Andrew Keatts | @andy_keatts | June 27, 2016
The news out of Rio has not been good.
First, there were concerns about unsafe water for swimmers. Then came the warnings about the prevalence of Zika. After that came a state disaster declaration. And just days ago, the country shot its own Olympic mascot.
As the Olympics approach, the emphasis hasn’t been on the typical athletic narratives, but rather, it’s on the turmoil surrounding the logistics of the two-week sporting event.
And maybe, that shouldn’t be too much of a surprise.
Researcher Martin Müller, a geographer the University of Zurich, wrote in the Journal of the American Planning Association last year of the world’s problem with “Mega-Event Syndrome,” explaining that Olympics and similar major events are broken – and in need of serious repair.
He says mega-events like Olympics now routinely cost $10 billion is capital investment, require hundreds of acres of land and demand the infrastructure of a city accommodate hundreds of thousands of visitors and participants. They take up resources and attention, waylay law enforcement and can cause long-term urban development plans to be re-written.
While there’s some scholarly evidence for the events’ benefits – fast-track infrastructure improvement, some economic rewards and international attention – the negative effects are “well documented and occur in almost every case,” he writes.
And yet, across the globe, cities continue to fight vigorously to host them.
Since 1960, Olympic games have gone over budget by an average of 179 percent, he says. The nine U.S. cities that hosted the 1994 U.S. World Cup were hit with an economic loss, not a gain. The Athens Olympics cost the country 3.4 percent of the GDP, while leaving it saddled with largely-unused facilities around the region.
Müller identifies the common plagues of these events, intentionally using the medical term “syndrome” to describe them. As in a medical syndrome, the effects occur as a group because they are related and share one cause – the event.
By identifying those symptoms and focusing on their root causes, he proposes a series of policy fixes to treat the mega-event syndrome.
Symptom 1: Overpromise Benefits: Host cities overpromise the benefits of big events to win over organizers and to win public support – one official on an organizing committee Müller interviewed referred to pre-event bids as “science fiction.” They say what people want to hear, with no plans for how they’ll deliver. It leads to misallocated resources and lost trust with citizens, Müller writes.
Symptom 2: Underestimate Costs: Likewise, cost overruns are almost universal for mega-events, in part because the event itself must not be delayed. When a project falls behind, cities throw money at it to complete it on schedule. There’s also no room for trial and error because the event must run smoothly from day one. That means more money to ensure perfection. And since contractors know this, they profiteer off it: they make demands knowing the hosts have no alternatives.
Symptom 3: Event Takeover: Events are often described as ways to accelerate projects a city already intended to pursue. In practice, event planning often wholly displaces the existing urban plans that preceded it. For example, the mayor of Rio de Janeiro in 2011 said, “The Olympic plan is Rio’s plan, and Rio’s plan is the Olympics.” Venues take up scarce urban space, which can no longer be used for other needed purposes. They likewise compete for finite dollars, especially as it gets closer to show time. A city might fund a stadium instead of public transit improvements, for example. Or, for instance, a city might need to expand an airport to accommodate the peak Olympic travel demand, which it would likely never see again.
Symptom 4: Public Risk Taking: Due to competition from would-be host cities, event organizers have the benefit of demanding that cities shoulder the financial risks of throwing the event, while the organizers themselves take home much of the profit. Cities often say they will seek private investment for infrastructure spending. In reality, that's not always the case. Local governments ended up paying 95 percent of the costs for Rio’s 2014 World Cup and the Sochi Olympics in 2014.
Symptom 5: Rule of Exception: Because these events are exceptional, one-time circumstances, cities often resort to exceptional, unlawful measures designed to make them successful. Boston forbade city employees from criticizing the bid. In 2010, Vancouver barred non-Olympic signage in the city. Hosts often expropriate private property just before events.
Symptom 6: Elite Capture: Cities tend to promise broad-based social benefits, but in practice, the benefits flow towards local businesses and real estate interests. In Brazil, four well-known crony contractors reportedly received almost all of the work contracts for the upcoming games, Müller notes. Infrastructure work serving airports tends to benefit a city’s business travelers, not its blue-collar workers. Gentrification is common – Müller cites research finding it was associated with Olympic developments in Atlanta, Sydney, Vancouver, London and even Rio.
Symptom 7: Event Fix: The deputy mayor of Lviv, Ukraine before the 2012 European Football Championship, said hosting an event is like hosting a visiting family member. You finally do all the stuff you’d been avoiding but know you need to do all along. But this justification also means cities often short-circuit the normal development process, sweeping aside environmental reviews or community discussions of a project, forcing consensus to get something done by eliminating the things that tend to make projects take a long time – even if they’re things society has decided it actually likes.
Müller offers several policy fixes to these symptoms. Some are relatively drastic.
For one, cities should avoid tying urban development projects to events. If a city needs extensive infrastructure improvement, it should either be built before an event bid is placed or only if it was already part of city plans, he says. Event organizers can help by giving preference to cities with existing infrastructure, as they did with the Los Angeles Olympics in 1984.
Second, cities need to band together to combat the monopoly power of bodies like FIFA and the IOC, Müller argues. The level of demand to host these events must fall, and those cities that remain should bargain collectively to wring concessions from the groups. Among his suggestions: fewer building requirements, taxation of all revenues the organizer receives (just as a city would for a typical business) and a waiver of cost-overrun guarantees.
Cities should cap their public expenditures to prevent the rampant profiteering among contractors too, he argues. Likewise, they should earmark funds so that money intended for urban projects doesn’t instead go to event hosting.
But he proposes easier changes, too.
Cities should solicit public participation at the beginning of the bid – holding meetings with a range of stakeholders to ensure infrastructure projects are aligned with citizens’ desires. They should refuse to sign contracts with the organizers that are deliberately vague or that leave concrete details to be filled in later.
Also, he says, cities should create a separate organization focused entirely on turning event preparations into a long-term legacy. And cities should build temporary structures when there’s no clear long-term use for a facility.
These changes are too late for Rio, but they need to begin now to take effect in future Olympics and other mega-events.
“Debates and actions to counteract the mega-event syndrome must start now, early in the bid phase, when basic parameters can still be changed,” Müller writes.