Saturday, September 28, 2013

Kissing the NFL Good-Bye

A couple weeks ago I wrote about my like-dislike relationship with the game of (American) football. After reading it a friend suggested I read a book entitled The Winner-Take-All Society by Robert H. Frank. I've added it to my reading list but unfortunately my local library does not have a copy, so I will have to look elsewhere. About the same time the current issue of The Atlantic crossed my desk and I read a very interesting article in it: “How the NFL fleeces taxpayers,” written by Gregg Easterbrook. The article is adapted from Easterbrook's soon-to-be-released book The King of Sports: Football's Impact on America. I shall add this book to my reading list as well, but the article alone was enough to bring me to the conclusion that I need to withdraw my support from this league, if the reasons I listed in my previous post were not sufficient.

In the article Easterbrook describes how the NFL earns phenomenal profits for team owners and league executives while passing the cost of stadiums to the taxpayers in NFL cities. In an era of tight budgets and calls for decreased government spending, in a time when resources for the poor, for education and other truly useful services are being slashed by local and state governments, politicians continue to shovel largesse to private teams so that they won't move out of town. He cites numerous examples, all of which made me wonder why I should continue to give any support to this league. Why should taxpayers subsidize the Washington Redskins to the tune of $4 million dollars to upgrade their workout facility, when the team owner has an estimated net worth of $1 billion? Surely Virginia taxpayers could direct that $4 million towards more useful causes and $4 million out of Dan Snyder's $1 billion would hardly even make a noticeable dent.

The NFL is ultimately a business. It's about entertainment, but it's also about making money and it does that fantastically well. The league will receive about $4 billion dollars this season alone in broadcast rights. That's not counting ticket sales, merchandising and other sources of income. I have no bone to pick with the league and its teams for making money. If people want to pay for tickets and merchandise, if networks believe there is money to be earned in broadcasting the games, great. However, don't ask the taxpayers of Footballtown, America to pick up the bill for building, maintaining and upgrading the stadium that the teams use to earn their money. Teams should build their own stadiums. They could then choose to manage and lease them for other purposes as they see fit, earning additional income. This would be preferable to forcing communities to build these modern cathedrals, then paying them a pittance in rent to use them for their games.

In return for the stadium “rental” charges, teams receive in most if not all cases the exclusive right to revenues generated within the stadium, including ticket sales, concessions and, most importantly, revenue from the broadcast rights that go with each game. These sources of income far outweigh the rental fees the teams pay. When you factor in that the rental fees often don't cover the cost of actually constructing the stadium and paying off the debt for doing so, the teams essentially receive government subsidies to run their very lucrative businesses. I find it appalling that in a time when we hear politicians proclaiming the need to cut subsidies to the poor of our nation we continue to subsidize billionaire owners of sports teams. Something is seriously wrong with this equation.

I imagine someone will point to the economic “benefit” that sports teams bring to a city. Yes, they generate some jobs, but I wonder whether they truly generate enough local employment income, particularly jobs that pay a livable wage, to merit the subsidies they receive. For example, Louisiana gives up to $6 million a year to the owner of the New Orleans Saints as an “inducement payment” so he (hopefully) won't consider relocating the team. I would think that one could create a decent number of jobs in other ways for $6 million a year.

I am thankful that I do not live in a community with an NFL team, so I do not pay directly to support one through my taxes, although I do not have any idea whether and how much my state legislature has chosen to support the Arizona Cardinals with my tax money. I feel sorry for the taxpayers of Glendale, who get to pay for the shiny University of Phoenix stadium where the Cardinals play. (I think, to be fair, that they chose to tax themselves to build it, but I was not around at that time so I am not familiar with the details.) The residents of Tempe and Mesa should congratulate themselves on having the wisdom to reject efforts to construct the stadium in their cities.

The NFL will continue with or without my support. I don't even mind that they do. In fact I don't mind if they continue making money. But I do mind that they do so on the backs of taxpayers, when they do not need to do so. Team owners should take responsibility for the expenses of their teams and not expect taxpayers to subsidize them. Their earnings are more than adequate to pay for their stadiums and upgrades and whatever else they want. And if they aren't, then maybe they need to adjust their business model rather than blackmailing cities into pouring millions into their coffers. I don't expect them to change their ways, but until they do, I don't need to be an active contributor to their bottom line. I'm sure I can find better ways to spend my limited income—as well as my Sunday afternoons.

No comments:

Post a Comment