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Chicago 2016

The Tail Is Already Wagging Our Dog

By ALLEN R. SANDERSON
   With about a year to go before the International Olympic Committee (IOC) selects from among Chicago, Madrid, Rio de Janeiro and Tokyo for the honor of being the host city for the 2016 Olympic Games, there are strong signals that Chicago will prevail—perhaps in a cakewalk—in the October 2, 2009, Copenhagen vote.
   Sports betting markets, populated with folks who are wagering with their own money and thus have a personal financial stake in being right (as opposed to those who spout “free” opinions on sports-talk radio or in the press) make Chicago the overwhelming favorite. Complementing that are sentiments from informal cocktail-party exchanges and tea leaves.
   Continuity inherent in a Barack Obama victory next month, coupled with the likelihood of Richard M. Daley still being the mayor in eight years, might put risk-averse IOC voters more at ease and trump the natural sympathy for Rio—the games have never been held in South America—and Chicago’s new-kid-on-the-block status among more familiar locales and faces.
   In addition, the IOC itself, never one to leave money on the table, can expect to rake in much more from a bidding war among American broadcasters for the 2016 rights  if the games are held in the United States.
   Thus many, though not all, signs are pointing increasingly toward Chicago.
   However, there are also ominous signs that the attempt to “stir the soul” (Chicago’s motto or tag-line as a candidate city) will end up stirring wallets, as well.
   When a teacher’s union and its members want more money or less work, they always couch the appeal as being “for the children.” When ardent environmentalists or their minions in Congress push their pet agendas, it’s, of course, “to save the planet.” Anti-government stances and excessive appeals to patriotism are the counter-parts from the other side of the political aisle.
   Already, even before Chicago submits its revised bid in February or welcomes IOC delegates in the spring, City Hall rhetoric, negotiating patterns with special-interest groups and proposed public policy initiatives, from CTA renovations to Buckingham Fountain upgrades, almost invariably now carry the “it’s for the Olympics” justification.
   Sensible long-term urban planning, whether it be for the grossly overused feel-good term “infrastructure” or to begin to address some consequences of rising income inequality with the development of affordable housing, should not be based on a two-week party seven years from now. The (re)configuration of the network for rail lines, improvements to parks and roadway and the location of other civic amenities should be largely independent of whether Chicago plays host in 2016 or not.
   In terms of dogs and tails, or carts and horses, we should have asked at the outset and must continue to ask as we proceed down these paths, “How would the Olympics fit into our overall game plans?” and not, “How can we modify our plans to accommodate a stadium located here and a swimming pool over there?” For example, absent the Olympics, is the area designated for the athletes’ village (and subsequent conversions) the best long-term use of that prime real estate? Are South Side residents clamoring for a 10,000-seat amphitheater?
   One of the least important components of 21st century life in the city is being given far too much weight in the determination of the most important features. The 2016 Games should be an afterthought, not a forethought.  Using the deadline of an upcoming dinner party as an excuse to finally clean one’s home is not a sound management strategy.
   Olympic facilities in Sydney (from the 2000 Olympics) and Athens (the 2004 Summer Games) remain woefully underutilized and constitute significant on-going financial drains for maintenance. Without a permanent tenant, even Beijing’s national stadium, the Bird’s Nest, will follow down that same path shortly. With a little luck, for Chicago, the net cash flow from being the host city could be positive, but also very small in comparison with other public “investments”—in politics, governments invest while private citizens only spend or waste—over the next decade.
   The decision to renovate Soldier Field, a hideous, obsolete, dysfunctional facility that with Valium and a little foresight could have served as a permanent location for the opening and closing ceremonies (and track & field events) in 2016, as well as a much better long-term home for the Bears and the venue for future Super Bowls, NCAA Final Four games and other big-ticket events. Cost-overruns that more than doubled the reconstruction outlays for the Dan Ryan Expressway or Millennium Park mean that other state or city improvements had to be postponed or eliminated. This should give us pause and concern. Private contributions to plug deficits are not a no-tax-dollars-were-used escape contingency because they entail the economist’s familiar “opportunity cost” refrain:  regardless of the source, money given for X is not available for Y.
   Daniel Burnham exhorted us to “make no little plans.” The admonishment not to make huge, unwise ones is equally applicable. In the past half- century, the ex ante promises of most Olympic Games far surpass the ex post reality.  May Chicago go for the gold, not the bronze—or tin.

Published: October 11, 2008
Issue: November 2008 Investing In Chicago