The Sports Team Con

(c) by Mark Dempsey

Most economic studies say that economically, pro sports are a wash. Teams cost their cities at least as much as they produce in revenue. And speaking of costs...Sacramento's Kings got a $70 million loan from the City when they first moved to Sacramento so costs are often at the expense of the public, whether people attend games or not. Sure, your roads may be full of potholes, but at least you've got a team of mercenary athletes to represent your city!

Big league teams regularly move, or threaten to move, unless they get subsidies or stadium financing. The pro football Oakland Raiders got subsidies from Oakland, then Anaheim, then Oakland again and finally Las Vegas. George W. Bush bought into the Major League baseball Texas Rangers with some borrowed money, then persuaded Arlington Texas to finance their stadium, and later sold it for a handsome profit. The rate of return is difficult to calculate since he didn't invest any money. The profit was capital gains, too, so it was not fully taxed. That little score comprises an estimated 75% of Shrub's net worth.

After they had been in Sacramento for a while, the NBA Kings threatened to move and the City of Sacramento magically produced a quarter billion dollars for a newer, City-owned stadium. No tax revenue for the City, and no stake in or veto on the team's movements. And--bonus!--if the team threatens to move again, they could extort still more from a City beleaguered by the beggar-on-every-corner economy it currently enjoys.

Why we can't possibly get a quarter billion dollars to house poor people, we must subsidize the wealthy! Forbes reports the team is now worth roughly double what the plutocrats who bought it paid, and, by design, the City shares in none of those profits.

One foundation of this particular extortion racket is that, in the US, pro sports teams are exempt from antitrust prosecution. A city cannot create a new team and still play in the major leagues. UK sports franchises have no such exemption, and there are reportedly 13 soccer stadiums in the City of London, which exist without extracting public money.

In one public appearance, then-mayoral-candidate Darryl Steinberg proclaimed he was proud to have been part of the state's legislative effort to set aside environmental constraints and build the Kings' new stadium downtown. The Kings, in Steinberg's words, were an "asset," despite their questionable economics, the potential for extortion he set up, and despite a poll at the time that said 70% of Sacramento City voters opposed any subsidy for pro sports.

The Romans had bread and circuses--certainly more cruel than pro sports like football where a mere 30% of participants report brain injuries. And that didn't prevent the fall of Rome. Meanwhile, Steinberg's mayoral stint is expiring, and he's reportedly considering higher office.

In better news, the Sacramento Bee paused its cheerleading for pro sports coming to Sacramento to publish an opinion piece that was at least ambivalent about the possibility of the Oakland's A's moving to town. But the piece only accuses the A's team owner of being "un-woke," and it ignores the costs of promoting entertainment over civic virtue.

Finally, a word about what kind of role models these high-achieving athletes are. They are often drug addicts, or insanely obsessed with just their sport. These are supposed to be providing role models for youth. Better to have public servants cognizant of the consequences of promoting bread and circuses.