How to rethink the Olympic bid for Boston’s benefit
With planning and discipline, we could create a better city for all — even if the torch never makes it here.
AS THE RHETORIC in the Olympic debate heats up, the pros and nos are painting radically different portraits of our future. Will a post-Olympics Boston be an Eden of commerce basking in an enduring global glow? Or a debt-crushed Land of Nod with a vacant velodrome serving as a monument to our civic foolishness?
Meanwhile, the rest of us undecideds are left to sort out how we should feel. On the one hand, we have this vague unease that hosting the Summer Games could turn out to be about as fiscally prudent as buying a flat-screen TV from Rent-A-Center. On the other, we’re proud that Boston beat out three bigger cities to be selected for the United States’ 2024 bid. And some part of us wonders if taking on this Olympic challenge could be the jolt we need to get past our usual incrementalism and make some bold investments in Boston’s future.
Chuck Collins is surprised to find himself in that middle camp. By ideology and experience, he arrives deeply skeptical of the pro-growth coalition behind Boston 2024, a collection of construction and corporate heavyweights, real estate developers, and government boosters (many with awfully high pay rates). Yet Collins can’t help but think that hosting the Olympics might be what it takes to get some traction, finally, for the cause of his lifetime.
The 55-year-old has spent all of his working years trying to close the gap between rich and poor. At age 26, Collins, the great-grandson of deli-meat magnate Oscar Mayer, gave away his entire inheritance to grass-roots organizations working for social justice. He’s been toiling in the trenches ever since.
Had Collins invested his bologna fortune, it would likely be worth more than $8 million today. Instead, the cheerful guy who keeps his gray hair parted in the middle continues to live frugally, plugging away in a drafty Jamaica Plain office with creaky floors. But what does he have to show for it?
The United States now has the greatest income inequality of any highly developed country in the world, and Massachusetts sits far north of the national median. A recent Brookings Institution study ranked Boston the third most economically unequal big city in America, after only Atlanta and San Francisco. Massachusetts has a larger gap between rich and poor than only a handful of other states, making our income divide roughly comparable to that of Rwanda.
Wages for the working class, when adjusted for inflation, have barely budged since 1979, while income has soared for the affluent. Tax policy changes since the early 1980s that favor the rich have widened the gap even more.
Anyone who thinks the income gap is somebody else’s problem might want to think again. Higher income inequality is associated with a host of negative outcomes, from reduced social cohesion to increased crime. Want a future where you need to take an armored car to go shopping on Newbury Street, the way the affluent have to do their luxury shopping in Sao Paolo? Then by all means cheer for the gap to keep growing. But the rest of us should probably start paying a lot more attention to reversing this trend.
Could we use our Olympic moment to help do that? It won’t be easy, and, realistically, the odds aren’t good. Still, there’s a sliver of opportunity to play this Olympics card in a way that creates a better Boston for everyone. That’s a risk worth taking, especially considering how the Olympics drama is otherwise likely to play out.
FOR STARTERS, let’s not waste any more time trying to fool ourselves into thinking that hosting the Olympics, in the traditional way, makes any economic sense. Smith College economist Andrew Zimbalist’s slim new book, Circus Maximus, is packed with forensic data from dozens of economists who’ve studied host cities going back half a century. Taken together, the data show a numbing parade of cost overruns, collateral damage, and promises about job growth, income gains, and tourism surges that proved hollow.
There are exactly two examples of Summer Games that turned out to be unalloyed success stories for their hosts: Los Angeles in 1984 and Barcelona in 1992. But to suggest either of them could be replicated in Boston is to engage in self-delusion.
Los Angeles’s most powerful weapon was the unprecedented leverage it had over the International Olympic Committee (IOC). LA was the sole bidder for the 1984 Summer Olympics, after Tehran (Tehran!) backed out. Following bloodshed in Mexico City in 1968 and Munich in 1972 and financial ruin in Montreal in 1976, the Games had come to be seen as toxic. Eventually, the desperate IOC waived its rules, letting a private group serve as host and agreeing to absolve Los Angeles’s municipal government from any financial losses. The city had nothing to lose.
Under the savvy leadership of Peter Ueberroth, LA used existing arenas, some from the 1932 Olympics, and capitalized on record levels of corporate sponsorships and broadcasting revenues. (Back then, the host city pocketed more than three-quarters of TV revenue; today, the IOC keeps the bulk of it.) In the end, LA got a $232.5 million surplus and the IOC got cities from around the globe tripping over one another for the chance to become the next success story.
Barcelona’s afterglow from hosting the 1992 Summer Games helped catapult the city from the 11th most popular tourist destination in Europe all the way into the number four slot. But people forget all the vital work that took place long before the opening ceremonies. After the death of dictator Francisco Franco in 1975 freed Barcelona from a brutal stretch of subjugation, the city spent a decade re-imagining and then reshaping itself. Its Olympics bid, awarded in 1986, was the capstone — not the start — to ten years of intense, thoughtful urban planning, which resulted in new housing, arenas, metro lines, and whole neighborhoods.
Zimbalist argues that it’s nearly impossible not to lose money as a host city these days. But for the sake of argument, he suggests, let’s charitably assume that it’s an economic wash, with the drains and gains canceling each other out. “The fact that one sector or a few sectors are getting a lot of benefit means the others have to have losses,” he says.
The construction sector is always a big beneficiary, Zimbalist says. It’s no surprise, then, that the driving force behind Boston 2024 would be John Fish, the head of one of the biggest construction companies around. Holy Cross economist Victor Matheson, another Olympics specialist, calls Fish’s vow to keep his Suffolk Construction away from all Boston 2024 projects “a brilliant political move.” With competitors racing to keep up with huge Olympic contracts, he says, Suffolk could effectively name its price for any hospital wing, research lab, or corporate headquarters that needs to be built in Greater Boston. (In a statement, Fish says that Boston is such an attractive market that major projects will always draw plenty of competitive bids from national and even international construction firms.)
Matheson and Zimbalist point to the experiences in other host cities where the gains in some sectors were accompanied by losses for the working class. When a private developer walked away from building the Vancouver Olympic Village for the 2010 Winter Games, the nearly $1 billion bailout came from public money, which ultimately squeezed social services funding. In Rio de Janeiro, despite ambitious plans by organizers for the 2014 World Cup and 2016 Summer Olympics to invest in poor neighborhoods, many infrastructure improvements were scrapped in the face of a ticking clock and darkening finances. The costly new arena projects, however, were considered untouchable. “When push comes to shove, the urgent always overtakes the important,” Matheson says. “So you have to have the velodrome, but all the general infrastructure can get cut.” And in many cities, even Barcelona, the combination of land-taking and gentrification displaced a whole lot of poor people.
With all of this sobering economic evidence, how can I possibly make the argument that Boston’s experience could become a force for the better? It’s a two-part answer. First, the IOC is again approaching a level of vulnerability that is serious enough to give Boston considerably more leverage than what recent host cities had. Second, and perhaps more important, the plan I have in mind would be so favorable for Boston’s future that it would all but guarantee the Olympic torch never gets here. And that’s not necessarily a bad thing.
IN THE EARLY 1990s, as Atlanta began its building spree for the 1996 Games, organizers had a problem. The planned new Centennial Olympic Park, on the northern edge of downtown, would host high-profile Olympic events and serve as the backdrop for the satellite images of Atlanta beamed around the world. But there was a big source of blight ruining the view: the Techwood-Clark Howell Homes housing projects.
Atlanta’s powerful pro-development forces initiated a process to raze Techwood — the oldest public housing project in America — and relocate its residents. But then something interesting happened. The complex’s long-dispossessed residents used their Olympic moment to demand a seat at the planning table. The message delivered by the then president of the tenant association, Andrell Crowder-Jordan, was simple: “We won’t sit back and allow you to sweep us under the rug.”
Before long, the blight was gone, replaced by Centennial Place, a sprawling mixed-income complex of handsome brick-and-clapboard apartment buildings. Centennial Place turned out to be the leading edge of a sweeping conversion of Atlanta’s public housing to mixed-income complexes.
Many Olympic critics and advocates for the poor correctly point out that hosting the Games usually leads cities to push poor residents from their housing — they estimate some 30,000 were displaced in Atlanta. But Crowder-Jordan says what it misses is how often that displacement has produced good outcomes.
“You had grandparents living in public housing, followed by their kids, and their kids’ kids,” says Crowder-Jordan, who is now 54. “It was time to break this cycle.” She and her family found subsidized housing elsewhere in the city and then moved into the new Centennial Place when it was ready. Eventually she and her husband saved enough to be able to buy a four-bedroom house with a nice yard. “I’m very proud of the fact that I moved up and I moved out,” she says.
Longitudinal studies by Georgia Tech economist Thomas Boston show that she was hardly an aberration. In fact, residents who moved out of one of Atlanta’s many public housing projects and into Section 8 housing were one-and-a-half times more likely to be employed in the long term than those who remained in the projects. And for those who moved into mixed-income complexes like Centennial Place, that job rate was nearly five times higher.
As with most Olympics, there was a lot of over-promising and under-delivering in Atlanta. Costs exceeded the initial budget by 147 percent. The hyped effort to revitalize an ailing section of the city by converting Olympic Stadium into a permanent home for the Atlanta Braves fizzled with the team’s announcement that it’s moving to the suburbs. And Atlanta has the most income inequality among big American cities, according to that new Brookings report.
In spite of all that, the Games helped give people like Crowder-Jordan the opportunity to improve their lives. “If the Olympics hadn’t come,” she says, “no one would have cared or thought about changing our community.”
Her advice? “The people of Boston need to get involved. Without them being involved, they will lose.”
TODAY, THE International Olympic Committee has a big problem. Cities are getting wise to how bad an investment hosting the Games has become. As with most Olympic problems, the signs can be detected first with the smaller-scale Winter Games.
Witness the only two countries currently bidding to host the 2022 Winter Games: China and Kazakhstan. Coming on the heels of Vladimir Putin’s $51 billion vanity project in Sochi (and the companion disaster of the 2022 World Cup being hosted by Qatar), the Olympics seem on the road to becoming the Dictatorship Games. Leaders in democracies will increasingly find themselves unable to persuade their voters to bankroll these treasury-draining enterprises, ensuring that all the bidding will be done by despots.
Can another bid by Tehran be that far off?
All of this explains the newfound talk of flexibility and frugality coming out of the IOC. So instead of insisting on its usual 80,000-seat stadium with luxury boxes to house the opening and closing ceremonies, the IOC signaled a willingness to accept Boston’s plan for a no-frills 60,000-seat temporary stadium (which nonetheless could cost half a billion dollars).
The problem for Boston is that international interest in hosting the Summer Olympics hasn’t yet dried up the way it has for the Winter Games. By September, it is likely to find itself competing with bids from the likes of Rome, Paris, Hamburg, and Istanbul. When one or more of those cities offers a new 80,000-seat stadium with luxury boxes, the pressure will be on for Boston to up its ante. After all, the IOC had the chance to select a cost-effective bid from Madrid for the 2020 Summer Games and instead opted for one from Tokyo with a price tag more than twice as high.
When the pressure mounts for Boston to goose its bid, what should it do?
Refuse to budge. In fact, with public support for Boston 2024 starting to crater, now is the perfect time for Mayor Marty Walsh to reclaim control of a process that he never initiated but which could end up, if he’s not careful and lucky, swallowing his tenure. Despite the spin from Boston 2024 that this effort will be privately financed, it’s likely that billions of public dollars will go into transportation and other infrastructure. Walsh can make it clear that Boston will harness the Olympic momentum to craft a plan to strengthen the city, not just please the IOC.
The mayor (and governor) could do this by imposing a simple test before greenlighting any major infrastructure spending: Will this project help make Boston a more livable, equitable city long after Bob Costas has cleared out of town?
A smartly planned Olympic Village that leaves us with mixed-income housing that remains affordable? Yes.
Public-transit improvements that better knit together growing parts of Greater Boston? Yes.
Costly new stadiums or velodromes? No and no. Foxboro would work just fine for the opening ceremonies. Or why not simulcast them from there, Fenway Park, and the banks of the Charles?
The result of this simple standard would be a usable plan as smart as the city it’s designed to serve.
Now, Olympic backers might say such a plan would be dead on arrival, and they might be right. But so what?
If the IOC truly wants to avoid devolving into the Dictatorship Games, it will embrace the opportunity — and accompanying great PR — that Boston’s resourceful, recycled, future-oriented plan would offer.
More than likely, though, it will opt for a more conventional and costly bid from another city. Either way, we’ll be fine.
Economists Andrew Rose and Mark Spiegel have found that countries bidding to host the Olympics see a boost in trade that is just as robust as any trade gains that come from actually hosting the Games (without any of the headaches). Simply by putting together their bid, these places are advertising to the world that they’re open for business.
In that way, we have already won. If we use this Olympic opportunity to build for a better Boston, we’ll turn silver into gold.