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Why Can’t We Privatize the Olympics?

The Olympics, viewed through a pair of liberty-tinged glasses, is a pretty bizarre event.

Every four years some government in some country or other steals billions of dollars from its citizens and spends it on sports which, for the most part, none of them seem to actually care about at any other time of year. In doing so, they create not an angry, aggrieved populace, but rather an occasion for national celebration and something in the region of the most watched event in TV history.

rio stadiumsThis year, rumblings of discontent have been have been a little louder than usual, perhaps because the uncomfortable juxtaposition of Brazil’s favelas against the lavish superfluity of the Olympics makes it just that little bit more obvious that governments should probably be giving their tax dollars to poor people, not construction companies. But still, I haven’t seen many people calling for an end to the whole thing.

This, in many ways, provides a nice illustration of the process by which ‘public goods’ of the entertainment product variety come to be seen as such. Armed with a zealous belief in the special value of their own hobbies and healthy dose of self-interest, the International Olympic Committee and a conglomerate of other interest groups have convinced the public that this event is a non-excludable public good, and therefore the use of force is necessary to ensure that it is provided appropriately.

Unlike most other ‘public goods’ of this kind, however, the Olympics would hardly disappear if governments stopped funding it. In light of its extraordinary success, it would seem that a very similar event could be provided privately at a substantial profit. Indeed the city of Los Angeles actually did turn a profit when they played host in 1984. But of course, left entirely in private hands, the event would be trimmed down to those components which people are actually willing to pay for, and some of the less spectacular events and less crucial infrastructural projects would no doubt be cut.

Logically speaking, the argument against privatization therefore rests on the notion that those components which are not commercially viable are of crucial importance to the event’s special value – a pretty implausible idea I think. That the Olympics just would not be the same without the modern pentathlon or synchronized swimming or that it would be ‘unfair’ to exclude them, but yet, that none of the hundreds of other minority sports out there are required in the same way is not a completely indefensible idea, but it does seem pretty far-fetched.

So what could actually explain why privatizing the Olympics would be such an unpalatable, even offensive idea to so many people? One thought is that, like most other government projects, the costs of the Olympics are made to seem intangible while the benefits are more immediately apparent, making it easy for people to passively support that which they would never explicitly agree to. The traditional public good argument implies that, presented with a bill, the vast majority of people would be happy to pay provided that everyone else would be forced to do so as well. And maybe they would. After the London Games, 80% of Brits thought the event had done ‘a valuable job in cheering up a country in hard times’. But would everyone be so enthusiastic if they were each presented with an Olympic bill of 125 pound sterling? (my crude estimate of the cost per head).

‘Public goods’ are also apt to come cloaked in the emperor’s new clothing. Contrarian spoilsports like myself aside, few will consider it worthwhile to stand up and loudly proclaim that they aren’t really feeling this whole ‘Olympic spirit’ thing, and while we’re at it, no they have not been ‘enriched’ by that museum down the road. It’s easier just to nod and agree that these things are wonderful public services. Then there’s what Milton Friedman called the tyranny of the status quo; the government is funding this project, therefore they should be funding it. Any proposed changes are ‘extremist’ and therefore wrong. Or so a popular form of reasoning seems to imply.

Perhaps most crucially, the Olympics thrives on an idealized notion of political representation. One which goes beyond the idea of political authority – i.e. that government can legitimately act in a manner which would be unacceptable for anyone else (thoroughly debunked by Michael Huemer in this great book!) – towards a view of government as being somehow inextricably linked to a concept of national identity. Accordingly, it would simply be improper for a private company to host the Olympics. How could they possibly stage the opening ceremony?

This sense of political representation is not necessarily any worse than plain old nationalism (the Olympics’ heavy promotion of which arguably renders it an anti-public good on a global scale and therefore worthy of being taxed not subsidized) but it does create its own special kind of absurdity. It fuels a notion that the government ought to do certain things not just because it would be in the national interest, but simply because they are the government. It’s as though the government is some kind of beautiful poem, brought vividly to life when it performs certain ceremonial functions.

‘Brazil is hosting the Olympics this year’ you’ll hear people say. Libertarians who feel like pompously lecturing, their family and friends should respond that, no, the Brazilian government are hosting the Olympics, and they’ve stolen a lot of money to make it happen.

* Eoin Perry is an economics and philosophy student at University College Cork, Ireland. In his free time, he enjoys complaining governments.

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