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The Olympic Games have become a cherished tradition for millions of people all over the world. There is something special about a country uniting over one common goal: winning a gold medal at the Olympic Games. As incredible as the Olympic Games may seem to the viewers at home, the host countries often have an unpleasant experience with Olympic preparations. A country will work for over a decade to prepare for the games, and at the end of the Olympics, most host countries are stuck in debt. As Japan prepares its capital city, Tokyo, to host the 2020 Summer Olympics, they may be realizing they are going to lose more money than they will gain by hosting the Olympics.
The best way to see the dramatic losses incurred by host countries is to look at the current economic situations of past host countries. Before the 1970s, the Olympic games were publicly funded, allowing for the host countries to incur fewer costs of their own. Los Angeles was the only city to bid for the 1984 Olympics, which allowed the United States to negotiate terms that allowed the city to use existing stadiums and infrastructure, instead of constructing brand new buildings and racking up more costs. Los Angeles was able to make a profit by hosting the Olympic games, but since then, no other countries have followed in their successful footsteps. In the 2008 Summer Games in Beijing, China spent $42 billion while only making $3.6 billion. Today, China is still dealing with its debt from infrastructure construction, on top of the 10 million dollar bill for the annual maintenance of the Olympic Stadium. The public usually has a bit of an issue with Olympic infrastructure development because their tax dollars are often used to pay for the construction. Tokyo has yet to use any tax dollars, but the committees in charge of the planning haven’t confirmed that they will not be using taxpayer dollars yet.
While it is easy to see the disadvantages of hosting the Olympics, it’s also hard to ignore the benefits. One of the biggest benefits for Tokyo will be the increase in revenue from housing. Airbnb has expanded in Japan to create more housing for tourists during the Summer 2020 Olympics. Additional hotels are in the works to meet the need for temporary housing for tourists. Most commonly associated with the Olympic Games is the mass amount of tourists that will make their way to Japan. The increase in tourism is the primary reason for the increase in hotel construction, but tourism also boosts the economy as a whole. Tourists will want a taste of the local cuisine, and they will want to see all the tourist attractions, which will boost sales for restaurants, souvenir shops, local tourist attractions, and other related areas associated.
Overall, the calculations and finances show that most host countries will not be able to make a profit by hosting the Olympics. There are simply too many new pieces of infrastructure to be built for a country to make a profit, let alone break even. Yet, many countries and people will argue that truly there is no price tag that could compare to the experience of hosting the Olympics.
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