Mar 1, 2010

Costs do matter!


Admittedly, I’ve been over 4000 kilometres away from the frenzy on Robson Street for the last two weeks and more. Nevertheless, I still can’t buy into the new found enthusiasm for the Olympics. True, the men’s hockey final was spectacular, and I enjoyed it as much as anyone, celebrating with a margarita at a favourite bar looking out to Isla Carmen in the Sea of Cortez. It’s just I don’t go along with those who say the Olympics were worth it, whatever they cost.

I would feel better about that benefit-cost assessment if government at any level had been willing to fess up to the costs. But that accounting is yet to be done. I would also find it more compelling if the economic arguments put forward to justify the Games were not so patently false. The Games, much like our own Liberal and U.S. Republican tax cuts, do not pay for themselves. There are positive impacts and enduring infrastructure from the Olympics, but there is no credible evidence that they have a value anywhere what they cost.

I know economics really is a dismal science, and not much of a science at that, but if there is one thing that it teaches us is that there are opportunity costs. A dollar (or several billion as the case may be) invested for one thing cannot be invested elsewhere.

Street parties are great. Crazy booming business even if limited in time and space can be pretty good too. But in the end what do we have. And what could we have had if we committed anywhere near the same resources to something else. That is the question we have yet to seriously address.

It’s too late for us. You can’t undo what has been spent and done. But you certainly can help those in other countries make more informed choices, especially those in poorer countries that can less easily mask their mistakes.