air India Ltd (also called The Tata Airline), the Air Services of India (also called the Scindia Airline), Airways (India) Ltd, Bharat Airways (also called the Birla Airline), Deccan Airways, Himalayan Aviation, the Indian National Airways, Kalinga Airlines and Air India International.

In 1953, India had over 20 private airlines, with unstructured growth without proper infrastructure creating market problems similar to the current woes of some domestic airlines. JRD Tata (1904-1993), called the father of civil aviation in the subcontinent, predicated an industry disaster. One of the reasons why the government nationalized the entire airline industry in 1953 was apparently to ward off many private airlines going bankrupt.

Now with Air India saved from bankruptcy with a $5.7 billion gift of public money, the government may as well consider re-privatizing Air India, and selling 49% of the stock back to its original owners the Tata Group.

The $5.7 billion bailout and the 49% FDI decision for overseas investors have better chances of working only if the government ensures there being low-cost operational costs to support low-cost air travel.

(Copyright 2012 Asia Times Online (Holdings) Ltd. All rights reserved. Please contact us about sales, syndication and republishing.)

Sugar: it's time to get real and regulate

The consumption of fructose and sucrose is on the increase – and so are preventable diseases such as Type 2 diabetes

• 
• • Jacqueline Windh
  • guardian.co.uk, Monday 13 February 2012

Last week, a trio of American scientists led by Robert Lustig, professor of clinical paediatrics at the University of California, published an article in the journal Nature, outlining the toxic effects that sugar has on humans and arguing for governmental controls on its sale and distribution. While the authors come short of labelling sugar a "poison" outright, in a 2007 interview with ABC Radio about excess sugar consumption, Lustig said: "We're being poisoned to death. That's a very strong statement, but I think we can back it up with very clear scientific evidence."

That evidence has been growing – particularly in the western world, where consumption of sugar is increasing rapidly. Globally, sugar consumption has tripled in the past 50 years. But, it turns out, the greatest threat to human health is one type of sugar in particular: fructose.

In the US, per-capita consumption of fructose, a common food additive there – mainly in the form of high-fructose corn syrup – has increased more than 100-fold since 1970. Although fructose is not a common added sweetener in the UK and other countries, sucrose is; sucrose contains 50% fructose. Lustig and his co-authors note that last year, the United Nations announced that non-communicable diseases (NCDs) had, for the first time, overtaken infectious diseases in terms of the global health burden. Non-communicable diseases now account for 63% of all deaths, and that total is expected to increase by a further 17% over the next decade.

The scientists cite growing evidence that our increasing consumption of sugar is partly responsible for the growth of NCDs: diseases such as cardiovascular disease, cancer, diabetes and the suite of symptoms known as metabolic syndrome. And they argue that, as for substances known to cause NCDs such as tobacco and alcohol, sales and distribution of sugar should be controlled, and products with added sugar should be taxed.

I used to be a sugar addict. And yes, for those who haven't found out first-hand, sugar is addictive; perhaps not to the same degree as alcohol and tobacco, but a recent study has shown that sugary foods, or even just the expectation of eating sweets, can trick the brain into wanting more. When I decided to cut my sugar consumption 12 or so years ago, I had no idea of the serious health concerns that excess sugar consumption brings. I only wanted to avoid the so-called "empty calories" that sugar provides. I had noticed that eating cookies and desserts was making me feel lethargic.
Sugar, and in particular fructose, affects metabolism. Unlike glucose, fructose can only be metabolised in the liver. Some of its effects on the human body include increasing levels of uric acid, which raise blood pressure; increased fat deposition in the liver; and interference with the insulin receptor in the liver. This inhibits ability of the brain to detect the hormone leptin, which regulates appetite. So beyond the empty calories that fructose provides, eating it makes you want to eat more.

When I started reducing my sugar intake, I had no intention of cutting it out completely. Reducing my consumption was a gradual process, over many years. Sugar had been used as a reward when I was a child, and sweets were still a comfort food for me. But I found that the less of it I ate, the less I craved it. Today, I barely eat sweetened foods at all. If I were to eat what to most North Americans or Europeans is an "average" dessert serving, I would feel sick. Avoiding sugar is no longer an exercise in willpower; I have developed a revulsion for it. I feel that I have brought my body back to its original state. Sugar, in anything other than small quantities, feels like a poison to me.

Illnesses related to dietary choices do not affect only the individuals who become sick; they affect us all, as a society. The US alone spends $150bn on healthcare resources for illness related to metabolic syndrome. Of course, I would like to think that governmental regulation of a food-item such as sugar is not necessary. I do place value on an individual's right to choose, and on personal responsibility. But in the case of sugar, it's time to get real. The incidence of preventable diseases such as Type 2 diabetes is increasing and many health authorities have expressed concern that our current youth may be the first generation that does not live as long as their parents.

Most of us have known for some time that excess sugar is not good for us, but education and knowledge are clearly not enough. Regulation is required. This is no longer an issue of personal responsibility, but one of public expenditure and public health.

Only builders will profit from Cameron's sub-prime homes

Simon Jenkins, The Guardian, 23/11/2011

After the SS British Economy hit an iceberg three years ago, survivors were hauled from the freezing sea aboard the good ship Cameron. They assumed he'd be a more reliable helmsman. So what should they make of their new captain deciding to hurl his vessel at full speed towards the self-same iceberg?
David Cameron announced on Monday that he wants to "revive people's hopes and dreams of homeownership". He intends to use up to £650m of public money to reflate what is by definition the sub-prime end of the mortgage market. Public money will this time bail out not reckless bank mortgage lending, but reckless sales to individuals by private housebuilders. It is called kickstart, which is coalition speak for bailout.

Magic gold dust is the stock in trade of the politics of housing. Cameron, like all leaders exhilarating in spending public money, accords the owning of a home (cosy word for house) the status his forebears gave the church. He speaks spiritually of "that magic moment when you get the key and walk into your own flat". It is a dream, he says, "which should be available for everyone, not just the better off". His government wants to meet that hope and realise that dream.

With ministers said to be panicking about growth, every lobby in the country is rushing to town waving bottles of snake oil. Few are as powerful or persuasive as the housebuilders, sharing with bankers a responsibility for the world's current woes. The Guardian on Monday listed six almost identical housing initiatives in recent years. This kickstart is eerily similar to Labour's explicit Kickstart Housing Delivery plan of 2009, with the same subsidies for undeveloped sites and the same £400m incentives package. On each occasion the lobbyists come away with money in their pockets – but with the housing market unmoved. The market tracks not Whitehall initiative but the level of demand in the economy, and this tracking is as constant as government's belief in its power to break it.

On Monday the eager-beaver housing minister, Grant Shapps, indulged in the usual mission creep. "It is not a multimillion-pound expense," he said, which is what it is. The policy is to be "industry-led", with housebuilders "buying into the scheme". This is no wonder when they wrote the rules to enable them to profit risk-free. It is a lobbyist's charter.

There is some new help for renovating existing and derelict properties and some welcome land disposals, but no sign of an end to tax discrimination against repairs and conversions, where big gains in housing capacity are to be found. There is just an incantation of the developers' slogan that 230,000 homes are "needed nationwide", as if a home were a unit in a Leninist housing pool, rather than a flexible concept in a market responding to demand and supply.

There is no shortage of houses in Britain, indeed there is a raw surplus. Many are just too expensive for those who want to live in them. This is hardly new. Every chart of housebuilding and prices suggests that both will start turning up soon, along with mortgage availability, irrespective of government subsidy. The one thing that will send prices into a speculative spiral is a reckless return to Thatcher-style mortgage subsidies and Blair-style sub-prime lending.

The proper use of public money on housing is on the very poor. Here the policy is mystifying. Shapps asserts a hitherto unknown "right" of social tenants to buy the houses they rent. He is offering a 50% discount on the estimated purchase price, thus giving away half the value of the public housing stock, regardless of whether its not-for-profit owners agree. So much for localism and the "big society". This will be exacerbated by a little noticed concession to the housebuilders, releasing them from past promises to supply social housing on already permitted sites. This astonishing capitulation makes a mockery of planning localism.

Social housing remains hopelessly ill-defined in Britain, where 60,000 of its beneficiaries reportedly have second homes and hundreds of thousands more are well-off. Shapps even asserts a social right to a subsidised house near where one's parents live. When the Victorian social reformer, Octavia Hill, launched "three percent philanthropy" to aid the urban poor, she too was aiming away from real need. As Gareth Stedman-Jones wrote in Outcast London, Hill was helping not the truly desperate but a politically emergent class of "deserving poor". The same applied to municipal housing. Only after the second world war was access to a subsidised house loaded in favour of real need.

Under Margaret Thatcher housing subsidy wheeled upmarket, to promote homeownership. Tax relief was explicitly deployed as a means of sucking wage earners into homeownership (and Tory voting). The memoirs of Tory chancellors Lord Howe and Lord Lawson blaze with arguments with Thatcher on this. To her, subsidies were not to relieve housing distress but to aid those heroes of stability and growth, the deserving poor and middling rich. Housing politics has been skewed upmarket ever since.

Today's constant reference to the plight of young people "struggling to get on the housing ladder" reflects the reckless politics of the sub-prime crisis. It humiliated renting, inflated house prices, impoverished young people and ruined thousands in a frenzy of the "homeownership" bubble. Home owning peaked at 70% of Britons, against between 40% and 55% in Germany, France and the Netherlands. It leached savings from the economy and made British workers starkly immobile, compared with Germans or Japanese.

Much could be done to raise the status and availability of renting. The balance of security of tenure has tilted too far from tenant to landlord. Tilting it back could be balanced by fiscal incentives for converting and subletting. The latest kickstart echoes the cliches and slogans of the 1990s and 2000s, inducing hundreds of thousands on both sides of the Atlantic to sink their savings in to properties they could not afford.

The message is toxic. Even if the government is underpinning the housebuilders' side of the bargain, and the
money would be better spent on housing the poor, people should not be encouraged to borrow beyond their means in another gamble on rising prices. Sub-prime was an error more grotesque in its consequence than any could have foreseen. No responsible government should head that way again.