Dear Winnipeg

A Fun Blog About Infrastructure and Municipal Finance
Random Thoughts on Taylor Swift, the World Police & Fire Games and the Economy

Random Thoughts on Taylor Swift, the World Police & Fire Games and the Economy

Dear Winnipeg,

Last week, I read that the Federal Reserve Bank of Philadelphia published a report in which they noted the significant economic impact of Taylor Swift‘s latest world tour. One research firm even estimated that T-Swizzle’s concerts could add up to $4.6 Billion in consumer spending in the U.S. alone.

That’s a lot of money.

Of course, since people generally have a fairly fixed entertainment budget, probably at least some of that money is just redistributed spending by locals rather than net new spending. For example, the money spent on Tay Tay tickets or hotel stay or drinks is just money you would have instead spent on the opera, a party bike tour, or a night of Barbie-cosplay, beers and axe-throwing. [Sorry, I have no idea what kind of stuff you’re into.]

Still. Even a portion of a number that big is still a big number. So it’s no surprise when cities all over North America fall over themselves to figure out how they can get Miss Americana to come to their town and shower them with the gift of economic prosperity.

But it’s not just Tate and her army of Swifties that get city officials tied up in economic-envy knots. Cities are often willing to throw around big money, just to attract the next “big event” in the hopes that it will finally turn around decades of visible decline.

In a fun coincidence, Winnipeg is playing host to the World Police & Fire Games this week. I just want to focus on the economics of the Games, an event like many others, which received a $1.5 million subsidy from the City of Winnipeg, as well as $4.9 million from the Province and $2 million from the Feds. The entire event has a $17 million overall operating budget.

Of course, those contributions came with a promise of new economic activity, estimated to be around $85 million, from the expected 8,500+ athletes, in addition to their friends, family and travel companions that would descend upon our fair city for 10 days of competition. At the 2019 Games in Chengdu, China, that meant over 25,000 visitors.

High hopes!

Unfortunately, just three days before the start of the Games, organizers revised their attendance projections. Instead of 8,500 athletes PLUS their friends, family and travel companions, they were now expecting 8,500 people INCLUDING friends, family and travel companions.

A far cry from 25,000.

Not to mention that some events have had to be adjusted due to having fewer participants register than expected. For example, Women’s Softball only had two teams registered, so they already finished up on Day 2 of competition. Will they now staying in the city the full 10 days, or heading home early with their money still in their pockets?

The promised economic impact keeps dwindling, meanwhile, the government contributions to this event stay the same. To the extent that any of that money was borrowed, taxpayers could expect to continue paying for the Games for years to come.

But that’s the nature of these high-risk big bets.

In the spirit of the Games, let me use a baseball analogy: when you focus all your efforts only on hitting home runs, you may get one every now and again, but most of the time, you won’t. Of all time, the best anyone has ever done was hitting a homer on about 9% of his times at bat.

And, using that strategy, even when you do hit one, you’ll only score a single point.

A better strategy would be to focus your team’s energy on getting more players on base with safe singles.

Four consecutive singles and you’ve scored a run. And every single after that scores another run. And if you do manage to hit a home run at some point, it’ll score a whopping four runs by bringing home all the runners on base. Grand Slam, baby!

What does that mean from a city’s perspective? It means focusing our economic development energy on small bets that make our neighbourhoods great places for us to live, play, work, and operate small businesses instead of trying to attract The Next Big ThingTM.

And while we may sometimes think we know what that looks like, an economically successful city is about more than just having built the right things. It’s about making a place for people.

All too often the focus is on “what we build next”, using the same approach of throwing subsidies at the next big project that uses the right buzz words of “density” and “mixed use”, whether that’s a hotel, new apartments at the mall, or revamping a failed downtown experiment from the 90s, all the while ignoring all the things we’re doing wrong that make our places hostile to people.

We can see it in our own downtown’s Exchange District. It has all kinds of “density” and “mixed use”, but devoid of people, it struggles to be economically vibrant.

Like, imagine you’re throwing a party. You can have all the best decorations, themed drinks, the most Swiftastic playlist, and even thoughtfully curated appetizers (including Why-you-gotta-be so-“bean” dip!), but unless people come, and stick around, your party is going to be as sad as an empty downtown.

That means in every neighbourhood, including downtown, we should be prioritizing the people that are in the living room enjoying the party, rather than the people that are trying to leave. Seem pretty obvious? Now think about that in relation to letting people cross the street at Portage & Main. Or slowing vehicle speeds in residential neighbourhoods.

Isn’t that obvious too? And isn’t it just as obvious that spending a billion dollars to make sure people don’t ever have to stop at your party is not the best economic approach?

Instead, we need to use an approach that is centered on the humans we’re trying to serve, while being meticulous about our financials. It’s an approach that starts with humbly observing where people struggle, identifying the next smallest thing we can do to help, doing that thing immediately, and repeating.

Low-cost, low-risk, high-reward. That’s economic development in a smart and successful city.

To be that kind of city, it all starts with the basics: focus on making a place that more people want to come to, a place they want to be in, without worrying about getting them to leave. If we get that part right, we’ll already be economically successful. And we won’t be reliant on gambling on big projects and big subsidies to lure big events. As Gregory Mason wrote in this morning’s newspaper:

“With a smart land use and transportation plan, we could get Winnipeg’s population to two million in 25 years. Then maybe Taylor Swift will include us on her concert tours.”

— Gregory Mason, Associate Professor of Economics, University of Manitoba

I think Greg is right. Because if there’s one thing Teffy loves, it’s good urbanism!

“In other towns, things feel very spread out… [in New York or London] it seems like there’s just this magic about the city where a night just falls together.”

— Taylor Swift, BBC Radio 1 Live Lounge interview (2019)

But we shouldn’t build it for her, we should build it for ourselves. We deserve a magical city where “a night just falls together” for us, even without the Queen of Bridges here. But, if it does make Taytor Tot want to join our party, then that’s great too. She can bring some delicious dip!


Elmwood Guy