Wasting billions of dollars, time and time again, to stage self-indulgent sports spectacles is no way for any society to build shared prosperity for the long term. But just try explaining that common-sense economic logic to the sports-crazed cities that keep lining up to purchase a moment of fleeting fame – and that end up squandering vast sums, by building use-once-throw-away “white elephants” for one-off events like the Olympic Games or the World Cup soccer tournament.
The sports-industrial complex continues to beguile the gullible and the grandiose, even though scholars have long warned of the futility of sports-event-driven spending. Beijing spent about $40 billion to host the 2008 Summer Games, and Sochi spent upwards of $50 billion to stage the 2014 Winter Games – while Brazil spent $20 billion to host (and heartbreakingly lose) the final rounds of 2014 World Cup soccer. Not to be outdone for extravagance and excess, Qatar reportedly plans to spend as much as $200 billion for the 2022 festivities.
Like the deluded leaders of declining Rome – who distracted their once-industrious city into passivity by pacifying the populace with what the poet Juvenal derided as panem et circenses: "bread and circuses" – modern-day civic leaders are allowing their obsession with media-moment athletic fame to trample economic logic. The scale of their civic hubris – and the malign self-interest of the construction firms, financiers, flacks and fixers who goad credulous Olympic-wannabe cities into wanton overspending – is insightfully dissected in a valuable new book, “Circus Maximus: The Economic Gamble Behind Hosting the Olympics and the World Cup,” by Andrew Zimbalist, a professor of economics at Smith College.
In recent remarks at the World Bank, Zimbalist deplored the reckless rush that stampedes many cities into bleeding their civic coffers in the quest for Olympic notoriety. The saddest example may be the city of Montreal, whose debt from the 1976 Summer Games burdened the sorry city for 30 years.
Yet the suckers keep taking the bait. Boston, said Zimbalist, recently put forth an extravagant multibillion-dollar bid for the 2024 Summer Games – and only later, after the initial headlines and hoopla had abated, did more complete statistics reveal the likely scale of Boston’s folly. And, of course, the Olympic organizers would again stick the long-suffering taxpayers with the bill for any revenue shortfall.
Zimbalist’s logic is a wake-up call for those who somehow imagine that “this time is different” – that one-shot wonders might somehow produce long-term economic benefits. Some occasional exceptions suggest how very rare it is that optimists are rewarded: London, for example, may have gained a much-needed morale boost after its successful 2012 Summer Games, and two (but only two) Olympic festivals actually turned a profit – both of them in Los Angeles, which shrewdly re-used some of its 1936 Olympic facilities when it again played host to the Summer Games in 1984. But for most cities – Montreal in 1976, Sarajevo in 1984, Athens in 2004 and many more – the money spent on soon-to-crumble stadia, ski jumps and swimming pools was a diversion from urgent human needs and productive investment.
Zimbalist makes a compelling case – yet beyond the diagnosis of the malady, one seeks a prescription to cure it. Can such Olympic megalomania be tamed? Are there other ways to build, and pay for, worthy sports facilities that honor the spirit of the Olympic Games while avoiding the overspending that bleeds their hosts dry?
A potential solution arose amid Zimbalist’s recent World Bank discussion. Rather than build one-shot Olympic facilities that are destined to be discarded as soon as each extravaganza is finished, why not build just one enduring set of permanent Olympic facilities that can be refurbished and re-used, year after year? Build it right, and build it only once: That way, the cost of building and maintaining an Olympic complex could be spread over generations.
Pursuing that solution seems especially timely right now, and here's why. Where is the historically logical place to locate such a permanent Olympic site? Why, in Greece, of course, where the Olympics originated in 776 B.C. and continued until 393 A.D. There could be no more authentic place to have today’s marathoners run than in Marathon itself – no more meaningful place to have skiers schuss than on Mount Olympus, or to have boaters ply the very waters that warmed Odysseus’ odyssey.
Along with the historical logic of permanently siting the Games in Greece, think of such an infrastructure-building stimulus program's long-term benefit to Europe's most endangered economy. With the global financial markets now fretting about a potential Greek crashout from the eurozone – amid fears that insolvency could soon become bankruptcy – a sustained infrastructure investment program would be a reliable generator of jobs and incomes in an economy that desperately needs them. Granted, the ill-organized preparations and now-decaying white elephants that marred Athens’ brief 2004 Summer Games were certainly a drain on the city and country. Yet hosting a durable and re-usable Olympics site (and related infrastructure) could be a long-term economic engine for Greece's growth.
In his World Bank remarks, Zimbalist had a quick quip in reply to that idea: “And who’s going to pay for that? Angela Merkel?”
Come to think of it: Why not Angela Merkel? Or, looking beyond the German Chancellor in particular: Why not the European Union?
With Germany championing the virtue of a shared European identity, renewing the Olympic ideal, in situ in Greece, would be a substantive (as well as symbolic) way for modern-day Europe to embrace its sans frontières role as the inheritor of “the glory that was Greece and the grandeur that was Rome.”
Committed to peacebuilding through economic integration, a diplomacy-driven Europe would evoke a historical echo: The original Olympics, after all, were held amid a truce among the region’s warring city-states. The hoped-for permanence of today’s European security would be a reminder that “a Europe whole and free” is fulfilling the ancient dream of an enduring armistice.
A “two birds with one stone” solution, investing to permanently restore the Games to their historic home would meet two challenges at once: halting the recent overspending for duplicative Olympic sports facilities, while stimulating the now-imperiled economy of the country that invented the Games in the first place. With the aid of good-governance consultants and anti-corruption advisors – the World Bank could surely lend a supportive hand on those priorities – the project could be managed as a showcase of transparency and competitive bidding, thus helping the stricken country shun its tendency toward opaque dealmaking and clientelist cronyism. That would promote a more constructive investment climate in Greece, encouraging additional private-sector investment.
Hard currency can serve “soft power.” This week’s European emergency economic summit, aiming to help Greece stave off bankruptcy, is a fitting moment to envision a job-creating, wealth-generating Olympic investment plan that would renew Europe’s harmony with its history. Modern Europe thus enjoys an opportunity to rediscover the lesson learned, long ago, by the original Olympians: Channeling a healthy competitive spirit into contests on the sporting field, while renouncing any return to the battlefield, is a reliable way both to help security flourish and to help economies thrive.
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