Tag: stadiums

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The New Yankee Stadium

Here is a picture of the New Yankee Stadium, from behind home plate.

I know the Yankees used to think of themselves as being the “class” of professional sports franchises. They refused to allow advertising along the board behind home plate because that would be tacky, like hockey.

Well, here we are:

Now you might think this is the triumph of commercial considerations over artistic considerations. I say it isn’t. I say it’s the triumph of stupidity over wisdom– the commercial advantages will be short-lived because the damage to the Yankee brand will be long-term. Think of the impression children — future baseball fans– will have of this stadium. Think of the impression they would have had if there had been no advertising visible in the above shot. Think of how that plays on the imagination year after year after year– until a franchise has a clearly defined luster.

Not any more. What is the new Yankee Stadium? A bunch of billboards with people in front of them and grass in front of the people. That’s all. You’re uglier than Susan Boyle.  You’re tackier than roller derby.  You’re cheaper looking than professional wrestling.

Thank you and good bye.

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Mike Piazza Pie: Sports Economics

Mike Piazza now makes $91 million for playing baseball, for seven years. How on earth can they do it? Only 30 years ago, the entire New York Yankees baseball club was valued at only $12,000,000.

Well, it’s a free country. If a baseball owner wants to pay an athlete $17 million a year to play a game, why shouldn’t he?

They can pay Mike Piazza $91 million because fans continue to flock to the stadiums and plop themselves in front of their television sets to watch Mike Piazza play baseball. From that money, the New York Mets pays its players. And like every other business, they pay all their other expenses, like administrative staff, office space, scouts, managers, and rent or mortgage for the stadium… and taxes.

Well, wait a minute.

Yes, yes, the Blue Jays pay $11 million dollars a year in taxes on the Skydome. But who built the Skydome? You did. With your tax money. We paid $321 million to build the Skydome and then we rented it to the Jays for considerably less than it costs to operate it.

That is why the Skydome Corporation is now bankrupt.

This year, Hartford, Conn. is donating $350 million to the New England Patriots. And Maryland is donating $220 million to the Baltimore Ravens NFL team, and kicked in an extra $80 just to make owner Art Modell happy.

At least the Blue Jays paid their taxes last year. And so did the Expos. But the Cardinals and the White Sox, and the Red Sox, and the Reds, and the Dodgers, and the Rockies, and the Mets, and all the other teams? Not a penny.

How can that be? This is a multi-million dollar business! These owners are filthy rich. They pay their players absurdly extravagant sums of money to do what most of us would gladly do for nothing. And they don’t pay taxes?!

No, they don’t. They don’t pay taxes, because foolish citizens and even more foolish politicians have decided to use tax payer money to subsidize professional sports teams.

You see, Mike Piazza doesn’t care who he plays for. You do. You are a fan. You want your team to win. You are loyal to your team even if they lose. Loyalty is a good quality.  But baseball players have the loyalty of rats. If the New York Mets didn’t offer to pay Mike Piazza more money, he was going to go play for someone else!

But the New York Mets didn’t have enough money for Mike Piazza. How would the owners of the Mets make a profit if they had to pay Mike Piazza more money?

Well, they can cut other expenses, like those horrific stadium costs. But if the team cuts those costs from its budget, who is going to pay for it? Why the city, of course! But where does the city get its money? From property taxes. And where do property taxes come from?

Right– you. You with your $45,000 a year. You are going to give tax money to the New York Mets (if you are citizen of New York) so that they can give Mike Piazza an additional $4 million per year.

But the tax payer would think that is a dumb idea. So instead of the city giving a check to the Mets, it gives them a deduction on their taxes. And then it chips in for a stadium. And then it provides police and traffic services for free.

This is all no secret, by the way, though you would think it would be almost unimaginable that voters would be so stupid as to approve these arrangements. Sports Illustrated has been ranting about this devious little scam for years. A few smart politicians and journalists have caught on as well. And the voters in Minnesota caught on, and recently turned down a proposal to make a gift of a $100 million stadium to the billionaire owner of the Twins, who then threatened to move the Twins to some town with more idiots in it.

It is one of the biggest scandals in modern history: taxpayers subsidizing multi-million dollar contracts for spoiled athletes! And you just know that some of these same owners and athletes and sports journalists and politicians who approve of these arrangements would be among the first to complain bitterly about their hard-earned tax dollars going to a single mother on welfare. Freeloader! Parasite! Give us back your $500 a month and go find a job! Maybe you can park Mike Piazza’s spare Rolls Royce for him, if you’re good.

The problem is that too many cities give in to owner blackmail: build me a stadium or I move to a different city. And the city fathers weep and wail– “Alas, we cannot be without our sports team!” and issue a bond or debenture and build a stadium and forgive them their annual property taxes. Cities without sports teams plead with the Expos or the Twins: move here and we will give you millions of dollars. Millions of YOUR dollars.

And you voters stand for this??? You re-elect these guys? Are you insane?

The Baltimore Orioles, thank you, paid for their own stadium. Hurray for Baltimore! But they still don’t pay any taxes. [According to the Toronto Star of Nov. 29, 1998, the taxpayers paid $254 million for Baltimore’s stadium. When I find out who’s telling the truth, I’ll update this.]

Now, you will hear many supporters of these professional sport teams argue that the teams generate a great deal of revenue, including tax revenue, and attract jobs, and therefore, more than “pay for themselves”. Right. You can apply this argument to absolutely any business you like: banks, car makers, theatre companies, insurance companies, computer makers, anybody. They all generate revenue and taxes. Big deal. Pay your taxes and shut up.

And the issue has been studied: the economic benefits are grossly exaggerated, especially, as I say, compared to other possible investments.

The only solution is for all the cities to get together and agree that none of them will subsidize major league professional sports in any shape or form whatsoever. No subsidized stadiums. No tax concessions. No free police guards. Not even a parade (a long civic advertisement for the team). Tell the major leagues to conduct their businesses like everyone else: you balance out your income vs. your expenditures, and if you can’t afford to pay Mike Piazza $91 million, you offer him less.

Even better, the federal governments in both Canada and the U.S. should outlaw civic funding of sports stadiums.

 

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Sports and Taxes

Let’s see if I understand the logic of Gary Bettman.

He spoke to the Canadian Club in the luxurious York Hotel in downtown Toronto. He said this:

Cities are bidding to try and get franchises away and they’re willing to build buildings and they’re willing to not tax because they understand that there is an economic and an intangible value to having professional sports teams.

According to Bettman, the Ottawa Senators, who pay the least in Canada, a mere $3 million a year, in taxes, pay more than 20 U.S. teams.

So Bettman wants you and me, brother, to contribute our tax dollars to the Ottawa Senators, the Montreal Canadians, and the Toronto Maple Leafs, and the other Canadian teams, so they, in turn, can pay Wendell Clark two or three million dollars a year to sit in the press box, play golf, and once in a while show up in uniform to play hockey.

Are we nuts? Is he nuts?

Well, no, the truth is Bettman is pretty smart. As he points out, 20 U.S. teams pay less than $3 million a year in taxes, and get all kinds of other taxpayer sponsored concessions, like stadiums, parking, highways, and traffic police. From the point of view of professional athletes and the owners of professional sports teams, he is very smart indeed.

If someone came up to you and said, “Hey, would you please give me some money, so I can hire some athletes to play baseball?” you would probably say, “Well, how much do you need?” And Mr. Bettman would reply, on behalf of all sports owners, “Oh, about $60-70 million.” You might come to your sense about this point and say, “Why would any sane person pay someone that much money to play baseball?”

Why indeed.

This is madness, insanity, and incomprehensible idiocy. But it goes on and on and on.

The Canadian Taxpayers Federation also reported that the Canadian Government has extended more than $11 billion in “aid” to corporations over the past 15 years (1982-97). Of the $11 billion, about $2 billion is not likely to ever be repaid. Remember that the next time you hear a politician or business leader talk about those “lazy” welfare cheats and their scandalous $365 a month.

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The Wrong Issue: Welfare Bums in Ontario

A surprising number of my friends and acquaintances absolutely agree with Mike Harris when he says he wants to kick those lazy free-loaders off the welfare roles and put them back to work. Why should the government subsidize able-bodied adults who should be out there working? Why am I working hard just so my tax dollars can pay for you to have a good time?

Maybe I agree, maybe I don’t. The thing is, I don’t think most people realize how much a smoke screen this issue is.

The thing is, when the government writes a check for $450 to Mabel Smith (not a real person) and her two children because she doesn’t have a job and needs to pay for her apartment and food, we cry “hand out”! Welfare bum! Parasite!

But when a corporation receives a tax exemption…. we get confused. The government doesn’t give Molson Breweries, for example, a check, so it isn’t a handout… or is it?

You tell me: what’s the difference? There isn’t any. If Molson owes the government $10 million in taxes on it’s net profits and the government says, hey, tell you what, pay me $5 million instead, what we have is the government giving Molson’s $5 million dollars as surely as if they handed it to them in small denominations in a little black briefcase. If it was true, this would be a massive government “hand-out”. It would be unfair.

Well, the government does this all the time. It does it when it allows corporations to deduct the cost of renting a box at the Skydome as a “business” expense. It does it when it allows corporations to pollute the environment without paying the cost of cleaning it up. It does it when it uses tax money to pay for sports stadiums, or when it defers taxes on a new factory, or subsidizes the cost of electricity for aluminum plants. It does it when it builds highways and bridges for the cars manufactured by Chrysler, GM, Ford, and Toyota. It does it when it helps bail out the banks that made stupid loans to third world despots who used the money to buy weapons from American manufacturers. It does it every time two businessmen go out for lunch and bill their expense accounts.

The most egregious example of this kind of lavish government subsidy of the rich is, of course, professional sports. The Minnesota Twins are, at this moment, demanding that the hardworking taxpayers of the State of Minnesota fork over about $400 million to pay for a new stadium for the Twins. The owner of the Minnesota Twins is a billionaire. But, he weeps, he can’t afford a new stadium. The old stadium, built to last 30 years, is only 15 years old, but it doesn’t have a private entrance for the boxes, you see, so those rich people actually have rub shoulders with ordinary plebes on their way to their exclusive, private, privileged seats.

At the same time, these idiot owners are offering their players contracts for up to $100 million over seven years. Everyone on the face of the earth knows that this is insane, but most people seem to think that it doesn’t directly affect them because they don’t go to many professional sporting events and if the owner wants to squander his money like that, so be it. The truth is though that you and I are paying Joe Carter $6.5 million to hit 25 home runs and bat .240 this year, because we paid for the Skydome with our tax dollars and the money that the Blue Jays didn’t have to pay for a stadium was thereby freed up to pay for their players. Just to add insult to injury, they gave the exclusive food concession rights to McDonald’s so they could charge twice the regular price for a hot dog. You would think that since we paid for the stadium we could at least get decent food at a fair price. And, of course, McDonald’s is thereby getting a government subsidy. Where are all the free market believers when it really matters?

This is madness. This is insane. This is the product of a society that is full of macho sports freaks who get visibly upset when they hear about a welfare mother spending $30 of her money on booze and cigarettes instead of food but stare with envy when see a basketball star show up with his two bodyguards. What that welfare mother should really do is learn how to play baseball.

The solution is simple. The reason Minnesota even considered subsidizing the stadium for the Twins was the threat to move the Twins to another town that would be willing to pay for a stadium. (Minnesota turned them down). It should be illegal for any town or any state or province to subsidize, with tax dollars, a professional sports stadium. All of the other subsidies should also stop, including “hidden” subsidies, like the costs of dealing with environmental damage caused by factories and industries.

Every corporation should be required to clean up after themselves– if they complain that they can’t afford to do this, they shouldn’t be in business. Should car manufacturers pay to build roads? They’ll scream bloody murder. They’ll say that it would make cars too expensive. Well, isn’t that a thought! You mean the real cost of cars is far higher than the sticker price? How about the cost of bodily injuries caused by speeding? Maybe we should have built up the public transit services instead of the highways. Maybe we should have more trains and buses today and less Firebirds and Intrepids. Read the history of the development of our cities: this idea is not as far-fetched as you think.

Finally, no bank– including the IMF– should be allowed to loan money to any government that is not certifiably democratically elected. Why should the people of Brazil or Argentina pay for F-14 fighter jets ordered by the illegal governments that ran those countries in the 1970’s? Do you know what those jets were used for? Nothing. Do you know where the money is coming from to pay back those loans? It’s coming out of the schools and hospitals and development projects that are needed to help the average people of these countries survive.

Either that, or we should learn to shut up about welfare recipients.