Are the 2024 Paris Olympic Games economically viable?

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00:00Now we can take stock of these games from an economic perspective with Professor Victor

00:04Matheson from the College of the Holy Cross in Massachusetts. Thanks very much for speaking

00:09to France 24 and taking the time. So you've written extensively about the economic viability

00:15of the Olympic Games and how we overspend each time, how this is not particularly pragmatic.

00:20How would you say is Paris measuring up? Before it started we did hear some reports that it was

00:26going to break even. Now it's looking like another overspend, although perhaps not a massive one.

00:33Yeah, so actually Paris looks like they're doing pretty well. This looks like it's going to be the

00:37first Summer Olympics since Sydney back in 2000, over 20 years ago, that comes in at under $10

00:44billion. I doubt they break even, but there's a whole lot of difference between losing a few

00:49hundred million or a few billion dollars than losing tens of billions of dollars hosting the

00:53event. Now Victor, we hear about these overspends and how they're justified by the cities, by the

01:00organising committees, by claims of sort of value-added things, economic, cultural, societal,

01:05perhaps even some sort of an intangible benefit to a city or a country. But what independent

01:11evidence would you say is there for these kinds of benefits? So typically there's not much of that.

01:17So you always hope for some sort of legacy because, again, if you spend over $10 billion there's no

01:22way you can make up that money in a short period of time, but perhaps you end up with some sort of

01:27legacy. The problem is the Olympics are always in places that are wonderful locations like Paris.

01:35You know, if you're counting on the Olympics to put Paris on the map, you might need to get

01:40yourself a new map. Obviously Paris is one of the most iconic tourist destinations in the world

01:46and the Olympics isn't going to add to that in any significant way. Right, so one idea that we've seen

01:52raised at how to make the Olympics more cost-effective is let's have it in one dedicated

01:57place each time. Would that not be very boring? I mean, especially as we're seeing Paris now raising

02:02the bar, hosting these events in these implausible but beautiful places, as you say. Yeah, so there's

02:08a couple ways we can do this. So first of all we could have maybe not just one, but you could have

02:13a rotating group of cities, you know, three or four cities. Imagine in Athens and Los Angeles

02:19and in Tokyo, something like that would work. So that would keep it from getting, you know, boring

02:24because at least we change locations. Another thing you can do is you can spread the games out

02:29so you don't have to have all of the events in one place because even a city like Paris may not have

02:35all the sporting facilities in place to host the games all by itself. But if you expand it out and

02:41add additional cities like they're doing for soccer and they're doing for surfing, you know,

02:47that allows you to spread out the costs and makes it much more likely that you have your facilities

02:53in place already. Yeah, but having the Olympics in the same few places each time, does that not

02:58create more of a hegemony around the hosts in terms of their, you know, their benefits they

03:03are receiving from the games, the global attention on it? Yeah, well certainly it does, right? So this

03:09is a trade-off. There is something interesting and nice for the fans, nice for the idea of this

03:16being a World Games by actually moving it around. But the question is whether that's worth the tens

03:22of billions of dollar price tags that we've seen when you have it in, when you have the Olympics

03:27in places like Rio that does not have the facilities in place to host that and then it

03:33ends up with a huge bill when the games are over. Right, I suppose it would be good to reuse some of

03:38those disused Athens stadia again. If we move on now to whether these Olympics are, as the

03:46organisers have been saying, are among the most inclusive ever and perhaps one of the greenest ever,

03:52I've just been thinking, well, do the sponsors come into this equation? Surely some of the

03:58sponsors putting together all what they need to put together to promote themselves during the

04:03Olympics, they are omitting, they are wasting. So how is this calculation actually made and are they

04:09really going to be some of the greenest? So it turns out one of the most non-green things you can

04:16do in creating an Olympics is actually build a bunch of new facilities. Concrete is one of the

04:21worst things in the world when it comes to global climate change and in

04:27Paris, since very very little in the way of new facilities were constructed, Paris will come in

04:33at one of the greenest games in the last couple decades. Simply build, use, if you build a lot of

04:39new stuff you're going to emit huge amounts of greenhouse gases. If you can use existing facilities

04:45like Paris is doing, they're in good shape. And of course from sponsorships, however we

04:52want to think about the global corporate world, sponsorships do serve a very important role

04:59in reducing the total price tag to local taxpayers. So certainly if someone is going to pay

05:04for an expensive games, you'd rather have it be Coca-Cola than the taxpayer in the northern

05:10Paris suburbs. All right and then perhaps about this inclusivity claim there and the fact

05:15that we've got these hundreds of thousands of free tickets, certainly if you walk around Paris and

05:19talk to locals here, this message isn't really getting across. Most people are saying it's been

05:25prohibitively expensive for me and my family to get tickets. So how about this claim then?

05:29Is this something that Paris can truly say is its legacy, the fact that it's opening these games up

05:33to the world? I find that a pretty far stretch myself. Remember this is a games that

05:43people can come and watch it if you're the sort of person who can travel across the globe

05:48and make it to Paris and enjoy accommodations for Paris. Sure there's a possibility for a

05:54handful of people in the local area to enjoy the spectacle of the Olympics even without

05:59expensive tickets, but let's be quite clear what the Olympics is. It's a spectator

06:04sport for the wealthy worldwide who can afford to travel globally to go watch soccer and gymnastics.

06:12And perhaps we can just talk on the benefits for countries that are maybe big medal winners

06:18but aren't the host necessarily because there's got to be some incentive for

06:22countries around the world to still put so many resources into getting the most competitive teams

06:28possible if in future we're doing a kind of rotating around fewer cities system. So what

06:34kind of benefits do countries draw from getting those big results? Sure well let's not put

06:41down the idea of a feel-good effect right. Americans we know in particular we love the patriotic

06:47Olympic Games where we can rack up medals. I noticed we moved just ahead of France in the

06:52gold medal table yesterday. These are the sort of things that this is a good sort of competition

06:58between countries and we shouldn't discount the feel-good effect entirely. Also obviously

07:04these athletes can serve as important brand ambassadors for your country. If you see a country

07:10like Brazil, Brazil has done better than most countries in the world at how much other countries

07:18like them. And why is that? Because of the beautiful game they play in soccer. We see other cases where

07:25maybe we have a brand new brand ambassador for Saint Lucia thanks to Julian's fantastic

07:32run yesterday in 100 meters. So let's not discount the fun impact that these games can have

07:40on spectators and countries alike. So these games may make us happy, they're just not likely to make us rich.

07:47All right, Inspector Matheson. That's a fair point.

07:53Thank you very much for joining us from the College of the Holy Cross in Massachusetts. Thank you.

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