Olympic Games: becoming too big of a monster to feed

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Some experts and analysts believe that the standards for the Olympic Games and how this event has to be held, have grown to very large proportions through the years. Is the Olympic Games becoming too big of a monster to feed?

McKinsey, a a global firm, engaged in consulting and information research spoke on the subject with Wolfgang Maennig,  a professor of economics at the University of Hamburg and a two-time Olympian, winning a gold medal in 1988 as a member of West Germany’s eight-man rowing team.

Maennig said the Olympics are among those events, which are commonly known as “mega-events”. He said there are several ways to define what a mega-event means.

“One is by the number of participants. A second is by the number of spectators worldwide. Another is by impact. There’s no consensus. But certainly things such as the Olympics, the World Cup, and maybe the Henley Regatta and Wimbledon are mega-events,” he said.

Maennig believes the time is to greatly rethink the ambitions toward infrastructure connected with the Olympic Games.

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“If you look back to the classical Greek Olympics, there was no idea of urban revitalization associated with the Olympic Games. I think the mess started in 1992 when Barcelona, in a clever way, was able to attract a lot of money from the Spanish government and from the European Union to stage the Summer Olympics. The Barcelona authorities used the money to refurbish the city, and they did it very well,” he said.

“But the problem is that, since then, cities are not applying for the Olympics because they want to have the best athletes in their city or because they want to be part of an Olympic experience but because they think they can press the national authorities to get money for infrastructure projects they otherwise would not have. In addition to that, the Olympic Games bidding process nowadays is like an auction, so that each city is overbidding the next—more and larger stadiums, a bigger airport, bigger staging, bigger streets, bigger railroad stations, and so on.”

“In the beginning, the International Olympic Committee (IOC) and the World Cup leaders liked it because if you spend a lot of money on the Olympics or the World Cup, it means that you have a decent impact, a legacy. Now, however, the IOC is noticing more public resistance in the host and potential bidding cities,” he said.

Further on, Maennig said some countries even withdraw their bids for hosting large-scale events, such as the Olympics, because of lack of public support.

He went on to say that the Olympics and the World Cup are among the most attractive brands in the world, and their leaders are worried their reputation is getting damaged because of the criticism.

Contrary to the opinion that mega-events bring a lot of benefits to the hosting country, Maennig disagrees.

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“There have been a number of studies using statistical data from the host cities and host countries. As always in academics, you find a range of opinions. But the overwhelming majority of these studies say that there are no significant effects from mega-events on income, employment, tax income, tourism, and so on. There might be other benefits, such as more medals for the host nation, a feel-good factor for the population, and a better reputation for the host city. But the positive “core” economic effects cannot be proved,” he said.

He also believes that for such mega-events the process of bidding must be different.

“It’s not only that we have to reduce the demand for infrastructure. It’s more fundamental,” he said. “We have to accept that the credibility of the elites—and I am part of one elite group—has suffered in the past decade, and especially in the past five years.”

“That’s true for athletes. It’s true for politicians. It’s true for economic and financial leaders. It’s true for all kinds of elites. So, we have to admit that although we think we know better, we cannot just propose a project and expect people to accept it. They don’t believe anymore that we know better. People think that they are at least as well educated as, let’s say, their political leaders.”

Maennig also said that the Olympics have become a rat race for bigger and bigger infrastructure.

“The federations would have to adjust to the needs of the Olympic cities and not the other way around. Historically, remember, some of the early Olympics in the modern era were just part of, or parallel to, big international exhibitions. That was the case for Paris in 1900, St. Louis in 1904, and London in 1908. There was little or no new construction for those Olympic Games,” he said.

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