Is hosting the Olympics worth it?
No, it is not.
City after city has withdrawn its bid from hosting the olympics due to local opposition, and the IOC was forced to “award” the 2024 and 2028 games without a proper competition. Why? Because it was running out of cities that were willing to host the games.
In contrast to the claims of the IOC about switching to cheaper olympics, the cost of organising the olympics has continued to increase.
Olympics always exceed estimated budgets
The first thing to note is that olympics - both summer and winter games - always overrun their costs.
Proponents of the olympics usually respond that the IOC’s novel initiatives towards making the olympics cheaper (Agenda 2020 and Agenda 2020+5) are meant to reverse this trend. However, the update to the famous Oxford Study reveals that these initiatives are not working.
It must be noted that bids usually do not include indirect capital costs such as improvements to roads, rail, airports, hotels, and other infrastructure not directly associated with the operations of the games. We must also add that total costs and total revenues are very easy to manipulate. For instance, Japan’s National Audit Board found that the Tokyo Olympic organizers’ estimates of $12.6 billion did not include $17 billion of direct costs. Add to that that Japan is a nation usually recognised for honest accounting. The public authorities of other host nations are not as conscious. The 2022 Beijing organisers reported a surplus of $52 million on $2.24 billion of expenditures. However, a Business Insider investigation found that the overall costs were likely more than ten times that amount. The case of the Athens olympics is notorious, having contributed greatly to the financial ruin of the nation.
The overall balance: manipulated results
It is not as simple as revenues minus costs. Once you start going into details, it gets extremely complicated and messy.
How do they manipulate costs?
Is the hosting of the olympics really the best investment for a given country? Is this country spending enough on education, healthcare, infrastructure, poverty reduction, etc? (Greece, Brazil and Russia all provide sad examples.)
Is it really the capital city/large city that needs the investment? Or is the rest of the country in dire need of development?
Alternatives and opportunity costs are not calculated. Is organising the olympics really the best way of solving housing and public transport issues in a given city? Does it even come close to an optimal solution? Or is it a massive distortion to the real needs of the city?
Indirect costs are not included.
The line between public and private sector costs is deliberately blurred. Example: organisers claim such and such is a private sector contribution, but the firm in question receives a tax break.
The costs of maintaining and keeping the venues useful in the long run is not included. The update to the Oxford Study notes that the IOC’s claim about reusing and retrofitting already existing venues cannot be verified due to a lack of transparent documentation.
How do they manipulate benefits?
Most importantly: who really benefits? While revenues are often sold as benefitting the entire nation or the entire city, in fact it is large construction firms, hotel chains and security companies that reap enormous benefits, organisers often work on a voluntary basis. Sports economist and olympics expert Jules Boykoff calls this “trickle up economics”, referring to the discredited Reaganite ideology of “trickle down”. Much of the benefits to corporations and their rich owners actually leaks out of the country.
Another entity that does well out of the olympics is the International Olympic Committee, based in Lausanne, Switzerland. They make billions of dollars every time there is an Olympic games. The IOC is characterised by a massive lack of accountability regarding where this money flows. Broadcasters also make gigantic amounts of money.
Organisers often claim to benefit impoverished groups. This almost never happens eventually. One example is when Japanese PM Shinzo Abe claimed that the Tokyo olympics will be a recovery olypmics for the Fukushima area, devastated by the infamous nuclear meltdown. Kansai University professor Satoko Itani asserted that hosting the Olympics actually brought some of the cranes and other materials away from the affected areas.
In Beijing, 1.5 million people were displaced to make way for the olympic venues, in Rio de Janeiro 77,000 people. In Atlanta, in preparation for the 1996 Olympics, the country’s first federally subsidised public housing project, called Techwood Homes and was established during the New Deal, was demolished to make way for the Olympics. Eric Garcetti, the mayor of Los Angeles, has said that bringing the Olympics to Los Angeles would help the city eliminate the problem of homelessness by 2028. In other cities this has meant rounding up the homeless for the duration of the games.
Side effects:
Olympics interrupt daily life.
Olympics crowd out and scare away other tourists. During the two-week London Games, the British museum lost one out of every four visitors, the National Gallery two out of every five, and the London Zoo saw a 40 percent plunge in the number of recorded entries. Many Parisian museums even closed, and re-occurring festivals were cancelled, as the expect dwindling numbers.
Olympic venues are often left unused, as was the infamous case of the Athens sites.
House prices go up. In Barcelona, housing prices went up. In London, in the boroughs around the Olympics in 2012, housing prices went through the roof.
Greenwashing. Olympics is a very unsustainable event from an environmental pint of view. Organisers therefore always try to greenwash. One notable and even laughable example was BP becoming a “sustainability partner” for the London Olympics.
WHY would a city want to organise the olympics?
After all the financial questions, let us face the most important issue, which must be raised even before any financial consideration: why would you want to host the olympics anyway? There is simply no good answer.
The usual reasoning is one of the following:
To “put a city on the map”. However, all organising cities had already been on the map.
To prove that a nation has “arrived” (has become developed). Actually, if you are already developed (think Los Angeles or Tokyo), everyone already knows it. If you are an underdeveloped petro-authoritarian state (think Sotchi), no-one will believe you. In the digitalised and globalised world, you are not gonna fool humanity.
To attract more tourist. Well, most cities do not need more tourists, they need less. We are already in the age of over-tourism.
To show off your elite sports. If you have great elite sports, you can show them off in plenty of world sports events across the world. Also, if your society is terrible at populars sports, as opposed to elite sports, once again you cannot fool the world with your elites sports. If your nation has a low average health status, your elite sports do not help. They are a waste of money. You need to spend on popular sports instead, as did Iceland.
Book and study recommendations
