A SURPLUS OF ILL WILL
Controversy continues to surround the profit generated by the Los Angeles Olympics. The LAOOC now says that sum is $155.5 million, instead of the $150 million originally announced (SCORECARD, Sept. 24). Committee insiders speculate that the figure may eventually reach $180 million. More to the point, LAOOC general manager Harry Usher recently admitted to the Los Angeles Times that he had realized on the eve of the Games that the organization might be sitting on a surplus of $60 million to $80 million—and this at a time when the LAOOC was officially predicting only a $15 million surplus.
The gap between the LAOOC's projected and actual figures is disturbing. In pleading financial uncertainty even after it knew that uncertainty had dissipated, the LAOOC abused the good will of private contractors, local government officials and its own employees. Of the LAOOC's 80,000 workers, 60,000 were unpaid volunteers; LAOOC president Peter Ueberroth (now the commissioner of baseball) made a grand gesture when he publicly declined to accept his salary for the last of his five years on the job, saying, "I'm a volunteer, too." But Ueberroth received bonuses and severance pay after the Olympics totaling more than half a million dollars (which he has put in a charitable trust). Usher received a $350,000 bonus.
The LAOOC defends such payments as being in line with those in the corporate world, an argument belied by the fact that corporations ordinarily don't compensate top executives so handsomely while prevailing on underlings to work for free. One Olympic volunteer told the Times that he and others had offered to work without pay because "we were told there just wasn't any money." A municipal official said, "They built the surplus by squeezing, bleeding and gouging."
The Games' profit is also a sore point with the U.S. Olympic Committee, but for a different reason. Ueberroth has said the LAOOC intended to put $3.5 million to $5 million of the surplus in a Friendship Fund for Third World countries that made a financial sacrifice to send athletes to the L.A. Games. The USOC says the surplus funds are not the LAOOC's to give away. In 1979 the USOC agreed to be the financial guarantor of the Games (the city of Los Angeles flatly refused to). The USOC was to receive 40% of any surplus; another 40% was to go to Southern California youth sports programs and 20% to U.S. sports governing bodies. Usher called the USOC's opposition to the Friendship Fund "greedy and rapacious-looking." USOC president William Simon told SI's Bob Sullivan, "It's unfortunate Usher would use a term like that. We're a business. We have an agreement. We have a deal with them."
Usher argued, "The countries we're talking about paid...for press and Olympic Village accommodations. If we'd known where we'd be financially, we wouldn't have had to take that money. Basically, it's like returning a deposit to them."
But apparently the LAOOC did know where it was financially, giving rise to the suspicion that the committee was grandstanding, wanting to make itself look marvelously efficient by piling up the biggest surplus it could, and then appear gracious and magnanimous by contributing some of that money to Third World countries.
Then the International Olympic Committee got into the act. IOC officials were said to have been "shocked" by the size of the surplus, and recalled financial support it had given the LAOOC. Two weeks ago IOC president Juan Samaranch urged the LAOOC to go beyond the Friendship Fund and use as much as $7 million of the surplus to reimburse all other countries, not just those in the Third World, for the cost of competing at Los Angeles.
The real bottom line is that the Olympic flame is being run backward.