The Curmudgeon on Airports

Opinion, by Michael Royster

RIO DE JANEIRO, BRAZIL – What a difference a week makes! Just last week, as reported in The Rio Times article, the government announced it was taxiing towards privatization of five major airports in Brazil, including Galeão in Rio. This week, the government announced that privatization of Galeão was not going to take off—or, put another way, “there’s no horizon” for granting a concession to private companies for Galeão.

Should we be surprised at this about-face? Not really. Rather, we should be surprised that the government decided to privatize anything. One of the hallmarks of Lula’s campaigns for president was that privatization was utterly wrong: the state needed to control infrastructure. Once elected, Lula halted all privatizations.

It had been supposed that Dilma, his chosen successor, would hew to the strait and narrow path of state-owned infrastructure, so many true believers were dismayed at the news last week, and asked “why privatize?”

The short answer to that question is: football, meaning World Cup 2014. Brazil has guaranteed that there will be no infrastructure problem for the legions of fans around the world who will fly into hub airports here and then fly out to the hinterlands to watch young men with silly tattoos and sillier haircuts disport themselves…but I digress.

The fact, as pointed out by INEA, a government research entity, is that most of the major airports in Brazil are hugely deficient in infrastructure. But infrastructure costs money, and that, according to the federal government, is in much more plentiful supply in private hands than at the public coffers. In short, follow the money.

We are thus entitled to ask why it is that Rio’s Galeão will not be privatized. The stated reason is that there’s no infrastructure problem at Galeão, which has unused capacity. The unstated reason is that INFRAERO, an acknowledged sink of corruption and inefficiency, is being given one last chance by Dilma, who prizes efficiency, to get its act together.

INFRAERO has long been an integral part of the spoils system in Brazil, for two main reasons: (a) it is a huge cash generator, and (b) it is where the hugely influential Brazilian Air Force (FAB) and its politico supporters can pension off 45-year-old veterans. No one, before Dilma, has ever been allowed to peer over FAB’s bulky shoulder into the sump.

Dilma, who is not stupid, knows that if World Cup 2014 infrastructure fails, the blame will fall on her shoulders: she will not permit that. Most people feel that excess capacity plus incompetent management translate into an infrastructure problem, but Dilma says “not so”. Is she right? Of course not! For the nonce, Galeão is being offered as a sop to those political interests most interested in maintaining INFRAERO’s cash cow status.

Dilma knows that, for Rio de Janeiro, crunch time is not 2014, but 2016 when the Olympics arrive. In 2014, if there is still excess capacity, efficient airport management will paper over most other problems. But by 2016, the Curmudgeon predicts that management of Galeão will have been turned over to private hands.

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Michael Royster, aka THE CURMUDGEON first saw Rio forty-plus years ago, moved here thirty-plus years ago, still loves it, notwithstanding being a charter member of the most persecuted minority in (North) America today, the WASPs (google it!)(get over it!)