July 20, 2024
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OLYMPIC OVERRUNS

Once every two years, I assume the role of an Olympic expert. Like countless other people around the world, I unilaterally and unabashedly deem myself an Olympic aficionado and presume that I know as much about the competition as the television commentators who actually do have extensive professional experience in each respective event.

During the Summer Olympics, I transform into a self-proclaimed maven on Olympic events such as diving, gymnastics, swimming, volleyball, and track and field. When the Winter Olympics roll around, I become an enthusiast of events such as bobsleigh, figure skating, luge, ski jumping, and speed skating.

Very often, I will catch myself questioning the sanity of the judges when they award an underwhelming score to an athlete whose performance I am quite certain was extraordinary, or, conversely, when they reward an athlete with high marks when I thought their routine was subpar.

I fall prey to Olympic fever as much as the next guy. In addition to thoroughly enjoying watching the competitions, I well up with pride when witnessing an American athlete standing proudly with a gold medal around his or her neck as the national anthem is played and the American flag is unfurled high above the arena.

Yet, there is a much deeper and more serious side to the Olympic Games that does not always garner the attention and concern that it warrants. I am referring to the effect that the Olympics has on the host cities.

The excitement of hosting the Olympics is quite understandable. Prospective host cities pull out all the stops as they do whatever it takes to lure the games to their backyard. They become giddy as they dream about their city being squarely in the spotlight in the years and months leading up to the Olympics, as well, of course, as throughout the duration of the games themselves.

The problem is that the visions of grandeur that accompany the exuberance of the host cities impair their ability to exercise any degree of fiscal prudence in relation to the Olympics.

The economic boon that they dream of generally fails to materialize. Instead, the host city is often faced with an economic bust of monumental proportions.

The costs to the host city to prepare for the Olympic Games are extraordinarily exorbitant.

This year’s Winter Games in Sochi is the perfect example. Originally estimated to be in the range of $10 billion, the actual cost is hovering around a whopping $51 billion. That would shatter the record set by Beijing during the 2008 Summer Games, when the cost was approximately $43 billion, and give this year’s Olympics the dubious distinction of being the most expensive games ever.

There have been many economic debacles of Olympic-type proportion. The 2004 Olympic Games in Athens were over budget by 60% after they spent a total of approximately $15 billion. To add insult to injury, many of the state-of-the-art venues that they constructed for the Olympics at that time are now run-down and unused.

Going over budget in anticipation of hosting the Olympics is endemic and virtually guaranteed. Albertville in 1992, Montreal in 1976, Lake Placid in 1980, Albertville in 1992, and Nagano in 1998 are just some of the host cities that saw their costs skyrocket far beyond their original estimates.

Sadly, history has shown that the prominence of the host cities on the world stage quickly dissipates shortly after the closing ceremonies of the Olympic Games have concluded. The spike in tourism that they hoped for never occurs. The commercial investment in their cities that they yearned for never happens. The host cities are often left with nothing but a colossal debt, brand new venues that have no tenants, and that helpless feeling of “how did we get into this mess?”

All of this begs the question. In a world in which poverty is prevalent, hunger and famine are commonplace, and homelessness is widespread, is spending $50 billion on the Olympics the best use of our money?

To put it in perspective, according to an estimate by the United Nations, world hunger can be eliminated for $30 billion a year. In addition, the U.S. Department of Housing and Urban Development approximates that it would cost approximately $20 billion for the government to end homelessness in the United States.

To be clear, I am not advocating that we eliminate the Olympics and instead use the funds for social justice endeavors. My intent is merely to point out the out of control spending that is associated with the Olympic Games.

The Olympics serve a vital purpose. The spectacle of top-flight athletes from all corners of the world coming together to participate in a civil and spirited athletic competition is always a sight to behold. The longstanding tradition of the Olympic Games is an integral part of the fabric of our society.

However, we cannot turn a blind eye to the massive amount of money that is expended by the host cities. Perhaps the International Olympic Committee (IOC) needs to initiate a conversation on how to curb costs and make the Olympic Games a more sound investment for host cities. The IOC needs to furnish a new model that will enable and encourage host cities to approach the games with a greater degree of fiscal prudence and reasonable budgetary projections.

Judging from an economic practicability standpoint, the current pecuniary prototype for host cities would regrettably not even make the cut in an Olympic qualifying heat.

Absent any substantive changes to the current system, when it comes to the Olympics, the acronym that host cities will become most familiar with is not the IOC; rather, it is an IOU.

By N. Aaron Troodler, Esq.

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