Hosting the Olympics is more trouble than its worth
Published: Wednesday, February 5, 2014
Updated: Wednesday, February 5, 2014 23:02
There is only one more day until the opening ceremony for the 2014 Winter Olympics in Sochi, Russia. Preliminary rounds in three sports got underway today in the early hours of the morning. These are the most expensive Olympic Games ever, costing around $50 billion, according to an article from Business Insider. Hosting the Olympics puts a huge financial strain on the taxpayers of the host city, and even the whole country. It is simply not worth it.
Some economists might point to the fact that bringing people into the host city will drive business sales and create extra tax revenue. However, because of exclusive commercial agreements for Olympic sponsors, many local businesses are unable to sell their products at all during the Olympics. During the 2012 Olympics, only corporate sponsors Coca-Cola, McDonald’s, Cadbury and Heineken were allowed to sell food products in areas where events were taking place. Other companies based in the area were forced to shut down. The one exception was made to allow Britain’s iconic fish and chips stands to sell their wares – but only if they sold both fish and chips together. They were not allowed to just sell chips (french fries.) This actually takes away revenue from local businesses at the benefit of international chains. This debunks the most common counterargument in favor of hosting the Olympics.
Hosting the Olympics causes far more trouble than that. According to the same Business Insider report, the Olympic Games in Athens in 2004 were, at the time, the most expensive ever; costing an inflation-adjusted $18.22 billion in today’s dollars. In spite of all this money, Athens proved incapable of hosting the Games. Many venues were barely finished on time, and the swimming facility lacked a roof. Greece is still feeling the effects of this disastrous hosting experience today.
Just a few years after hosting the Games, Greece fell into financial ruin. The large amount of money put a huge strain on the small country’s economy and was one of the major factors in its collapse a few years later. Greece did not have the resources to put on such a big event and struggled immensely to pull it off. Now, it is facing the consequences.
Greece is the best example of a country’s economy collapsing due to hosting the Olympics, but it is not the only one. According to CNN, Montreal accumulated $1.48 billion of debt due to hosting the 1976 Olympics. Most of this cost was due to building the new Olympic Stadium, nicknamed “the Big O.” This debt nearly bankrupted the city, and it took 30 years to finally pay it off. During that time span, Olympic Stadium’s retractable roof failed to work, was replaced by a new retractable roof that also failed to work, and finally was replaced by a permanent roof, all at the taxpayers’ expense. There is a reason locals now refer to the stadium as “the Big Owe.”
Furthermore, many Olympic venues sit empty after hosting the Olympics. The Bird’s Nest, the architectural wonder of a stadium that was built for the 2008 Summer Olympics in Beijing, now has no regular tenant. It was initially intended to host soccer matches, but there was not enough interest in soccer in China to use such a large stadium. It occasionally hosts track and field competitions, but that is it. Most other venues built for Olympic Games are also seldom used.
The only Olympic Games in recent times with many new venues still in use today was the 1996 Summer Olympic Games in Atlanta. A new tennis center was built in Stone Mountain, Ga. which is still in use today. Forbes Arena, which was used for preliminary basketball rounds, is now home to the basketball teams of Morehouse College, a Division II school. The Olympic Stadium was turned into Turner Field, today home of the Atlanta Braves. (However, in almost all cases, most Olympic venues built as part of the host bid are unused after the Games are over.
No sane city would ever want to host the Olympic Games if it considered all the facts. It comes with a large price tag attached and is simply not worth it. Hosting the Olympics is not beneficial for the economy – it is destructive.