Bobsleds over the cliff

Cities want to host Olympic events for the same reasons they crave pro sports teams:

(1) People come and spend money; and

(2) It’s cool.

But the spenders never seem to cover all the costs, and now those practical Canadians are wondering if the cool factor is worth it. Folks, here’s your answer: No, it’s not.

Your suspicions are correct; the winter games are going to leave you with a pile of bills. Every tourist on the planet would need to show up for a night out on the town and a souvenir $30 maple leaf t-shirt to pay for this spectacle.

Ian Austin of The New York Times writes a concise, very readable and sobering piece on this very thing. He points out that the Olympic Village, a development project so ballsy that Donald Trump might not try it, is a tsunami of red ink:

“But cost overruns, combined with the credit crisis in 2008, destroyed the financing. Once in office, [Vancouver, B.C.'s mayor] Mr. Robertson had to obtain special permission from the province to borrow $434 million to complete the village. In all, the city is responsible for about $1 billion in development costs, a situation that lowered its credit rating.”

Remember, this is a city of fewer than 600,000 people who are responsible for that $1 billion debt. And it’s not like things were really solid before Bob Costas showed up.  As Austin points out, the resort hosting Alpine events (Whistler Blackcomb) is set to go on the auction block after the events. The repo guy is probably standing by right now, waiting to tow those courtesy vans with the Olympic logo on the sides.

Other Canadian taxpayers and various Olympic emergency funds can come into play, but the responsibility pretty much sticks to locals.

The notion of permanent Olympic Villages (which gets floated every few years and is now being pushed by some as a greener alternative) seems smart. Building anew each time was never a solid financial move, and the jingoistic pleasure that comes from hosting the games is an expensive indulgence in 21st century economies. Maybe we could even turn this into an urban bail-out strategy. They could get some snow-making equipment in Detroit, couldn’t they?