a) The blank cheque
Imagine that you have serious reasons to doubt someone’s financial responsibility and trustworthiness, and yet they take your credit card away on a shopping spree to the store of friends and business partners. What they will buy and what the budget will be is not shared in advance – welcome to the Budapest Olympics!
The government is proposing a blank cheque to cover the costs of the Olympics held in Budapest. The cheque contains the name of the drawer and payee but it does not discuss the sum, which its recipients can determine at their own will. Should Budapest win the rights to organise the 2024 Olympic Games, we would accept the liability of planning the event at a given time and at all costs. The expenses are not covered by the International Olympic Committee, nor by the Fidesz government which attempts to politically and financially exploit the event, but it is going to be paid by us, Hungarian tax payers – even if no one has asked about the opinion of the public yet.
b) Unrealistic estimations
It is hard to tell in advance where the costs of the Budapest Olympics would come to a halt. Entrusted by the government, PwC gives an estimation of total costs around 774 billion forints (cca. $2,7billion), but this figure is unequivocally questioned by experts. This number is a result of the periodic reconstruction of the study under government pressure, where many investment projects for the Olympics were deemed already ‘necessary’ in order to hide the actual costs. Besides, the study has elementary shortcomings: for instance, it does not account for safety costs, although the threat of terrorism has always accompanied the games.
At previous Olympics, the average costs of organisation were $5,2billion (1524 billion HUF), and this excludes investments in infrastructure. The government expects that developing the country’s infrastructure from its current state is going to take major expenses, so we can realistically expect a total sum of $10-17billion. For a point of reference, Hungary’s complete national budget for 2017 is cca. $60,5billion, while the expected deficit is cca. $3,8billion.
As a result, it is already apparent that we are not going to profit from the Hungarian olympics, and in fact we are likely to lose an enormous sum. The data of previous olympics are quite telling: planning the event has never been profitable for the host country; since 1960 the Games have always surpassed the previously expected budget; and since 1976 the average spending level relative to the expected budget was 156%.
c) With Fidesz, costs might shoot up
In Hungary there are two more factors that would increase the olympic budget: first, corruption, and second, the fact that venues have to be provided for many olympic sports that are practically absent in the country. There is a need for large investments in new facilities to match the infrastructure of eg. the London, Paris or U.S. Olympics. In addition, experience tells that one of the safest and most profitable forms of corruption in the country is through construction tenders which favour companies crony to the governing elite.
It is instructive to look at non-Western points of reference to better understand the dangers of the Hungarian corruption model: the final bill of the notorious Sochi Winter Olympics (2014) was around $52billion, while the costs of the first Azerbaijan European Games (2015) were $8,1billion.
In Hungary the costs of application alone were initially fixed around $52million, but after the mayor in Rome announced the decision to withdraw the city’s bid, the government extended the Hungarian budget with an extra $5million of ‘advisory fee’. Rome’s move was neither sudden nor any relevant to the case of Budapest, and the remaining applicants did not at all consider a similar move. Our bid is a demonstration in small of how much waste we can expect should the government win the rights for the 2024 Olympics. To date, large sums of money have already disappeared via non-competitive construction tenders – many conclude that the primary objective is not the successful realisation of a Hungarian Olympics, but more the misappropriation of the money invested in our olympic bid, which is in itself a considerable amount.
On top of everything else, the government is simultaneously preparing for another major (and not less dodgy) spending project that will be a serious burden on its budget: the Paks II nuclear power plant will cost at least $12,8billion (without corruption), which means roughly $1billion every year. While these are estimations published by the government, it is hard to check for their validity since the entire deal is secretic and lacking in transparency. In any event, if either of the estimated budgets detailed here are not entirely honest and accurate, an economic recession akin to the Greek case might be in the offing. As such, the aftereffects of our olympic bid will have to be measured in decades, way after the current government will have already been gone.
d) Bread and circuses to the crony elite
In all probability, we can also expect the olympic success of our athletes abroad, while the best-case scenario of organising the Games domestically is barely avoiding financial collapse via an increased national debt. So who would profit from the Hungarian Olympics? Naturally, it is the group that is running towards the store with your credit card.
The popularity of the government has dropped significantly in recent years – Hungarian citizens have started to realise that other nations outcompete us in the region. Figures of competitiveness and corruption have not been so disconcerting since the shift from a planned socialist economy to Western-type capitalism in 1989-90. The government would readily exploit the Olympics to gain legitimacy for its populist catchphrases about ‘national unity’ and ‘putting Hungary on the map’. At the same time, the sham construction tenders would give an ever greater opportunity for financial fraud by the elite.
Fidesz provides circuses to the public regardless of whether they want it or not, and they are happy to keep the bread even if this leads to the collapse of the Hungarian economy.
- by Daniel Corsano; translated by Sebestyén G.
a) Systemic problems
Even according to the study requested by the government, we should expect additional costs of $2,7billion throughout the planning and realisation of the Olympic games; while experts predict that this figure could easily shoot higher up. Instead of Budapest’s olympic bid it would be crucial to focus on resolving more urgent problems. Due to the ‘unorthodox’ economic policies of Fidesz, since 2010 Hungary has been lagging behind its regional counterparts in ways it is hard to comprehensively define.
The country’s performance is amongst the poorest in economic competitiveness, quality of life and transparency factors across the continent. Besides, the state-financed health care and educational systems also face serious shortcomings – in the absence of immediate reforms, more generations will grow up without an equal chance on the European labour market, and more citizens will suffer from diseases that could otherwise be effectively cured.
b) Health care: $580-620million missing a year
Expenses on health care in Hungary are 170-180billion forints below the average of the Visegrad4 group. However, we do not need to know the numbers to understand how under-financing the health industry is one of the government’s biggest vices. The lack of funds is apparent on pictures of hospital food – which has the sole potential of nourishing internet memes -, inside dirty and contagious hospital wards, in the low salaries of demoralised workers, through the embedded nature of the system of gratuities, or in the fact that most medic students seek job opportunities abroad following their graduation. Meanwhile, under the government’s assist the health care system is getting divided into a small number of expensive private hospitals and a large number of public institutions mostly uncapable of looking after those who are less well-off.
If the government believes that the country can resist the massive financial challenge of the 2024 Olympics, they should first assume liability to provide quality health care provision across Hungary.
c) Education: reduced funding, deteriorating PISA results
The second serious problem is the under-funding of the educational system – year by year, the government periodically reduces its contribution to the school system, while simultaneously impeding local councils to act via large-scale centralisation. Within the Hungarian system, even the best secondary schools operate with little or no private funding, and hence the state’s responsibility should be much higher accordingly.
Hungarian schools are ever less competitive and often even uncapable of fulfilling some of their basic functions. Even the money eventually spent appears not to lead towards positive outcomes, as it is apparent via the recently published PISA results.
Instead of the olympic games, it would be essential to invest much more in the infrastructure and reform of our educational system – only a successful youth generation can build a successful nation. The development of IT tools and their maintenance, along with the promotion of digital and foreign language competences should enjoy top priority. At the same time, we cannot ignore the low level of salaries that teachers and other educational actors receive: raising these salaries would not just provide extra motivation, but it would increase the prestige and labour market competence of the profession.
- by Gergő Papp; translated by Sebestyén G.
a) The support for the Olympics in Budapest is missing
The International Olympic Committee have established that one of the conditions of candidacy for the Olympic games is widespread support. However, a survey conducted by Publicus has concluded that support for the 2024 Olympic games in Budapest is virtually missing from all classes of Hungarian society. Three quarters of those asked thought that the money should be spent on other things, and two-thirds thought that the country is frankly too poor to host the Olympic games. Respondents would rather increase spending on education, healthcare together with using such funds to alleviate poverty. Eight out of ten people who have been asked who would support hosting the games would do so out of national pride or out of enthusiasm for Hungarian achievements, six out of ten respondents thought that organising the games would improve the country’s image. Although, if we confront the respondents with the expected costs, support for hosting the games halves. The majority believes that the government informs the populace rather one-sidedly about the ins and outs of hosting the Olympics. Among Fidesz voters, if not exceedingly, yet there is support for the Olympics, among them the majority still takes the stand that it would simply cost too much.
b) It is not enough that the majority of the voters of the ruling party support hosting the games
On the one hand, widespread support does not precisely mean that something is narrowly supported over being opposed, but rather that most people support it with a few exceptions. On the other hand, barely two million people voted for Fidesz in 2014, which is the fifth of the country’s population. In Budapest, where the Olympics is to be held according to the latest information, Fidesz currently stands at 22% and the parties in opposition if we exclude Jobbik, together stand at 34%, so the difference is more significant, then it was for Fidesz in 2014.
Drawing on all this, we can safely conclude that even among Fidesz voters, support for the Olympics in Budapest is far from excessive.
Furthermore, these voters neither represent the country’s population, nor all party voters, especially not in Budapest.
The survey conducted by Publicus that accounts for undecided and all other party voters clearly represents that the country as well as Budapest mostly opposes hosting the game.
The ruling party was responsible to acquire regarding such a monumental issue, they should have asked the Hungarian people before embarking on a decision that is to affect all of our futures.
c) The ruling party could have proposed a referendum, but it has failed to do so
Hosting the Olympic games requires adequate responsibility and self-knowledge from the side of the bidding country and the city itself. It is no coincidence that several cities who would initially show interest in bidding for the games have eventually withdrawn their bid for candidacy following a decision made either by the leadership of the city or the people themselves. Rome was the last one to withdraw from the competition, in last September. Similarly, in Rome there wasn’t widespread support for bidding for the Olympic games in 2024, and the city is still paying its debts off for hosting the 1990 FIFA world cup.
Furthermore, the Mayor of Rome Virginia Raggi who is committed to eradicate corruption was concerned that due to apparent fraudulent practices, the only people who would profit from hosting the games would be the already wealthy contractors.
Boston has also withdrawn their bid after the success of the No Boston Olympics movement. In Hamburg the Nolympia movement has successfully initiated a referendum, through which the people of Hamburg have withdrawn their bid to host the Olympic games of 2024.
In Budapest it would be significantly harder to establish the required framework for hosting the games, the support is at a similarly low level and when it comes to corruption we are well known to “do better” in the words of the Prime Minister.
We should also take a look at the other side of the coin: if the government is committed enough, they can hold a referendum themselves.
Last year’s invalid referendum was reasoned to be necessary, because at the time of the election in 2014 the migrant question was not yet relevant in the EU, therefore the government wasn’t authorised to act in the name of the people regarding this question. There is a similar situation when it comes to the lack of authorisation from the side of the populace for the Olympic games, yet the government is rather reluctant to move this time around.
Seems that Fidesz is just as committed in their efforts when it comes corruption as Mayor Raggi in Rome, but apparently on different sides and they are purposefully avoiding a civil discussion regarding the candidacy of Budapest.
We, however think that the people of Budapest should be informed about what sort of sacrifices hosting an Olympics would impose upon them and we should inquire whether they are prepared to shoulder the burden.
- by Kata Urban; translated by Bálint Kulcsár
a) Our cultural heritage is in danger
According to the visual plans submitted with Budapest’s application, the city’s landscape would be drastically redefined. A number of the new sports facilities built would be placed on the Banks of the Danube, which are UN World Heritage Sites. The maintenance of the historical landscape of the city is in everyone’s interest, it is therefore important to find harmony amongst the modern and classical buildings. Regulators often ignore this and act like as if the capital city’s architectural treasures were part of a playground: As such, let’s just think of the relocation of the Prime Minister’s office to the Buda Castle.
b) Damage sustained by the environment due to the Budapest Olympics
The Olympic Games in Budapest would not only greatly affect the city’s landscape, but would also upset it’s natural environment. Some constructions could bring about irreversible damage to the environment and could lead to the disappearance of green areas. The case of the bicycle race course (the location of which was changed multiple times and one of the options considered was a natural reserve) clearly shows how negligent is Budapest’s bid for the Olympics and how uncaring it is for the city’s environment.
The bid’s success would bring about significant constructions and due to the negligence of the government this could cause damage to specially protected ecosystem of Budapest. The new roads and buildings could lead to the cutting of trees in neighbouring areas which has become a regular practice in Budapest (for which there have been a number of examples such as the famous case of the Varosliget or liquidation of the Benczur-garden) and this could lead to a further decrease in the number trees and green areas in Budapest. The environmental aspect of the Budapest Olympics is only an illusion, it’s purpose is to convince the international community but yet it does not provide real solutions for protecting existing green areas or creating new ones.
c) The aggravation of regional inequalities
The plans of the 2024 bid mostly affect Budapest, therefore would provide little benefit to the country’s poorer regions. Budapest would not cover all the costs alone though, and this could lead to the expansion of the wealth gap between the capital, smaller cities and villages. Although the concept includes a few locations in larger cities in the countryside (eg. Gyor and Szekesfehervar), investments in these areas would likely only include sports facilities. Larger, system-wide action which could benefit the country’s poorer regions is barely considered. The Olympic Games would just aggravate the regional inequalities within Hungary, which are one of the main causes of the division in Hungarian society
– by Sandor Miklos Kadar; translated by Kornél Kőműves