2010 Olympics Business News for the Vancouver and Whistler
regions of British Columbia. Plus, Alberta, the rest of Canada, Washington
State, Oregon, Idaho, Montana & California
originally published November 2008
John Furlong Wants Local Businesses to Pay for 2010.
I've been asking you for years ...
"If you have to pay for 2010, shouldn't you benefit too?"
At a Vancouver Board of Trade luncheon on November 13, 2008, John Furlong told the audience he wants it mandated that ALL local businesses shut down during the 2010 Olympics, and that business owners pressure employees to take vacation during the seventeen day event. He even suggested business owners pay employees to volunteer.
Interestingly, Jeff Lee, official 2010 Olympic Vancouver Sun reporter, published an article the next day about Furlong's statement, but Lee failed to mention the crowd laughed out loud at the request.
Most readers were surprised Furlong would ask this of a community already burdened by the increased cost of living in and doing business in our 2010 Olympic region, but if you've read my book and followed this blog you knew it was coming.
To those who took my advice and developed plans
to leverage Olympic momentum, CONGRATULATIONS!
To the rest of you - it's time to catch up.
Mainstream news media knew Furlong's request was coming, but they failed to warn the public. It's no wonder Canwest share prices have dropped so drastically. It's what happens when you don't serve your customers in a timely fashion.
Furlong is beseeching everyone to stay off the roads during the Games so he can transport athletes and spectators to events. His back is against the wall and he has no choice but to ask business owners to foot the bill. This type of plea indicates VANOC is having serious challenges regarding transportation, which is no surprise because it rolls out like this in all Olympic regions.
Ed. In July of 2009, eight months later, BC premiere Gordon Campbell announced the harmonization of the provinces GST and PST taxes. Basically, it allows the government to collect an additional 7% on a wide range of services and products previously untaxed. Someone has to pay for 2010. and an Olympic Sales Tax seems to be the solution.
2010 Olympic Athletes' Village Scandal City Bails Out Millennium Developer - Taxpayers Assume Risk
Preamble:Instead of providing in depth investigative journalism addressing the $70 million Athletes' Village overrun cost, The Vancouver Sun publishes inflammatory articles about who leaked the secret $100 million loan report.
It's an orchestrated DISTRACTION that creates sensational headlines.
I'm sure VANOC appreciates The Sun deflecting heat away from them, and instead to the political arena, but the real issue is Olympic overrun costs.
The Sun is well paid by Olympic organizations to tell the Olympic side of the Olympic story, and I agree it is important to weed out corruption at City Hall,
but the important issue is that permission for the $100 million loan was granted secretly,
and not that the report was leaked to the Globe and Mail.
Leaks like this are part of daily business at a news company, but The Sun is positioning it like it's the first time issues like this occurred. I wonder if they would be so righteously indignant if the leak was sent to them instead of a rival?
On 11/13/08, The Sun reported their parent company, Canwest, is preparing to cut 350 jobs from their overall newsprint roster.
Considering The Sun seems to have such a challenge focusing on truly important issues and in a timely manner, is it any wonder newspaper positions are being reduced?
I want to know why Estelle Lo, Vancouver's Finance Director resigned, and the details about how her resignation is connected to Olympic spending.
Everything else is basically a smokescreen. The Sun should have sent a journalist to Hong Kong where Lo is vacationing or hired a foreign correspondent to investigate.
Read what Gary Mason at The Globe & Mail has to say about Lo. It's not flattering. Ed. This article is now behind a pay wall. The Globe and Mail is also an Olympic partner.
The video below was produced two days before the Beijing 2008 Olympics.
It is even more relevant today after the 2010 Athletes' Village scandal.
Taxpayers should not carry risk for the Olympic Athletes’ Village loan.
Considering developer Millennium Development Corp., and Fortress Investments Group can no longer cover overrun costs, the City of Vancouver should convince VANOC to go to Olympic sponsors and convince them it is in the sponsor's best interest to cover the developer's loan.
Next to local taxpayers, Olympic sponsors have the most to lose if Vancouver 2010 is impacted by the type of negative publicity that also occurred in past Olympic cities like Salt Lake City, Athens, Turin, and Beijing.
Peter Ladner thinks taxpayers should assume the risk. He's wrong.
The risk should be carried by sponsors like Rona, Visa, and NBC - the corporations generating Olympic profits.
The Vancouver Sun actually implies Gregor Robertson is engaging in "scumbag politics" and is making a mountain out of a molehill.
It’s hard to know where to start anymore, or what to believe regarding the huge volume of misdirection and misinformation spread by local mainstream news media regarding the 2010 Olympics.
Newspapers mislead readers into believing
they have true concern for our community.
The Vancouver Sun ran an editorial a few months ago claiming they warned everyone in a responsible and timely manner of the dangers of high-risk mortgages and of investing without careful thought in our market. However, when we did a quick check of our files we discovered that over a two-year period The Sun only published two headlines that adequately warned readers to be prudent regarding local real estate investment. Surprisingly though, they published at least one hundred and twelve headlines that effectively did the exact opposite.
Most articles supported an atmosphere of loose abandon, and some implied property values could only keep going up and that ďfundamentalsĒ were not right to create a bubble. They stated unequivocally this era's financial industry was smarter and would never let us slip into a depression again.
Journalists actually published that if anything was about to happen, the investment industry would be able to react quickly to manage it.
I'm sure the millions who recently watched their property values and portfolios shrink would angrily challenge this cavalier attitude today.
I admit it's possible that during our search for cautionary Sun articles we might have missed one or two pieces, but even if we missed five, and thatís highly unlikely, the ratio is alarming.
112:2 Ė one hundred and twelve Ö to two.
Readers didnít stand a chance, especially the naive or innocently trusting.
Only fools and opportunists listen to clowns of commerce.
The obscenely skyrocketing property values and taxes Vancouver experienced since winning the Olympic Bid in 2003 are an indirect result of Olympic frenzy promoted by local media on behalf of real estate developers. Values are now falling as quickly as they rose.
How many front-page headlines did you see claiming you were a ďpaperĒ millionaire as a result of the (artificially) inflated value of your home, which btw is now deflating faster than Sam Sullivanís popularity?
How rich do you feel today?
Most people donít know, or they forget The Vancouver Sun is well paid by the IOC to tell the Olympic side of the Olympic story.
Also, by now, most people do know, but donít necessarily appreciate the depth of the newspaper industryís financial troubles. The media company that owns The Sun, Canwest, recently watched its share price plummet to less than a buck. They slipped, in one year, from over eight dollars to what Reuters describes as penny stocks - ninety-five cents.
Canwest is in trouble, so donít be surprised if The Sun decides to discontinue its Monday edition, which of late has seen many of its articles written in other cites in an effort to save money. It's so small and of such little consequence it's not worth the gas it takes to deliver it.
Companies in dire financial straits push ethical bounds to prevent being taken over. For many news reporters itís either do what the boss wants, irrespective of journalistic integrity, or look for another job in a dark cavern without a light.
Most reporters will grit their teeth and toe the party line while fooling themselves into thinking it will get better. It won't.
The economy will most assuredly improve Ö eventually, but the news industry, as we knew it is fading fast and evolving into a business model far removed from traditional advertising models.
News media, like the music business, has to find a new way to value their product, and so far both industries are failing miserably.
One of our goals when OlyBLOG.com first launched was to demonstrate to local small and midsize business owners that if they had to pay for the 2010 Olympics, they should benefit too, and not just indirectly through a few new sports facilities sprinkled throughout our community.
We demonstrated ways to leverage Olympic momentum to increase visibility and generate revenue for local companies.
The premise was to counterbalance the increased cost of living in, and of doing business in an Olympic region. Increased rents and taxes forced many companies out of Vancouver, and even some out of business entirely. As businesses abandoned our Olympic region over the last few years it had a trickle down effect that saw families also leave, which caused retailers and schools to close. When people gave up and abandoned the city the tax base was whittled down, which meant those remaining had to pay more, hence the 3.5 percent increases which will increase indefinitely to cover growing Olympic costs.
Some companies are doing well, but most naively trusted Olympic organizations and local news media, and now theyíre paying the price instead of reaping the benefits they expected.
Most people don't realize local mainstream news media make more money promoting the Olympics than they do cautioning local residents to be wary, or to look for options and opportunities.
News media, which has already made a fortune hyping the Olympics on behalf of VANOC, developers, and the real estate industry, and will make even more, now feign to be innocent bystanders - simple messengers incapable of predicting the future.
Make no mistake though. They contributed to this folly by using misdirection and misinformation, and by looking the other way.
Just recently, in The Sun on Friday, November 7, 2008, reporter Miro Cernetig voiced his 2010 concern on his paperís front page by opening an article with the following two one-line paragraphs;
ďCould the Olympics bankrupt the City of Vancouver,
or put it in a financial straightjacket for decades to come?
Iíve never considered that as a remote possibility. Until now.Ē
Iíve read your work and consider you to be a pretty smart guy. So to claim at this late date you never considered the Olympics could bankrupt our city is a stretch. Itís hard to believe you could be so naive.
How is it possible that someone as witty and professional as you, had never thought until now the Olympics could bankrupt our city, when the last four Olympic events in Beijing, Turin, Athens, and Salt Lake City created economic havoc in their respective regions?
Athens was hit so hard bond-rating agency Standard & Poor's dropped the country's debt-rating outlook from "stable" to "negative" blaming "an accelerating loss of fiscal discipline" partly related to the Games. They also reported Greece's fiscal position is the weakest of any major European economy. Greek Prime Minister Costas Karamanlis placed the blame squarely on the Olympics.
Is it possible Miro, you think Vancouverites are smarter than people in all these other Olympic Host regions? If so, thatís pretty arrogant.
Noam Chomsky coined the term ďnecessary illusion.Ē Basically, it means news media report an issue in a manner that on the surface looks like they are concerned for society and their community, but on another level they slyly promote the perspective of their advertisers.
How many articles and ads have you seen recently telling you to buy 2010 license plates, or to scoop up those popular sport event tickets - or think back to a few years ago when newspapers were jammed with full color double spread real estate ads and supporting articles unabashedly promoting that condos were selling out at exorbitant prices in one day?
The IOC buys huge sums of advertising from The Vancouver Sun. Itís a very lucrative arrangement for the newspaper, while for Olympic organizations itís a conduit to the community through very manipulative advertorial that looks like editorial.
Kirk LaPointe, The Suns managing editor, recently clearly stated his newspaper is in business first and foremost to make money.
Itís disingenuous of The Sun's reporter, Miro Cernetig, to now stamp his foot in righteous indignation over VANOCís penchant for ďsecrecy.Ē
What took so long?
Why did it take you so long to complain of a characteristic common to all local Olympic organizing committees? Now you think lack of transparency is an issue? Now youíre worried Miro? Where were you four years ago when lack of IOC transparency was in its infancy in Vancouver? Maybe you were too busy making money instead of warning our community.
Miro goes on to write;
ďThe truth is Vancouver taxpayers have been let down.Ē
Why has it taken such a smart guy so long to come to this conclusion, and at a time when the possibility of doing anything about it has long passed?
If Miro had done a little research he would have had an inkling that this was going to be a serious issue. He could have read a few books Iíve long recommended, one written by IOC executive Richard Pound, or a book by Tony Webb, or one by Helen Lenskyj, or even my 2010 Vancouver-specific book published way back in 2006. Hell, Miro doesnít even have to read a book because this blog also covers many of these challenges in detail, and even more so in some instances.
One day after Cernetigís article was published, on Saturday November 8, 2008, two other Sun reporters jumped into the conversation.
Pete McMartin weighed in on the possibility the Athletesí Village could bankrupt the city, except good neighbor Pete thinks we have nothing to worry about. In fact he doesnít even mention the secrecy issue. He thinks Millennium, the developer who was pre-approved for a one hundred million dollar loan from Vancouver City Hall to keep the project alive, will cover the tab in case something goes wrong.
He carefully explained the developer has enough security to back the loan. Unfortunately, in this volatile economy, Vancouver land values fell faster than Bill Clintonís pants in the Oval Office.
What could go wrong with such an overpriced and media-frenzied condo development that at this late date has only sold about one third of the units? Iím sure itís comforting for trusting Sun readers to know affable Pete is going to bat for the community, but the rest of us are wondering why it also took him so long to step up to the plate?
McMartin anemically tries to convince us the panic over the Athletesí Village loan is a consequence of a mayoral candidate making a mountain out of a molehill. McMartin writes, ďFirst consider the politicking that Vision Vancouver and its mayoral candidate, Gregor Robertson, are engaging in right now. Gregor has been busily trying to pin the whole deal on the NPA mayoral candidate Peter Ladner.Ē
In the next paragraph McMartin writes;
ďHeh, allís fair in love and scumbag campaign tactics, . . .Ē
Scumbag? Are youíre saying mayoral candidate Gregor Robertson is a scumbag for bringing to the fore an issue you and your employer should have seriously addressed years ago? [Robertson btw, won the election and is now Vancouver's new 2010 era Mayor]
Granted, judging by Robertson's responses in news media it looks like he doesnít have a great grasp of IOC history or their business machinations, but it seems he knows quite a bit more than the crowd at The Sun.
Itís also important to note Robertson has also staunchly defended our small and midsize business community respective of 2010 more effectively than anyone in the local news media circle.
And even though Robertson was outmaneuvered by VANOC at almost every turn, his track record with business owners on Cambie regarding Canada Line is testament to his genuine concern.
Robertson is at least trying to help our community, and heís doing it in a timely manner, unfortunately, like many, he's too trusting of the IOC.
At the other end of the spectrum, Peter Ladner, Robertsonís competition for the mayoral race, wants taxpayers to blindly trust that he and his fellow councilors made the right decision to secretly lend Millennium $100 million behind closed doors.
Itís unnerving that the people responsible for placing our city in this Athletesí Village economic mess are the same politicians saying ďTrust us - itís a good deal. Taxpayers should not be concerned.Ē
McMartin even gets ex-Vancouver mayor, Larry Campbell, now a senator, and who was also responsible for masterminding the original deal, to support his argument that taxpayers have no need for concern.
Just before Campbell became a senator he admitted he wasnít a good politician, but he must have learned something about politicking over the last few years, because in McMartinís article, even though Campbell told taxpayers not to worry, he also threw in the disclaimer, ďIím not critical of it [the Millennium deal] at all. I believe Ė and I say this with the proviso that I donít know all of the details Ė thereíll be a good return on this.Ē
Wow. Thereís a glowing endorsement negated by a sweeping disclaimer. Well maybe there will be a good return Senator Larry, but for whom? If the deal goes south it wonít be good for taxpayers, but it seems developers will be covered.
The Athletesí Village is built on contaminated industrial land that has still not been fully cleaned or reclaimed. Wealthy people who can afford to buy the outrageously priced condo units donít usually live on land leaching poisons that could be detrimental to their health, which means speculators will eventually buy the condos and rent them to the unaware, which also means that in this economy, it will be an incredible challenge, if itís even possible, to see a timely return on their investment.
One more Sun reporter, actually The Sunís official Olympic reporter, Jeff Lee, also weighs in the same day as McMartin with a headline on his article that blares, ďCity protected in village deal, officials say.Ē
According to Lee, the city of Vancouver holds title on the development until the project is delivered. Thatís a risky position to place the city in, but in Leeís mind he thinks itís a good thing. If the developer defaults, the city is left holding the bag and taxpayers will cover the cost until the developerís securities are sold to pay for the debt. Again, in a stable economic market this might not be a great risk, but today, considering Vancouver is already overextended, Iíd say there is ample reason to be concerned.
Robertson is saying taxpayers should have at least been made aware of the specifics of the deal considering they will be on the hook if something goes wrong, while Sun reporters like McMartin and politicians like Ladner think it is none of our business to know the details.
Ladner claims that even discussing the issue in public puts the project at risk. Realistically though, this project was in jeopardy in 2006 as soon as Millennium bid $193 million for it, $23 million more than their closest rival.
Out bidding rivals by such a wide margin is a common strategy that effectively shuts out the competition. It sends a message the top bidder is flush with capital and prepared to put its money where its mouth is.
Bell used the same strategy a few years ago to shut out Telus with a whopping $200 million dollar bid that garnered tremendous media accolade. When corporations make such outrageous offers, and reap the benefit of positive media worship, they then have an ethical obligation to deliver without further risk or stress to taxpayers.
Over the years The Vancouver Sun mistakenly reported land values in Vancouver would only continue to rise.
If, like OlyBLOG.com, local news media had made an issue years ago about the lack of transparency and shrouds of secrecy surrounding VANOC, deals like this would not have occurred.
Itís not as if news media didnít know this nightmare was coming. Weíve been warning everyone for a long time, as have people like David Eby, Wendy Pederson, and Am Johal.
Local news media, an industry generating incredible profit respective of the 2010 Olympics, chose to look the other way and protect their vested interest. Unfortunately, ignoring issues of transparency in a timely manner had a negative impact on our community.
It's ironic that at one time not so long ago, The Sun proclaimed in their masthead their goal was to ďimprove the lives of our readers.Ē
Apparently they meant only their very wealthy readers and not the community in general.
If you live in or own a business in our 2010 region you will pay more for the Games than VANOC or local news media initially led you to believe.
The question now is how will you make up for the added cost?
Theoretically, the answer is simple.
Convince Olympic Sponsors to guarantee
the Millennium loan and cover overrun costs.
Go to all the Olympic sponsor corporations making a killing through their association with 2010 and convince them to guarantee the loan. Surely Olympic sponsors like GM, Coca-Cola, or Visa have the capital to easily manage the risk. OK, maybe not GM, but you get my drift.
VANOC boasts of reaching sponsorship investment levels, but my two decades of special events promotion experience tells me they sold the sponsorships for too little money.
VANOC admitted they were surprised at such a high offer when Bell offered $200 million for the telecommunications sponsorship.
VANOC's response indicated they didnít know what they were doing.
A negotiator who is first surprised by a high offer, and secondly, admits to being surprised, is an inept negotiator.
Vancouver taxpayers should send VANOC back to the sponsor trough for more money. Promoters with experience will tell you VANOC accepted sponsorship offers too quickly. Based on VANOC's account, it appears they undervalued sponsorships and accepted offers below realistic market values instead of negotiating more effectively.
Maybe their intention all along was to have taxpayers pick up the slack.
Back up option . . .
If going back to Olympic Sponsors for more money doesnít work then local business owners have another course of action.
They can use their websites to tell the droves of people around the world who are considering coming here for 2010, and the billions who will watch the Games on television, not to worry.
Let the foreign market know that despite the bumbling by Olympic organizations, Canadian governments, and our news media, there are people on the ground here working to make this event successful.
Assure them that as a community, we have things under control.
Here's why you should get involved ...
When an Olympic region experiences
foreigners don't show up for the event. It occurred in Athens, Turin, and Beijing.
When no one shows up local Olympic organizing committees "paper the house," which means they give tickets away so it looks like people are attending the sports events. The last three Olympic events, Athens, Turin, and Beijing were a nightmare in this respect.
If you donít get involved there is great potential for Vancouver to look similarly as bad, and thatís not good for taxpayers and especially business owners in Vancouver or Whistler.
No one can send this message more effectively than the thousands of businesses and people in our region. Donít leave it up to VANOC, or politicians, or news media, because so far they havenít done a very good job, and it is unlikely they will get it right at this late date.
Their window of opportunity slammed shut during that embarrassing show in Turin 2006 when VANOC used igloos and snowmobiles to showcase modern Canada. Canadians were outraged. Even BC Premier Gordon Campbell publicly voiced his anger and frustration.
Ask yourself what you thought of people in Athens when their 2004 Olympic construction plans hit the news media iceberg.
How many times did you see our news media accuse Greeks of being lazy, or worse, inept? What makes you think people around the world arenít already thinking similarly of Vancouver?
Foreign athletes, the IOC, and international news media are watching.
You can set them straight and make this work.
You have access to the world through the internet.
Use it to put minds at ease because you can bet anti-Olympics groups are leveraging the internet to get their point across, and the message they send about Vancouver won't be flattering.
So far Standard & Poors indicate they are not concerned, but this agency can do a lot of harm to our community just by issuing a warning.
YouTube, Facebook, and company websites
can ease the tension.
If you do nothing and look the other way it sends a tacit message you donít care about our reputation.
Doing nothing is not an option.
It is easier and cheaper to take positive action than you might think.
1st printing no longer available at CHAPTERS locations in Vancouver
Own the Podium?
The official creed (guiding principle) of the Olympics is a quote by the
founding father of the modern day Games Baron de Coubertin. He said, "The
most important thing in the Olympic Games is not to win but to take part,
just as the most important thing in life is not the triumph but the struggle.
The essential thing is not to have conquered but to have fought well."
The Olympic motto consists of three Latin words Citius, Altius, Fortius,
which means, "Swifter, Higher, Stronger." The 1924 motto is meant to encourage
athletes to embrace the Olympic spirit and perform to the best of their
No where does it imply that winning the most gold medals for your country
is part of the agenda. In fact it implies exactly the opposite.
The IOC maintains that it doesn't actively encourage countries to collectively
win the most gold medals, but on the other hand they also don't institute
anything to ensure that the Games are not turned into corporate money
In fact, IOC sponsorship and partnership business models encourage a win-at-all-costs
mentality. It is the reason they have doping, fraud and bribery scandals.
The IOC invites young people to compete in the Olympics using the original
Creed & Motto. But when it comes to delivering on the promise they
fall incredibly short.
The Olympics today isn't as much about sport as it is about money and
Priorities changed over the years and so too should their Creed &
If athletes go for the gold, and the IOC goes for the gold, and corporate
sponsors go for the gold, and governments go for the gold, and considering
that you will have to foot the bill for their gold, why should
you be edged out of the race?
Move to the starting line.
Own the Podium?
Own Your Home?
Real journalism consists of
what someone doesn't want published,
all the rest is public relations." George Orwell