Why Hosting The Olympics Isn't Worth It Anymore ? - Business Insider

It's no secret that it's a pricey pain to host the Olympic Games, running billions of dollars above the estimated budget.AstheInternationalOlympicCommittee receives fewer bids with each problematic games, the future of the tradition is looking unsure.
We spoke with Smith College Professor of Economics Andrew Zimbalist on the matter. He should know, he's written about the Olympic issues in Circus Maximus, No Boston Olympics, and Rio 2016.

Ah, the Olympics!

The glory of our best athletes competing for greatness, in shiny new stadiums for viewers around the world. 
But recent games are rife with over spending, waste, and controversy. 

And most viewers don't even see the lasting damage the games do to the host city.

Could we be watching the death of the Olympics? 

Well, right now it's hard to tell.

But this honored tradition is looking sicker every year. 

Hosting is expensive. Every game in the last 50 years has gone over budget.

The 2014 Sochi Winter Games went over its 10 billion $ budget, 

by an additional 41 billion $. 

No one knows this better than Professor “Andrew Zimbalist”. 

He's written several books on the Olympics,

including "Rio 2016: Olympic Myths, Hard Realities".

These days they require about 35 different athletic venues.

They require an Olympic village that costs one and a half, two, three billion dollars, depending on the circumstance. They require a media and television production facility, which could very easily go for half a billion, to a billion dollars.

They require a media village. They require ceremonial space, and green space. 

They require transportation amongst all of them,

and special lanes for the IOC executives transportation amongst all of the venues.

Cities used to make a profit from the games.

Partly, because they collected a lot of revenue in TV rights.

But, recently the International Olympic Committee has been taking a larger percentages. In the 90's for instance, it took 4% of revenue.

Compare that with the 70% it pocketed from the 2016 Rio Games.

The newly built stadium can cost up to 30 million dollars a year to maintain,

and they are often on valuable real estate.

Most cities don't even know what to use them for after the games.

Those facilities fall into decay if they're not kept up, and that hurts property value.

There could also be a lot of Environmental destruction.

The Winter Olympics they'll be having in Pyeongchang, they destroyed a whole mountainside. Trees and animals that are there, and some of them close to Extinction.

So, who'd want to host the Olympics in the first place?

Not many!

After each financial failure, fewer cities bid to host the following decades games.

After all, it takes 10 years of planning just to be in the running to host.

Chicago spent an estimated 100 million on the campaign to host in 2016,

and they lost!

Boston famously pulled its bid for the 2024 Summer Games, 
after citizen group No Boston Olympics convinced the city otherwise.

12 cities bid for the 2004 games, five for 2020, and just two tried for 
2022 Winter Games:  China and Kazakhstan.

So is that it? RIP Olympic Games?

Huh.. No. It won't end..

Thomas Bach, the President of the IOC, for all the criticisms that I have of him, 

he’s a smart guy, and he knows when he's up against the wall.

And they've been up against the wall.

In 2014, IOC President Thomas Bach suggested a list of 40 actions the IOC could take, 

to shape the future of the Olympic Movement.

Among them, evaluate bid cities by assessing key opportunities and risks, 

reduce the cost of bidding, and include sustainability in all aspects 

of the Olympic Games. 

It sounds good on paper, but time will tell if these actions take root.

We're gonna to become more sustainable, 

We’re gonna to become more affordable,

We’re gonna to become more flexible,

And by doing that, by tweaking the model a little bit, 

and making pronouncements, they reengage cities to participate.

And what's generally happened is the model has been slightly reformed.

It's a little bit more sensible now, then it was before the end of 2020.

Zimbalist supports a different idea to keep the Olympics alive:

Get rid of the bidding system, and pick a permanent host.

Somewhere that has the built in facilities, infrastructure, and venues.

We happen to have such a city for the Summer Olympics. 

It's Los Angeles. 

They don't have to do any building virtually.

They've got the infrastructure, transportation infrastructure. 

Because, it's the second largest, city and the entertainment capital of the country.

They've got all of the professional teams from all the leagues.

A permanent city could benefit the Winter Games as well.

As the climate changes, less cities that have hosted Games in the past can reliably keep Snow. The IOC isn't a fan of this idea, but as bidding hosts dwindle, 
so do their options. 

The future Summer Games are planned out through 2028, 

and the Winter Games through 2022.

The 2026th Olympics have several cities exploring bids, including two previous hosts:

Salt Lake City & Sapporo Japan. 

Germany, Australia, and India have all expressed interest in the 2032 Summer Games.

Despite its flaws, the Olympic Games is still a people pleaser. 

The IOC polled candidate host cities for the 2020 Games,

and 70% of Tokyo, 76% of Madrid, and 83% of Istanbul were in support.

So maybe the Olympics aren't dying!

But, it's certainly up to the International Olympic Committee to keep the games in check.

Both on the field & Off.

@ Rob Ludacer