Why Would Any City Want to Host the Olympics?
The Olympics have been a money pit for host cities in past years, but officials in Los Angeles are still excited to make a push for the 2020 games.
Los Angeles Mayor Eric Garcetti really wants his city—which is now the United States Olympic Committee's official Olympic bidder for 2024—to host the Olympic Games.
"We know how to do Olympics, we know how to do them well, we know how to do them economically," he boasted on Tuesday. Los Angeles mayors can only serve two four-year terms, so whatever happens he'll be out of office during the games, but he's working hard to make this thing happen.
The City Council backed Garcetti's bid, but some council members seemed slightly less enthusiastic than their mayor. "All public fund commitments would require express, advance authorization of the council and the mayor. And as of this moment, we've made none," City Councilman Paul Krekorian, who voted in favor of the bid, told VICE.
The need for caution when it comes to Olympic bids is pretty obvious by now: Though the Olympics bring unrivaled publicity to a metro area, the event can cause some pretty serious civic damage. Athens is perhaps the most notorious case: The 2004 Olympics left the taxpayers of Greece with a debt of 7 billion euros (not including the money sunk into a new airport and transportation system), and the mess is regarded by some as a major contributor to Greece's ongoing economic crisis. When the Olympics came to Beijing in 2008, China used it as an opportunity to showcase its status as an economic powerhouse, but wound up with massive bills and headaches, along with a bunch of depressing abandoned stadiums and crumbling infrastructure. Today, some Chinese academics regard hosting the Olympics as a mistake.
The 2012 London games were regarded as a rip-roaring success by London politicians, but in reality it went $15 billion over budget, and the benefits to the local economy that are supposed to come with the Olympics didn't materialize during the games. (Neale Coleman, an advisor to the mayor of London credits the games for a spike in tourism afterward).
The Winter Olympics aren't much better, as anyone who can remember the morass of corruption that was the 2014 incarnation in Sochi, Russia, can attest.
Still, when the announcement came in 2013 that Tokyo had won the 2020 Olympics, beating out somewhat limp competition from Istanbul and Madrid, there were celebratory shouts of "Banzai!" As if on schedule, problems have begun to crop up in Tokyo. The centerpiece stadium has hit delays and suffered from massive cost overruns earlier this summer. The plans were scrapped in July, and, surprise surprise, costs went up again.
So why all the enthusiasm, when these games are clearly a bad investment most of the time? Is there something only the local Olympic committees can see, or is Garcetti banking on LA being immune to the Olympic curse?
One city that seems to have been inoculated against Olympic fever is Boston. In January, the Massachusetts city won the chance to bid on the Olympics away from Los Angeles, but anti-Olympic protesters quickly came out in force. By spring, only 36 percent of Bostonians even wanted the games to come to their town. In July, Boston's mayor announced that the city didn't want the stupid Olympics anymore.
Christopher Dempsey, an activist involved with No Boston Olympics, one of the groups that led the charge to shoot down the city's Olympic ambitions, says the three weeks of the games are a distraction from the larger impact of spending taxpayer money on a giant international party that benefits no one quite so much as the International Olympic Committee.
"It's essentially an auction," Dempsey told VICE. "They're trying to get cities around the world to bid on this thing that's very shiny and very sexy, but it's hard to really value it in any quantitative way." After it's over, he added, "economists haven't really found that cities are better off."
When the bidding process was finished, Dempsey claims, the city of Boston would have written itself into a very bad deal. He explained the IOC's offer this way: "We're going to basically promise you we're going to do all this stuff, and if there are cost overruns, the city of Boston is the payer of last resort."
But Los Angeles isn't like Boston, according to Krekorian. "We don't have to start from scratch, building big stadiums, doing multibillion-dollar projects that a lot of other cities have to do. If Rio pulled out of the Olympics next year, we could probably host with what we've got," he said.
LA hosted the 1932 games—set against the backdrop of the Great Depression—and they were profitable. According to the Guardian, the next Olympics that made money for the host city was 1984, when LA hosted once more. (In fact, the games were so profitable, some officials felt duped by the Los Angeles Olympic Organizing Committee's alleged tightfistedness.)
"I remember the atmosphere in Los Angeles at that time. I think that that history does inform our conclusion now that Los Angeles is a great Olympic city," Krekorian said. "The 1984 games produced such a fiscally positive result that we created a foundation that continues to benefit the people of Los Angeles today." He's referring to the LA84 Foundation, a youth sports nonprofit founded with money from the 1984 surplus.
But the Olympics are a gamble, and no one can guarantee that Los Angeles won't lose. "Our job is to look at this in a cold-eyed, analytical, data-driven way, to make sure we protect the taxpayers of Los Angeles," Krekorian said, adding, "We're not going to write a check just for the joy of having the Olympics here."
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