The original plans are one thing, reality is another. Although the operating budget for the games is estimated at approximately $2 billion, this amount is only the tip of the iceberg. According to current estimates, the total cost, including massive investments in infrastructure, is approaching seven billion dollars, with public funds covering approximately 63 percent of these expenses.
Although the organizers boast that they have used 92 percent of existing or temporary sports facilities, history warns us. The average budget overrun for Winter Games has recently reached a staggering 156 percent. In addition, Italy is struggling with inflationary pressures that are already increasing the costs of key projects, such as the reconstruction of the bobsleigh track in Cortina and the construction of ice hockey arenas.
Supporters of the Games often cite so-called multiplier effects—the vision that every euro invested in infrastructure will generate additional profits in tourism and services. According to some analyses, the Games could bring up to €5.3 billion to the Italian economy in the long term.
Academic studies temper this optimism. They point to the "crowding-out effect." While fans come, ordinary tourists avoid overpriced and overcrowded locations.
Studies following the 2006 Winter Olympics in Turin also showed that although tourism in the area increased, there was a significant increase in municipal debt per capita, while key indicators such as unemployment and real GDP did not improve significantly.
As a result of the games two decades ago, Turin is now one of the most indebted cities in Italy. Anyone who thinks that twenty years is a long time should know that Rome was still paying off its debts incurred in connection with the 1960 Summer Olympics until recently.
The verdict of academics is clear: most independent studies confirm that the real economic impact of the Olympics is either close to zero or only a fraction of what is predicted.
The real winner of the Olympics is rarely the host city. While the International Olympic Committee collects billions from broadcasting rights and sponsorship, the costs of maintaining "white elephants," i.e., unused stadiums, remain on the shoulders of local officials.
Hosting the Games is often more a matter of national pride, political marketing, building monuments to ruling politicians at the expense of taxpayers, and, in addition, often a "pass" of public resources to friendly companies, such as construction companies.
For the average taxpayer, it is an "entry fee" to a prestigious club that will probably never return to their wallet. The real losers are the public budgets of the host cities, which will be dealing with debts for years after the Olympic flame has been extinguished.
The text was originally published on the website lukaskovanda.cz.