D.C. Sports Billionaire's Next Act? Olympic Profiteering

The proper position for listening to billionaires talk about civic pride is with arms folded and an eyebrow raised. With that in mind, let us listen to Ted Leonsis, the billionaire Washington, D.C. sports mogul, talk about civic pride. Engage eyebrow:

"It pains me personally that the U.S. hasn't hosted the Olympic Games in a long, long time," Leonsis cried to the board of the Metropolitan Washington Council of Governments in September. In Leonsis' world, 12 years is an unacceptable Olympic respite. Just think of all the children out there soon to be bar mitzvahed without having witnessed an Olympics on American soil. And we call ourselves a superpower.

Due to his self-professed personal anguish, Leonsis must be thrilled that D.C. is one of four finalists—along with Boston, Los Angeles, and San Francisco—for the U.S. Olympic Committee's bid to host the 2024 Summer Olympics. And thrilled he is: "[The Olympics] are a once in a lifetime [opportunity]," he told D.C.'s 106.7 The Fan. Considering the time between the 2002 Salt Lake City Games and the 2024 Olympics, it logically follows that Ted Leonsis believes the average human life span is 22 years.

Leonsis also believes D.C. is both the most visited destination in the United States and also in desperate need of recognition. Back in September, Leonsis hoped the Olympics would introduce the world to the tiny village on the Potomac: "There is no bigger global spectacle, no better way to hold a coming out party than the Olympics." Keep this in mind when reading the following quote, spoken by the same person, a mere two months later: "(Forbes called us the coolest city), Lonely Planet says we're the most visited destination in the United States." Underrated tourist attraction or global powerhouse, any narrative will do.

Okay, so D.C. may not need recognition, but it does need money, right? Leonsis argued hosting the Olympics will rescue the economy of Washington, D.C., which is akin to defibrillating someone with a perfectly healthy heart rate. D.C. is the most prosperous American city of the last decade. Leonsis' economic confusion doesn't end there.

Despite being a billionaire—or perhaps because of it—Leonsis is vexed by how jobs work and why people want them. "It's creating jobs," Leonsis said on the radio spot. Extolling the virtues of the London 2012 games, he claimed "70,000 people got put to work." This statement is true only if you think work and money have nothing to do with each other; the 70,000 "workers" were unpaid volunteers. Leonsis continued, "There are about 100,000 young people that served as interns." It is true that London has lots of interns; about 100,000 a year,any year, per the Guardian's estimates.

Even if we grant Leonsis' false assumption that the D.C. economy needs assistance, and further grant that the Olympics would actually create an environment in which people were compensated for their labor with currency, the Olympics does not do that. "The bottom line is, every time we've looked—dozens of scholars, dozens of times—we find no real change in economic activity [as a result of the Olympics]," University of South Florida economist Philip Porter told the New York Times in an August article titled ""Does Hosting the Olympics Actually Pay Off?" Not to spoil the thrilling conclusion, but the answer is a big, fat no.

We have known mega-events are, at best, fiscal washes for even longer than the "long, long time" since the U.S. last hosted the Olympics: here is a sharp article from 2000 by Neil DeMause detailing these realities. The Times article is also a solid summary of why mega-events like the Olympics, the Super Bowl, and World Cup don't generate economic activity, but to summarize the summary: hosting the event deters as many visitors as it attracts—particularly in popular tourist cities such as London, Los Angeles, and, depending on which Ted Leonsis interview you're listening to, D.C.—and money spent during the event is simply revenue that would normally be spent elsewhere in the city.

Even Leonsis' shining beacon of Olympic-fueled progress, London 2012, exemplifies this very process at work. The Washington Postran a story about how West End plays shut down, restaurants hired more workers only to give them notice when business didn't pick up, hotels were unusually empty for a London summer, and museums echoed with the empty breeze instead of the footsteps of silent visitors. While it may have required actually visiting London to notice the economic consequences, the financial disasters experienced by other host cities—both Athens and Montreal come to mind—have become international punchlines.

Quickly, we see a fundamental divide between two different groups of people: those who study the events and those who stand to profit from them. Leonsis owns two arenas in the D.C. area: the Verizon Center in downtown D.C. and the Patriot Center in Fairfax, Virginia, a D.C. suburb. Hosting the Olympics would almost surely result in refurbishment of either or both facilities, if not brand new ones, paid for by the taxpayers. The Patriot Center, which currently is not metro-accessible, would be in prime position to see that changed, with the all but certain result being a busier arena schedule. The people who study mega-events invariably conclude they add no net-benefit to the economy. Politicians, contractors, construction companies, and sports arena owners insist they're great for everybody. What they really mean is it will be great for them.

However, Leonsis insists this isn't about him, that he wants to "make sure that Ward 7 and Ward 8—communities that need our embrace and some transformation—can benefit from the Olympics." As of 2011, Wards 7 and 8—the two wards largely untouched by the D.C. income and population boom—had poverty rates of 26 and 36 percent, respectively. As detailed by the Urban Institute, nearly all the real estate development in Wards 7 and 8 have been single-family homes, while the rest of the city's sun is blocked out by the plethora of construction cranes erecting new apartment complexes and million-dollar condos.

It is also worth noting that D.C. is one of America's most segregated cities. Wards 7 and 8 are almost entirely black; 95 and 94 percent, respectively, while Northwest and NoMa—the construction boom epicenters—are overwhelmingly Asian and white.

Leonsis' bio page claims he has given to more than 400 charities in the past year, so he is no stranger to how giving works, which makes this an exemplification of twenty-first century latent racism: a wealthy white man declares that the two black sections of town "need our embrace" by smothering them with a sporting event from which only the wealthy white man will profit.

If Leonsis genuinely wanted to lift up these communities, why bother tying it to the Olympics? Wards 7 and 8 have been "historically underinvested," according to Rob Pitingolo at the Urban Institute. They will likely need housing in a decade, but affordable housing and employment are huge problems now. Pitingolo told me "there are immediate opportunities for affordable housing investment," which would do far more far quicker than a velodrome, water polo arena, IOC-approved handball courts, or table tennis arenas, all of which would require expensive conversions to usable infrastructure after the closing ceremonies. So, Ted, if you're reading this, and you don't want to wait for 2024, finance an affordable housing development that might not make back every cent. Or give to one of the many local charities that serve the area. If the Olympics can't wait until 2024, then neither can this.