1 week ago
The PyeongChang Winter Olympics boasts an estimated $13 billion tab. While a bargain compared to Sochi’s $50 billion expenditure in 2014, that’s still enough to give any aspiring host pause. The Olympics can bring global attention to a city and provide the incentive for a building boom that will still be useful many Games later. Or you may wind up shelling out frightening sums on structures that get used once, all for a moment in the spotlight that leaves your community a punchline.
These are the questions that every potential Olympic host should address. If “No” is a recurring response, it’s probably best to let someone else have the prize.
Does Your City Actually Want an Olympics? This seems obvious, but it’s been known to produce unexpected answers. Famously, Denver won the right to host the 1976 Winter Olympics. Triumphant local politicians got a harsh awakening when it came time to pay for it and voters overwhelmingly rejected a bond issue. Quite simply, the people of Colorado preferred keeping their tax dollars and protecting their environment to Olympic glory. The IOC then offered the Games to Whistler, Canada, which also passed. (Ultimately, they wound up in Innsbruck, Austria, which had just hosted in 1964 and so largely had the needed infrastructure already in place.)
Similarly, Boston’s bid to host the 2024 Summer Olympics died in 2015 when Bostonians rallied against it. Even an unsuccessful effort comes at a cost—reportedly Chicago blew over $100 million on a failed attempt to host the 2016 Summer Olympics. Quite simply, communities should guarantee the people are on board before busting out any checkbooks.
Will the Money You Spend Reach Where It’s Meant to Go? In general, Olympics require lots of buildings to be completed quickly. And yes, this is a perfect setup for money to be wasted or simply pocketed. As noted, Russia shelled out an astounding $50 billion on Sochi in 2014. Why so much? One possible reason: $30 billion of that total may have been stolen. (It’s believed contracts were often awarded to pals of Vladimir Putin without competitive bidding or any particular supervision.) The 2016 Rio Olympics are long over, but Rio’s former mayor is still being investigated for allegedly soliciting millions in bribes for related construction projects. Quite simply: If there are doubts about a government’s integrity (or competence), an Olympics is an invitation for a full-on looting.
Can You Put Your Best Foot Forward? Russia literally spared no expense with the Sochi Olympics. For their efforts, they earned stories like:
U.S. bobsledder Johnny Quinn even achieved celebrity after being forced to smash his way out of an Olympic Village bathroom. (He had a second wave of fame after getting trapped in an elevator as well.)
Again, $50 billion spent. If a place isn’t ready for the spotlight, there’s something to be said for remaining in the shadows.
And most importantly…
Do You Have a Plan for What Will Happen Post-Olympics? Far too often Olympics leave behind only abandoned facilities. Some places have excuses for this. Sarajevo hosted the 1984 Winter Olympics and less than a decade later Yugoslavia splintered apart in brutal warfare. More often it’s a case of constructing something that is neither wanted nor needed after the Closing Ceremony. Which is why Brazil boasts a $900 million stadium that serves as a parking lot. (Okay, that was from the 2014 World Cup, but Rio has plenty of projects that are experiencing some dark days.)
This is where Sochi may prove a surprising success. Granted, it has a fair share of facilities apparently out of commission. But Fisht Stadium will get some additional use thanks to the World Cup. More importantly, Russia was looking beyond both the Olympics and the Cup. They had a goal of transforming Sochi into a winter destination for tourists. (It was already popular in the summer.) This seems to actually be happening. Was a frightening amount of money wasted? Most definitely, but something of lasting value was created.
Plus even the most cost-conscious economist would have to agree you cannot put a price on this Sochi musical performance.