Von Ripper-off, a.k.a. IOC President Thomas Bach, and his attendants have a bad habit of ruining their hosts, like royals on tour who consume all the wheat sheaves in the province and leave stubble behind. Where, exactly, does the IOC get off imperiously insisting that the Games must go on, when fully 72 percent of the Japanese public is reluctant or unwilling to entertain 15,000 foreign athletes and officials in the midst of a pandemic?
The answer is that the IOC derives its power strictly from the Olympic “host contract.” It’s a highly illuminating document that reveals much about the highhanded organization and how it leaves host nations with crippling debts. Seven pages are devoted to “medical services” the host must provide — free of charge — to anyone with an Olympic credential, including rooms at local hospitals expressly reserved for them and only them. Tokyo organizers have estimated they will need to divert about 10,000 medical workers to service the IOC’s demands.
Eight Olympic workers tested positive for the coronavirus during the torch relay last week — though they were wearing masks. Less than 2 percent of Japan’s population is vaccinated. Small wonder the head of Japan’s medical workers’ union, Susumu Morita, is incensed at the prospect of draining mass medical resources. “I am furious at the insistence on staging the Olympics despite the risk to patients’ and nurses’ health and lives,” he said in a statement.
Japan’s leaders should cut their losses and cut them now, with 11 weeks left to get out of the remainders of this deal. The Olympics always cost irrational sums — and they lead to irrational decisions. And it’s an irrational decision to host an international mega-event amid a global pandemic. It’s equally irrational to keep tossing good money after bad.
At this point, money is the chief reason anyone is even considering going forward with a Summer Games. Japan has invested nearly $25 billion in hosting. But how much more will it cost to try to bubble 15,000 visitors, with daily testing and other protocols, and to provide the security and massive logistics and operating costs? And what might a larger disaster cost?
Suppose Japan were to break the contract. What would the IOC do? Sue? If so, in what court of justice? Who would have jurisdiction? What would such a suit do to the IOC’s reputation — forcing the Games in a stressed and distressed nation during a pandemic?
Japan’s leaders have more leverage than they may realize — at the very least, they are in position to extract maximal concessions from the IOC for hosting some limited or delayed version of the Games, one more protective of the host.
The predicament in Tokyo is symptomatic of a deeper, longer-lasting illness in the Olympics. The Games have become a to-the-very-brink exercise in pain and exhaustion for everyone involved, and fewer countries are willing to accept these terms. Greed and blowout costs have rendered it an event that courts extreme disaster. In September, a report out of Oxford University’s business school found that the IOC has consistently “misled” countries about the risks and costs of hosting. Example: The IOC pretends that a contingency of about 9.1 percent is adequate to cover unforeseen expenses.
The true average cost overrun on a Summer Games? It’s 213 percent.
The IOC understates these risks for a reason: because fewer and fewer countries want to do business with it after seeing all the pillage.
The IOC intentionally encourages excess. It mandates elaborate facilities and events for the sake of revenue, most of which it keeps for itself while dumping the costs entirely on the host, which must guarantee all the financing. The IOC sets the size and design standards, demands the hosts spend bigger and bigger — against all better judgment — while holding close the licensing profits and broadcasts fees. Tokyo’s original budget was $7 billion. It’s now four times that.
In the Oxford paper, “Regression to the Tail: Why the Olympics Blow Up,” authors Bent Flyvbjerg, Alexander Budzier and Daniel Lunn observe that the Games dwarf every other national building project on earth in terms of cost blowouts — even mega-dams and tunnel digs. The ever-increasing complexity and expense, and the long window of planning (seven to 11 years) make them a project with high uncertainty that can be affected by everything from inflation to terrorist threat and “the risk of a big, fat black swan flying through it.” The Rio Games, held in 2016 in the midst of brutal economic downturn, were 352 percent over their original budget. And these blowouts are “systematic,” not happenstance.
“Either the IOC is deluded about the real cost-risks when it insists that a 9.1 percent contingency is sufficient, or the Committee deliberately overlooks the uncomfortable facts. In either case, host cities and nations are misled,” they write.
This is why virtually the only government leaders that will have anything to do with the IOC anymore are thugocrats such as Vladimir Putin and Xi Jinping, who can coerce labor and spend limitlessly for prestige. Over the past 20 years, other potential hosts have dried up. Among those who have wisely said no to the IOC: Barcelona, Boston, Budapest, Davos, Hamburg, Krakow, Munich, Oslo, Rome, Stockholm and Toronto. Los Angeles Mayor Eric Garcetti, who wrested away key concessions from the IOC for the 2028 Games, has observed that most cities “will never say yes to the Olympics again unless they find the right model.” This is where the barons’ gluttony has led them.
All of this should empower Japan’s leaders to do whatever is best for themselves and their own people. When the Games reasonably could be portrayed as a source of international tourism revenue, perhaps some of the expense could be justified. But now the costs to the Japanese people run much deeper than financial. If ever there was a time and place to remember that the IOC is a fake principality, an oft-corrupt cash receptacle for peddlers with pretensions of grandeur, this is it. The IOC has no real powers, other than those temporarily granted by participant countries, and Japan owes it nothing. A cancellation would be painful — but cleansing.