Who’d want to host the Olympics?

By Max Seddon
July 26, 2012

Londoners are greeting the Olympics with all the enthusiasm of a child awaiting a root canal. The government has warned those unable to book coinciding holidays not to travel anywhere beyond walking distance of home as Communist-style “Olympic lanes” whisk dignitaries past the interminable traffic the Games cause. During the Olympics, London will be run under a curious kind of corporate martial law. Thousands of troops will handle security to make up for private contractor G4S’s staffing “shambles”; missiles have been placed atop public housing; an Orwellian “brand police” is sweeping the city to ensure no businesses other than 11 official sponsors use words like “gold,” “silver,” “bronze” and even “London.”

Putting up with this misery is supposedly justified by the commercial windfall, tourist bonanza and enhanced prestige the Olympics create. One Tube station poster depicts a man who, having identified alternative transport routes, is jauntily reading a newspaper as he whizzes past an escalator logjammed with athletes: The headline is “London 2012 Games a huge success, save British economy.”

But as Wednesday’s woeful economic data confirmed Britain’s slide into a double-dip recession, it’s worth questioning whether hosting the Olympics is worth the $14.5 billion cost. In strict financial terms none ever actually make money. Some host cities have turned profits since Los Angeles was the first to do so in 1984, escaping the crippling public debt incurred by cities like Montreal and Vancouver. But, as a recent report by Goldman Sachs points out, “most countries … have treated the cost of constructing facilities and infrastructure, together with security and other ancillary costs, as being separate from the cost of running the Games themselves.”

In other words, it’s possible to declare an operating profit while incurring huge losses on major expenditures that may not be recovered for decades. Beijing trumpeted a $171 million profit made on operating costs, while neglecting to mention the $40 billion-dollar infrastructure buildup it made ahead of the 2008 Games. The $5 billion to $6 billion the London Olympics earn will not even begin to cover the cost of infrastructure and security alone. Even if it did, half of revenue is split among International Olympic Committee members.

Like many major sporting tournaments, the Olympic Games often create embarrassing white elephants. Beijing’s Bird’s Nest remains largely unused. The Olympic stadium in Montreal proved such a drag on city finances that the Quebec government imposed a $2 billion tobacco tax to help pay it off – and that took 30 years. Facilities often have no conceivable use beyond the two weeks of the Games, like Athens’ softball stadium and sailing marina. Since the world seems likely to remain in the economic doldrums for some time, chances of future facilities being purchased or converted are low: The London village already looks like a combination of a garish British seaside holiday resort and Pripyat, the Ukrainian ghost town abandoned after the Chernobyl disaster.

There’s even less evidence that the Olympics or other major sporting events drive tourism long term. Regular tourists are kept out for the duration of the tournament, and host cities are usually either known well enough to potential visitors and investors – London is probably more beholden to foreign capital than any other major Western city – or lack the attractions to make them a viable destination in the first place, like the Ukrainian mining town of Donetsk, host of several Euro 2012 soccer matches.

If anything, the Olympic spectacle is often so grotesque that it brings out the worst aspects of its hosts. London 2012 is exposing to the world traditional British foibles like nightmarish transport infrastructure, overzealous policing and failed privatization schemes. Beijing did the same for China’s aggressive nationalism and choking air pollution. The 2014 Sochi Winter Olympics will need a lot more than a Romneyesque crusade to shed the image of a rampantly corrupt Russia: One road has cost $7 billion, which Russian Esquire calculated was enough to cover the same 48-kilometer stretch with 9 centimeters of Louis Vuitton bags or 21 centimeters of foie gras.

The profligacy, draconian security and surveillance measures, and general contempt for ordinary citizens the Olympics bring seem more appropriate for a dictatorship than a dynamic Western democracy. That’s why we should hope the IOC takes a leaf out of FIFA’s playbook and holds future Games in repressive petrostates. For a start, the scrutiny of a major sporting tournament often puts pressure on repressive countries’ harsh laws. Ukraine’s soccer-fueled coming-out party was ruined by a Europe-wide ministerial boycott of the Euro 2012 matches it hosted this year, prompted by the jailing of former Prime Minister Yulia Timoshenko. Qatar will, in all likelihood, have to relax its views on public displays of homosexuality and alcohol consumption for the 2022 World Cup.

Conversely, the undesirable aspects of the Olympics are far better suited to countries that essentially have them in place already. Baku, Doha or Dubai – all bidding for the 2024 Games – would have no concerns about lavish budgets and would hardly have to beef up security beyond that of their extensive police states. Compared with competitors like New York or Paris, those cities would actually see an increase in international prestige and, with the right amenities, even tourism. The white elephants that plague most Olympic hosts are par for the course in the lands of half-empty resorts and half-finished skyscrapers.

This isn’t to say the Olympics aren’t worth having – they can make even sports that nobody usually watches, like the discus or curling, magically fascinating once every four years. But they’re certainly not worth the chaos and budgetary millstones they create in the world’s capitals. Rather than bring the mountain to Mohammed, we should hope the Olympic curse restricts itself to cities that already share its Ozymandian dream.


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