Olympics celebrate struggle for excellence, not costs. As more emerging economies are hosting Olympics, it is time to recall the Olympic Creed.
When Brazil won the right to host the Summer Games over six years ago, its economy was booming after years of President Lula’s successful economic policies. Today, Brazilian economy is struggling amidst its worst recession since the 1930s,
But the economic fall of Brazil’s host capacity is only a part of the big picture. The other part has to do with cost overruns.
The initial cost of organising the Rio Games was estimated at $2.8 billion. The current budget is closer to $5 billion. The total Olympic budget is far higher. It was initially estimated at $12 billion, whereas the current estimated bill is closer to $20 billion – more than 22 times what Brazil is spending to contain the Zika virus.
Worse, cost overruns have been the rule of summer and winter Olympics since the 1960s.
Rising Costs, Soaring Cost Overruns
When the first Olympic Games were held in Athens in 1896, the final bill was $10 million, in today’s money. The first billion-dollar games ensued in Berlin 1936, when Nazi Germany’s expenditures soared to $1.7 billion. In turn, the postwar austerity ensured that the costs in London in 1948 were around $30 million.
About the Author
Dr. Dan Steinbock is Guest Fellow of Shanghai Institutes for International Studies (SIIS). This commentary is based on his project on “China and the multipolar world economy” at SIIS, a leading global think-tank in China. For more about Dr Steinbock, see http://www.differencegroup.net/ For more about SIIS, see http://en.siis.org.cn/