LOS ANGELES—Even with an $11 billion in economic output and tens of thousands of jobs, the Olympic Games aren't a guaranteed win for the City. In fact, the cost of the Olympics is so significant, it is often a burden for the host city. However, Los Angeles is in luck. With little to no new infrastructure needed and the promise that no public money will be used, the City of Los Angeles will likely break even after the Olympics.
“There is a benefit to the local economy and it is measured in billions of dollars and tens of thousands of jobs that will be created,” Robert Kleinhenz, executive director of research at Beacon Economics, tells GlobeSt.com. “There are some true economic benefits. The question is: will the Olympic Committee be able to meet the cost [of the Olympics] with these benefits to at least break even. They have promised to do so, and that was one of the hallmark achievements of the 1984 Olympics. They have created a way to cover all of the costs, and that would be the best way to determine if this would be a net benefit.”
Kleinhenz believes that the Olympic Committee won't need to use public funds because of the strong infrastructure already in place—especially since Los Angeles hosted the Olympics in 1984, and followed the same structure. “It really does boil down to weather or not there was infrastructure built for the Olympics and the extent to which that infrastructure has a useful life after the Olympics were over, and whether or not the public had to ante up any of the funds,” adds Kleinhenz. “Those are really the things that determine if an Olympics can be a success or a failure.”
The success of the Olympics isn't only about infrastructure. Kleinhenz says that the city's vow not to spend any public money will also help keep Los Angeles in the black. “Aside from the fact that we won't need any new infrastructure, the Olympic committee is also emphasizing that no public money will be used to cover the costs,” says Kleinhenz. “It is expected that neither the city nor the state will incur any expenses.”
LOS ANGELES—Even with an $11 billion in economic output and tens of thousands of jobs, the Olympic Games aren't a guaranteed win for the City. In fact, the cost of the Olympics is so significant, it is often a burden for the host city. However, Los Angeles is in luck. With little to no new infrastructure needed and the promise that no public money will be used, the City of Los Angeles will likely break even after the Olympics.
“There is a benefit to the local economy and it is measured in billions of dollars and tens of thousands of jobs that will be created,” Robert Kleinhenz, executive director of research at Beacon Economics, tells GlobeSt.com. “There are some true economic benefits. The question is: will the Olympic Committee be able to meet the cost [of the Olympics] with these benefits to at least break even. They have promised to do so, and that was one of the hallmark achievements of the 1984 Olympics. They have created a way to cover all of the costs, and that would be the best way to determine if this would be a net benefit.”
Kleinhenz believes that the Olympic Committee won't need to use public funds because of the strong infrastructure already in place—especially since Los Angeles hosted the Olympics in 1984, and followed the same structure. “It really does boil down to weather or not there was infrastructure built for the Olympics and the extent to which that infrastructure has a useful life after the Olympics were over, and whether or not the public had to ante up any of the funds,” adds Kleinhenz. “Those are really the things that determine if an Olympics can be a success or a failure.”
The success of the Olympics isn't only about infrastructure. Kleinhenz says that the city's vow not to spend any public money will also help keep Los Angeles in the black. “Aside from the fact that we won't need any new infrastructure, the Olympic committee is also emphasizing that no public money will be used to cover the costs,” says Kleinhenz. “It is expected that neither the city nor the state will incur any expenses.”
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