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Lessons For London

Jul 28, 2012 • 257 Views
EST. TIME TO READ: 2 minutes

Competing against Paris, Madrid, Moscow and London for the 2012 Summer Olympic Games, NYC made it to the second round and then joined Moscow when it was cut. Next, Madrid was eliminated, then Paris, and London remained.

Was winning worth it?

It depends.

Barcelona (1992) and Atlanta (1996) fared well. Preparing for its games, Barcelona replaced a commercial waterfront with 2 miles of sand, sea and marinas. The beaches led to restaurants, a new port, hotels, a rejuvenation. Atlanta also figured out the formula to make it work. Home of Coca-Cola, they had a deep-pocketed sponsor that made the finances viable. They built stadiums that were used afterwards—by the Atlanta Braves, for example– and Georgia Tech uses the former Olympic Village to house students.

Athens (2004) and Sydney (2000) are a different story. After their Olympiad, the Greek venues deteriorated with 21 of 22 abandoned. Tourism was not fueled. Urban renewal failed to materialize. Spending was massive and debt remains. Even the Sydney Olympics about which Bill Bryson said, “I don’t wish in my giddiness to overstate matters, but I invite you to suggest a more successful event anywhere in the peacetime history of mankind, ” has had little long-term benefit. Its re-development projects did not materialize and the taxpayer cost was considerable.

What happened?

Sports economist Andrew Zimbalist says the big problem is realistic planning. Starting with a bidding process that cost a losing city like Chicago close to $100 million, private interests that will bear none of the expense propose a lavish design. During the construction phase, with little cost/benefit analysis and the siren song of overbuilding, short-term excitement can override all fiscal responsibility and planning discipline. Some say that only after the 17-day extravaganza ends does sobriety return when the new infrastructure is all that remains. Others remind us that morale cannot be quantified as a benefit.

Dating back to 2008, this article from the Independent provides detailed stories of why Olympic cities have won and lost. For even more of the Barcelona story, you will enjoy this BusinessInsider article. Meanwhile, this sports economics Atlantic article and this NPR interview are excellent as is this 3 minute animated history of the Olympics.

Econlife Olympics:

  • Olympic Medal Predictions: here and here
  • A Euro Zone Olympic Team: here
  • Sports Events Boosts: here

 

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