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Russians Debate Sticker Price of Sochi Games Russians Debate Sticker Price of Sochi Games
(7 months later)
MOSCOW — With less than two weeks to go before the opening of the Winter Olympics in Sochi, the country is finally having a debate — of a sort — over the cost of the event, celebrated as Russia’s triumphal moment on the international stage, yet derided as a bacchanalia of waste and corruption. MOSCOW — With less than two weeks to go before the opening of the Winter Olympics in Sochi, the country is finally having a debate — of a sort — over the cost of the event, celebrated as Russia’s triumphal moment on the international stage, yet derided as a bacchanalia of waste and corruption.
President Vladimir V. Putin stoked the debate when he recently told a group of television anchors that Russia had spent only 214 billion rubles, or roughly $7 billion, to erect the sporting venues for the games. And less than half of that, he maintained, was government spending.President Vladimir V. Putin stoked the debate when he recently told a group of television anchors that Russia had spent only 214 billion rubles, or roughly $7 billion, to erect the sporting venues for the games. And less than half of that, he maintained, was government spending.
Others, though, say those figures are grossly understated.Others, though, say those figures are grossly understated.
An organization led by Aleksei A. Navalny, the anticorruption blogger who has become one of the Kremlin’s most prominent critics, has been working for two months to compile a detailed chronicle of Russia’s Olympic spending, culling figures from annual budgets and corporate reports since 2006. The goal is to document the true cost of the Winter Games in an economy that has slowed considerably, and to focus attention on a debate that has occurred so far only on the fringes of public discourse. The organization, the Foundation for the Fight Against Corruption, is to publish the result of its work on Monday on an interactive website.An organization led by Aleksei A. Navalny, the anticorruption blogger who has become one of the Kremlin’s most prominent critics, has been working for two months to compile a detailed chronicle of Russia’s Olympic spending, culling figures from annual budgets and corporate reports since 2006. The goal is to document the true cost of the Winter Games in an economy that has slowed considerably, and to focus attention on a debate that has occurred so far only on the fringes of public discourse. The organization, the Foundation for the Fight Against Corruption, is to publish the result of its work on Monday on an interactive website.
Mr. Putin’s figure was, Mr. Navalny said, “a lie of an absolutely absurd scale.” It is not only one-tenth of the spending that has been widely reported, but it is also less than the $12 billion Mr. Putin pledged in 2007 to spend on the games when he personally appealed to the International Olympic Committee to choose Sochi as the host.Mr. Putin’s figure was, Mr. Navalny said, “a lie of an absolutely absurd scale.” It is not only one-tenth of the spending that has been widely reported, but it is also less than the $12 billion Mr. Putin pledged in 2007 to spend on the games when he personally appealed to the International Olympic Committee to choose Sochi as the host.
That Russia’s first Winter Olympics would be an expensive undertaking has been a given since the government first broke ground on the projects in and around Sochi, which Mr. Putin called “the biggest building site on the planet.” For the first time, though, the cost issue appears to have become politically sensitive for the Kremlin.That Russia’s first Winter Olympics would be an expensive undertaking has been a given since the government first broke ground on the projects in and around Sochi, which Mr. Putin called “the biggest building site on the planet.” For the first time, though, the cost issue appears to have become politically sensitive for the Kremlin.
Officials here once boasted of Russia’s ability to spend so lavishly, but of late they have embraced Mr. Putin’s more frugal tone, and have sought to defend the outlays by redefining what constitutes spending on the Olympics. They have argued that the billions poured into projects like the huge new power plant on the edge of the Olympic Village or the adjacent new railroad station should not be counted as Olympic expenditures, but rather as part of a broader economic stimulus project to rebuild the sea-meets-the-mountains resort on the Black Sea.Officials here once boasted of Russia’s ability to spend so lavishly, but of late they have embraced Mr. Putin’s more frugal tone, and have sought to defend the outlays by redefining what constitutes spending on the Olympics. They have argued that the billions poured into projects like the huge new power plant on the edge of the Olympic Village or the adjacent new railroad station should not be counted as Olympic expenditures, but rather as part of a broader economic stimulus project to rebuild the sea-meets-the-mountains resort on the Black Sea.
“It’s just senseless to take the cost of everything built in Sochi — and the building of roads in Sochi — and ascribe it to the Games,” Aleksandr D. Zhukov, the deputy speaker of the lower house of Parliament and the chairman of the Russian Olympic Committee, said in an interview. “Were you in Beijing for the Games? They made boulevards twice as wide — built new roads there. What did that have to do with the Olympics?”“It’s just senseless to take the cost of everything built in Sochi — and the building of roads in Sochi — and ascribe it to the Games,” Aleksandr D. Zhukov, the deputy speaker of the lower house of Parliament and the chairman of the Russian Olympic Committee, said in an interview. “Were you in Beijing for the Games? They made boulevards twice as wide — built new roads there. What did that have to do with the Olympics?”
To critics like Mr. Navalny, however, Sochi has turned into an unaffordable personal vanity project, intended to cement Mr. Putin’s legacy as the driving force of the country’s restoration after the collapse of the Soviet Union more than two decades ago.To critics like Mr. Navalny, however, Sochi has turned into an unaffordable personal vanity project, intended to cement Mr. Putin’s legacy as the driving force of the country’s restoration after the collapse of the Soviet Union more than two decades ago.
“It actually seems like some small, spiteful pharaoh is building himself the greatest pyramid in the world,” Mr. Navalny said in his organization’s new headquarters in southeastern Moscow, which hummed late into the evening last week with people still crunching the numbers for the report. “There’s no other way to explain the gigantomania,” he said.“It actually seems like some small, spiteful pharaoh is building himself the greatest pyramid in the world,” Mr. Navalny said in his organization’s new headquarters in southeastern Moscow, which hummed late into the evening last week with people still crunching the numbers for the report. “There’s no other way to explain the gigantomania,” he said.
According to the group’s calculations, Russia has spent more than 1.5 trillion rubles on the Olympics, which at today’s suddenly declining exchange rate would amount to at least $48 billion — more than China spent for the far larger Summer Olympics in 2008.According to the group’s calculations, Russia has spent more than 1.5 trillion rubles on the Olympics, which at today’s suddenly declining exchange rate would amount to at least $48 billion — more than China spent for the far larger Summer Olympics in 2008.
While that figure is roughly comparable with a $50 billion estimate that Russian officials here disclosed a year ago and then quickly disavowed, the group’s calculations are based on detailed accounting of project costs that have remained largely opaque, perhaps on purpose.While that figure is roughly comparable with a $50 billion estimate that Russian officials here disclosed a year ago and then quickly disavowed, the group’s calculations are based on detailed accounting of project costs that have remained largely opaque, perhaps on purpose.
The website — in Russian and English — documents thousands of expenses salted through Russian federal budgets since the country first applied to host the games. Mr. Navalny said the work was made difficult by the way spending was scattered in myriad accounts. “There is no single source for the figures,” he said. “Every project requires its own investigation.”The website — in Russian and English — documents thousands of expenses salted through Russian federal budgets since the country first applied to host the games. Mr. Navalny said the work was made difficult by the way spending was scattered in myriad accounts. “There is no single source for the figures,” he said. “Every project requires its own investigation.”
Mr. Navalny challenged the Kremlin’s assertions that much of the spending was private, not government. When Mr. Putin said that less than half of the figure he cited was federal money, he sidestepped the fact that many of the largest “private” expenditures were made by companies that are state-owned, like Russian Railways, the state bank and Gazprom, Mr. Navalny said. According to his organization’s analysis, less than 4 percent of the overall spending came from truly private companies.Mr. Navalny challenged the Kremlin’s assertions that much of the spending was private, not government. When Mr. Putin said that less than half of the figure he cited was federal money, he sidestepped the fact that many of the largest “private” expenditures were made by companies that are state-owned, like Russian Railways, the state bank and Gazprom, Mr. Navalny said. According to his organization’s analysis, less than 4 percent of the overall spending came from truly private companies.
Mikhail G. Delyagin, an economist in Moscow, said in an interview that as a rule, the Olympic Games rarely prove to be the engines of economic revival that officials claim. “The situation in Sochi is indeed positive, because there wasn’t even a normal sewer system there,” he said, “but one shouldn’t expect that these resorts will recoup the cost.”Mikhail G. Delyagin, an economist in Moscow, said in an interview that as a rule, the Olympic Games rarely prove to be the engines of economic revival that officials claim. “The situation in Sochi is indeed positive, because there wasn’t even a normal sewer system there,” he said, “but one shouldn’t expect that these resorts will recoup the cost.”
Mr. Navalny argued that beyond the most visible projects, like the stadiums and arenas, the government also spent heavily on buildings that had nothing to do with the Olympics or even with future tourism in Sochi. They include new residences for Mr. Putin, a church at the Olympic Village, and resorts for various agencies like the prosecutor’s office and the Federal Security Service, all classified in the annual budgets as Olympic projects.Mr. Navalny argued that beyond the most visible projects, like the stadiums and arenas, the government also spent heavily on buildings that had nothing to do with the Olympics or even with future tourism in Sochi. They include new residences for Mr. Putin, a church at the Olympic Village, and resorts for various agencies like the prosecutor’s office and the Federal Security Service, all classified in the annual budgets as Olympic projects.
“Under the guise of the Olympics, they made themselves a super-magnificent resort for those who have ended up on the ‘Magnitsky List’ and cannot leave the country,” he said, referring to American sanctions that bar travel and investments abroad for certain Russian officials accused of human-rights abuses.“Under the guise of the Olympics, they made themselves a super-magnificent resort for those who have ended up on the ‘Magnitsky List’ and cannot leave the country,” he said, referring to American sanctions that bar travel and investments abroad for certain Russian officials accused of human-rights abuses.
The Sochi Olympics are seen as such a national priority — and a personal one for Mr. Putin — that there has been little official debate about the preparations and the costs. The Parliament has not held hearings. The state auditing chamber has compiled a report on spending, but it has not disclosed its findings and would not do so until after the Games, a spokesman said.The Sochi Olympics are seen as such a national priority — and a personal one for Mr. Putin — that there has been little official debate about the preparations and the costs. The Parliament has not held hearings. The state auditing chamber has compiled a report on spending, but it has not disclosed its findings and would not do so until after the Games, a spokesman said.
What criticism there has been of the spending has come from a handful of news organizations and bloggers. Online critics in particular have enthusiastically questioned the building projects and the chronic delays, delved into accusations of cronyism and corruption and mocked absurdities they uncovered.What criticism there has been of the spending has come from a handful of news organizations and bloggers. Online critics in particular have enthusiastically questioned the building projects and the chronic delays, delved into accusations of cronyism and corruption and mocked absurdities they uncovered.
Recently, there was the matter of the men’s room that was observed and photographed by Steve Rosenberg, a BBC journalist, during a visit to the Laura Cross-Country Ski and Biathlon Center in the mountains above Sochi. In a single, sleekly tiled bathroom stall were not one but two toilets, side by side. The image seemed a pas de deux of either poor design and Olympian waste that, for a fleeting moment at least, became a symbol of the entire endeavor.Recently, there was the matter of the men’s room that was observed and photographed by Steve Rosenberg, a BBC journalist, during a visit to the Laura Cross-Country Ski and Biathlon Center in the mountains above Sochi. In a single, sleekly tiled bathroom stall were not one but two toilets, side by side. The image seemed a pas de deux of either poor design and Olympian waste that, for a fleeting moment at least, became a symbol of the entire endeavor.
Boris E. Nemtsov, another prominent opposition leader who has written extensively about corruption in the Olympic project, said the Kremlin wanted to now revise Sochi’s budget because of fear of popular outrage and even prosecution, though the latter seems unlikely. “So they shamelessly underestimate the expenses so that people don’t become indignant, and instead say that all we have is like in Canada,” he wrote this week on the website of the independent radio station Ekho Moskvy.Boris E. Nemtsov, another prominent opposition leader who has written extensively about corruption in the Olympic project, said the Kremlin wanted to now revise Sochi’s budget because of fear of popular outrage and even prosecution, though the latter seems unlikely. “So they shamelessly underestimate the expenses so that people don’t become indignant, and instead say that all we have is like in Canada,” he wrote this week on the website of the independent radio station Ekho Moskvy.
Andrey Miroshnichenko, an independent media analyst, questioned whether Mr. Navalny’s report would at last spur a meaningful political debate, and noted that excessive spending and corruption are taken for granted in Russia. “Everyone knows how business is done here,” he said. “Expensiveness is considered a way to redistribute the state’s wealth.”Andrey Miroshnichenko, an independent media analyst, questioned whether Mr. Navalny’s report would at last spur a meaningful political debate, and noted that excessive spending and corruption are taken for granted in Russia. “Everyone knows how business is done here,” he said. “Expensiveness is considered a way to redistribute the state’s wealth.”
Dmitri A. Medvedev, the former president and now prime minister, acknowledged in an interview with CNN on Wednesday that the larger figure of nearly $50 billion was accurate, but he disputed accusations of excessive waste or corruption. “There is no data on whether the corruption related to the Olympics,” he explained, “is much higher than the average level of corruption in the country.”Dmitri A. Medvedev, the former president and now prime minister, acknowledged in an interview with CNN on Wednesday that the larger figure of nearly $50 billion was accurate, but he disputed accusations of excessive waste or corruption. “There is no data on whether the corruption related to the Olympics,” he explained, “is much higher than the average level of corruption in the country.”