Company News · October 2, 2009

The Olympics: A Battle Worth Losing?

By Edison Research

The Matt Drudge headline said it with pizzazz: “The Ego has landed: World rejects Obama, Chicago out in first round.”
While I can’t agree with Drudge that Chicago’s Olympic loss was a result of a “rejection” of Obama, I have found the President’s push to bring the Olympics to Chicago a completely misguided effort. My bone to pick isn’t so much with the wasted time spent travelling to Copenhagen to pitch the International Olympic Committee. After all, the trip took less than 24 hours and I have no doubt Obama got some other work accomplished during his roundtrip commute. Also not my main concern is the political risk – though it was certainly there from the outset when the decision was made to make the trip. And it has, of course, now proven itself a losing move with terrible timing, with a worse than expected unemployment figure arriving in tandem with Drudge’s “reject” headline. My complaint is not primarily with the timing of the effort or the diverted attention it caused, but with the goal itself. We should have let Rio, Tokyo and Madrid fight it out to begin with.
Why do countries battle to host the Olympics, with head-of-state pitches, marketing campaigns, and wining and dining of Olympic officials? The primary argument for the benefits of hosting the Olympics have always been economic. The spoils of hosting, proponents say, are infrastructure building, increased tourism dollars and job growth. But as noted by Jeffery Owen, this is often not the case. He states, “studies have consistently found no evidence of positive economic impacts from mega-sporting events even remotely approaching the estimates in economic impact studies.” In fact, Olympic costs often exceed their budgets, and projections of revenue directly related to the Olympics often disappoint estimates made by prospective host cities.
Certainly another benefit of hosting the Olympics is the ability to show off your country to the world, showcasing political or economic power. For a country clamoring to take its place as a Super Power (Beijing 2008) or as a budding economic and regional power (Rio 2016) this makes a lot of sense (assuming the games are pulled off free of disaster). But obviously the United States has no need to legitimize itself as a World Power. And would there have been any benefit to the effort spent planning an opening-ceremony-to-top-all-opening-ceremonies for Chicago 2016? Let Rio have that “glory,” please. With two wars, terrorism threats and a serious international image problem, is there any harm to just laying low for a while? Anyway, we can still win all the medals we want.

Get our latest insights delivered to your inbox.