Rio Olympics

The Orange County Register has a great piece, "As Games nearly ready to begin, Rio's success or troubles may shape future Olympics," on the issues surrounding the Rio Olympics, which are occurring in the face of major economic deprivation, social and political unrest, the Zika virus public health crisis, and ever present crime. From the article:

A study of Olympic Games over the past 50 years by Oxford’s Saïd Business School found that the Games had an average cost overrun of 179 percent. An inflation rate of 11 percent has been a leading factor in Olympic costs rising $99.3 million from August 2015 to this past January.

“As with all Olympic bids since 1984, there are interested parties who are deeply invested for personal reasons, the principal one being financial gain, another being political advancement,” said Cashmore, author of “Studying Football.” “I have no doubt it occurred to some that a city might experience some benefit, but strictly as a byproduct rather than a direct effect of hosting the Games.

“The risks are colossal, too colossal for any individual or corporation to want to gamble. If you consider the security costs alone for London 2012 exceeded 1 billion pounds ($1.33 billion), you can’t imagine a corporation that operates for profit wanting to take a chance. In any case, even the most cursory examination of all the Summer Games since Sydney in 2000 alerts you to the fact that cities themselves, more specifically, their taxpaying residents, end up with enormous bills that take decades to settle.”

While some cities like Barcelona in particular have been successful at leveraging the Olympics as part of a larger and comprehensive land use and economic development plan and program, most cities have not been equally successful, being saddled with expensive buildings that take decades to pay off.

Also see "Much is at stake for Brazil as it takes center stage  in the Olympics," Los Angeles Times.and "Rio 2016: The high price of Olympic glory," Financial Times.

When I wrote about the fallout over Olympics bids and other mega sports events ("Not enough time for a) 2024 DC-Baltimore Olympic Bid (to make sense)" and "Big sporting events (World Cup/Olympics), economic development and trickle down economics") a key point was by the time the host city is chosen, such as with the Olympics they have only seven years before the event, and that isn't nearly enough time to build significant new infrastructure, irrespective of the issue that many of the buildings required for events are specialized with limited alternative uses, and the way that the International Olympics Committee has the majority of power, hosts are on the hook for overruns, which tend to be considerable.

Some simplification of requirements for host cities.  Even though the IOC revised the requirements for successful bids to allow for use of existing buildings rather than requiring new construction ("Olympic bid process to be simplified to allay fears over hosting games," Guardian), the reality is that especially for countries outside of the First World, the Olympics could be uplifting for communities but aren't, because of how asymmetric the power is between the IOC and the host community.

-- Olympic Games Framework for host city, 2024 Olympics bidding process, International Olympic Committee

Note that while I have not written favorably about a bid from the City of Washington, I did suggest when Chicago was bidding, back in 2009, that it would be possible to leverage the Olympics for intra-city, neighborhood, revitalization, in "Chicago Neighborhood Revitalization and the Opportunity presented by the 2016 Olympics." But the processes tend to be very top-down, and the Growth Machine types pushing for sports tourism aren't particularly interested in how a neighborhood might be able to be improved as part of the pre-Olympics development process.

Cities on the hook for cost overruns.  According to the New York Times ("The Backlash") it was the issue of seen paying for the privilege of the Olympics, and being on the hook for cost overruns, in the face of what was seen as limited economic returns, plus the realization that if Boston were selected the Olympics would take up the majority of political and economic energy within the state, regional, and local governments at the expense of being able to address housing, equity, and other issues, that led to the No Olympics 2024 campaign, which led to the city scuttling its bid.

IOC should share some of the cost of overruns.

Cities need more time.  To make the infrastructure development process more realistic and realizable, the IOC would have to change the timeline for the bidding process.  I'd add four more years to the time between being picked and holding the event--11 years instead of 7 years.

Instead, the Olympics could be augurs for local improvement if the IOC would use proceeds from television rights and sponsorship to help fund local infrastructure and other improvements as part of the selection and hosting process.

But that's not how it works.

Interestingly, the Guardian just ran a piece, "London's Olympic legacy: a suburb on steroids, a cacophony of luxury stumps," on post-Olympics revitalization in London.  It's taking a long time there too, even though London has been one of the world's strongest real estate markets for the last 15 years.

Proposals for the development of affordable housing haven't been realized and aren't likely to be.

Rio.  All those issues have come to a head in Rio de Janeiro, which hasn't been able to follow through on various commitments that were made, including ensuring that the water in Guanabara Bay was relatively clean ("Who is Polluting Rio's Bay?," New York Times; and "Rio Promised to Clean Up Guanabara Bay Before the Olympics:
Priscila Pereira was murdered while trying to make that happen," Bloomberg Businessweek) for sailing.

Complaints are rife about failures in construction of the Olympic Village, and the new subway line, Line 4, will be running for the Olympics, but only for Olympics events, and it will close for awhile, open again for the Para Olympics, but not be fully operational until next year.

Plus there are allegations of corruption in how the subway contractors have been paid ("SUBWAY EXPANSION BUILT FOR RIO OLYMPICS OVERBILLED," Associated Press), etc.

Olympic Village

Line 4 Metro Station and Train (Image from Railway Gazette)