Let Boston 2024 pay for the Olympics
At a booster dinner on Oct. 6, Boston Mayor Marty Walsh declared that if the city hosted the 2024 Summer Olympic Games, “It would be Boston leading the United States.” He went on to say, “It’s an opportunity for us to plan what the future of Boston will look like,” and that it would bring awareness to issues of global warming.
These claims all appear to be lines from the International Olympic Committee’s playbook on how to make a successful bid to host the Games. While the assertions may please the IOC, they haven’t worked out as advertised for the host cities, with few exceptions.
Los Angeles 1984 is one exception. Back then, Los Angeles was the only bidder. City officials told the IOC that it would only host if the IOC guaranteed the organizing committee against any losses. The Los Angeles plan was to use the existing sports infrastructure (plus a few smaller, privately-funded venues), and Peter Ueberroth, the head of the organizing committee, introduced a new corporate sponsorship model to help cover operating expenses.
Barcelona 1992 is another exception. The city began to develop a plan for its renovation after the death of former Spanish dictator Francisco Franco in 1975. The plan had several components, including the opening of the city to the sea. Crucially, the plan preexisted the bid to host the Olympics, and the Olympics were fit into the plan, reversing the typical sequence.
If Boston wants to plan properly for its future, it must have a lengthy discussion about the city’s developmental, architectural, environmental, and financial possibilities. Beginning that conversation with the need to create more than 30 competition venues — plus an Olympic village, a media center, and special traveling lanes for IOC officials — is not the way to do this planning.
One venue that will have to be built is the Olympic Stadium, with an 80,000-person capacity. There are no venues in greater Boston that will meet IOC standards. The stadium needs a track and a field, plus all the luxury accoutrements of a modern sports facility. It will also need some 20 acres of land, complete with special access roads and parking. Such a stadium is likely to cost upwards of $1 billion.
Where would it go? Is it wise to sacrifice these 20 acres for the next several decades? What would be its use when the 17-day event is over? Perhaps the New England Revolution could play there, but the capacity would have to be reduced to 25,000 and the track removed. London is spending more than $320 million to “remodel” its Olympic Stadium for the West Ham soccer club.
The independent scholarship on the return to hosting the Olympics suggests that it does not pay off economically. Beijing 2008 spent over $40 billion; London 2012 spent close to $20 billion; Rio de Janeiro 2016 is projected to spend over $20 billion; and, Tokyo 2020, just having won the bid a year ago, is already facing political protests and reformulating its plan to reduce costs.
The Summer Games bring in around $5 billion to $6 billion from television, sponsorships, ticket sales, licensing, and merchandise. Less than half of this sum goes to the host city. Beijing and London actually experienced a decrease in international tourism during their host month and year. This balance of revenues and expenses is not encouraging for a prospective host city.
It is little wonder, then, under the current hosting conditions, that the number of bidders for the Winter Olympics has gone steadily down from nine in 1995 for the 2002 Games in Salt Lake City to two in 2014 for the 2022 Games. The Summer Olympics has decreased from 12 in 1997 for the 2004 Games in Athens to three in 2013 for the 2020 Games in Tokyo.
The notion that hosting will promote sustainability in Boston also lacks credibility. There will be billions of dollars spent on sport facility construction, much of it for facilities that will find no financially viable use going forward. This construction will not lower Boston’s carbon footprint.
Neither the state Legislature nor the Boston City Council has voted to pursue hosting. Rather, Governor Patrick appointed a committee of 10 construction industry executives to investigate the feasibility of the hosting the Games. The construction industry will benefit mightily from all the contracts. The rest of us will pay the bills.
Andrew Zimbalist is a professor of economics at Smith College. His latest book, “Circus Maximus: The Economic Gamble Behind Hosting the Olympics and World Cup,” will be published in January.