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London 2012

Will the Olympics pay off for Britain?

Stephen Beard Jul 23, 2012
London 2012

Will the Olympics pay off for Britain?

Stephen Beard Jul 23, 2012

Tess Vigeland: The Olympic Games open Friday in London. Athletes from around the world are limbering up for the big event. But another, now-familiar contest is also well underway: The host country is having a big argument about the economics of the Games. Brits are wondering whether they see any sort of return on their $15 billion investment.

From London, Marketplace’s Stephen Beard takes the gold for this report.

Stephen Beard : If you want to gauge the mood of a city, it’s not a bad start to ask a cab driver. But in London, the cabbies are up in arm. Here’s more than 50 of them protesting. They hate the Olympic Games Lanes, a network of roads reserved for the exlcusive use of Olympic officials and sponsors.

Johnathon Myers: I can’t see any reason or justification why these elitist people have to have the freedom of London to swan around as they were.

Johnathon Myers leads a militant group of cabbies. They’re upset that like all non-Olympic traffic they’ve been excluded from the Games Lanes, condemned to ply their trade mostly in the minor roads in the city.

Myers: Takings will be down by anything between a half and two-thirds. So it’s going to be very difficult. People are going to be frustrated. They’re going to get out of the taxi and walk. In fact, they’re not going to get in taxis.

Nevertheless, overall ,the government says the Olympics will deliver a $20 billion boost to the British economy. But many Londoners are asking: What do we get out of the Games?

This is Spitalfields, Britain’s biggest fresh fruit and vegetable market, not far from the Olympic Park. Some of the traders here, like Steve Scrivener, feel put out they’ve not been allowed to supply the Olympic Park.

Steve Scrivener: They could be buying — what have we got here? We’ve got boxes of mangoes for £2 a box, in perfect condition. We’ve got strawberries 30 pence a punnet. I’ve got best raspberries here, 40,50 pence a punnet. Best, best English raspberries.

But, he says, the Olympic sponsors are not interested in his raspberries. They have lined up their own suppliers.

Another trader here, Emin Mehmet, is also miffed about the Olympics.

Emin Mehmet: It don’t benefit anybody. Why they put it here I don’t know. I really don’t know. It’s really a waste of money. I think it’s going to be a lot of hassle.

The government says the Olympics have poured billions into the British construction industry and Londoners will see a lasting benefit.

Promotional video: A great rainbow arcs over Bolton and down onto a giant steelworks where they are finishing the last girder for the Olympic Stadium.

Building the Olympic Park has regenerated a large, poverty-stricken and rundown slice of the East End of London. John Armitt of the Olympic Delivery Authority.

John Armitt: What you’ve got now are nearly 3,000 new homes, you’ve got a whole series of fantastic sporting facilities. You’ve got a 100-acre park, the largest park created in London for a hundred years.

But Andrew Scott is not impressed. He’s the deputy dean of the London Business School and comes from the area where the Olympic Park is located.

Andrew Scott: It’s very hard to take an area that is disconnected, low-income and has a centuries-long bad status, and suddenly turn it into something prosperous and vibrant.

He says the Brits should stop trying to kid themselves that they made a shrewd investment. They’ve blown $15 billion on a gigantic party — so just enjoy it.

Scott: I’m excited about the Olympics. It does tend to boost the happiness of a country. And sometimes it is worth spending money on things that don’t boost GDP.

It had better be. The most wildly optimistic estimate suggests that the Olympics will boost Britain’s GDP each year for a decade by no more than one-tenth of 1 percent.

In London, I’m Stephen Beard for Marketplace.

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