By: Lynn Reaser
The Winter Olympic Games will start shortly in Russia and questions have again surfaced as to whether the benefits will come anywhere close to the costs.
Sochi expenses will exceed those of all previous winter Olympics combined since 1924 even after accounting for inflation. Security costs in the disputed Caucasus region, aspirations of extravagance, and corruption have more than quadrupled costs from estimates made in 2007 when Russia was awarded the games.
The current $50 billion estimate will far exceed benefits, which could be either hard dollars such as tourist spending, or an intangible lifting of national prestige. Few travelers are likely to attend both because of security concerns and per person weekly costs of $7,000-$14,000. Visions of a “new Russia” have been supplanted by views of violence and corruption.
Hopefully, the games will go well and will be enjoyed by athletes and observers from around the world. Sadly, for the Russian people, they are likely to be a large economic loss.