Why the U.S. Should Never Host Another Olympics
Janill Gilbert stashed this in Sports
It's expensive, demanding, and in the eyes of the many cities that have refused to throw their hats into the five-ring circus, a total scam
After enough pleading and promises to make a desperate boyfriend seem hard to get, the International Olympic Committee thought it had the final list of candidates that would compete to host the 2024 Summer Olympics: Paris, Rome, Hamburg, Budapest, and—a last-minute substitute for Boston—Los Angeles. But then, late last year, Hamburg said no thanks, leaving four organizing committees in four cities who say they really, really want the Games. So now we wait. And wait.
In the meantime, there will be two years of politicking, schmoozing, and wining and dining. (The IOC promises there won’t be any outright bribery this time, unlike with past Olympic beauty contests like Salt Lake City.) Then, two years from now, in September of 2017, IOC pooh-bahs will meet in Lima, Peru, and, to great fanfare, announce the lucky winner. There will be scenes of jubilation among the assembled campaign workers from the city that prevails.
The heartache of remorse will take a while to settle in.
Los Angeles mayor Eric Garcetti is absolutely sure there will be no heartache if L.A. ends up winning. He says he’s thrilled about the idea of subbing for Boston, whose citizens wisely balked at the enormous financial uncertainty of hosting. In what must be some sort of record for speedy government action, a motion was introduced before the L.A. city council to authorize Garcetti and council president Herb Wesson to negotiate with the IOC for 2024. Before Angelenos could react, the city was off to the Olympic races. Exactly how, or if, residents there will have a say about the idea remains murky, but here’s hoping that, inspired by Boston’s and Hamburg’s good sense, Angelenos ultimately reject the Games, too. And while we’re at it, let’s forget about hosting the Olympics in the United States at all—not just in 2024, but forever.
This is not a call to boycott U.S. athletes’ participation in the Games. You want to go skiing on fake snow in a country that’s a human-rights nightmare? Go right ahead. But the U.S. should stop doing the IOC’s dirty work by hosting, because the Games are a losing proposition.
As the “competition” to host the 2022 Winter Olympics showed, citizens of the world, or at least those parts of the world in which citizens have a meaningful voice, have finally begun to catch on to the Olympic scam. The IOC begged Norway to host the 2022 games, but the Norwegians—people who invented ways to have fun on snow—rebuffed IOC entreaties, citing both the cost and outrageous IOC-member demands for rock-star treatment.
The IOC reacted like a petulant schoolboy. Christophe Dubi, executive director of the Olympic Games, scolded the entire nation, saying, “This is a missed opportunity for the city of Oslo and for all the people of Norway.” He blamed Norwegian politicians for accepting “untruths and factual inaccuracies” about the Games’ costs and the IOC’s demands.
That left only two countries that wanted to host: Kazakhstan and China. Both have lousy human-rights records, and neither has much of a winter-sports tradition. But both promised to do just about anything to host, including, in Beijing’s case, creating skiable slopes where there are neither ski slopes nor snow. Beijing won the Games and has already started wreaking environmental havoc. The IOC obviously thinks it can weather the political problems that will follow as the Chinese, who broke promises of greater freedoms for both visiting media and domestic citizens made before the 2008 Summer Olympics, inevitably do the same in 2022.
The Winter Games have always been a harder sell than the summer edition. More than 40 years ago, the IOC awarded the 1976 Winter Games to Denver. Organizers graciously offered U.S. taxpayers the chance to pay one-third the cost of the Games, with Colorado taxpayers absorbing much of the rest. But in a 1972 referendum, Colorado voters decided they had better things to do with their money and rejected the overture. The Games were moved to Innsbruck, Austria. Winter sports in Colorado seem to have survived.
The Summer Games have shown signs of sputtering, too. In the run-up to 1984, no cities submitted bids, and the Olympics seemed close to death. Then Los Angeles offered to host. The IOC was so grateful, it allowed L.A. organizers to excise a clause in the host contract that called for the city to be responsible for any debt resulting from the Games. No other city has gotten such a break from the IOC, and the IOC says L.A. won’t get that same break again. That’s one reason why San Jose, California; Rochester, New York; Minneapolis; Nashville; San Diego; and even Chicago, the USOC’s choice to bid for a 2016 games in the U.S., declined to even consider one for 2024.
There are any number of squishy-sounding reasons why the U.S. ought to get out of the hosting business forever, many of them having to do with IOC corruption, moral blindness, and an absurd sense of entitlement. But lots of people seem willing to overlook all that. So let’s talk money instead.
“The Games overrun with 100 percent consistency. No other type of megaproject is this consistent regarding cost overrun,” concluded a 2012 study by Oxford University economists Brent Flyvbjerg and Allison Stewart. Think about that for a moment. Every Olympics, from 1960 through 2012—and that doesn’t even count the massive Sochi boondoggle of 2014—has run over budget. And not by just a little.
“With an average cost overrun in real terms of 179 percent—and 324 percent in nominal terms—overruns in the Games have historically been significantly larger than for other types of megaprojects, including infrastructure, construction, ICT, and dams,” the report notes. “The data thus show that for a city and nation to decide to host the Olympic Games is to take on one of the most financially risky types of megaproject that exists, something that many cities and nations have learned to their peril.”
Boston’s would-be organizers had to settle debts incurred by just trying to start a bid. They settled them by asking creditors to take a financial haircut, as reported in the Boston Globe. More recently, as reported in the Los Angeles Times, an L.A. city councilman pointed out that it would take about $2 billion just to buy and remediate the rail yard proposed as the location for the athletes’ village for the 2024 Summer Games.
The IOC insists that hosting is a huge honor for any city. The Games, it argues, lead to all sorts of wondrous economic, social, and athletic miracles . This isn’t true. Stephen Billings, an economics professor at the University of North Carolina at Charlotte, who has studied the economic impact of hosting the Games, says that even when hosting isn’t an economic sinkhole, as it was for Montreal—which didn’t pay off its debt for the 1976 Summer Olympics until 30 years later—having an Olympics in your city is, at best, “a wash.”
Even that best-case scenario turns out to be bad for a city and country. When economists James Giesecke and John R. Madden of Monash University looked at the Sydney 2000 Games—with a view toward asking what would have happened if the money had been spent in other ways—they found that “in terms of measurable economic welfare, the Sydney Olympics came as a cost to Australians, reducing the present value of real private and public consumption by $2.1 billion.”
The only Olympics in modern times that officially didn’t lose money were the 1984 Summer Games in L.A. Despite cost overruns, chief organizer Peter Ueberroth sold the hell out of them to TV and corporate sponsors, and L.A. bragged that it made more than $200 million on the deal. But that’s creative accounting. When city organizers tally up costs versus income, they conveniently leave out the government’s—that is, taxpayers’—share. According to studies by the General Accounting Office (now called the Government Accountability Office, a nonpartisan research arm of Congress), in the case of Los Angeles, the federal government paid $78 million (in 1999 dollars), 11 percent of the Games’ total cost. So while the 1984 Games did finish in the black despite cost overruns, they got a free boost from federal taxpayers. Federal costs for subsequent Games soared to $609 million for the 1996 Summer Games in Atlanta and to $1.3 billion for the 2002 Salt Lake City Winter Games.
Boston2024’s bid created a rosy picture to promote the idea of hosting, claiming that its budget “does not rely on a single tax dollar.” This is also untrue. A few pages later, Boston2024 pointed out that “all transportation and security costs are assumed to be covered by the United States federal government and have not been included per guidance from the USOC.”
In other words, tax dollars would have helped pay for the IOC’s Boston party, just as taxpayers have helped pay for every domestic Olympics. And by security they’re not talking about a few overtime cops.
Boston2024 would have required “at least” $1 billion, congressman Bill Keating told the Boston Globe. He was probably underestimating. London’s security costs alone were about $1.6 billion.
As then Utah Senator Bob Bennett said at the time of the Salt Lake Games, without U.S. taxpayer money, “no American city will ever host the Olympic Games again, because no American city can ever afford the kinds of things that are required.”
As another example, let’s say federal tax-dollar costs for security at the proposed 2024 L.A. games amount to $1.5 billion, a low estimate that doesn’t account for other costs incurred by a number of state and federal agencies, from the FAA to the State Department.
A drop in the budget bucket, you might say. Still, you could, for the same amount of money, install solar-energy packages on 100,000 Los Angeles homes. You could build 100 new elementary schools in Los Angeles County. You could do an awful lot to alleviate the homelessness problem that caused L.A. to declare a state of emergency in September.
If the IOC was some poor charity feeding hungry kids around the globe or curing malaria, maybe that kind of taxpayer subsidy could be justified. But the IOC isn’t the idealistic movement it pretends to be. It’s a huge multinational entertainment corporation, and a rich one at that.
In July, the IOC unveiled new deals, worth over $14 billion for broadcast rights and sponsorships, made since the conclusion of the Sochi Games. NBC signed a $7.7 billion deal for U.S. rights through 2032.
Olympic “partners” like Coke, Dow, GE, and McDonald’s pay about $200 million each for “exclusive global marketing rights and opportunities within a designated product or service category,” according to the IOC. They also get the full courtship experience from the host committee, including increasingly elaborate “marketing partner hospitality centers,” VIP retreats where companies and their executives can entertain guests and reward clients.
IOC chief Thomas Bach has issued what he calls Agenda 2020, promising reforms, transparency, sustainability, and financial help for hosting cities. But the IOC has been reforming itself for decades, notably after the Salt Lake City bribery scandal. And awarding the Winter Games to Beijing is hardly sustainable. The fact remains that cities willing to promise the moon to the IOC will continue to win hosting rights.
Cities prepared to do that are increasingly cities located in countries wishing to show off, while residents have little chance to object.
This, then, could be the future of the Olympics: insane locations where governments are happy to risk a sizable chunk of city and national treasure to host what amounts to a prepackaged reality show for TV. Don’t be surprised to see a Winter Games in a Middle Eastern sheikdom. Qatar has shown that it’s willing to work migrant labor to death FIFA’s World Cup, and Dubai has constructed ski slopes.
You might object by arguing that if countries like the U.S., Norway, Canada, Australia, and other democracies don’t offer to host, then we’ve left the IOC no choice but to accept offers from places like China.
Let them have it. Let them build white-elephant stadiums and Potemkin villages. We’ve got schools and bridges to raise, teachers to pay, parks to create and maintain. The United States doesn’t need the Olympics.
I agree with them. It's expensive and demanding. Does not seem worth it.
The IOC needs to change its ways.