Posted on 09/14/2004 7:55:53 AM PDT by Loyalist
London — After a summer of fun, Games and frantic spending on the world's largest party, the people of Greece are waking up this week to an Olympic hangover of truly gold-medal proportions.
Greeks were proud of an Olympics that took place on schedule and without any serious security or organizational threats, but they are now learning the true cost of all that last-minute construction and street cleaning: a bill that could cripple the country's economy for a generation.
Greek Prime Minister Costas Karamanlis conceded yesterday that the country's deficit has soared faster and higher than that of any European country, reaching four times its projected level and twice the legal limit allowed for European Union member countries.
In response, the bond-rating agency Standard & Poor's lowered the country's debt-rating outlook from "stable" to "negative" yesterday, blaming "an accelerating loss of fiscal discipline" partly related to the Games. The agency declared Greece's fiscal position the weakest of any major European economy.
Mr. Karamanlis placed the blame squarely on the Olympics. The scramble to get a half-dozen stadiums finished in time for the August games rang up billions in overtime costs, and security and terrorism-prevention costs were five times as high as the pre-Sept. 11 games in Sydney, Australia.
"A large part of Olympic, social and other spending was not written up in the budget. . . . The public debt exceeds even the most pessimistic of estimations," he said, laying much of the blame on the moderate-left Socialist Party, which his right-leaning party defeated in March. "The real deficit was not recorded."
The Games, which cost Greek taxpayers at least $10-billion, are credited with at least a fifth of the soaring debt. Total Greek public debt has now reached 112 per cent of the country's gross domestic product, which amounts to $75,000 for each Greek household.
By contrast, Canada's debt peaked at 68.4 per cent in the mid-1990s, prompting huge cuts in federal spending.
While Greek politicians had optimistically promised a tourism-driven economic boom and an improved standard of living in the wake of the Games, the opposite seems to be taking place. The International Monetary Fund predicted a period of contraction: "Underlying fundamentals suggest the economy may slow materially in 2005."
A harsh period of fiscal austerity and reduced ambitions was predicted yesterday, with both the IMF and the Organization for Economic Co-operation and Development declaring that Greece will have to slash wages and social spending if it is to remain competitive enough to earn its way back into prosperity.
Greece has now joined a large club of governments that have been economically crippled by playing host to the Olympic Games. The most famous member is Montreal, whose municipal bill for the 1976 Olympics is not expected to be fully paid until 2006.
Mr. Karamanlis acknowledged that repaying the Olympic debt would entail sharp cuts to public services -- an awkward move, as the Games were sold to the Greek public as an economy-building event that would raise their standard of living. The Prime Minister tried to describe the cuts in optimistic terms.
"We will implement radical tax reforms that support investment . . . a new development law that helps small and medium enterprises flourish . . . new business frameworks that cut down bureaucracy," he said. "We will make good use of the post-Olympic period and promote our country's competitive advantage in combination with the new investment-friendly environment that we are creating."
However, the only concrete moves he announced were the sale of a government-run savings bank, a cut in military spending and an attempt to privatize Olympic Airlines
The Olympics should have a permanent venue, and all participating nations should contribute towards the costs of the event beyond their own teams' expenses.
Thoughts?
I disagree- you are proposing GOVT CONTROL of yet another stupid spending hole.
Greece did a fantastic job, by all accounts, but they did not spend within their means.
Poor Planning on their part does not constitute and emergency on MY part.
It would never fly.
The Olympics are more about politics than sport. That is not the way it should be but that is the way it is.
If there is a permanent site, it should be in Olympia, Greece.
Who needs them? You already have the World Games, Pan Am Games, etc.
Perhaps $150 hotel rooms that were going for $1,500 had a lot to do with people staying away from Greece during the Olympics.
Screw the Olympics. Let the people who play in them and the spectators pay for them. Such an incredible waste of money and effort.
I think the only answer is to spread the Olympics over several countries, like they did with the last World Cup which was shared between Korea and Japan. Different countries can host different events. This would especially work in Europe where countries are small. Even when the games are held here, they are spread out between several states. Economically it's the only thing that makes sense.
"and twice the legal limit allowed for European Union member countries. "
Does this mean Greece will have to pay fines on top of this ?
Sound good.
KEEP IN MIND the Britsh papers have been BRUTAL in condeming the Greek games. It was all the usual suspects.
One Reporter was even caught getting in LEGALLY through security and then claiming he got into the venues ILLEGALLY.
Could it be due to the March 7 election that booted the socialists?
Give the Greeks the Games in 2012, they would make money...
No way. The US would end up footing the bill. I find the Olympics tedious--so do many. I do not understand why any city would want to host them--they may enhance pretige (??) but are moneylosers.
Actually it was all very well planned. The did spend within their means and did seek the outside help.
It is ALSO worth noting that Greece has had the only EU country with a GROWING ecconomy even without factoring in the Olympics.
There is more here than just Olympic spending.
Something stinks in Denmark...
Actually it was more 450 US a night. People who were foolish enough to stay away were those who were afraid of security not cost.
I was there, the stores were PACKED the clubs were PACKED and it was a kickass good time.
That is what happens when Political Correctness overshadows all common sense.
There was NO olympic event! There was a massing of self-serving snobs. There was no Pomp & Circumstance just displays of .... what can you call that ridiculous march of video cameras with occasional flags that took the place of the display of PRIDE in your country?
This one olympic display that I only watched less than FIVE minutes total! I will never bother to even turn one one again.
Or was that the real reason for this sordid display?
A sort of sports Vatican - someplace close to sea level, with a temperate climate bordered by stable nations (the Winter olympics is somewhere else...). Particpating nations build their own dorms and practice areas or rent the the same.
Give it its own little army for security... Gurhkas and ex-SAS?
This is important.
ATHENS and Greece had very limited infrastructure. In the span of 6 years they built 100 years of infrastructure. Projects that would have taken decades to plan and finish were approved and built.
Greece has new telecomunications, Metro system that is useful, AND an national highway systen AND a MODERN airport. No more walking down the stairs to the tarmac.
THIS need to be considered, they did not just build a few state of the art venues.
Greece also is a tourist ecconomy similar to FL. Not all but much of it, Given the glowing praise fo the viewers it will provide benefits for decades to come.
Most in the states did not see the final hour of the closing ceremony because NbC cut away. It was a BLAST, dancing cheering and THEN most went on to party in athens until they absolutly had to go to the hotel pack and leave. (sleep on the airplane)
The british media is just doing a hatchet job. Who do they think they are, Dan Rather?
IMHO, if not entirely self-supporting, the Olympics are/is a waste. I couldn't care less if it stopped happening altogether.
You asked. :-)
I was in the boxing venue cheering when the American beat the Cuban. (certainly shut up those cuban cheering Iranians) It was just sport.
You really have to attend one to understand just how reaaaaly neato it is to be in an olympic city and celebrating in an olympic city.
The Games, which cost Greek taxpayers at least $10-billion, are credited with at least a fifth of the soaring debt.
This means, of course, that 4/5ths of the debt went to something else.
I can't blame this on the Olympics, then, and the whole point of the story is lost.
Oops.
Anyone know how much the broadcast rights sold for? Seems to me the Olympics should cost no more to put on than the sum of ticket sales + broadcast rights.
I think the real problem was light attendance. I remember reading a Wall Street Journal story saying that many tickets were going begging. I think many people expected more of a boom than was warranted by the facts.
You might want to remember that the 1984 Olympics in Los Angeles were a financial success.
Maybe the real lesson is that the Olympics should always go to a country with existing facilities instead of building things just for the Olympics.
D
if they couldnt handle the costs etc. they shouldnt have applied for the games to be held there. since they did they must have thought it would be good for them. if they screwed it up its their problem, and it was there's to loose.
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