The Ghent Festival has its origins in the 19th century, when Ghent city fathers decided to consolidate the weekly neighborhood Sunday celebrations (or beer-fueled, drunken blow-outs) by grossly underpaid common folk into a general fair, thinking such a strategy might cut down some of the rampant Monday absenteeism of the times. But the idea of a cathartic release for the peasants comes from the medieval period, where mid-lent celebrations--like carnival or the feast of fools--were meant to be a sort of reversal, with the common folk gaining status and achieving temporary freedom from their nose-to-the-grindstone misery while the rich were shuffled off into the background.
Celebrations were sponsored by the cities and those same rich folks, of course; a subsidy that, although existing for a short time each year, would have been considerable.
Evolution of the Festival
The first Ghent festivities revolved around horse racing. Then, at the beginning of the 20th century, festivities moved to the city center, where the "Bal Populaire" was held--with the aristocracy occupying the paved section of the square and the rest...well, it was miserable and dusty on their side.
By the late 60s, the Ghent festivities had turned too "middle class" to get excited about. Enter legendary Walter De Buck, who, along with his musician friends organized their own festivities. Counter-culture to the core, De Buck stuck barbs into the Catholic Church, the municipality, and politicians. His act was a hit and put the festival back on track--subsidized, of course, by the Ghent Municipality he skewered. Just like old times.
Ghent, in fact, subsidizes another endeavor: Graffiti Walls. Yes, to keep Ghent's monuments clean, the city makes a pact with graffiti artists--"we'll give you pristine alleyways in which to practice your art if you promise to work only in these areas." So far, the social contract is working quite well. You can see some of the art produced in these areas at Ghentizm: Graffiti in Ghent.
The Ghent Festival Today
The Ghent Festival promises "pop music, folk rock, rock 'n' roll, hip hop, jazz, R'n'B and lots more on all the squares in the city center." There's theatre, comedy, sightseeing, exhibitions, boat trips on the river Lys. And there's always that fine food (and beer!) that Belgians are famous for.