Rio’s financial crisis reveals the moral bankruptcy of the Olympics

The mayor of Rio de Janeiro would like the world to know that the economic crisis engulfing Brazil “in no way delays the delivery of Olympic projects and the promises assumed by the city of Rio.”

Other non-Olympic promises are in jeopardy. On the weekend Rio’s state governor declared a state of financial emergency. The city faces “a total collapse in public security, health, education, transport and environmental management” if it does not receive funding from the federal government of Brazil.

What a contrast. On the one hand, Rio’s politicians have absolute confidence they will deliver this year’s summer Olympic games, which begin on August 5. On the other hand, they have almost no confidence they will be able to provide their citizens with the basic functions of government.

Rarely is the moral bankruptcy of the Olympics so starkly put. Bread and circuses both consume scarce resources. What should we think of governments that put circuses first? What should we think of the circus?

Brazil is in the middle of an economic and political crisis. The Brazilian economy has been in recession since the start of 2015. It has shrunk a massive 5.4 per cent since this time last year. Brazil’s inflation rate is around 10 per cent. The only silver lining is that the economy shrunk by slightly less than experts had predicted.

Brazil’s recession is having social consequences. The cash-strapped Rio state government cut the police budget by a third, reversing advances in crime reduction made since the turn of the century, and raising concerns about tourist safety during the Games. Unemployment is at 11 per cent and growing, and 24 per cent of young people are unemployed. This is the worst economic crisis in Brazil since the 1930s.

The political crisis is almost as calamitous as the economic one. President Dilma Rousseff has been stood down while she is impeached by Brazil’s senate. Rousseff is formally accused of manipulating the government budget to hide the size of the deficit. (Simply servicing Brazil’s debt costs 7 per cent of the country’s GDP.) But she’s also tied up in a major corruption scandal concerning a state-owned oil company. The interim president is also tied up in a corruption scandal. Indeed, up to 30 per cent of the country’s politicians might be implicated in a corruption scandal shortly.

It could well be that the Rio Olympics go off without a hitch. News stories about delayed projects and panicked construction are as much a part of the Olympic ritual as the torch relay and parade of nations.

But outside the athlete’s village and ticket-only areas will be a country straining to foot the enormous Olympic bill.
Hosting the games is a terrible economic deal at the best of times. Hosting the games when you’re a developing economy in the middle of a serious recession is its own scandal.

The woeful economics of the Olympics are clear-cut and, outside the corridors of political power, uncontroversial. A paper published in the Journal of Economic Perspectives in May this year summarising a mass of scholarship and analysis found that the Olympics are almost always a “money-losing proposition”.

The influx of tourism rarely compensates for the decline of economic activity displaced by the Games, and rarely translates into long run tourism increases. It is true that hosting an Olympics encourages governments to invest in infrastructure, but the bulk of those funds are spent on uneconomic specialised venues that cities struggle to utilise once the closing ceremony is finished. Only construction and development companies gained from the Sydney Olympics, as my colleague Sinclair Davidson has found.

The economics are even worse for developing countries. To avoid disaster host cities need extremely capable and non-corrupt management, as well as the political stability to facilitate that management. These sorts of institutions are sadly lacking in poorer nations.

Hosting the Olympics is particularly dangerous for countries that lack tight control over government expenditure. For instance, the Athens games in 2004 exacerbated Greek fiscal profligacy – while the Olympics did not cause the Greek economic crisis, the stadiums and infrastructure stand as monuments to the reckless spending that did.

Brazilian governments spend 41 per cent of the country’s GDP, which, as the Wall Street Journal pointed out in April, approaches the sort of spending levels seen only in mature social democracies like Germany and Norway. It is just not a country with the institutions to manage the extreme political and economic pressures of Olympic hosting.

It is galling, then, that the International Olympic Committee has been encouraging bids from developing countries. Even a failed bid can be extremely expensive – the “low cost” bids for the 2024 games cost about $AU80 million each.

This money of course comes not from the politicians who flank their bids and take box seats at opening ceremonies. It comes from the taxpayers of the bidding countries, and from the public services not provided as scarce resources are redirected towards stadiums and ceremonies.

The Olympic movement likes to affect an image of sporting valour and nobility. But it is the epitome of government waste, almost always doing great harm to its host and taking a real human toll. Once the athletes have gone home, let us hope Brazil can recover from this recklessness quickly.

The Olympics: A Tool For Autocrats Since 1936

Another Olympics, another repressive state using the Olympics to boost its international reputation and gain legitimacy at home.

This time it’s Russia and the Sochi Winter Olympic Games.

When will it sink in that repression is not a regrettable anomaly in some host nations, but a central feature of the Olympic package? That the Olympic movement feeds, legitimises, and even encourages political authoritarianism?

Here’s the rap sheet for Sochi. The 2012 presidential election, which put Vladimir Putin back in the Russian presidency, was surrounded by allegations of fraud. His government met the resulting mass protest movements with a suite of legislation designed to suppress dissent, free speech, and free assembly.

The prosecution of members of the band Pussy Riot was just the most highly publicised attack on political and religious dissent in the last few years.

Amnesty International estimates that 4,000 people across Russia were detained for protesting in 2012 alone. International non-government organisations engaging, however vaguely, in “political activity” are required to register as “foreign agents” and are subject to routine harassment. Foreign journalists are intimidated and sometimes banned.

Then, of course, there’s Russia’s “gay propaganda” law, which makes it illegal to suggest that gay relationships and heterosexual relationships are in any way equal.

All this is on top of the usual forced evictions, construction and development corruption, and extra-legal environmental damage that is par for the course for any Olympics held outside the very richest countries. Putin promised a “zero waste” Olympics as part of its bid back in 2007; apparently the Olympics committee is unable to detect outrageous nonsense when they hear it.

Indeed, it was clear during 2007 that Putin’s Russia was an illiberal Russia. This chronology by FreedomHouse shows how political repression has increased since Putin’s first election to the presidency in 2000.

But by now there is a well-established Olympic media cycle. Negative stories are aired before the games commence. The opening ceremony is 10 days away. The next week and a half will, no doubt, be full of exposures of Putin’s political perfidy, about the environmental and economic cost of the Sochi Olympics, warnings that Sochi’s infrastructure isn’t up to speed, fears about terrorism, and revelations of waste and mismanagement.

But those tales subside the moment the opening ceremony wraps up. Unless there is a major political, logistical, or security crisis, the international coverage of the Sochi games will immediately focus on the sport.

Athletic performances will wash away the political stench. Putin and his government will be the beneficiaries. They will be photographed with sports stars and visiting celebrities. They will feed off the praise of organisers and fans and athletes, for whom there is no world outside the Olympic villages and stadiums.

All the pre-Games bad press will be chalked up to anti-Russian sentiment.

That’s the Olympic calculus – repressive regimes have to tolerate a few months of quiet and steady negativity, which is more than adequately compensated by a fortnight of blisteringly positive press.

Western complaints about Russia’s anti-gay law will not take the shine off Putin’s Olympics.

Defenders of the Olympics make much of the one historical instance where the games bought genuine, welcome political change: Seoul, in 1988. South Korea’s democratisation dates roughly from that time.

But this is not much of a defence. The country was at the time of its bid in 1980 controlled by a repressive military dictatorship, who wanted the Olympics to legitimise its rule.

As this 2004 paper makes clear, at best, the Olympics can be seen as a catalyst, rather than a cause, of South Korea’s democratisation. There were many factors pressuring the country towards change.

And anyway, the International Olympic Committee had no problem being used for authoritarian propaganda. From the Olympic movement’s perspective, it was just a happy accident that South Korean democracy emerged from South Korean dictatorship.

There’s simply no reason to believe the Olympic movement cares about political freedom, and many reasons to believe it is happy to be a tool of the world’s worst regimes.

The 2007 assessment of the Sochi bid (here, page 9) is a masterpiece of amoral detachment. In its assessment of Russian politics, the only factor it feels worth relating is the overwhelming political support for holding the games, as if democratic debate about the virtues of the Olympics would be would be a negative.

It’s true that the repression in Russia is now less than the last time Russia hosted the games in Moscow in 1980. Or than that of Berlin in 1936, or even Beijing in 2008.

But it’s no coincidence that the three most brutal totalitarian dictatorships of the twentieth century have each been granted an opportunity to host the Olympics.

Or that many other undemocratic nations have used the games to build legitimacy at home and aboard.

The Olympics movement simply doesn’t care that it – and all the athletes who compete in their events – is being used as pawns in an authoritarian political game.

Let The Cult Begin

The Olympic Games are creepy. Sure, their creepiness isn’t immediately apparent. We have grown familiar with the pageantry that surrounds this sporting carnival. But there’s more to the Olympics than swimming, shot put and badminton.

The Games are steeped in ritual, all of which is designed to promote an unsettling ideology. They are unlike any other international sporting event. Games officials talk of an Olympic movement, an Olympic spirit, and an Olympic ideal. Its five-ring logo is imbued with a quasi-mystical significance. It even has its own ceremonial calendar: an Olympiad is a period of four years. It’s hard not to conclude that the Olympic Games are a religion, and a bizarre religion at that.

The opening ceremony for the 2012 London Olympics is this Friday. The official protocols dictate it will feature a sacred torch, which will carry a sacred flame, which will light a sacred cauldron. The flame is supposed to represent purity – flames come from the sun and are untainted by our material world. When the Olympic torch was lit in a Greek temple in May, there was a ceremony of dancing priestesses and men dressed as heralds performing feats of strength.

The flame ritual will be preceded by a symbolic release of pigeons. An Olympic flag will be raised. A hymn will be sung. There will be oath-taking. These rites are all very purposeful. The founder of the modern Olympics, Pierre de Coubertin, said its basic idea was to convert athletics into “a religion, a cult [and] an impassioned soaring”.

So the entertainments and frills of the opening ceremony obscure just how odd all the Olympic rituals are.

It is really only when totalitarian states host the Games (Berlin 1936, Moscow 1980, and Beijing 2008) that the cultish elements of the Olympics are fully assimilated into the opening ceremony.

For instance, what we call the ”parade” of athletes around the ceremony would really be better described as a march. Coubertin was explicit about the militaristic elitism of the Games. He wanted to showcase ”an army of sportsmen”. Olympic athletes are the peak physical specimens of all the world’s nations. They are young, fit and virile. In Coubertin’s view, physical perfection was a sign of moral purity. He wanted athletes to devote themselves to sacrifice and an “ideal of a superior life”.

No surprise when the Nazis hosted the Games in 1936, Coubertin embraced them. Berlin was the culmination of his life’s work. It was the ultimate display of ceremony and strength. Olympic ceremonies still combine a sort of fascist symbolism with Cirque du Soleil-style choreography.

Yet the International Olympic Committee is proud of Coubertin. Our Australian committee even has an award in his honour, handed to the secondary school students who best epitomise the values of the Olympic movement.

No doubt the students don’t understand how strange those values are. Presumably they believe the Olympics are focused on peace and global harmony. Because if there is one thing Olympic officials do well, it is soaring speeches about all the good they are doing for the world.

Jacques Rogge, the current Olympic president, told the United Nations in 2007 that “in a world too often torn apart by war, environmental degradation, poverty and disease, we see sport as a calling to serve humanity”. An earlier president, Avery Brundage, pronounced in 1968 that “the essence of the Olympic ideal maintains its purity as an oasis where correct human relations and the concepts of moral order still prevail”.

Their words are cheap and self-serving. Brundage made his lofty claim just five days after the Tlatelolco massacre, where the Mexican government killed dozens of students protesting the Mexico City Games. Rogge gave his speech in the lead-up to the Beijing Olympics, described recently by the dissident Ai Weiwei as nothing more than propaganda for the Chinese Communist Party.

Their words are so cheap that in 1995 the Olympic committee even tossed “sustainability” into their charter. Not content with saving humanity, they wish to save the planet. It’s not clear how flying 10,000 athletes around the world every four years will achieve that goal. The sustainability platform is almost like a deliberate joke. And it reveals just how vacuous the Olympic ideal really is.

The Olympics do nothing to achieve global harmony. They arguably work against it. If harmony was the goal, athletes would compete as individuals, not on behalf of nations.

Do the Olympic ideologists honestly believe the nonsense they spout? The Games are a taxpayer-funded cash cow for all involved, and that’s probably motive enough for many. Yet Olympism offers a sense of mission. It’s not like the World Cup or the Commonwealth Games. The Olympics is a cause. It is a full-blown belief system.

Rogge said in his UN speech he wanted to place “sport at the service of mankind”. Maybe he does. But right now, sport is serving the weird ideology of the Olympics much more than humanity.

Sport As Propaganda: Bahrain’s Vile Grand Prix

The relationship between international sporting events and repressive governments can be truly vile. The latest reminder of this is the decision by Formula One to hold the Bahrain Grand Prix for 2012 this weekend.

The race will be held smack in the middle of daily protests against the Bahrain regime – a regime which is trying to avoid being washed away by the same pro-democracy tide that has seen the end of many of its autocratic neighbours.

Formula One cancelled the event in 2011 because the Bahraini government was violently cracking down on pro-democracy demonstrations. Since then, the regime has tried to rehabilitate itself.
Bahrain wants to stay one step ahead of the Arab Spring. It commissioned an independent inquiry into allegations of torture and violence during the crackdown. The inquiry reported in November last year, and recommended a range of modest judicial and policing reforms.

But Bahrain shouldn’t get off that easily. There are still 14 opposition leaders and hundreds of others in prison for participating in last year’s protests. There are still daily clashes between protesters and police. There are still continuing human rights abuses. Foreign reporters still have their entry into the country strictly limited.

The Bahrain Centre for Human Rights says there have been 31 deaths – including three from torture – since the independent inquiry released its recommendations.

Yet Formula One head Bernie Ecclestone claimed last week: “There’s nothing happening. I know people who live there and it’s all very quiet and peaceful.”

Bahrain’s rulers are using the Formula One race to rebuild their reputation. The race is part of a “normalisation” campaign. It provides the cover by which Bahrain can present a stable front to the world – and avoid serious reforms.

Yet the relationship between Bahrain and Formula One is hardly unusual. Repressive states have long recognised that international sport is a potent propaganda tool.

The granddaddy of international sporting contests, the modern Olympics, has long been a friend of tyranny. Virtually from birth, the Olympics was studiously, and shamefully, neutral about the political environment in its host countries.

During the Berlin Games of 1936, the Olympics’ founder, Pierre de Coubertin, described the “Hitlerian” elements of that event as a merely the happy by-product of Germany celebrating “in accordance with its own creative powers and by its own means”.

Supporters of the Olympics’ bizarre ideology say its political know-nothingism would be better described as “universality” – a belief that all people of the world are entitled to participate in the Olympics, no matter what political system they have chosen.

But as one historian has written: “What this has meant in practice is that the [International Olympic Committee] has turned a blind eye to any sort of political crime committed by a member of the Olympic movement.”

Jean Todt, the president of the Fédération Internationale de l’Automobile, said this week that he and Formula One were “only interested in sport, not politics”.

He might be, but his hosts are not. For repressive governments, the purpose of holding an international sporting event is simple: it confers political legitimacy and the approval of the foreign press.

Todt may imagine otherwise, but for host governments, international sport is entirely about politics.

When Moscow hosted the Olympics in 1980, it was an occasion to impress the world with Soviet superiority; when Beijing did the same in 2008, the Chinese regime used the Games to show off its “socialist modernisation” project.

One infamous example of this phenomenon is how the brutal Argentinian military junta used the 1978 World Cup to solidify its domestic and international position.

The junta had seized control of the country just two years earlier. It immediately directed its propaganda efforts to the Cup, as well as 10 per cent of the national budget. Indicatively, one of the new regime’s first priorities was to improve the foreign journalists’ accommodation for the upcoming event.

The glamorous World Cup was held in the middle of Argentina’s Dirty War, where tens of thousands of people were being murdered by the state.

The protestations that international sport is above tedious national politics are doubly false when we consider the money those governments pay to host major sporting events. States are willing to spend big on premium carnivals. And a cosy relationship with host governments is a key part of international sport’s business model.

When it comes to human rights violations in Bahrain, Formula One cannot pretend to be neutral.

Amnesty International says “the human rights crisis in Bahrain is not over”. The International Crisis Group says Bahrain is “sliding toward another dangerous eruption of violence”.

And it’s hard to disagree with Human Rights Watch when it says the Formula One race gives Bahrain’s rulers “the opportunity they are seeking to obscure the seriousness of the country’s human rights situation”.

If so, Formula One has to take some responsibility.

Commonwealth Games Bad News For The Gold Coast

Poor Gold Coast. Acting Queensland Premier Andrew Fraser told reporters after the city won the right to hold the 2018 Commonwealth Games over the weekend that the economic benefits would be “priceless”.

That’s right: the Queensland Treasurer suggested that the financial gain for the Gold Coast was completely unquantifiable.

Politicians are living in a fantasy land when it comes to the economics of major events.

Evidence that international sporting festivals provide any economic benefit to their host is almost non-existent. The games will discourage as much economic activity in the Gold Coast as they will boost. Probably more.

We have enough serious, scholarly, dispassionate studies of major events to be strident here. Winning the Commonwealth Games is nothing to celebrate. It is bad news for the Gold Coast.

Of course that is not how the Games bid has been pitched to voters.

Anna Bligh has argued the bid is “vitally important for the future of the Gold Coast”. Fraser may believe the benefits are priceless, but the Government and the bid team have been spruiking an economic benefit to the city of between $1.4 billion and $2 billion (naturally, the Government prefers the higher number).

According to comments by the bid chair Mark Stockwell late last year, the Games will also create 24,000 jobs. In Queensland Government press releases, that projection has become a nice round 30,000 jobs. One press release is higher again, and weirdly specific: 33,540 jobs between 2015 and 2020.

These figures are apparently based on a “feasibility study”, which the Government commissioned. The study is not available for public scrutiny.

It doesn’t have to be. We already know it’s wrong.

In their 2008 paper “Do Economists Reach a Conclusion on Subsidies for Sports Franchises, Stadiums, and Mega-Events?”, the economists Dennis Coates and Brad R. Humphreys survey the “large and growing” peer-reviewed literature on major sporting events.

There is an overwhelming consensus among academic economists that no tangible economic benefits from subsidising events, stadiums, or sports franchises exist. None at all. In fact, some papers have found substantial losses from hosting these big national or international sport festivals.

After all, major events are not all economic boom. They are disruptive. Roads are closed. Residents stay away; when locals might have gone out for other entertainment, they stay home fearing crowds. Businesses which cannot take advantage of the visitors see their sales slump.

Major events are not even unambiguously positive for the hospitality industry. One study failed to find any statistically significant relationship between the US Super Bowl – which moves from city to city each year within the same country and provides a convenient natural experiment for major sporting events – and hotel occupancies or retail sales.

Infrastructure gets built, sure, but not necessarily the most useful infrastructure. Events distort spending priorities. Stadiums have only limited uses once the event is over. Transport designed to ferry thousands to an event only held once might not be the most useful transport once fans go home (and why governments don’t do their job and build needed infrastructure until a major event forces them to do so is beyond me).

Add these problems to the large amount of taxpayers’ money used to directly finance major events, and the economic case slips away very quickly.

One academic analysis of the 1994 World Cup in the United States estimated the host cities lost up to $9.3 billion.

But beforehand the boosters were predicting it would increase economic activity by $4 billion.

Every single Commonwealth Games, World Cup or Olympics is matched by a consultancy report forecasting the huge numbers of jobs that will be “created”, the flood of tourism which will be unleashed, and the massive infrastructure investment that will be sparked.

Anna Bligh launched Queensland’s bid for the Commonwealth Games in August 2008. The feasibility study came well after. She told parliament in June 2009 she had “recently” agreed to commission the study, but the Premier was already talking up all the glorious new jobs it would bring. You might say that was jumping the gun. It wasn’t. It was a study commissioned by a Government for a major event. Of course it was going to find a squillion jobs would be created.

Last year the Gold Coast Business News decided the benefits of the Games so concrete, the reverse must be true as well. They titled an article on the bid “Unsuccessful Games bid could cost Gold Coast $2B”. Sounds serious.

What happens from now is all very predictable. Tourism lobbyists will spend the next seven years talking up the event. A few years after the Games have ended, and once it is blindingly obvious the influx of long-term tourism dollars has not arrived, they will blame the Government for “failing to capitalise” on the global goodwill.

Then everybody will move onto bidding for the next event, armed with fresh new consultancy reports and suffering amnesia.

Such is the fantasy world of major events.

Buying Our Love With Our Money Is Just Not Sporting

The Sunday Age 27th December, 2009

Nothing excites state politicians more than having their government host major sporting events. Over the past decade, the Victorian Government has increased its self-imposed “cap” on subsidising major events from $35 million a year to more than $80 million. Why bother calling it a “cap” at all?

This mega event mania is not limited to the states: Australia’s bid for the 2018 or 2022 soccer World Cup is at $45.6 million. The bid now has its own special Commonwealth taskforce.

Roman politicians knew the most effective way to keep their citizens relaxed and quiet: lots of bread, lots of circuses. The Australian wheat industry has been almost completely deregulated over the past few years. So governments have doubled the circus money.

But politicians don’t like to admit they just buy our love. Instead they give lavish economic reasons why we need to subsidise mega events to the hilt: think of the tourism! The “eyes of the world”! The eleventy-thousand jobs!

The Victorian Events Industry Council believes our state’s mega events strategy is the key reason we have avoided the global recession. Just as helpfully, the Australian Grand Prix Corporation claims its event has singlehandedly provided the Victorian economy with $1.5 billion since 1996. (If so, one wonders why we do anything else at all.)

And federal Sports Minister Kate Ellis has argued that a World Cup in Australia would be an “important catalyst” for investment in needed infrastructure, such as roads, rail and ports” perhaps implicitly admitting that even governments need motivation to do their jobs.

Therefore, we are told, the Government must aggressively compete with other governments around the world to secure these guaranteed money-spinners.

Before it hosted the 2002 World Cup, the Government of South Korea claimed its economy would receive an $8.9 billion boost. It was being modest: its 2002 co-host, Japan, determined that the Japanese economy would be suddenly $24.8 billion richer.

As we know, Germany was the host in 2006. This explains why all Germans are trillionaries.

But here’s the shameful secret: the economic benefits of holding mega events are almost entirely fictitious. A broad survey of the economics literature published in Econ Journal Watch in September last year found an overwhelming consensus that these economic benefits are either insignificant or totally non-existent. In fact, there’s stronger agreement among economists about the uselessness of mega events and sports subsidies than there is about the benefits of free trade or the need to eliminate farm subsidies.

Certainly, the Victorian Government believes its mega events strategy has made this state $1 billion richer. They have studies! But these economic impact studies – machine-produced by pliant consulting firms and uncritically accepted by governments looking to justify their actions – rarely take into account the lost revenue from locals who leave when events come to town, or who avoid going out. Or that some money spent on tickets comes at the expense of other local entertainment. Or that there might be better, more productive ways to use the Government’s limited funds. After all, if one of the reasons we host mega events is to spur government investment in infrastructure, why can’t we just skip the events and build the infrastructure anyway? It would be a lot simpler. And much, much cheaper.

When the United States hosted the World Cup in 1994, its supporters maintained the event would boost the US economy by $4 billion. But a 2004 study published in the economics journal Regional Studies found that the event actually cost the US economy between $5.5 billion and $9 billion.

And an analysis by the German Institute of Economic Research concluded that the country’s 2006 World Cup didn’t budge consumer spending at all.

Even the Sydney Olympics dismally failed to boost tourism, its ostensible purpose. We spent all this money “showcasing” Sydney to the world, yet tourism to NSW actually declined, relative to the rest of Australia.

Of course, there is a more obvious benefit we get from hosting mega events, albeit an intangible one. Having the World Cup played in Australia would be a lot of fun, particularly for people who are really into soccer.

So perhaps, after all the taxpayers’ money we spend on it and the burden it will place on our economy, it might still be worth doing. (Well, maybe: we could put it to a vote.) At the very least, we shouldn’t miss an opportunity to stick it to the Brits, who are also bidding for the next World Cup.

Higher, Faster, Costlier: The Price Of Olympic Gold Is Too Great

Malcolm Fraser opened the Australian Institute of Sport in 1981 by saying we were “no longer going to let the world pass us by”.

Since then the performance of Australian sportspeople on the world stage has been not just a matter of pride, but an essential matter of government policy.

Just this week the Rudd Government announced plans to allow foreign athletes to fast-track (I daren’t say “queue-jump”) our laborious citizenship process so we can claim them as our own as quickly as possible. For all the Government’s lyricism about the romance of becoming a citizen of this great, wide, red-brown land, it is happy to toss aside its sacred citizenship rites so we can clock up one or two more medals at the next Olympics.

Indeed, Australia’s relatively weak performance in Beijing – Australian passport holders came a dismal sixth place on the gold medal tally – has panicked senior sports apparatchiks. The $220 million the Federal Government gives each year to the Australian Sports Commission is an embarrassingly small amount of money, according to athletics officials, and risks Australian athletes being trounced by better-resourced foreigners.

So maybe it is better we import athletes rather than hand the Australian Institute of Sport the extra few hundred million bellowed for after Beijing.

Australia is a sports-obsessed country, according to Lonely Planet. That’s fine. But all this political energy, tax money and policy directed towards the four-yearly achievement of a few medals by Australian athletes has to make you wonder – why bother?

It’s anachronistic, for one thing. When Fraser directed the government to mine Olympic gold, he was responding to a Cold War fear that free countries could not compete with socialist ones. Having watched the success of Russia and East Germany at the 1976 and 1980 Olympic Games, Australia’s athletics bodies were convinced they needed state central planning if they were ever going to win medals again. (Not a bad theory, perhaps, if you believe the superiority of your political system can be demonstrated only in a water polo pool. Of course, we now know that a key part of the Eastern Bloc’s sporting plan was performance drug binges.)

It’s been 20 years since the Berlin Wall came down. Now might be a good time to abandon the state-subsidised jingoism embodied in elite sports funding.

Perhaps we could start thinking of sport like we think of any other industry. Competitive sport is like a competitive market. We import things which are uneconomical to produce in Australia. So too we could appreciate the skill of – and morally support – athletes from around the globe. The political insistence that our national honour is tied up in our domination of sporting contests is quite similar to the belief that we must have a home-grown Silicon Valley or green manufacturing industry if we’re going to have a self-respecting economy.

After all, globalisation has changed irrevocably our sporting allegiances. Many Australian soccer fans are just as likely to be interested in the fortunes of Real Madrid as they are in the Socceroos. Cricket fans might be more eager to watch the Rajasthan Royals compete in the highly competitive Indian Premier League than watch the Victorian Bushrangers. The traditional Australian constellation of swimming and tennis on the world stage, and football and cricket at home, is being undermined – in a good way – by our increasingly diverse ethnic make-up, as well as the accessibility of international sport on pay television and online.

These multicultural sports surely hold more appeal than the millions of dollars we spend on highly subsidised, niche elite sports such as volleyball. Most people care about volleyball for only 10 minutes every four years – and even then only if the sport rises above the din of other Olympic events. (Can anybody name an Australian volleyball player?)

Popular sports can afford to support themselves, and sports that are unpopular do not necessarily deserve to be propped up by taxpayers’ money. Australian athletes will continue to dominate many international competitions. As consumers of sport, we will be drawn to their success. Let’s leave it there. Why subsidise Cold War-style nationalism?

Politics, not sport, is the purpose of the Olympic Games

Available here in PDF.

On the March 26 1938, six months after he died, Pierre de Coubertin’s corpse was exhumed from its grave in Lausanne, Switzerland.

His heart was cut out and transported to Olympia in Greece. The heart of the founder of the modern Olympics was then reburied in a ceremony attended by his long-time friend, Nazi bureaucrat, and organiser of the 1936 Berlin Games, Carl Diem.

The tomb of Coubertin’s heart has remained a spiritual centre of the Olympic movement. The tomb was the first destination of the Beijing torch relay — after the torch was lit with the sun’s rays and a parabolic mirror by an official Olympic ‘Holy Priestess’, of course. And late last year the tomb was the site of a ritualistic olive tree planting, to symbolise the Olympic movement’s appreciation of the environment, and to demonstrate the support of Coca-Cola for the Games.

These bizarre rituals, performed around the decomposing body organ of a dead Frenchman, are emblematic of the sometimes odd, sometimes deeply disreputable, and always lumbering and heavy-handed symbolism that has soaked the Olympic Games for a century. The torrent of symbols, emblems and rhetoric that accompanies the Olympics is supposed to convince us that the Games have a moral and ethical stature beyond reproach.

But all this pageantry obscures the Olympics’ essential purpose — first and foremost, the Games are designed to shine glory upon the nations that hold them. National politicians and government use the Olympics to achieve their individual or national goals.

Certainly, the politics lying behind each Olympics may often be diffuse, but it is overt. Sport may be the style of the Olympics, but nationalism and geopolitics are the content.

The ideology of ‘Olympism’

For such a long-running institution, the Olympic Games to a remarkable degree still reflect of the idiosyncratic vision of the founder of the International Olympic Committee (IOC), the
French baron Pierre de Coubertin.

Coubertin was born into a Catholic and Royalist family in 1863, but in the turbulent ideological climate of the French right-wing in the Third Republic, his political views quickly diverged from the traditional. From a modern perspective, his politics were quirky, even contradictory; he described himself as a democrat, yet at the same time nominated the ‘triumph of democracy’ as one of the four political innovations which humanity could have gone without. But he was in many ways typical of his era—a conservative aristocrat whose political and moral views had much in common with the left-wing progressives of the time.

While conservatives like Coubertin rejected the utopian dreams of their socialist counterparts, they shared with progressives and socialists an antipathy towards individualism, a belief in the power of experts, a deep faith in the state, and an obsession with proto-totalitarian concepts like ‘moral hygiene,’ ‘national fitness’ and eugenics.

In sport, the conservative progressivist Coubertin found an outlet where he could express all of his political and moral views. While many were searching for national meaning after the French defeat in the Franco-Prussian War in 1870, Coubertin argued that ‘sports can provide the virile formula on which the health of the state can be founded.’

But most importantly for the development of the Olympic ideology, Coubertin complemented this nationalist ethos with a staunch internationalism. Coubertin founded the Olympic movement with a doctrine of ‘universalism’, which as it appears in the most recent Olympic Charter is described as ‘any form of discrimination with regard to a country or a person on grounds of race, religion, politics, gender or otherwise is incompatible with belonging to the Olympic Movement.’ But as John Hoberman writes in The Olympic Crisis: Sport, Politics and the Moral Order:

What this has meant in practise is that the IOC has turned a blind eye to any sort of political crime committed by a member of the Olympic movement. In September 1978, the President of the IOC Lord Killanin, made this claim: ‘I am not for one moment saying we have any right to tell what governments should do in the interests of their own country…’ Such a disclaimer is made to preserve the ‘universality’ of the movement. What is thereby forgotten is that another side of universality is the failure to discriminate.

It is this failure to discriminate that led the Olympic movement to proclaim its support for ‘universal fundamental ethical principles’ while at the same time throwing its support behind the three largest dictatorships of the twentieth century — Nazi Germany, Soviet Russia and now Communist China. Certainly, this is slightly unfair to China — in 2008 its human rights record is poor, but is markedly better than it was during the Great Leap Forward — but the country is still a dictatorship with at least 4000 domestic political prisoners.

This would, however, have been fine by Coubertin, who dismissed ethical questions with a trite affirmation of moral equivalence. In an interview during the 1936 Berlin Games, he argued that:

It is good that each nation of the world be granted the honour of putting on the Games and of celebrating them in their own manner, in accordance with its own creative powers and by its own means. In France they are disturbed by the fact that the Games of 1936 were illuminated by a Hitlerian force and discipline. How could it have been otherwise?

This doctrine of ‘universality’ above all other considerations was also the lynchpin upon which the Soviet bloc was able to hang their claims that the communist world was being unreasonably ignored by the IOC.

After all, for Coubertin, a nation’s political system is merely a reflection of its culture. For the Olympic movement, totalitarianism is not an aberration, but an accepted part of the international cultural patchwork. As a consequence, there is very little in the Olympics’ doctrine of universalism that suggests any allegiance to ‘fundamental ethical principles’.

Pagentry and politics

For the cities and corporate sponsors of the games, Olympism and its doctrine of universality are not much more than a philosophy of convenience; a pre-packaged ideology ready to be adopted when the Olympics come to town. Few outside the IOC share Coubertin’s views on the moral neutrality of political systems, or, indeed, the IOC’s view that politics has nothing to do with the Olympic ceremony.

Instead, for the host nations, the games represent an easy opportunity to conduct domestic and international politics without the distraction of being accused of doing so. Even the athletes, standing on the winners podium, draped in their national flag and singing their national anthem, must realise that politics, not sport, is the dominant Olympic event.

For much of the life of the modern Games, politics was defined by the Cold War, which divided participating nations into clearly delineated factions. The nationalistic passions inflamed by this international and ideological rivalry became the primary characteristic of the Games in the second half of the twentieth century.

Australians may remember Melbourne 1956 through sepia-tinged nostalgia, but the political circumstances of those Games were controversial and impassioned. They were held in the inter-
national atmosphere created by the Suez crisis and the Soviet invasion of Hungary. The then President of the IOC, the American Avery Brundage, in an attempt to separate the Melbourne Games from the fragile international situation, argued desperately that ‘the Olympic Games are contests between individuals and not between nations.’

The President of the Netherlands Olympic Committee, which boycotted the Games responded bitterly: ‘How can sports prevail over what has happened in Hungary? How would we like it if our people had been atrociously murdered, and someone said that sports should prevail?’

His questions are surely more morally clear than any of the vague platitudes contained in the lavish Olympic Charter.

The IOC’s pleas for calm had little effect on the political aggression displayed during the contests. A water polo match between Hungary and the Soviet Union was a violent blood bath, but Hungary managed a 4-0 victory.

The attitude described by an American contestant at Helsinki (the site of the 1952 Olympics) was characteristic of many of the Olympics during the early Cold War period:

[Russians] were in a sense the real enemy. You just loved to beat ‘em. You just had to beat ‘em. It wasn’t like beating some friendly teams like Australia. This feeling was strong down through the entire team, even [among] members in sports where the Russians didn’t excel.

Not only has the international political context of the Games undermined its claim to the moral high ground, but the Olympics have themselves been affiliated with state violence. As Hoberman writes, ‘the world of sport has given rise to more bizarre, violent, aberrant, and even criminal behaviour than its faithful public is disposed to recall.’ The most notorious
example of this was the Tlatelolco Massacre, which occurred just ten days before the 1968 Mexico City Games, where the Mexican government fired upon a demonstration of 5000 students demanding greater human rights. Some estimates of the death toll at Tlatelolco range up to 300 people.

And quite apart from the failure of the IOC to influence China’s poor human rights practices in the lead up to Beijing, critics of the communist regime can point to mass home evictions to make way for construction. One left-leaning human rights group, the Centre on Housing Rights and Evictions, claims that there have been over 1.25 million Chinese forced to resettle, although the group has not made their report public, apparently to protect their sources. The Chinese government only acknowledges 6,000 homes seized, all with adequate compensation. Nevertheless we know that like many other previous host cities, Beijing has launched a program to ‘clean up’ the city of beggars, hawkers and prostitutes before the tourists arrive.

Much of the pageantry of the modern Games was developed by the totalitarian hosts. Nazi propagandists invented the torch relay in order to ferry Western journalists around idyllic German villages, in support of the Nazi’s rural ideology.

And the opening ceremony to the Moscow Games was reportedly the most expensive ever held, a gigantic billboardfor the social superiority of Soviet communism, setting the stage for the lavish ‘cultural’ ceremonies of the coming decades.

The Olympics offer totalitarian or otherwise oppressive governments an opportunity to repurpose the publicity accorded to sport for the benefit of the state and its ideology. The official website of the Chinese Olympic Committee is unambiguous about Beijing’s ideological content, advertising its National Fitness Program, which has been hard at work since 1995 ‘promoting mass sporting activities on an extensive scale, improving the people’s physique, and spurring the socialist modernisation of our country’.

The same website laments the attempted politicisation of the Beijing Games by ‘some Western forces’ and ‘separatists’.

For democratic states, the political purposes may be different, but they are still clear. In Sydney 2000, the government emphasised Australia’s tourist potential. Politicians wanted their country to be seen as more than just a ‘good source for raw materials—a perpetual cry of Australia’s economic interventionists.

Economic distractions

Part of the reason we be can sure that it is politics that is at the centre of governments’ relationship with the Games is because they cost a great deal but provide little economic benefit. Politicians eager to host the Olympics talk up their financial and social benefits — rhetoric which the IOC is more than happy to encourage.

The Olympic movement has had a turbulent economic history. For most of its history, the Games have been overwhelmingly supported by government finances, with corporate sponsorship and the sale of television rights playing a supportive role. This model of Games funding reached its zenith with the Munich 1972 and Montreal 1976 Olympics. But the City of Montreal ended its closing ceremony with a deficit of 2.7 billion dollars (in 2000 terms) which it only managed to finally pay off in 2006.

After Moscow 1980, the next Games held in a democratic nation were the Los Angeles Games of 1984, and following a significant protest movement, the citizens of LA refused to provide any public funds for staging the Olympics.

In 1984 there were no formal organisational links with the city, and the United States Olympic Committee managed to skirt IOC regulations which would have otherwise compelled them to provide public funds. As a consequence, the 1984 Games were the first to be fully paid by the private sector, with only minimal infrastructure upgrades and sport facilities provided by the city.

Successive games have managed to slowly reinvolve public financing, and the Sydney Games set a new standard in government involvement, when the NSW government and Commonwealth provided US$1 billion (in year 2000 dollars). For Beijing 2008, the Chinese government’s habit of trying to take credit for private investment makes it hard to properly account for the taxpayer’s contribution, but the Belgian analyst Gilbert Van Kerckhove conservatively estimated a figure of roughly $5-6 billion.

But what for? Supporters of the Games can cite a myriad of potential benefits of staging the Games. Few of them stack up. Tourism is the most common perceived benefit from the Olympics. Tracking the long term impact of the Games on a city’s tourist market is tough. In The Economics of Staging the Olympics, Holger Preuss argues that it is impossible to prove that the Sydney Games increased Sydney’s tourist market, as the impact of September 11 on the world’s tourist market muddies the evidence.

But September 11 occurred more than twelve months later and had worldwide, not Australia specific, impacts. Furthermore, as Preuss concedes, local tourism markedly decreased during the Games period. As an example, Sydney Zoo saw a 300 per cent decrease in tourism. Certainly, many studies — often commissioned by governments seeking to defend their policies — proclaim long term tourist increases to be in the hundreds of thousands.

But the causal link between a city hosting the Games is far from established. Calgary, site of the 1988 Winter Games, saw a 12 per cent decrease in tourism immediately following the Games, and a 10 per cent decrease the following year.

An increasingly common benefit claimed from the Olympics is infrastructure improvement. As the argument goes, staging the Games allows a city to conduct widespread infrastructure upgrades, avoiding the normal political bargaining required to achieve even modest investments. From this perspective, the hosting of the Olympics is merely an excuse to conduct the normal business of municipal government, allowing the city to upgrade its airports, road and rail networks and telecommunications services.

Undoubtedly, hosting the Olympics sparks a frenzy of big infrastructure projects. But a study by a group of RMIT University economists demonstrated that while overall the market did not respond to the announcement that Sydney was to host the Games, the only sector that did respond positively was the construction industry. Building firms — and politicians interested in basking in the bright light of political glory—are the only unambiguous beneficiaries of the Olympics, outside the athletes themselves.

But infrastructure disasters are common in the history of the Games — many projects, like the Montreal-Mirabel International Airport, while initially praised, are quickly revealed to be little more than boondoggles.

At their best, the Olympics are a government supported circus provided by politicians from democratic countries who want the world’s media to flock to their most attractive city. But at their worst, the Olympics have have provided totalitarian regimes with pre-packaged marketing programs, allowing them to paper-over serious human rights issues while they pretend to be enlightened members of the international community. The moral authority that the International Olympics Committee continues to claim has been repeatedly shattered by the experience of 100 years of the Olympic Games.

The Patriot Games

Is there anyone, anywhere, who believes Olympic bureaucrats when they declare that the Games are about athletics, not politics? Even the athletes themselves — standing upon the winners’ podium, draped in their national flag and singing their national anthem — must realise that the Olympics are actually undisguised geopolitics and taxpayer financed publicity stunts.

One need only look at the opening ceremony to realise that the Olympics are little more than an excuse for nation states to preen in front of each other like ostriches in mating season.

By August, the three largest totalitarian states of the 20th century — Nazi Germany, the USSR and China — will all have been Olympic hosts. Certainly, China’s appalling human rights record has improved since the Great Leap Forward. But providing dictatorships with a pre-packaged marketing program is hard to reconcile with the Olympic charter, which argues that the Games are to reflect “universal fundamental ethical principles”.

But everybody knows the torch relay has its origins in the Nazi Ministry for Public Enlightenment and Propaganda. Everybody knows how the USSR seized upon the Moscow Games, proclaiming that it was an acknowledgement of their fantastic record of maintaining world peace.

The relationship between totalitarianism and the Olympics is old news.

The modern Olympics have always been a potent mix of late 19th century nationalism and elite athleticism. The Olympics may now sparkle with the glitter of cutting-edge telecommunications infrastructure and high-performance sports apparel, but the Games have never quite shed their legacy of stern pseudo-militarism.

Even when peaceful liberal democracies host the Olympics, they are drenched with propaganda. As everybody remembers from last year’s federal election, democratic governments are always happy to spend gigantic sums on public relations. The Olympics are a publicity stunt on a colossally expensive scale.

Few of the other justifications for staging the Olympics stack up. Whatever jobs are “created” during the two weeks of events are quickly extinguished when the flame is.

Some Games supporters claim that staging the Olympics provides an opportunity to make much-needed infrastructure upgrades, particularly in transportation. Those who still hold this view clearly haven’t been to Sydney recently.

Others claim that the Olympic publicity encourages international tourism once the festivities are over. But we only ever hear politicians predict tourism bonanzas when they can’t think of anything else to say. What potential visitors were unaware of the existence of Athens, Beijing or London until they heard that those cities would be Olympic cities?

Whatever economic spillovers hosting the Games can bring, they nowhere near justify the enormous cost. If there is an economic benefit to staging the Olympics, then the economy hasn’t heard about it.

Looking at the impact of the announcement in 1993 that Sydney would host the Games, a group of RMIT economists concluded that the stock market didn’t budge at all. Only building firms saw their values rise.

The two biggest beneficiaries of the Olympics are politicians hoping to bask in the loving glow of the international media, and property developers looking for stadium contracts.

In Beijing, Chinese taxpayers have to support an event designed to glorify the Communist Party that has ruled over them for more than half a century.

But boycotting the Beijing Games is no more likely to pressure China into repairing its human rights record than granting them the Olympics did in the first place. There have been dozens of Games boycotts over the past century, and none have had any significant political impact.

In fact, political controversy has shared the stage with athletics at almost every modern Olympics. Even innocent Melbourne in 1956 was marred by boycotts — China withdrew because the Games committee recognised Taiwan, three countries withdrew because of Israel, and another three withdrew in protest at the Soviet invasion of Hungary. When the USSR played Hungary in water polo that year, the match resembled a pub brawl.

Boycotts and underwater fisticuffs may be rarer since the end of the Cold War, but politics still infuses every aspect of the Games.

The official website of the Chinese Olympic Committee is unambiguous about Beijing’s ideological content, advertising its National Fitness Program, which has been hard at work since 1995 “promoting mass sporting activities on an extensive scale, improving the people’s physique, and spurring the socialist modernisation of our country”.

In the same breath — or, at least, on the same page — the website laments the attempted politicisation of the Beijing Games by “some Western forces” and “separatists”.

Remember the tedious controversy about non-Australian marching bands in the Sydney opening ceremony? Every moment of the Beijing Games will be stage-managed to shed the best light on a dictatorship that has more than 4000 domestic political prisoners.

So, rather than pretending that politics can be hidden under the woolly feel-goodness of the officially prescribed “Olympic Spirit”, we should encourage the Games’ politicisation.

The Chinese Government is welcome to its publicity stunt, but while the country is under the full glare of the world’s media, there is probably no better time for demonstrations and counter-stunts.

Despite their lofty ambitions, the Olympics have never brought world peace. Nevertheless, if the press corps manages to outflank China’s propaganda machine, they might be able to turn this expensive political advertisement into something good for human rights.

Don’t forget — it’s not about the sport.