Why would anyone want to host the Olympics? Pretty soon, it will only be mad dictators lining up to host the great games.
How do you think the Brazilian government is feeling about the Olympic games right now?
There’s so much fanfare around the selection of the Olympic city – so much excitement, jostling and bribes. But is it worth it? Does it even come close to being worth it?
For Brazil, the Olympics was meant to mark their promotion to first world status. When they were awarded the Olympic games back in 2009, the economy was booming on the back of a commodity boom. Brazil had jumped up the leaderboard to be the sixth largest economy in the world.
The future looked Brazilian.
By then commodity prices collapsed – and its two biggest export earners – minerals and sugar, were hammered.
(Fun Fact: Australia’s total sugar output is less than the statistical error estimate on Brazil’s estimated output.)
And like all booms it had left Brazil with a hangover of dud investments. And so by the time the games rolled around, Brazil was mired in recession.
Talk about awkward timing.
And that timing has made the massive financial burden that comes with the Olympics feel all the more heavier. And it’s hard to justify billions on a new stadium when your teachers aren’t getting paid.
The Olympics can be massively expensive. The Athens Olympics cost the Greek government about $16 billion – accounting for a full 5% of total government debt!
And the Olympics always costs more than you think. Always. A recent study found that Olympic costs always blew out by between 4 and 10 times the original estimate.
Think about that. The best case scenario is that it costs you 300% more than what you had budgeted for.
(Handball that one on to the future generations.)
But that cost doesn’t include the dozens of white elephants that get built in the process. Brazil still has an overhang of massive stadiums from the World Cup. One stadium, which has a capacity for 40,000, has been given to a team that pulls 1,400 on a good day.
But massive stadiums are expensive to maintain. There’s complex drainage and sewer systems. Air-conditioned change rooms. Gardens and car parks.
And most sporting infrastructure isn’t really re-purposable. What are you going to do with an Olympic velodrome? Flood it and turn it into a massive aquarium?
These white-elephant costs are the true ‘legacy’ of the Olympics.
But the expense is worth it right? These things are huge money spinners right? Well, no, actually.
Of the 17 Olympic tournaments held between the Second World War and 2012, only one of them – the Los Angeles Olympics in 1984 – actually made a profit.
Even London ran at a loss. David Cameron was saying the games was a financial success, but only if you included estimates for future business consulting to future host cities – i.e, if you just made stuff up.
London, already a tourist Mecca, actually saw a fall in tourist numbers during the games, and business saw reduced flows of traffic as locals stayed home.
And this is all before we include ‘legacy’ costs. So there’s no financial case for hosting the games.
The IOC has to take some of the blame here. The IOC has gouged out more and more revenue from the local hosts (see chart). At the same time, they tend to favour hosts who promise to build flash new facilities, rather than leveraging off existing ones. That means they are biased towards more expensive games.
Ok, so the games is a financial disaster. But what about the glory? Surely there’s all that national pride and brand recognition.
Well, how do you think Brazil is feeling about that now?
News and social media aggregators love disaster stories – and Rio has been full of them. From the green “fart-smelling” diving pool, to body parts washing up on the beach volley-ball venue, you get the impression it’s a total cluster-smurf.
To be fair, these incidents are probably blown out of proportion, and a great chunk of the Olympics is running smoothly, but that’s the way the media works. Good news never made a paper sell.
And what about the tourism pull – a benefit that supposed to live on long after the closing ceremony.
Well, I know I’m pretty well travelled, but I would of thought Rio of one of the most famous cities in the world already. Its not like it needs to be put on the map.
And so the question is what do we know about Rio we didn’t already? Well, for me, it’s that the recession is getting out of hand, there are armed gangs roaming about the place, and the bay is full of human faeces.
Sell it baby.
So it brings me back to the question – why would you ever want to host an Olympics?
And I think people are waking up to the waste of money that it is. 12 different cities bid for the 2004 Olympics. The 2020 round drew just 5. Currently there are only two cities in the running for the 2022 Winter Olympics – Beijing and Almaty, Kazakhstan.
In the near future, no sane city will want to host the Olympics. All we’ll get is tin-pot dictators with delusions of grandeur looking to fluff their egos.
Which, to be fair, is kind of what we get now, with tin-pot elected officials putting future generations on the hook for huge bills, in order to fluff their own egos. But now people are wising up to it.
It would be a shame if we went down this road. But if we’re going to avoid it, the IOC needs to stop selling itself as one of the jewels of civilisation. From what I’ve seen of the IOC, I don’t think they have the humility.
Here we come Angola 2024!
Can the Olympics ever be more than a way for dictators to get into dict measuring contests with each other?
NoelA says
Another great insight John, a concern I have from this week is hearing on the ABC radio (so it must be true …. right?) is that this Olympics cost the taxpayer (Us) 340 Million…. Me thinks some of that money could go toward slightly more important things like say addressing the 1 or 2 women a week dying as a result of domestic violence, or public housing or any of a bucket load of worthwhile causes.
Aaron says
Would it be reasonable to run the Olympics as a “distributed event” at multiple places around the globe at the same time?
Imagine every continent and many countries specialising in single/few events and delivering these to the absolute pinnacle.
The whole thing is more about broadcasting in terms of revenue. Why not embrace that fact? It’s not like most of the watching population actually care about the physical location. This comes a vast second to seeing the pinnacle of individual and team athletic capability compete at the very top of the global game.
IOC gets the revenue they need from broadcasting.
No single nation takes all of the burden.
A single nation can focus on competing to host the event(s) that make the most sense and they can actually deliver well. Rather than spending billions to be a “jack of all trades”, why not excel in the delivery of a couple of events? AND make money from those.
Imagine how well this would unify the planet in one event? Even beyond what it does now.
It’s time to make the Olympics a truly global event.
Grow up humans. We are pale blue dot floating in a vast ocean of nothingness.
Embrace it.
Act like it.
Put your big boy and big girl pants on.
Indy says
What if we could spread the Olympics throughout the world at the same time of a particular time of the 4th year. Swimming in thee US or Australia. Track athletics somewhere in Europe. Field athletics somewhere else. BMX through the jungle tracks of…….and bike racing zig zagging around mountain terraines somewhere else again. Equestrian maybe in Argentina as well as football(soccer) in Chile, with the Rugby 7’s in HongKong. You know where I’m coming from? That could spread the disiplines all over the world at facilities that suit and media rights that would advertise whatever country they are in. That would spread the burdon and the costs. I’d hate to see the Olympics shutter and die.
tezza says
I read recently that Brisbane (in conjunction with the Gold Coast and Sunshine Coast) were looking to bid on the 2028 (I think) Olympics. Hopefully the government will come to their senses before they waste too much money on a bid. Interestingly there have been several other cities looking to bid that have withdrawn after holding a referendum and finding the citizens were overwhelmingly against bidding for the games (e.g. Vienna had a referendum in 2013 and was 72% against bidding for the games).
Maybe they should go back to the idea of holding them in the same place (Greece) every 4 years which means they could reuse the same facilities and the IOC could fund the facilities through the TV rights.
Simon says
Uhm, what senses do you think politicians have, that they might find them and come to them?
grewster says
World Expo has the same effect , ask Brisbane. Brisbane also has a velodrome and aquatic centre left over from the Commonwealth Games.Maybe they could just do reno on old tired structures.
ron goddard says
it really is a laugh or two. dictators are politicians risen to the top. and politicians of all colour are professional hitmen surrounded by a police force and military to defend them in times of crisis. but then that’s democracy. as mr. plato said some time ago : democracy leads to corruption. but we keep electing them in the name of ‘democracy’ because we want them there to be responsible for us as we don’t want that responsibility. then we get upset when corruption sets in, as it surely does…EVEN in the land of oz.. mr. winnie churchill reckons that he only has to spend a few minutes with the average ‘voter’ to realise what a stupid idea is ‘democracy’ lol so we get dictators who have inflated egos. and they have meetings with other dics. sort of an ‘orgymeet’ and the public foot the bill. so thats about where it sits. and maybe in some distant, future time we will have many places to go to for the olympics..all of the old stadiums built around the world for the event…athens to rio to l.a. to moscow??
Simon says
One of my 10 best books ever, ‘Skunkworks’ about Lockheeds airplane development program thru the 50’s to 80’s, U2, SR71, Stealth.
They tried to sell stealth high speed battle ships to the navy, but the navy wouldn’t buy because they only had a crew of about 10 people, and there was no potential prestige for whoever was in command of them. now, 40 odd years later, the navy has got something similar.