A little over a year ago, the approaching Summer Olympic Games hosted by Rio de Janeiro grasped the globe’s attention for more than just the spectacles of gold medals and famed athletes. The 2016 Rio Olympics always seemed plagued by controversy, and many doubted that the city was going to be able to construct the necessary venues in time and under budget while still balancing all the other issues that either came with the Games or already afflicted the country. For example, many observers were shocked by the International Olympic Committee’s (IOC) decision to accept the city’s bid for the Games because of the trash-filled waste that was Guanabara Bay. Brazil was also suffering from a shrinking economy—the recession was the worst that the country experienced in over 80 years, raising concerns about the nation’s ability to host the Games—and a mounting health crisis—the Zika virus spurred international worry over an outbreak among the athletes. The state, too, was under deep scrutiny as it felt the tremors of record-breaking crime in nearly all categories ranging from robbery to homicides, prompting further skepticism about both the municipal and provincial Rio de Janeiro’s capabilities to welcome the competition. Despite all the many factors that seemed to doom the first Olympic Games held in the South American continent, however, the two-week festival was remarkably without disaster. But through a retrospective lens, how successful or rewarding was the Rio Olympics for the city, country, and its people? Unfortunately, not much.
Exceeding the established budget and estimated cost of the Games, Rio’s Olympic experience carried a hefty price tag of $13 billion USD. While this number, especially when compared to the dumbfoundingly extravagant expenditures that accompanied the 2008 Beijing and 2014 Sochi Games—a whopping $40 billion USD and $50+ billion USD, respectively—actually appears somewhat frugal, one must remember the circumstances under which such money was spent. As aforementioned, the nation was in a state of financial crisis unknown to them since the 1930s. Doling out any number of billions, even for the global competition, would prove damaging to Brazil’s state of affairs. Furthermore, the seeming nonchalance with which such money was given to a fleeting, arguably superficial event raised alarm bells for many. Numerous critics have pointed out that pensions, teachers, hospital workers, and even the police forces that would be securing the host city during the event have gone months at a time without any payment, yet there seemed to be ample funds present to exceed the budget for the already wallet-cringing expenses. This dissonance was further recorded in the disparity between the funding for the Olympics and the funding for the endemic Zika virus; only $780 million USD were allocated for research and prevention of Brazil’s worst health crisis since the influenza pandemic of 1918 struck the nation, meaning that nearly seventeen times more was spent on the Olympics. These facts are troubling for obvious reasons, and in a sense, it shows that the Olympics bring out the worst in humanity even as unites it in global competition. But perhaps such shortcomings of the host country and city were forgivable if the promises they made during their bid for the 2016 Games—to introduce wider public transport opportunities, to revamp the infrastructure for the famous low-income favelas of Rio de Janeiro, to remain environmentally cautious and emphasize sustainability in constructing Olympic facilities—were kept. Well, it has been a year since the flame left the village. What has come of these promises?
Disappointment. While billions were spent on the expansion of subways, many areas have not felt the tangible results of these promises. Certain attempts for renovation of impoverished districts were made but will not diminish the dominance of favelas in the poor city. As for the promised sustainability of Olympic facilities, dilapidation and abandonment have already rendered many such venues useless after only a year has elapsed since their use. The Deodoro Olympic Park, one of the two clusters of venues for the 2016 Rio Games, sits shuttered and closed. The Aquatics Center that housed Michael Phelps’ triumphant leave is drained and abandoned. The Barra Olympic Park was offered to private investors in a bidding, but with no takers the expected $14 million USD needed to maintain the park defaulted back onto the government. The Rio Olympic Velodrome, located in that park, recently was damaged by a fire initiated from the landing of an illegally released Brazilian lantern. The Maracana soccer stadium—where the opening and closing ceremonies took place—has largely been run-down, vandalized, and left abandoned; the venue no longer has power because of the exorbitant electrical bill: $950,000 USD. The $20 million USD golf course struggles to find players in the soccer-oriented country. The 31 towers in the Olympic village that housed the athletes—meant to be converted into luxury condos—sit mostly vacant. The Future Arena, which was used for handball and Olympic volleyball, was a temporary venue meant to be converted into four schools after the 2016 games; as of last month, Rio’s mayor has cancelled these plans. Apparently, the Rio 2016 Organizing Committee attempted to pay off its $40 million USD debt to its creditors through air conditioners. They then asked the IOC for help in their debt and were promptly ignored. A 16-month study commissioned by the Associated Press found readings of infectious illness-causing viruses at 90 percent of the test sites for waterways; Guanabara Bay was no doubt home to many of those viruses as well as pollutants and trash. In the city’s 2009 bid for the Olympics, they promised to reduce and treat the sewage streaming into Guanabara Bay by 80 percent; just before the games, the number was only 51 percent. Following the games, all efforts furthering the minor progress has ceased. The most aching part of all of it, though, is that from 2009 to the summer before the Olympics began, 4,120 families were evicted and removed from their homes due to reasons related to the Olympic projects. Thousands of families removed so that billion-dollar venues and stadiums can have a two-week shelf life, rotting away for all the time after their purpose expires as though they are beacons of senseless grandeur and perverse profligacy.
This now-clear outcome of Rio’s tenure as host of the Olympic Games was never by any stretch unimaginable. It is now just one exhibit in a trend that every host of the Games has adhered to and endured. In fact, the trend was established by the inaugural 1896 Olympic Games in Athens; the predicted cost by founder Baron de Coubertin was a modest quarter of a million drachmas, but the actual cost was about 3,700,000 drachmas (an equivalent to around $12 million USD). Furthermore, a 2012 study by Oxford University found that from 1968, every one of the Games studied has experienced budget overruns. Note that not all of the Games were able to be studied because of the lack of reliable public data on the subjects of budget-at-bid and official final costs. It should also be stressed that the final costs used in the study came directly from the estimates the Organizing Committee for the Olympic Games for each city were willing to admit; limiting their study to the official rather than total costs, the Oxford researchers presented these staggering budget overruns as the best-case scenario. The average cost overrun for the Games studied was 179 percent, significantly higher than cost overruns in other types of megaprojects such as transportation systems (average of 33 percent overrun) and major IT projects (average of 27 percent overrun). One could extrapolate this data and infer that, while there is no data to confirm, every Olympic Games in its 120-year history so far has exceeded the proposed budget. What’s more, only two Olympic Games—the 1984 Los Angeles Games and the 1992 Barcelona Games—have garnered profits from their endeavor. It is evident that Rio will not be joining those two cities as the exceptions to the crippling financial debt that comes in wake of hosting the Games.
The overruns also do not include the regaling that host cities perform for the International Olympic Committee while making their bids. These “gifts” and “celebrations” that act as licit bribes can add millions onto the prospective host’s expenditures and means that cities who are not selected have paid millions to lose. It recently came out that former Rio governor Sergio Cabral paid $2 million USD to an IOC member in order to secure his lobbying for the city in the selection process. It would be an understatement to say that such illicit briberies are rare. One would have to question why Rio’s governor would be adamant enough about securing the 2016 Games that he would commit a crime, and the reason is because of the extensive corruption that plagues Brazil’s governmental hierarchies. Corruption—characterized by large contractors bribing politicians at various levels for lucrative contracts—has been entrenched within Brazil for years and has been gradually revealed in recent times, so it is no wonder that the Olympics were looked at by corrupt officials as an opportunity for gain. Massive construction entities like Odebrecht, OAS, and Andrade Gutierrez received most of the contracts for the Olympic projects, a move which no doubt lead to much reward for the conglomerates that dominated Brazil’s construction industry for decades. Perhaps sparked by the recent sentencing for Rio’s corrupt former governor Cabral—14 years in prison—federal prosecutors are looking into the very apparent funding irregularities in projects for the 2016 Olympics. Just earlier this month, Carlos Nuzman, the president of the Brazilian Olympic Committee, was subject to a house search. The result of which was public acknowledgement by the federal prosecutors that the Rio Olympics were a breeding ground for corruption. For the people of Rio, the Games were disastrous and imprudent, but for the contractors and officials, they were lucrative and beneficial. Perhaps that was the intent of the initial bid…
Knowing all that is knowable about the 2016 Rio Games, what is to be learned? What is the message to take away from all this? It could be that the Games have never been justifiable from a financial point of view unless most of the venues that are to be used are already present (the way in which the only two successful host cities garnered their profits), something not possible in most cities. Or, it could possibly be that citizens of prospective host cities should be cognizant of the monetary burdens that they would place on themselves, for more might follow in the footsteps of the Bostonians who protested indebting their city in order to accommodate the necessary spending for the Olympics and achieved success (Boston withdrew their bid for 2024 Olympic Games, which will be held in Paris). Perhaps it is that the faults apparent in the Rio Olympics should serve as a warning to cities and countries who would spend, rather than on the welfare of their people, billions on venues to entertain the world for less than a month only for them to become the skeletal remains of white elephants. Perhaps it is that the Olympics should only be held in the same cities every few years, or maybe a plethora of cities at the same juncture, in order to mitigate and avoid such financial recklessness. Perhaps it is all of them; perhaps it is none of them. But what is certain, out of all of this, is that there needs to be a reevaluation of what it is the Olympics does and should stand for. Whether or not change will come, however, is dependent not on these Games past. No, it is dependent on where the Olympic flame has yet to come.
By: Ryan Hill
Photo: The Irish Times