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Brazil’s Soccer Collapse and Economic Waste….

Brazil’s World Cup experience is looking like a significant waste.  After yesterday’s 7-1 drubbing at the hands of Germany the country has not only been eliminated from the tournament, but is likely looking at a tremendous infrastructure investment program that won’t be put to much use.  But this is a common problem with World Cup and Olympic events.

What tends to happen here is that you get massive overinvestment in stadiums and other public facilities that benefit the public in the short-term, but end up being mostly useless in the long-term.  It’s a real tragedy because there are most certainly real investments that Brazil could have made that would have been far better long-term spending programs.  Instead, they built a bunch of stadiums in random places and they likely won’t be put to much use in the years ahead.  It’s one of those situations where the government tries to do something for the public good, but sacrifices the long-term for the near-term.  It’s just not good business or good government.

So yes, the Brazilian people should be mad.  Not because they lost the World Cup, but because their government went all in on an infrastructure program that has a long history of being a colossal waste.

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