How To Make The World Cup, Olympics, And Super Bowl Cheaper To Host


I finished Monday’s post about the absurdly high cost of the Sochi Olympics with a fairly important question: if mega-events like the Olympics, Super Bowl, and World Cup fail to bring economic benefits to their host cities and also often fail to paint those hosts as attractive places to visit and spend money, “how do we change the way these events are sold and delivered to the public to prevent similar problems in the future?”

Over at Salon, Alex Pareene has a proposal that might help answer that exact question. Instead of rotating these events to different cities every year (in the case of the Super Bowl) or to new countries every four years (in the case of the Olympics and World Cup), Pareene says the organizing bodies should build permanent host sites devoted to putting on these major sporting events. For the Super Bowl, he proposes building a big host site in the desert outside Las Vegas where “[t]he league can build its little Super Bowl village with its NFL Experience stuff, and keep it up all year, a whole little town dedicated to the majesty of football.” For the Olympics, he proposes picking two countries, one for the Summer games and one for the Winter games (he proposes Japan and Australia). He concludes:

It is time for sports to stop victimizing our cities. If holding big events in the same place every time is good enough for tennis and golf it’s good enough for American football and the Olympics. Please call your congressperson or member of Parliament or whatever you have today.

I like this idea, though I’m not sure hosting every Olympics (or World Cup, which Pareene leaves out) in the same spot is the right choice if we actually want anyone to consider such a plan or want it to work. The IOC and FIFA are corrupt enough when it comes to the current bidding process, in which any country can try to win one of these events. Any process that would attempt to settle on a single host for the rest of time, then, would be an absolute nightmare. The NFL isn’t going to go anywhere within shouting distance of Vegas because of gambling concerns, and building an entirely new site doesn’t strike me as the best idea anyway.

But it’s still a good start. So in an attempt to make it a little more palatable to the major organizations, here’s my proposal, which would create a permanent host for the Super Bowl and a rotation of host cities for the bigger events (NB: the following cities are hypothetical and could be substituted with others):

Put the Super Bowl in Miami: Miami has hosted more Super Bowls than any other city except New Orleans, and if the Super Bowl — a large, corporate party with no inhibition that only pretends to care about the football game at the center of it all — was a city, it’d be Miami. Dolphins owner Steven Ross wants to upgrade Miami’s SunLife Stadium for the explicit purpose of holding Super Bowls. Instead of forcing taxpayers to foot the bill, Ross could pay for it all in exchange for getting to host the Super Bowl for the next however many years. Miami is easy to get to, and unlike New Orleans, its stadium is outdoors, where football should be played. The Pro Bowl has a permanent location. Why shouldn’t the end of season spectacle people actually care about have one too?

Rotate the World Cup between the United States, England, Brazil, and South Africa, all countries where the infrastructure is or will be in place and all places where soccer is either madly popular or heading that way. England and the United States both have plenty of stadiums to host the World Cup at a minimal cost — when both bid on the 2018 and 2022 World Cups, neither proposed new stadium construction as part of it. The strength of the Barclays Premier League means that English stadiums will remain in top shape without major FIFA maintenance expenditures, and the NFL ensures that the same is true in the U.S. Brazil is having its trouble now, but by the end of the 2014 World Cup it too will have stadiums in place that will need to be used in the future. Plus, South America deserves to be in the rotation for the world’s biggest soccer tournament, and Brazil is the most able country on the continent. South Africa spent billions of dollars to host in 2010 but now has no domestic league or anything else that can regularly use the stadiums it built for it. Africa needs to be included because none of the power brokers want to cut it completely out of the process, and putting a World Cup in South Africa every 16 years makes more sense than trying to host an Olympics there.

Rotate the Winter Olympics between Vancouver, Nagano, and somewhere in Europe. Vancouver and Nagano are both recent Olympic hosts, and both are natural fits in a permanent rotation, though Nagano has since converted many of its facilities into mixed-use recreational sites. In Europe, there are plenty of options, whether in Scandinavia — Lillehammer, Norway hosted in 1992 and other Scandinavian cities have bid before and since — Switzerland, France, or Italy, where Turin hosted the 2006 Games. The cost of the Winter Olympics is relatively small or at least should be (Sochi notwithstanding), so even rotating it among a few more Asian, European, and North American cities (Salt Lake City may bid again soon) that already have most of the infrastructure in place wouldn’t be a terrible idea.

Rotate the Summer Olympics between London, Sydney, Beijing, and Rio, which by 2016 will have combined to host four of the past five Olympics. All of these countries have most of the necessary Olympic infrastructure in place, though the conversion of their major stadiums after the Games were gone would pose some problems. Yes, China has human rights concerns that caused major controversy during the 2008 Games, but fixing those and other problems (like pollution) could be a condition for including it in the rotation. And while Rio de Janeiro is having cost problems now, promising that it would host future Olympics would make the amount it is spending on the 2016 Games easier to stomach.

The benefits to finding permanent hosts, whether one as Pareene suggests or a small rotating group as I do, would be enormous. “Either fix a single host city/country or a small number of hosts and you save on the infrastructure costs,” College of the Holy Cross sports economist Victor Matheson said.

Because these cities and countries would know they would host regularly, development would be geared toward sustainability as opposed to producing lavish facilities meant to look pretty for television just once. Those bobsled tracks, velodromes, and Olympic-sized swimming facilities would get used more than once, keeping them from becoming a total waste of money. And because the sports infrastructure would be in place in these host cities, it would give the cities time to make the other infrastructure improvements that are often supposed to accompany these events but rarely do.

Yes, the list I proposed is heavily biased toward the world’s large, powerful countries, but it is done so purposefully. Research shows that the Olympics and World Cup don’t have major positive economic benefits, so these large, wealthy countries can at least absorb the costs of these events with minimal financial difficulty. Many of the excluded countries would surely complain, but they should recognize instead, Matheson said, that “the chosen countries are doing the non-hosts a favor” by taking on the costs of hosting these events.

Of course, each of those reasons Pareene and I view as positive are negatives for the NFL, IOC, and FIFA. The NFL uses the Super Bowl as a carrot to get taxpayers to put forth more money for stadiums (see: Miami, New Orleans, Dallas). A permanent host plan would also “cut down on [FIFA and the IOC’s] ability to extract huge concessions from the host,” Matheson said, gutting the financial gains those organizations make from spreading the events around the globe. As University of Michigan economist Stefan Szymanski has told me before, these events are as much about legacy as anything else: FIFA and the IOC love to point to stadiums and take credit for their construction. A permanent host plan would restrict their ability to do that, especially in countries like England and the U.S. where the stadiums exist primarily for other purposes.

There are other alternatives too. We could continue not to care about how much is spent on these events, or countries could band together and refuse to pay the high prices these events demand. Or the IOC, FIFA, and NFL could be honest about the economic realities of these events, making it clear that the Olympics, Super Bowl, and World Cup have social and health benefits for their host cities but won’t provide an economic boon. That honesty could itself drive down costs if citizens responded by asking their governments to spend less to win and host these events. That honest approach, though, is even more unlikely than the adoption of permanent hosts for each of these events.

IOC officials this week said that the high cost of the Sochi Games would force them to consider alterations to improve the bidding process, but anything as radical as permanent hosts (or a rotation of hosts) won’t likely be part of that conversation, even if it would make sense. It’s easy for economists and writers like myself and Pareene to look at this process and decide it’s broken. For the people and organizations in charge, though, the Olympics, World Cup, and Super Bowl are all working exactly the way they are supposed to.