Hosting the Olympics Is a Bad Deal

by Msnbctv news staff

However some cities nonetheless do wish to do that, proper?

The primary reply is that you’ve the development business executives deciding that this might be a beautiful factor for his or her business. They’re going to get billions of {dollars} of contracts. They will line up, in fact, the commerce unions, and a few funding bankers. They rent a consulting agency to do an financial impression examine, which makes use of a defective methodology and makes some unrealistic assumptions. They usually come out with “By golly, that is going to place our metropolis on the map.”

So that is about misalignments?

If, say, Deloitte had been to return out, having been employed by a chamber of commerce, and say, “This can be a loopy concept. Your metropolis ought to by no means do that,” they’re by no means going to do one other financial impression examine for a megastar sport occasion. So that is their modus operandi.

What in regards to the $4 billion the I.O.C. will get from broadcasters?

Particular person members don’t make something, besides that they’re handled to hospitality. The I.O.C. has an immense and elaborate working construction with all types of subcommittees and subagencies. So their working prices are fairly substantial. It’s in all probability someplace within the order of 15 % of their complete revenues over a four-year Olympic cycle.

Do you assume the broadcasting rights will acquire or lose worth sooner or later?

Properly, are we going to start out betting on the Olympic Video games? Definitely the Supreme Courtroom choice invalidating the Skilled and Novice Sports activities Safety Act is a sign that sports activities betting goes to hit all the sports activities leagues. This may very well be an enormous revenue-generating merchandise for broadcasting rights charges.

The subsequent Olympic Video games shall be in Beijing this winter. How do you count on it to fare?

I think about there’s an infinite quantity of political pushback to the I.O.C. for having chosen Beijing. After all, they solely had a alternative between Beijing and Almaty, Kazakhstan. It was a Hobson’s alternative.

Will Beijing generate income?

They’re performing some actually loopy, loopy issues. They’ve chosen two venues 60 and 120 miles to the north of Beijing to host the Nordic and Alpine snowboarding occasions. Each of these areas are arid — not removed from the Gobi Desert. They’ve to speculate tens of billions of {dollars} in a water switch system as a result of they’re going to have to make use of synthetic snow. None of that’s going to seem within the Olympic finances. It’s extraordinarily silly to spend that sort of cash to advertise snowboarding within the north of China when it’s not a very fashionable sport. They admitted to spending $44 billion for the 2008 Summer season Video games.

How a lot are the Olympics about international locations and cities demonstrating political energy?

It’s laborious for me to think about that President Xi thinks that that is going to place Beijing on the map. One of many issues we discovered in 2008 was that Beijing was horrifically polluted, and we discovered far more about repression in China due to the Video games’ being broadcast.

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